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<br /> <br />City of Elk River <br />REQUEST FOR COUNCIL ACTION <br />Agenda Section Meeting Date <br />Consent February 20, 2007 <br /> <br />Item Description <br /> <br />Consider Street De artment Motor Grader Bids <br /> <br />Item Number <br />3.13. <br />Prepared by <br />Phil Hals, Street Superintendent <br />Tim Simon, Finance Director <br />Reviewed by <br />Lori ohnson, Ci Administrator <br /> <br />. <br /> <br />Introduction <br />On January 2, 2007, Council authorized the Street department to advertise for a used motor grader. The <br />lowest bid was $101,175 for a 2002 motor grader with 5,136 hours, this included trade in of the city's <br />1978 CAT 120G motor grader. The second lowest bid was $5,218.50 higher, for a 2007 motor grader <br />with zero hours. This bid also included the trade in of the city's motor grader. Staff would like to re- <br />advertise for a used motor grader with a bid alternate of a new grader, at which time it can be assessed <br />which would be more favorable to the city long-term. <br /> <br />Discussion <br />The lowest bid, a 2002 motor grader with 5,136 hours, would serve the city's needs for 10 to 12 years at <br />the projected usage rate of 500 hours per year. The tires on this machine are at 50% tread remaining <br />which would amount to a $4,500 tire replacement cost within the next two years. On the other hand, the <br />second lowest bid for the new machine would serve the city's needs for 20 plus years and comes with a <br />one year full machine warranty. An additional warranty can be purchased after one year if deemed <br />necessary. <br /> <br />Financial Impact <br />The streets department has budgeted $185,150 in 2007 for the purchase of equipment. The grader is <br />budgeted at $100,000, plus the trade in value of our 1978 CAT 120G motor grader. If the price of the <br />grader (which after the re-advertisement will be new or used) exceeds the $100,000, the remaining <br />equipment purchases will be reduced to stay within the total budget for 2007. <br /> <br />Attachments <br />. Bid attachment <br /> <br />Action Requested <br />Staff requests that Council reject the bids received and re-advertise for the purchase of a used motor <br />grader with a bid alternate of a new motor grader. <br /> <br />Council Action <br /> <br />Motion by _ <br /> <br />Second by _ <br /> <br />Vote <br /> <br />Follow Up <br /> <br />C: \Documents and Settings \jmiller\Local Settings \ Temporary Internet Files\ OLK3E\ Used Grader.doc <br />