City council has given the public works and utilities department permission to spend nearly $86,000 more than budgeted to purchase two new front-end loaders that deal with construction and snow clearing.
The department planned to replace unit 156 as part of the 2021 major equipment budget, but that project was carried over to 2022 because of insufficient replacement funds due to market conditions. Furthermore, the department planned to replace unit 148 this year as part of the major equipment budget.
Both units were expected to cost a combined $560,000. However, after issuing tenders for the project, the lowest bid the department received was $645,540, which included the trade-in allowance for the old units. This left a shortfall of $85,540.
During the June 13 regular council meeting, council approved the new replacement cost for both units. To cover the shortfall, council authorized the public works department to pull $11,940 from the major equipment control account and $73,600 from major equipment purchases this year.
Unit 156 is a 2005 model and unit 158 is a 2006 model, and due to their age, heavy use and critical nature of the equipment for construction projects and public safety services such as snow clearing, city administration recommended pursuing new machines, Darrin Stephanson, director of public works, told council.
City hall has experienced a surplus of $73,600 this year in major equipment purchases due to lower competitive bids, he continued. Using this surplus would leave a shortfall of $11,940 that the public works major equipment control account would cover.
That account has $989,714 available to fund this request.
Coun. Heather Eby was excited to hear about the purchase of this new equipment.
“You had me at snow clearing,” she said. “The City of Moose Jaw’s practice of having a control account and reserve account makes purchases not as painful, even though when they come in over budget, it does not throw us into as big of a tailspin.”
In response to a question from Coun. Jamey Logan, Stephanson said that the equipment’s age and heavy use precipitated their replacement. He did not know how many hours those machines had been used since it varied by unit. However, the longer the department has older equipment, it experiences more problems with them and higher maintenance costs.
The next regular council meeting is Monday, June 27.
