HomeMy WebLinkAbout15.D.4. Request to utilize repurchase agreements for the John Deere 5420 Tractor and John Deere 1445 Mower
IS: o. r:
CITY OF SHAKOPEE
MEMORANDUM CONSENT
TO: Mayor & City Council
Mark McNeill, City Administrator
Bruce Loney, Public Works Director
FROM: Michael Hullander, Public Works Supervisor
DATE: August 3, 2005
SUBJECT: Request to utilize repurchase agreements for the John Deere 5420 Tractor
and John Deere 1445 Mower
INTRODUCTION:
Public Works is requesting council authorization to utilize the repurchase agreements
from Siemon Implement, Inc for the 1445 mower and 5420 tractor. The estimated cost of
this repurchase will be around $12,000.00
BACKGROUND:
Public Works has been using repurchase agreements with Siemon Implement, Inc. for a
number of years and find them to be of excellent value to save tax dollars on maintenance
costs. All vehicles Public Works purchases through these agreements are covered with
full warranties. Public Works currently has agreements with Siemon Implement, Inc. on
three John Deere 1445 Mowers and two John Deere 5400 Series Tractors.
Below are the two agreements with the costs to date, our estimated additional hours, and
estimated final costs.
John Deere 1445 Mower:
Trade every 18 months for $2,500.00 up to 250 hours and $6.00 per every
additional hour after 250 hours.
Current hours: 375
-250
125 additional hours x $6.00/ per additional hour = $750.00
+$2.500.00
Current Total $3,250.00
Estimated additional hours until trade: 50 x $6.00/ per additional hour = $300.00
Subtotal $3,550.00
Tax $230.75
Total estimated cost of trade $3,780.75
Internal Service Fund rental rate 18 months $3,750.00
John Deere 5420 Tractor:
Trade every 18 months for $3,500.00 up to 250 hours and $10.00 per every
additional hour after 250 hour.
Current hours: 550
-250
300 additional hours x $10.00 / per additional hour = $3,000.00
+ $3.500.00
Current Total $6,500.00
Estimated additional hours until trade: 100 x $10.00 / per additional hour $1.000.00
Subtotal $7,500.00
Tax $487.50
Total estimated cost of trade $7,987.50
Internal Service Fund rental rate 18 months $6,687.00
Public Works can only estimate the cost at this time. Siemon Implement, Inc. needs to
know if we are going to use the agreements so they can order the equipment.
ALTERNATIVES:
1. Authorize staff to use the agreements.
2. Deny the request.
3. Table for additional information.
RECOMMENDATION:
Staff recommends alternative No.1.
ACTION REQUESTED:
Move to authorize staff to use the repurchase agreements with Siemon Implement, Inc.
on unit #152 a 2004 John Deere 1445 Mower and unit #132 a John Deere 5420 Tractor
with the total cost not to exceed $12,000.00.
:::t~
Public Works Supervisor