Toronto Parking Authority Fleet Vehicle Replacement
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1 PA12.5 REPORT FOR ACTION Toronto Parking Authority Fleet Vehicle Replacement Date: June 8, 2018 To: Board of Directors, Toronto Parking Authority From: Acting President, Toronto Parking Authority Wards: All SUMMARY This report seeks approval of the Toronto Parking Authority Board of Directors to purchase replacement fleet vehicles under the Authority's ongoing Fleet Vehicle Maintenance and Replacement Plan, for a total of eight (8) mini-service vans and pickup trucks that are approaching the end of their useful economic lifecycle, in a total amount of up to $294,631 (including up-fitting of the vehicles for TPA functional needs as required plus a contingency sum). TPA has a services agreement with fleet support firm ARI Management Services which is also the Vendor of Record to the Provincial government. Leveraging this provides TPA access to the best available pricing, in addition to reducing procurement timelines and overhead costs. We have worked closely with the City of Toronto Fleet Services Division who have confirmed pricing of the total package is marginally more advantageous than pricing under City vehicle purchasing contracts. RECOMMENDATIONS It is recommended that the Board of Directors of the Toronto Parking Authority: 1. Approve the purchase of five (5) service mini-vans, two (2) ½-tonne pick-up trucks and one (1) 1-tonne pick-up truck, in the amount of $238,416, up to $40,267 for upfitting of the vehicles for TPA functional needs as required, and a contingency sum of $15,948; for a sum total of $294,631 (exclusive of HST), from ARI Fleet Management Services, as shown in Appendix A - Capital Required to Purchase Vehicles, attached to this report (June 8, 2018) of the Acting President; and Toronto Parking Authority Fleet Vehicle Replacement Page 1 of 8
2 2. Authorize the decommissioning of the TPA fleet vehicles identified in Appendix B - TPA Fleet Vehicles to be Decommissioned, attached to this report (June 8, 2018) of the Acting President, upon acquisition of the replacements, sold at auction in accordance with TPA Board Policy Resolution 3-14, Disposal of Surplus Vehicles and Equipment. FINANCIAL IMPACT The total purchase amount for the 2018 planned eight (8) fleet vehicle package of up to $294,631, including amounts for up-fitting the vehicles to satisfy TPA functional requirements and a contingency, exclusive of HST, is accommodated in the Toronto Parking Authority approved 2018 Equipment and Fixtures Account No TPA has a services agreement with fleet support firm ARI Management Services which is also the vendor of record (VOR No. OSS ) to the Provincial government and preferred provider to the broader Provincial public sector. Leveraging this provides TPA access to the best available pricing, in addition to reducing procurement timelines and overhead costs. We have worked closely with the City of Toronto Fleet Services Division who have confirmed pricing of the total package is marginally more advantageous than pricing under City vehicle purchasing contracts (see Appendix C - Vehicle Purchase Base Price Comparison). DECISION HISTORY The Board of Directors of the Toronto Parking Authority, at its meeting of May 26, 2016, approved the Staff Memorandum titled, Comprehensive TPA Fleet Vehicle Maintenance Management and Replacement Plan (Board Minute ). The TPA Board of Directors, at its meeting of April 24, 2017, approved the Staff Memorandum titled, "TPA Fleet Vehicle Purchase Plan 2017". (Board Minute ). COMMENTS Background: The Board of Directors of the Toronto Parking Authority, at its meeting of May 26, 2016, following a competitive Request for Proposals (RFP) process, authorized TPA staff to enter a five (5) year agreement for fleet management services with the firm ARI Management Services for the purposes of: Toronto Parking Authority Fleet Vehicle Replacement Page 2 of 8
