TO: Board of Trustees
THROUGH: Mary DeLoretto, Interim Executive Director
FROM: David Hancock, Acting Chief Service Development Officer
PRESENTER(S): Kyle Stockley, Rail Infrastructure Project Manager
TITLE:
title
Change Order: Tire Lease Program Extension (Michelin)
end
AGENDA ITEM TYPE:
Procurement Contract/Change Order
RECOMMENDATION:
Approve and authorize Executive Director to execute two one-year options and their associated disbursements on the Michelin Tire Lease contract in the amount of $3,690,000.
BACKGROUND:
UTA is under contract with Michelin to provide tire leasing and services for all UTA buses at the Meadowbrook, Central, Mt. Ogden, Timpanogos, and Riverside business units. Tires are leased per tire mile and Michelin provides all the tire servicing as part of the contract.
DISCUSSION:
Michelin has provided good products and reliable service for the life of this contract. Although there have been a few minor hiccups recently due to labor shortages it would not make sense to rebid this contract. Rebidding also carries a risk of increased cost due to rising inflation. Extending the contract appears to be the lower risk option in the current situation.
The $3,690,000 for the option years is an estimate based off the monthly invoices paid to Michelin for this contract (which average about $150,000). All pricing is based on mileage and that is why it is an estimate.
The pricing sheet attached to the Option Year Memo will not add up to the $3,690,000 but is the basis for figuring out what the charges will be for the month based on mileage reported.
CONTRACT SUMMARY:
|
Contractor Name: |
Michelin |
|
Contract Number: |
18-2595PP |
|
Base Contract Effective Dates: |
11/30/18 thru 11/30/21 |
|
Extended Contract Dates: |
Two optional 1-year extensions to 11/30/23 |
|
Existing Contract Value: |
$5,085,652.17 |
|
Amendment Amount: |
$3,690,000 estimated - based on miles driven |
|
New/Total Amount Contract Value: |
$8,775,652.17 |
|
Procurement Method: |
Options on existing contract |
|
Funding Sources: |
Local |
ALTERNATIVES:
Let contract expire and re-bid.
FISCAL IMPACT:
Costs for this contract are included in the operations budget.
ATTACHMENTS:
Change Order: Tire Lease Program Extension (Michelin)