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COUNCIL COMMUNICATION FORM <br /> PURCHASING & INTERNAL SERVICES MEMORANDUM <br /> #09-45 <br /> July 22, 2009 <br /> TO: Honorable Mayor McElroy and City Co ncil <br /> FROM: Ryan P. McCrady, City Manager <br /> Ron Neufeld, Financial Management Director <br /> Deborah M. Perry, Purchasing Supervisor�(� <br /> SUBJECT: Bids for backhoe <br /> SUMMARY RECOMMENDATION: Staff recommends awarding contract to Martin <br /> Equipment to furnish one (1) 2009 John Deere 310 SJ TMC diesel powered backhoe using the <br /> total cost bid for 5 years submitted under Alternate #2. <br /> BACKGROUND: Bid specifications requesting two bids were prepared due to the previous <br /> success the City experienced on total cost bidding of equipment. Bidders were asked to submit <br /> both a base bid for an outright purchase of the backhoe and also a bid which included a 5 year <br /> total cost buyback with a cap on repairs. Staff evaluated the bids and determined the bid <br /> alternate for the 5 year total cost of the backhoe is the lowest and best responsive and responsible <br /> bid for the City. <br /> Under Alternate #2, the backhoe will cost $61,500 after trade in. The maximum cost of repairs <br /> for 5 years or 3250 hours is $0. The low bidder, Martin Equipment also guarantees to buy back <br /> the backhoe at the end of 5 years or 3250 hours for $35,000, if the City so chooses, which would <br /> reduce the cost to $26,500. <br /> The backhoe will be used by the Street Division. The backhoe will replace a 2002 John Deere <br /> 310G backhoe currently in service. The old backhoe will be traded to the low bidder when the <br /> new unit is delivered. <br /> The low bidder for Alternate 2 has provided the City with the necessary bonding requirements. <br /> POTENTIAL OBJECTION: None <br />