Agenda Item Wording:
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Authorize the City Manager to execute a new contract with DelRay Tire & Retreading for tires and retreading services for all City vehicles and equipment serviced by the Fleet Division. Pricing for this contract will "piggyback" on State of California contract pricing. The contract will be Not-To-Exceed $500,000 per year with the costs split monthly through allocations to the appropriate City divisions whose vehicles are receiving the tires. This contract will be for one year, with an option to annually renew for up to four years.
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Deadline for Action: 2/6/2023
Submitting Department: Public Works
Contact Name and Phone Number: Mike Morgantini, Fleet Supervisor, mike.morgantini@visalia.city <mailto:mike.morgantini@visalia.city>, 713-4182; Nick Bartsch, Public Works Director, nick.bartsch@visalia.city <mailto:nick.bartsch@visalia.city>, 713-4052
Department Recommendation:
Staff recommends that Council authorize the City Manager to execute a new contract with DelRay Tire & Retreading for tires and retreading services for all City vehicles and equipment serviced by the Fleet Division. Pricing for this contract will "piggyback" on State of California contract pricing. The contract will be not-to-exceed $500,000 per year with the costs split monthly through allocations to the appropriate City divisions whose vehicles are receiving the tires. This contract will be for one year, with an option to annually renew for up to four years.
Background Discussion:
The Public Works Fleet Division is responsible for the maintenance of 620 vehicles and equipment. These vehicles and equipment require over 2,000 different tires due to brand, sizes, and ply type. The Fleet division operates with the sense of urgency to keep the fleet on the road and all departments functioning with excellent repairs and services. As part of the maintenance performed, tires are replaced or retreaded as needed.
The City of Visalia fleet division currently uses DelRay tire under contract number C18016 utilizing State of California approved contract pricing.
DelRay Tire and Retreading maintains the largest local inventory of tires specific to the needs for the City of Visalia fleet of vehicles. They are an authorized distributor for the multiple brands of tires that the City of Visalia uses with the State of California approved pricing. DelRay Tire and Retreading has a large warehouse inventory in Tulare, Hanford, and Fresno which stock most of the tires the City of Visalia purchases and can be delivered within 2 hours. Because of their extensive inventory, they can be very responsive to City fleet needs, which contributes to the Fleet Division consistently being able to maintain a minimum of 98% of the City of Visalia vehicles and equipment in service. They have been able to supply over 90% of the City’s tire needs. Last year, Fleet replaced 2,352 tires and retreaded approximately 450 tires with DelRay Tire.
DelRay is also the only ISO i9000-2008 Certified Bandag Retread facility west of the Mississippi River. This certification is obtained through an independent, third-party organization evaluating the operation and qualifying it to uphold very specific standards set forth by the branded corporation. The City of Visalia’s large trucks, such as solid waste and dump trucks, are the primary recipients of retread tires, which saves the City of Visalia about 60% over new tire replacement. In addition, if the tire core is not damaged, the core can be retreaded twice before needing to be replaced with new tires, which further increases the savings.
The City of Visalia fleet division made the decision several years ago to always opt for Bandag specific retreading due to the outstanding quality they provide to the fleet. Other retread brands are available, however, the City’s past experiences with these other brands have proven them to be a less reliable process and product than the certified Bandag process. The quality of the retreading process and the core that the brand of retread allows has a direct correlation to the performance and safe operation of the vehicle to which they are mounted. Based on fleet division experience over the years, these retreads have provided a retread tire at the same quality as a new tire.
The Public Works Department has, in the past, conducted a survey of local tire & retreading vendors to ascertain what local retailers could meet the City’s comprehensive needs. DelRay Tire & Retreading was the only responsive vendor in the area that can stock the City’s inventory locally, have ample service trucks to be ‘at the ready’ to service stranded vehicles within required time frames and offer certified Bandag Retreading. Other local suppliers either do not stock the variety of tire sizes used by the City, do not offer a delivery and certified Bandag retreading service, or do not have an adequate number of service vehicles to assure our fleet would be serviced timely. Down time for staff and vehicles could be greatly increased if staff must wait for tires to be ordered or vehicle servicing in the field. In additional, DelRay is on the State contract list.
Establishing this contract will keep the division in compliance with the Finance Department purchasing guidelines. The contract amount of $500,000 annually is based on the actual costs over the last four years of keeping the City fleet operational. The contract will “piggyback” on a competitively bid State contract. A contract with DelRay Tires & Retreading will enable the Fleet Division to quickly obtain the needed tires, service and lowest possible prices guaranteed through State of California Pricing. It will ensure the quality retreading needed to provide performance and safety to staff with quick service times to get staff and vehicles back on the road as quickly as possible.
If there is a time that DelRay does not have a specific tire in stock, a secondary vendor would be used. Purchases from any secondary vendor will be done in compliance with the City of Visalia Purchasing policy.
Fiscal Impact:
The request to increase the annual NTE amount to $500,000 is based on the average expenditures over the last 4 years reaching approximately $420,000 annually. The initial cost of these services will post to the Fleet Division (5012) and will be allocated out monthly to the various divisions whose vehicles required services.
Prior Council Action: None
Other: None
Alternatives: Request quotes from various vendors with each purchasing need.
Recommended Motion (and Alternative Motions if expected):
recommendation
Authorize the City Manager to execute a new contract with DelRay Tire & Retreading for tires and retreading services for all City vehicles and equipment serviced by the Fleet Division. Pricing for this contract will "piggyback" on State of California contract pricing. The contract will be not-to-exceed $500,000 per year with the costs split monthly through allocations to the appropriate City divisions whose vehicles are receiving the tires. This contract will be for one year, with an option to annually renew for up to four years.
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Environmental Assessment Status: N/A
CEQA Review: N/A
Attachments: State of California Price Book