A-2. Key Financial Strategy: Replace Ladder 11 � w
CITY OF CIIANIIASSEN
1VAS
Chanhassen is a Community for Life-Providing for Today and Planning for Tomorrow
MEMORANDUM
TO: Todd Gerhardt, City Manager
FROM: Don Johnson, Fire Chief
DATE: October 9, 2017
SUBJ: 2017 Key Financial Strategy: Replace Ladder 11
BACKGROUND
As part of the 2017 Key Financial Strategy(KFS) discussion, a project to replace Ladder 11, a
100-foot platform ladder truck, was submitted and approved as a KFS. The expected sale of the
Old Public Works Building was the anticipated funding source for this purchase.
NARRATIVE
Ladder 11 is a front line 100-foot aerial platform truck placed in service in 1989 at a purchase
price of$450,000. Approximately 10 years ago, a third-party vendor completed some
refurbishment work including updating electrical systems and the emergency lighting. Within
the past two years, the brakes and tires required full replacement by DOT guidelines and a crack
on the main ladder beam, found during annual inspection, was repaired.
In 2013, the city engaged in a fire study by the Springsted, Inc. As part of that study,the fire
department apparatus were evaluated with the results being released within the body of the fire
study. In May of 2014, I was hired as the first full-time chief and was immediately assigned to
evaluate and place all current fire apparatus on a replacement schedule.
The Major Apparatus Replacement Schedule was presented to the City Council in October 2014
outlining most major pieces of equipment with a recommendation for replacement based on 'best
practices' and the findings from the study.
In the 2013 Fire Study, Springsted used a point system to evaluate all fire apparatus. The scoring
system comes from the American Public Works Association(APWA), with the main criteria
being years in service. Other criteria includes maintenance records, functionality,body and
interior condition. The study recommends replacement when a vehicle has reached a score of
240 points. The National Fire Protection Association(NFPA) closely follows APWA
recommendations but adds maximum criteria for front line apparatus: 20 years of service for an
engine and 25 years of service for a ladder truck. Springsted recognizes NFPA/APWA as 'best
PH 952.227.1100• www.ci.chanhassen.mn.us• FX 952.227.1110
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Todd Gerhardt
2017 Key Financial Strategy: Replace Ladder 11
October 9, 2017
Page 2
practices' for the American Fire Service. In 2013, Ladder 11 scored out at 343.5 by the
evaluators. The majority of those points (318) came from the age of the vehicle. Most other
scoring indicators were in the `good' rating. It was recommended at that time that the vehicle be
considered for replacement. Scoring would have only increased since 2013.
As KFS discussion began for 2017, staff was aware that the sale of the Old Public Works
Building may provide a suitable funding source based on the contract with the current occupant.
The recommendation went through the KFS process and was placed on the approved list of
projects based on the proposed sale of the building.
A committee of command staff and subject matter experts began engaging truck vendors early
this year. We have seen several demonstrations from various vendors and have visited factories
of two of the vendors. We hope to have a truck vendor selected by the end of October. The
selection process has followed a similar process used to purchase the Quick Attack Apparatus
using the Houston-Galveston Area Council (HGAC), HCBuy Program. This is an approved
Joint Purchasing Program used nationally for major purchases by municipalities. With HGAC
we are able to select the vehicle that best suits the needs of the department and the program
ensures that the entity is receiving the absolute lowest contract price for that vehicle.
RECOMMENDATION
At this time, I would recommend moving forward with the purchase and replacement of Ladder
11. Regardless of vendor selection, there is a 300-day build process from the time of order
placement to delivery. All vendors offer a pre-pay incentive package that range between 3.5 and
5 percent. With the proceeds of the purchase being available, I would recommend pre-paying the
order. Also,the current vehicle will be sold at auction, or traded in, depending on which vendor
is selected. The approximate cost for replacement will be$1.2 million dollars. A detailed truck
specification and final costs will be presented to council for approval prior to placing the order.
This purchase will include replacement of most of the small tools and loose equipment on the
vehicle. The current stock have been on the truck since purchase. NFPA guidelines include the
list of loose equipment and tools required of a front line aerial apparatus. Costs may be in the
$50,000 range.
ATTACHMENT
1. Old Public Works Building Cash Inflows & Outflows.
g:\fire dept\dj\council updates\council resolutions and memos\ladder 11 replacement l.docx
Old Public Works Building
Cash Inflows&Outflows
Agreed Upon Purchase Price: $1,475,000
Down Payment $ 30,000.00
Principal Paid from 8-1-12 to 8-11-17 210,112.20
Interest Paid from 8-1-12 to 8-11-17 334,169.74
Final Principal Amount Owed 8-11-17 1,234,887.80
Interest Earned in Old PW Fund 8-1-12 to 8-11-17 8,642.10
Rent received from Beniek in 2012 12,337.00 $ 1,830,148.84
2012 Closing costs &other bldg costs before sale (112,514.99)
Fire Department Mini Pumper Bought in 2016 (254,192.20)
2017 closing costs (4,924.25)
City share of environmental costs ** (19,000.00) (390,631.44)
Approximate remaining Cash Balance $ 1,439,517.40 $ 1,439,517.40
** -Total estimated environmental costs to be $64,880.00