Title
Consider a memorandum/resolution authorizing the procurement of fleet parts through Heil of Texas, Lonestar Truck Group, Mac Haik Ford, NAPA/Third Coast Distributors, and O'Reilly, in an amount of $598,000, and tires through Southern Tire Mart, in an amount of $250,000 for Fiscal Year 2025.
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DATE: November 19, 2024
TO: Kent Cagle, City Manager
FROM: Judith Tangalin, Executive Director of Finance
SUBJECT: Procurement of Fleet Parts and Tires
BACKGROUND AND FINDINGS:
The City of Killeen Fleet Services Division provides the maintenance and repair required to keep the City’s approximately 1,045 units of fleet functioning properly. To accomplish this feat, there are numerous parts and tires procured daily. The costs of those items are then charged back to the corresponding City departments as they are used. The regularly used parts and tires are stocked at Fleet Services to facilitate timely repairs. The items not stocked within the 2,903 distinct parts within Fleet Services are purchased as needed and delivered to Fleet Services by the vendor.
Fleet Services purchases parts from 36 vendors that offer cooperative pricing and/or dealer only parts totaling approximately $1,265,000 annually. Six of these vendors periodically exceed the $50,000 annual threshold and therefore require City Council approval.
The primary vendors for fleet parts are Heil of Texas, Lonestar Truck Group, Mac Haik Ford, NAPA/Third Coast Distributors, and O'Reilly. During the previous fiscal year 2024, the combined amount spent with these five vendors was $539,575. The total estimated amount to be spent in FY 2025 is $598,000.
All five vendors offer significant savings to the City through their cooperative contracts. Heil of Texas provides cooperative pricing pursuant to the TASB BuyBoard contract #686-22, effective through November 30, 2025, with savings of 2% to 15% off list price. Lonestar Truck Group provides cooperative pricing pursuant to The Interlocal Purchasing System (TIPS) contract #221001, effective through January 31, 2026, with savings of 14% to 42% off list price. Mac Haik Ford provides cooperative pricing pursuant to the TASB BuyBoard contract #724-23, effective through November 30, 2026, with savings of 25% off list price. NAPA/Third Coast Distributing provides cooperative pricing pursuant to Sourcewell contract #032521-GPC, effective through May 19, 2026, with savings of 43% to 60% off list price. O’Reilly pursuant to The Interlocal Purchasing System (TIPS) contract #230604, effective through August 31, 2026, with a minimum savings of 41% off list price.
The vendor for new tires offering significant savings and service to the City is Southern Tire Mart of Waco, TX. During the preceding fiscal year, the cost for tires was $240,377. The total estimated amount to be spent with Southern Tire Mart in FY 2025 is $250,000.
Southern Tire Mart has provided new tires to the City for several years utilizing cooperative pricing pursuant to the TASB BuyBoard contract #729-24, effective through February 28, 2027. The cooperative pricing structure with Southern Tire Mart offers a savings of 41% to 67% off list price.
THE ALTERNATIVES CONSIDERED:
N/A
Which alternative is recommended? Why?
N/A
CONFORMITY TO CITY POLICY:
Fleet Services is seeking approval to purchase parts and tires for various departments from Heil, Lonestar Freightliner, Mac Haik Ford, NAPA/Third Coast Distributors, O’Reilly, and Southern Tire Mart through their cooperative contracts. Purchases made through a cooperative contract are exempt from the competitive bidding process as stated in Texas Local Government Code (TLGC) section 271.102, subchapter F; a local government that purchases goods or services under this subchapter satisfies any state law requiring the local government to seek competitive bids for the purchase of the goods or services.
FINANCIAL IMPACT:
What is the amount of the revenue/expenditure in the current fiscal year? For future years?
The estimated amount to be spent in FY 2025 for fleet parts with Heil, Lonestar Freightliner, Mac Haik Ford, NAPA/Third Coast Distributors, and O'Reilly combined is $598,000. The estimated amount to be spent in FY 2025 for fleet tires with Southern Tire Mart is $250,000.
Is this a one-time or recurring revenue/expenditure?
Recurring
Is this revenue/expenditure budgeted?
Yes, in each fund, department, and division’s 53800 (on-road) and/or 53315 (off-road) repairs and maintenance accounts.
If not, where will the money come from?
N/A
Is there a sufficient amount in the budgeted line-item for this revenue/expenditure?
Yes
RECOMMENDATION:
City Council approve the procurement of fleet parts through Heil, Lonestar Freightliner, Mac Haik Ford, NAPA/Third Coast Distributors, and O'Reilly in an amount of $598,000 and tires through Southern Tire Mart in an amount of $250,000 for Fiscal Year 2025, and authorize the City Manager, or designee, to execute any and all change orders within the amounts set by State and Local Law.
DEPARTMENTAL CLEARANCES:
Purchasing
Finance
Legal
ATTACHED SUPPORTING DOCUMENTS:
Contracts
Certificates of Interested Parties
Presentation