HomeMy WebLinkAboutAgenda Report - June 3, 1987 (91)C - '.SCIL C4J11MUNICATIQ'
TO THE CITY COUNCIL DATE: ! NO
FRtOW THE CITY MANAGER'S OFFICE June 3, 1937
SUBJECT: 1 DUCTI0N OF Oj0Ij INCE Ai`9E'^I 1% LODI MUNICIPAL = REGAMEZ BIDDY RBWUU �
PMW,IN G TO THE PURCHASE OF USED VEHICLES FROM FOUAL ACMES OR I"tEET DEALERS
RECOMMENDED ACTION: That the City Council amend Lodi Municipal Cotte
Chapter 3.20, Section 3.20.070 relating to bidding for purcha-� of
supplies, services or equipment which would allow the purchase of used
vehicles from rental agencies or fleet dealers. (See draft Ord. attached
marked Exhibit A)
BACKGROUND INFORMATION: The attached memorandum from Joel Harris,
Purchasing fficer, describes the advantages of purchasing City of Lodi
vehicles from rental agencies or fleet dealers. I heartily agree with
this procedure and would recommend adopting the attached Ordinance
which would formalize a procedure to accomplish this.
Ru ert H. Ho In
Finance Director
RHH/ss
Attachments
CCAUTO/TXTF.06S
11 EMORANDUM
TO: Robert Holm, Finance Director
FROM: Joel Harms, Purchasing Officer
DATE: May 21, 198;
SUBJECT: Proposal to Exempt from Lodi Municipal Code Section
3.20.100 (Formal Bid Procedures) Certain City Purchases
SELECTED CITY VEHICLES
I. In+ent:
To provide greater assurance of obtaining the best value
in certain vehicles purchased for the City of Lodi.
1I. Background:
In 1980, in an attempt to obtain quality vehicles at a lower
cost, the City began purchasing one -year-old automobiles from
car rental agencies Hertz and Avis and fleet dealers. The
advantages were as follows:
Lower initial cost;
Short lead times- typically- under -a week;
Fewer "bugs" in the cars, a result of formal and proper
maintenance of the rental fleet;
12-monthj12,000 mile warranty, written by the agency;
Higher resale value, due to the greater number of options
specified by the :rental agency on the available cars.
Prior to 198C, all vehicles purchased went through formal bid.
After bids were opened and contracts were awarded, the successful
dealer would factory -order the vehicle(s). Long Oilivery times
were not uncommon, so that chances of receiving a fehicle near the
end of a model year were very high. If used cars were purchased,
there were no assurances of performance reliability. Low bids
often resulted in "getting what we paid for" in automobiles.
Since 1980, the practice of purchasing used sedans, pickups and.
vans from Hertz, Avis and fleet dealers continued with users and
maintenance personnel expressing satisfaction with the program.
In fact, a number of cities currently purchase through rental
agencies: Alameda, Pleasanton and San Leandro purchase from
Hertz in Hayward; the Cities of Visalia, Tulare and Gustine, as
well as the County of Fresno, purchase from Hertz in Fresno; the
Cities of Oakland, San Jose, Modesto, Mountain View and San Rafael
and the Counties of Santa Clara and Sacramento buy from Avis; the
City of Stockton purchases vehicles from National in Oakland.
III. Discussion:
It. is not the intent of this proposal to exclude certain dealet's
who may not carry a certain i„oke or model of autcmpbile. Rather,
the intent is to tighten. Spec 'if ications so that the City has
greater assurance of obtaining a vehicle:
of superior condition and quality;
from a reputable dealer;
that will not require extensive additions to our repair
tool and replacement parts inventory;
at the lowest reasonable price.
in other words, we will require assurance that the automobile we
buy will serve the City's needs for the greatest period of time
at the lowest total cost.
To achieve this objective, we must write specifications that by
nature will exclude lower quality, higher mileage or older cars
of a make or model inconsistent with our Maintenance Department's
ability to maintain them. The specifications will also by nature
exclude any dealer who will not stand behind his sale to the City.
Any dealer may participate in the bidding for these vehicles as
long as he can meet the minimum standards we set. If he cannot
meet the specified standards, we do not want to douse ness
with him.
It is the belief of the Purchasing Officer that the best values in
standard transportation can be found in one to two-year-old, low
mileage automobiles. Therefore, the proposed specifications will
reflect these starting parameters.