3 Providing service options to plan, create, develop, and implement a fleet service management strategic plan and program; Overseeing all aspects of the TPA s day-to-day fleet operations needs whether through coordinating and working together with other external service providers or undertaking work through the company s own resources; and Planning and delivering a range of vehicle procurement and fleet management programs on behalf of TPA to provide the optimal strategy to meet TPA operational requirements. The May 2016 report noted a significant portion of the TPA vehicle fleet had reached or was approaching the end of its economic life-cycle (at that time the average fleet age was 8.3 years, significantly beyond that of corresponding classes of vehicles in the City of Toronto fleet, with the oldest dating to 20 years). Through years of under-investment, the TPA fleet was in generally poor condition and in need of significant improvement. The recommendations outlined in this report for proceeding with the planned 2018 fleet vehicle replacement purchases represent the continuation of the fleet renewal plan. Current State: Three TPA field operating units, namely Facilities Maintenance, Information Technology and On-street Operations, have requirements for fleet vehicles. Facilities Maintenance has a complement of twenty-five (25) pick-up trucks, one (1) dump truck and one (1) cargo van; Information Technology Department has a complement of nine (9) cargo vans; and On-street Operations has a complement of fourteen (14) cargo vans and two (2) pick-up trucks. Eight (8) vehicles are scheduled to be decommissioned upon replacement vehicles being available for service, as identified in Appendix B - TPA Fleet Vehicles to be Decommissioned. The average age of those vehicles recommended for replacement 2018 is 8.25 years. These service vehicles are subject to significant operating demands in terms of the constant use, stop and go city driving conditions, hauling trailers and carrying loads, transporting materials including salt and garbage, revenue machines, building materials, etc., and based on our review of other relevant factors such as mileage, operating demands, maintenance history/costs and current condition of the respective vehicles, require replacement. Vehicle Requirements: TPA has certain requirements for its vehicles. A key constraint for a number of our vehicles is to meet garage height restrictions (1.9M). The following vehicles are satisfactory in terms of meeting our requirements: A compact mini-service van is best suited for the On-Street Operations department as it is readily manoeuvrable and does not require a large payload for the work being performed. Toronto Parking Authority Fleet Vehicle Replacement Page 3 of 8
4 A durable ½ tonne light duty pick-up truck serves most requirements of the Facilities Maintenance unit. It has the required payload as well as fuel efficiency. It also serves the requirements of the Information Technology Services department to transport revenue control equipment and other technical assets across the enterprise. A durable 1 tonne heavy duty pick-up truck will be used by the On-Street Operations department to pick up and deliver pay-and-display machines as required on a daily basis. Vehicle Base Price Comparison Analysis: As noted above, TPA is in the midst of a five (5) year agreement for fleet management services with the firm ARI Management Services, which resulted from a competitive procurement process. ARI operates on several continents. In Canada, they specialize in fleet services and manage over 185,000 vehicles for clients including Ontario Power Generation, Rogers Communications, MPAC and the Provincial government. One of the elements of this arrangement is that TPA is able to leverage ARI s vast fleet vehicle purchasing power (they annually purchase about 10,000 vehicles on behalf of clients). ARI is the vendor of record to the Provincial government and preferred provider to the broader Provincial public sector, thereby acquiring vehicles through factory direct order. They also audit any retail incentive that may exceed the concession and apply the greater discount. We requested the City Fleet Services Division to review the pricing and they confirm that the package as a whole is more economical than would be available working through the City s vendors. TPA requested a vehicle base price quote from ARI and the City of Toronto as shown in Appendix C - Vehicle Purchase Base Price Comparison. In terms of price point ARI was better on 6 of the 8 vehicles required, and higher on the other two. The City pricing on the ½ tonne light duty pick-up truck was lower. Upon further analysis and discussion with City Fleet Services Department, the selected vehicles in this class tend to be somewhat better rated overall especially in the safety category. Considering the above mentioned factors and the better pricing on the purchase package as a whole, it is recommended that the ARI quote be accepted. Green Fleet Considerations: TPA is a participant with City departments and other agencies on the Fleet Management Steering Committee under the Shared Services initiative. One aspect being pursued through this group is a Green Fleets Plan which aims to advance the City s objectives in addressing environmental impact with strategies to reduce hazardous emissions from the City s vehicle and equipment fleet operations. A number of pilot projects have been initiated with investments made in new and emerging green vehicle and fuel technologies, to varying degrees of success. As well, through the development of the vehicle specifications, in conjunction with ARI we researched the current availability of alternative green technologies and potential application for our fleet purposes. Toronto Parking Authority Fleet Vehicle Replacement Page 4 of 8
