08-27-2018 BPU RPT 18 - Laserfiche WebLink

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WATER I ENERGY I LIFE RIVERSIDE PUBLIC UTILITIES Board Memorandum PUBLIC UTILITIES BOARD OF PUBLIC UTILITIES DATE: AUGUST 27, 2018 ITEM NO: 18 SUBJECT: PURCHASE HEAVY EQUIPMENT THROUGH A COOPERATIVE PURCHASE AGREEMENT FOR PUBLIC UTILITIES WATER DIVISION IN THE TOTAL AMOUNT OF $2,232,976.92 ISSUE: Approve the purchase of heavy equipment through a cooperative purchase agreement for the Public Utilities Water Division in the total amount of $2,232,976.92. RECOMMENDATION: That the Board of Public Utilities approve the purchase of heavy equipment through a cooperative purchase agreement for the Public Utilities Water Division in the total amount of $2,232,976.92. BACKGROUND: Riverside Public Utilities (RPU) Water Division uses heavy equipment daily to provide safe and reliable water service to its customers. Heavy equipment needs to be in safe, operable condition, and compliant with state and local emissions regulations. Equipment operating beyond its economic and useful life needs to be replaced to ensure operating efficiency, employee productivity, and public safety. Aging equipment is more prone to significant mechanical failure, causing increased maintenance/repair costs and downtime for field employees during vehicle/equipment maintenance. The proposed equipment to be purchased represents a selection of the Water Division's most heavily used equipment. This equipment is vital to support Water Field operations, and when the equipment experiences major mechanical breakdown, it is not uncommon for the equipment to be down for multiple weeks. Major repairs are not typically done by the Fleet Services Division, and the equipment must be sent to local repair shops. Additionally, significant repair work on older equipment comes with a higher premium, due to limited availability of parts and additional time to complete repairs. The age of the Water Division's current fleet contributes heavily to costs for maintenance and repair. The Water Division is extremely diligent in allowing time for preventative maintenance to be completed, per Fleet Services preventative maintenance schedule. However, the proposed list of equipment to be replaced has an average age of 21 years of service. Preventative maintenance is no longer keeping the equipment in consistent working condition as major items are needing replacement (e.g. engines, axles, rear -end differentials, etc.). By making the proposed purchases, the new equipment will enable Water Field crews to replace vital and critical aging infrastructure efficiently and in a timely manner. In addition, the proposed purchases are essential for the Water Division to support Utility 2.0 Capital Improvement Project (CI P) initiatives. Page 414