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RESOLUTION AUTHORIZING AN INCREASE TO THE ANNUAL CONTRACT FOR ORIGINAL EQUIPMENT MANUFACTURER (OEM) PARTS, SUPPLIES AND LABOR FOR 2020 FROM ZIEGLER, INC. IN THE AMOUNT OF $100,000 FOR A NEW TOTAL AMOUNT NOT TO EXCEED $450,000.
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CITY PROPOSAL:
RESOLVED, that the proper city officials are hereby authorized to contract for the purchase of OEM parts, supplies and labor in 2020 from Ziegler, Inc. for an amount not to exceed $450,000 payable as follows:
$265,000 660-015-5221 (Fleet Services, Public Administration, Equipment Repair Supplies)
$185,000 660-015-5404 (Fleet Services, Public Administration, Equipment/Machinery Repair & Mtc)
Statement of Purpose
STATEMENT OF PURPOSE: This resolution authorizes an increase to the annual purchase order for 2020 of OEM parts, supplies, and labor to maintain City of Duluth Caterpillar construction equipment such as skid steers, excavators, loaders, motor graders and onsite generators.
Caterpillar OEM parts are used because they are reliable, ensure proper fit and compatibility, and keep us within warranty specifications. The contract covers both routine maintenance and major repair costs on Caterpillar equipment; and provides a discount on parts as well as on-site repair services to reduce down time on equipment.
This increase is necessary due to a confluence of factors including 20 graders that are at the end of their five-year lease period, winter snow removal conditions that took a punishing tool on graders, and the City’s contractual lease obligation to return all graders to the dealer this fall in good working order.
The increase is offset by a $100,000 reduction in anticipated fuel costs for 2020 as a result of lower fuel prices, resulting in a net zero budget adjustment.