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Home My WebLink AboutStaff Report 317-10TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DEPARTMENT: PUBLIC WORKS DATE: JULY 26, 2010 CMR:317:10 REPORT TYPE: CONSENT SUBJECT: Approval of the Sale of Surplus Fire Equipment to Oaxaca, Mexico in the Amount of $20,000 RECOMMENDATION Staff recommends that Council approve the sale of three surplus fIre apparatus to Oaxaca, Mexico in the amount of $20,000. BACKGROUND In 2009, a contingent of dignitaries from Palo Alto's sister-city of Oaxaca, Mexico visited Palo Alto in conjunction with Neighbors Abroad. Members of the contingent included the Mayor and Fire Chief of Oaxaca. During that visit, Palo Alto Neighbors Abroad contacted the Fire Department and requested consideration for Oaxaca concerning the sale of upcoming surplus ftre apparatus. Subsequently three ftre apparatus were identified for potential resale to Oaxaca. Over the past fIve years, the Fire Department of Oaxaca has expanded signifIcantly. The department is currently planning to construct two new ftre stations and considering more in the future. During the visit in October 2009, the Palo Alto Fire Department staff convened with the Neighbors Abroad local representatives and conftrmed with Oaxaca's Fire Chief the drastic need for such equipment and the willingness to coordinate with the Mexican federal government should the request to sell surplus equipment be approved by the City Council. DISCUSSION The Fire Department has three remaining surplus Type I ftre pumper apparatus available that have been set aside for possible purchase by Oaxaca. This equipment was replaced in 2009 after 22 years of front-line service. City Policy 4-1 (Vehicle and Equipment Use, Maintenance and Replacement) prescribes a 20-year life for fire pumper apparatus. Because this equipment has exceeded its useful life, it is no longer needed by the Fire Department. The market value of these units (based on an independent appraisal, and sales prices for similar units) is approximately $10,000 each. The Fire Chief of Oaxaca has been able to procure funds in the amount of $20,000 for purchase as authorized by the Mexican government. Staff fully realizes that in today's economic environment, the City must maximize its return on surplus equipment. City staff did attempt to negotiate for a sale price equal to the full appraised value of the equipment; however, the funds available to Oaxaca are limited, and $20,000 is the maximum it can expend. Although staff is recommending the sale of this equipment to Oaxaca at a reduced price, the benefIt to our sister-city would be signifIcant in meeting their needs. The Neighbors Abroad CMR:317:10 Page 1 of2 Program in conjunction with the Fire Chief of Oaxaca has agreed to coordinate with the government of Mexico for the sale, transfer of docuntents, and delivery of the equipment from Palo Alto to Oaxaca, Mexico at no additional costs to the City, nor further use of City resources. City policy allows donation of surplus property to public bodies Or for charitable purposes with Council approval. RESOURCE IMPACT This surplus equipment has an appraised value of $30,000 and an estimated auction sale value with potential net proceeds to the City of Palo Alto of approximately $27,000 (sales price less listing fees and commission). This sale would potentially reduce the City's return by $7,000, which could be viewed as a donation by the City. Transportation will be arranged and paid for by Neighbors Abroad and the Oaxaca Fire Department. . POLICY IMPLICATIONS City Policy allows donation of surplus property to public agencies or for charitable purposes with Council approval. TIME LINE Sale and transpoqation of the equipment to Mexico will occur within 60 days of Council's approval of this City Manager's Report. ENV]RONMENTAL~ACT The request is not a project subject to the California Environmental Quality Act (CEQA). ATTACHMENTS None. PREPARED BY: DEPARTMENT HEAD: CITY MANAGER APPROVAL: CMR:317:10 ~ .. GLENN S. ROBERTS Director of Public Works Page 2 of2 July 20,2010 SR. MANUEL A. MAZA SANCHEZ JEFE DEL H. CUERPO DE BOMBEROS DEL GOBIERNO DEL ESTADO DE OAXACA AV. JORGE L. TAMAYO CASTILLEJOS SIN COL. CANDIANI. C.P. 68130 OAXACA, OAX. MEXICO Chief Maza: C:itY-of P'!lo Alto Police Department ATTACHMENT A This letter serves as an official agreement between the City of Pal 0 