IV. Proposed General Specifications:
A. Age: No more than two -years -old.
B. Mileage: No more than 25,000 miles.
C. Maintenance Program: Must be documented, showing intent to
properly maintain the vehicle.
D. Repair Record: Must be documented and reflect no major
deficiencies or damage. Factory recalls must be completed
and documented.
E. Warranty: Seller must provide at least a 12 month/12,000 mile
power train warranty at no additional cost to the City.
F. Leased Vehicles Only: Not owned by the public.
V. Proposed Method of Purchase:
Budgeted purchases of non -specialty vehicles can best be
accomplished by personally visiting three agencies known to meet
the general specifications outlined above (i.e., Hertz, Avis and
National) comparing vehicles (prices, mileages, conditions and
warranties) and making a selection therefrom. Following this
procedure will assure compliance with Lodi Municipal Code
(LMC) Section 3.20.110 (Open Market Procedure), except that the
purchase will exceed $5,000.00.
VI
The buyer can enter into the purchase with either of two
objectives in mind:
A. To get the most vehicle for the budgeted amount; or
B. To get a specific vehicle which meets the specifications
in Part IV. for the lowest prices.
Either way, the City is assured of getting the best value for the
dollars spent.
Summa rY
The number of city and county governments that purchase cars from
Avis, Hertz and National indicates that those governments believe
buying from the rental agencies is the best way to get the best
value for the budgeted vehicle dollars.
Buyers I talked with cited the importance of documented condition
reports, warranties and the selection and availability of vehicles
(e.g., immediate replacement of a car used for undercover work).
Most of all, however, the maintenance programs followed by the
agencies virtually assured that the vehicle purchased would be
well maintained and reliable. Few other dealerships can provide
such assurances of satisfaction and reliability. -
I, therefore, strongly urge that the City of Lodi adopt a
purchasing procedure for certain City vehicles which would be
exempt from LMC Section 3.20.100, allowing for informal but
closely controlled value comparisons at Hertz, Avis and/or
National Sales either in Sacramento or the Bay Area. Benefits
to the City, in terms of overall cost and value, would, I
believe, definitely justify it.
ORDINANCE NO. 2399
AN ORDINANCE OF THE LODI CITY COUNCIL
AMENDING CHAPTER 3.20 - PURCHASING SYSTEM
SECTION 3.20.070 - BIDDING, OF THE LODI MUNICIPAL CODE
RELATING TO THE BIDDING PROCEDURE
BE IT ORDAINED BY THE LODI CITY COUNCIL.
SECTION I. Lodi Municipal Code Title 3, Chapter 3.20, Section
3.20.070 relating to bidding, is hereby amended to read as follows:
"3.20.070 Bidding.
"Purchases of supplies, services, equipment and the sale
of personal property shall be by bid procedures pursuant to
Sections 3.20.200 and 3.20.110. Bidding shall be dispensed
with only when an emergency requires that an order be placed with
the nearest available source of supply, when the amount involved
is less than one hundred dollars, when the commodity can be
obtained from only one vendor, or when the City Council
determines that the purchase or method of purchase would be in
the best interests of the City."
SECTION 2. All ordinances and parts of ordinances in conflict
herewith are repealed insofar as such conflict may exist.
SECTION 3. This ordinance shall be published one time in the
"Lodi News Sentinel", a daily newspaper of general circulation printed
and published in the City of Lodi and shall be in force
and take effect thirty days from and after its passage and approval.
Approved this 27th day of June, 2987
EVELYN M. LS N
Mayor
Attest:
ALCH
C;tt C1 k
y er
State of California
County of San Joaquin, ss.
I, Alice M. Reimche, City Clerk of the City of Lodi, do hereby certify
that Ordinance No. 1399 was introduced at a regular meeting of the City
Council of the City of Lodi held June 3, 1987 and was thereafter
passed, adopted and ordered to print at a regular meeting of said
Council held June 17, ?987 by the following vote.:
Ayes: Council Members Hinchman, Pinkerton, Reid,
Snider, and Olson (Mayor)
Noes: Council Members - None
Absent: Council Members - None
Abstain: Council Members - None
I further certify that Ordinance No. 1399 was approved and signed by
the Mayor on the date of its passage and the same has been published
pursuant to law.
& C �;1 4'tox&
ALICE M. REIMCHE
City Clerk
Approved as to Form
RONALMST IN
City Attorney
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