Title
Adoption of Resolution Authorizing the Interim City Manager, or Designee, to Negotiate and Execute a Lease-Purchase Agreement with Moose Boats LLC Through the United States General Services Administration Procurement Program Substantially in the Form of the Attached Agreement; and a Financing Agreement with JP Morgan Chase Bank, NA for the Purchase of One M2-38 Moose Boat Catamaran Waterjet Fire Rescue Boat in an Amount Not to Exceed $1,500,000. (Fire 10032200)
Body
To: Honorable Mayor and Members of the City Council
EXECUTIVE SUMMARY
The City of Alameda’s (City) existing fire suppression and rescue boat has been in service for over 8 years and requires replacement. The City’s Fiscal Year (FY) 2022-23 Mid-Cycle Budget Update included an appropriation for the first year payment of a lease purchase of a new fire rescue boat in the amount of $300,000. Staff recommends City Council authorize the Interim City Manager to negotiate and execute an agreement with Moose Boats, LLC for the purchase of a M2-38 Moose Boat Catamaran Waterjet Fire Rescue Boat in an amount not to exceed $1,202,347.24. The purchase and pricing are based on the United States General Services Administration (GSA) procurement program, in which the City participates. JPMorgan Chase Bank (Bank) will provide the financing terms, with the Bank expected to act as the lessor under the proposed equipment lease. The financing agreement is estimated at $1,500,000 over a 5-year period, inclusive of debt service.
BACKGROUND
The Fire Department’s existing fire rescue boat, a 32' Harbor Guard Fire Hawk fireboat named “Deanna Jo”, was purchased in 2012 and put into service in February 2014. The existing fireboat increased the Fire Department’s pumping capacity from 500 GPM to 2,200 GPM and has served the City and regional partners for over eight years. Deanna Jo is the third fireboat to serve the City.
Alameda Fleet Services, in coordination with the Fire Department, is responsible for replacing fire apparatus, vehicles, and equipment according to the City's Vehicle and Equipment Replacement Policy. The replacement policy is based on Fleet Replacement Criteria, which considers the useful life of vehicles and equipment in terms of age, mileage (or hours), and usage. The current replacement policy does not specifically address fireboat replacement. In lieu of replacement criteria in the replacement policy, staff referenced National Fire Protection Association (NFPA) and current industry guidelines.
Once replacement criteria is met, each unit of the City fleet is further reviewed and analyzed for safety history, operating performance, and actual usage to determine if replacement is truly warranted and if so, in kind or with something more suitable for its intended purpose. Pursuant to current NFPA and industry standards, the maximum useful life of a maritime fire suppression and rescue boat is approximately 6-12 years and/or 1,200 hours in active frontline service, dependent on the operational environment, maintenance, vessel condition assessment and storage.
The existing 32' Harbor Guard Fire Hawk fireboat:
1. Has been in service for 8 years and has 1,100 hours of service, therefore meeting industry standard for fire suppression and water rescue fireboat replacement guidelines; and
2. Does not meet the minimum requirements needed to provide fire suppression and water rescue operations for Alameda and regional mutual aid partners; and
3. Manufacturer has gone out of business, making replacement parts and maintenance a challenge.
On June 21, 2022, the City Council adopted the Fiscal Year (FY) 2022-23 Mid-Cycle Budget Update (Budget). The Budget included (1) an appropriation of $300,000 for the first payment of a 5-year lease purchase of a new fireboat, and (2) directed staff to pursue a 5-year lease purchase with annual lease payments estimated at $300,000.
DISCUSSION
Extensive research was done on fire suppression and rescue boats, including consult with other agencies with similar service levels and challenges as Alameda. Various vendors were contacted for equipment demonstrations. After consideration of the information obtained and discussions with Fire staff end users and program supervisors, staff recommend purchase of the M2-38 Moose Boat Catamaran Waterjet Fire Rescue Boat from Moose Boats LLC, with a pumping capacity of up to 4100 GPM and the capability to operate in the shallows surrounding Alameda, as it is a jet-driven boat (not prop-driven).