Alto, CA, USA, and the City of Oaxaca, Mexico regarding the sale ofthree vehicles under the terms and conditions described herein: I. Vehicles to be sold: The City of Palo Alto agrees to sell the following vehicles to the City of Oaxaca: *61141987 Pierce-Arrow (Open cab) Pumper -Detroit 6V92 Diesel-Allison transmission-1500 GPM Waterous midship pump -500 gallon water tank -31,000 lbs. (Loaded laden weight) 29" long 124" inches high 178 inch wheelbase 38,400 Ibs GVWR, 12R22.5 tires, water cannon, hose wi reel, storage compartments, auxiliary lighting, emergency lights and siren. *61131987 Pierce-Arrow (Open cab) Pumper -Detroit 6V92 Diesel-Allison transmission -1500 GPM Waterous midship pump -500 gallon water tank -31,000 lbs. (Loaded laden weight) 29" long 124" inches high 178 inch wheelbase 38,400 lbs GVWR, 12R22.S tires, water cannon, hose wi reel, storage compartments, auxiliary lighting, emergency lights and siren. *61121987 Pierce-Arrow Pumper -Detroit 6V92 Diesel-Allison transmission -1500 GPM Waterous midship pump -500 gallon water tank-31,000 lbs. (Loaded laden weight) 29" long 124" inches high 178 inch wheelbase 38,400 Ibs GVWR, 12R22.S tires, water cannon, hose wi reel, storage compartments, auxiliary lighting, emergency lights and siren. Printed with soy-based inks on 100% recycled paper processed without chlorine 275 Forest Avenue Palo Alto, CA 94301 650329.2406 650.329.2565 fax 650.6173120 Administration fax 2. Sale Price and Payment Because of the "sister city" relationship between the City of Palo Alto and the City of Oaxaca, Palo Alto has offered to sell, and Oaxaca has agreed to purc:!lase the vehicles described in section one of this agreement for the total sum of$20,000 in United States dollars payable to the City of Palo Alto. Payment is due no later than 20 days of the City of Oaxaca's communication to the City of Palo Alto of its acceptance of this agreement. Funds are to be forwarded to the City of Palo Alto via a wire transfer per instruction in Attachment B. 3. Transportation of Vehicles to Mexico: Upon payment, the engines will become sole property of the City of Oaxaca Fire Department. The City of Oaxaca agrees to assume all responsibility for shipping the engines from Palo Alto, California to Oaxaca, Mexico. The City of Palo Alto shall not be liable for damage, destruction, or any and all other loss caused in transport. 4. Hold Harmless: The City of Palo Alto makes no representation or warranties whatsoever regarding the condition of the vehicles and the City of Oaxaca agrees to accept the units as-is. The City of Oaxaca further agrees to hold the City of Palo Alto, its City Council members, officers, employees and agents harmless from and against any and all demands, claims, injuries, losses, or liabilities of any nature, including death or injury to any person, property damage or any other loss and including without limitation al damages, penalties, fines, and judgments arising out of or resulting in any way from or in connection with performance of this agreement or use of the above units. 5. Authority to Enter Into Agreement Each party signing this Agreement represents and warrants that slbe has the authority from the City of Palo Alto and the City of Oaxaca to execute this Agreement on behalf of such party. If the terms and conditions of this letter agreement are acceptable to the City of Oaxaca, kindly have t4e appropriate authority communicate acceptance thereof on behalf of Oaxaca in the space provided below. Sincerely. k~ Chief Dennis Burns Interim Director of Public Safety Agreed: CITY OF PALO ALTO lames Keene City Manager City of PalQ Alto CITY OF OAXACA Sr. Manuel A. Maza Sanchez Jefe Del H. Cuerpo De Bombero Oaxaca, Oax, Mexico ( City of Palo Alto Wire Transfer Instructions Listed below are the wire transfer instructions for the City of Palo Alto. These instructions shall be used whenever sender is requested to use this method of payment. These instructions will remain in effect until sender is notified otherwise. Bank Name: Bank Routing IABA Number: Account Number: Type of Account: Wells Fargo Bank 121000248 4121076145 Checking ATTACHMENT B Branch Location: Federal Tax ill # 550 California Street; San Francisco, CA 94104 946000389 If you have questions call Tarun Narayan @(650) 329 -2362. Note: For Utility payments, in the wire description field put your Utility (aka Contract) account number(s).