HomeMy WebLinkAboutAgenda - 08-17-2004-5wORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: August 17, 2004
SUBJECT: Purchase of Two Trucks for Rural Curbside Recycling Pro
DEPARTMENT: Purchasing/Solid Waste PUBLIC HEARING
ATTACHMENT(S):
ram
(Y/N) No
INFORMATION CONTACT:
Pam Jones, 245-2652
Gavle Wilson, 968-2885
TELEPHONE NUMBERS:
Hillsborough
Chapel Hill
Durham
Mebane
732-8181
968-4501
688-7331
336-227-2031
PURPOSE: To approve the purchase of two recycling trucks to be employed in Orange
County's rural curbside recycling program, based on a bid awarded by the Board of
Commissioners on May 18, 2004 to Carolina Environmental Systems of Kernersville, North
Carolina for a previous recycling truck purchase.
BACKGROUND: On January 1, 2003, Orange County's Solid Waste Management Department
began to perform recycling at many multi-family housing sites throughout the County and
discontinued contracting out for that service. In preparation for the assumption of that program
in-house, the County purchased two multi-family recycling trucks. One additional truck was
purchased in June 2004 to assist in the multi-family program.
As part of the 2004-05 budget process, the Board approved the Department's proposal to
discontinue contracting out the rural curbside recycling program as of April 2005. Funding for
the staff, equipment, and operating costs needed to implement that as an in-house program
was included in the FY 04-05 Solid Waste Enterprise Fund budget. The operations plan for
assumption of the rural curbside program includes the acquisition of two additional recycling
trucks with the same capabilities as provided by the multi-family program trucks.
The County has been notified by the previous truck vendor, Carolina Environmental Systems of
Kernersville, North Carolina, that the company will honor through September 1, 2004 the most
recent bid price of $143,589 per vehicle, as awarded by the Board on May 18, 2004. The
vehicle is a Crane Carrier LET2-26 cab and chassis and a Labrie Top Select 1000-42 body.
The items to be picked up by these trucks are:
Action Agenda
Item No. ~- w
• Clear Glass
• Newspaper
• Plastic
• Aluminum/Steel Cans
• Green Glass
• Brown Glass
In view of significant price increases that have occurred in the world market for steel, staff
believe that it is in the best interests of Orange County to take advantage of this offer from
Carolina Environmental Systems. Staff believe this approach will produce cost savings through
a lower purchase price than would likely be achieved if new bids were sought for the trucks,
and through the broader standardization of parts, training of operators, and service for all the
recycling trucks.
FINANCIAL IMPACT: The purchase price for the two trucks would be $287,178. As has been
done during the past several years with other major Solid Waste equipment acquisitions, staff
recommends that these trucks be purchased through 59-month installment financing. This
approach spreads the cost of the equipment over its useful life, reduces the amount of cash
needed upfront for the purchase, and takes advantage of the low interest rates available
because of the County's excellent credit ratings. Depending on the precise financing terms that
the Finance Director is able to obtain, the total principal and interest cost for the truck
purchases is estimated to be about $310,000, with five annual payments on the order of
$62,000 per year. Sufficient funds are allocated in the Solid Waste Management Department's
FY 2004-05 operating budget to cover the first annual principal and interest payments.
RECOMMENDATION(S): The Manager recommends that the Board authorize the purchase of
two additional units from bid number 248 that was awarded to Carolina Environmental Systems
of Kernersville, North Carolina at a delivered cost of $287,178 for two units; and authorize the
Purchasing Director and Finance Director to execute all necessary paperwork associated with
the acquisition and financing of the two trucks.