5 Based on this review and taking account of our service demands, there are no one (1) tonne pick-up vehicles on the market in the form of hybrid or alternate power that may feasibly accommodate the needs of TPA. Similarly with ½ tonne pick-up trucks, the only green option to fit the same application as the current F series vehicle is a model equipped with a smaller eco-boost engine. The cost difference from the standard model is about $700. Actual fuel economy is hard to compare as the published numbers are based on no payload and very generic use in optimal conditions. As best as we can determine fuel savings with the eco-boost option would appear to be very modest and we are concerned that there is not enough of a track record to confirm that this option will adequately serve our demands. There is also more potential for costly repairs with the eco-boost. Regarding the mini service van in a hybrid/electrical option, both Ford and Nissan presently offer options, however, these vehicles are still being tested in various regions of the world. If these tests are deemed successful this may be a vehicle option in the near future. TPA staff will continue to monitor and leverage the work being undertaken under the City s Shared Services Fleet Management umbrella, and work closely with ARI to seek green fleet options that provide substantive environmental benefits for the investment made while delivering the service demands necessary. CONTACT Giancarlo Vitaro, Director of Operations, , Giancarlo.Vitaro@Toronto.ca SIGNATURE Andrew Koropeski Acting President, Toronto Parking Authority ATTACHMENTS Appendix A - Capital Required to Purchase and Up-Fit Vehicles Appendix B - TPA Fleet Vehicles to be Decommissioned Appendix C - Vehicle Purchase - Base Price Comparison Toronto Parking Authority Fleet Vehicle Replacement Page 5 of 8
6 APPENDIX 'A' - CAPITAL REQUIRED TO PURCHASE AND UP-FIT VEHICLES Appendix A - Capital Required to Purchase Vehicles Vehicle Type 2018 Quantity Base Price Cost TPA Specific Total Cost Options 2018 Ford F-350 Cab and Chassis 1 $ 36,783 $ 36,783 $ 20,776 $ 57, Ford F-150 4x4 Regular Cab Styleside 8 ft. box with plow package 2 $ 33,119 $ 66,238 $ 12,564 $ 78, Ford Transit Connect Cargo Van 2 $ 27,079 $ 54,158 $ 3,234 $ 57, Ford Transit Connect Cargo Van 3 $ 27,079 $ 81,237 $ 3,693 $ 84,930 SUBTOTAL $ 238,416 $ 40,267 $ 278,683 Contingency (5% base price / 10% Options) $ 11,921 $ 4,027 $ 15,948 TOTAL 8 $ 250,337 $ 44,294 $ 294,631 Toronto Parking Authority Fleet Vehicle Replacement Page 6 of 8
7 APPENDIX 'B' - TPA FLEET VEHICLES TO BE DECOMMISSIONED Appendix B - TPA Fleet Vehicles to be Decommissioned TPA Unit No. Year Make Model Existing Vehicle Details Odometer Reading (Km) TPA Operations A GMC SIERRA 110,540 Facilities Maintenance A CHEV SILVERADO 73,592 Facilities Maintenance A DODGE GRAND CARAVAN 154,401 Information Technology A DODGE GRAND CARAVAN 50,170 Information Technology B CHEV UPLANDER 146,549 On-Street Operations B FORD F ,143 On-Street Operations B CHEV UPLANDER 104,150 On-Street Operations B CHEV UPLANDER 96,920 On-Street Operations Average Vehicles to be Decommissioned Average Remainder TPA Fleet 8.25 Years 107,558 km 4.6 Years 51,486 km Toronto Parking Authority Fleet Vehicle Replacement Page 7 of 8
8 APPENDIX 'C' - VEHICLE PURCHASE - BASE PRICE COMPARISON Appendix C - Vehicle Purchase Base Price Comparison Analysis Vehicle Type 2018 Quantity Vehicle Make ARI Quote ARI Unit Price Vehicle Make City Quote City of Toronto Unit Price Base Price Variance ARI vs City ARI Total City of Toronto Total Total Cost Base Price Variance ARI vs City Cargo Van 5 Ford $ 27,079 Ford $ 27, $ 135,395 $ 137, ½ ton Pick-up (4X4) 2 Ford $ 33,119 Dodge $ 31,549 1,570 $ 66,238 $ 63, ton (4x2) Cab and Chasis 1 Ford $ 36,783 Ford $ 38, $ 36,783 $ 38, TOTAL 8 -$930 $ 238,416 $ 239,636 -$1,220 Toronto Parking Authority Fleet Vehicle Replacement Page 8 of 8
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