The M2-38 Moose Boat Catamaran Waterjet Fire Rescue Boat provides a reliable platform for critical marine response capabilities to the community, improves the Fire Department’s floating platform for dive rescue operations that reduce the reflex time to deploy a diver, and increase emergency water supply pumping capabilities to sustain firefighting needs in the event the island loses water supply post-earthquake. Additional detail on each of these enhancements is included in Exhibit 1. Moose Boats LLC, located in Vallejo CA, will also make it easier for fleet maintenance to facilitate warranty repair items and/or additional maintenance for the fireboat going forward.
Staff recommend purchasing the new fire suppression and rescue boat through the Moose Boat LLC contract with the GSA. The GSA is a nationwide, government-to-government procurement service that has procured products and services for over 37 years. All contracts available to members of GSA have been awarded by virtue of a public competitive procurement process compliant with state statutes.
The Alameda Municipal Code, Subsection 2-61-7, Joint Purchases with Public Agencies, provides authority for the city to use another government agency's competitive bidding process to purchase materials, supplies, equipment, vehicles, and apparatus, "provided the purchase is the result of competitive bidding or proposal and is made in compliance with the competitive bid or proposal requirements of any participating agency or organization in a manner that is consistent with the law."
Due to supply challenges and increased demand for manufacturing lead time from delivery for the new fire boat is 18-24 months. A performance bond will be issued as part of the purchase to protect the City's interests.
ALTERNATIVES
• Approve the recommendation to authorize the Interim City Manager, or designee, to negotiate and execute agreements for purchase of the proposed replacement Fire Rescue Boat.
• Do not approve the recommendation and provide staff direction on purchase of the replacement Fire Rescue Boat.
FINANCIAL IMPACT
This fireboat will be purchased through a leasing option with JPMorgan Chase Bank, N.A. JP Morgan is expected to act as the lessor under the proposed equipment lease, which will provide the necessary funding for the fireboat. JPMorgan will amortize the lease financing over five years. The first year’s debt service for the fireboat of $300,000 was appropriated in the Fire Department’s FY 2022-23 General Fund budget. The ongoing debt service payment will be incorporated into the FYs 2023-25 and 2025-27 Biennial Budgets. The estimated total cost of the fireboat inclusive of debt service is $1,500,000 ($300,000 per year for 5 years).
The cost of the fireboat inclusive of sales tax, but not including debt service, is $1,202,347.24, as detailed in Exhibit 2. Moose Boat LLC offers a discount of $30,829.42 for full payment at contract signing, which will apply in this case. The agreement requires a performance bond with both the City and JPMorgan Chase as obligees.
Additional costs associated with placing a new fireboat in service include additional training. The Fire Department will seek funding from Port Security Grant Program (PSGP) or Assistance to Firefighter Grant (AFG) to cover training costs. Other costs not directly related to the new boat but connected to building an enhanced emergency water supply system would include seeking grant funding to purchase 1-2 Portable Water Supply System that would optimize the enhanced pumping capacity of the new fireboat. Staff will return to City Council as needed on these items.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action is authorized pursuant to Alameda Municipal Code section 2-61.7 "Joint Purchases with Public Agencies," Alameda Administrative Rule 5, and Alameda Municipal Code section 2-62.2, which exempts contracts with any single or source supplier for supplies, material, or equipment from the City's local purchasing policy.
ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) applies only to projects that have the potential for causing a significant effect on the environment. This action is not a project pursuant to Public Resources Code section 21065 and CEQA Guidelines section 15378.
CLIMATE IMPACT
This action is consistent with the City of Alameda Safe Climate Resolution No. 15510. The Fire/Rescue Boat meets current emission standards for the State of California.
RECOMMENDATION
Adopt a resolution authorizing the Interim City Manager to negotiate and execute (1) a Lease-Purchase Agreement with Moose Boats LLC through the U.S. General Services Administration Procurement Program and (2) a Financing Agreement with JP Morgan Chase Bank, NA for the purchase of one M2-38 Moose Boat Catamaran Waterjet Fire Rescue Boat in an amount not to exceed $1,500,000.
Respectfully submitted,
Erin Smith, Public Works Director
Nick Luby, Fire Chief
By,
Forrest Heiderick, Fleet Supervisor
Financial Impact section reviewed,
Margret O’Brian, Finance Director
Exhibits:
1. Justification to Replace Fire Boat
2. Moose Boat LLC. Full Vessel Build Agreement