The purpose of this memo is to inform on the Fire Department’s opportunity to purchase a needed rescue squad and to request permission to execute a signed agreement with LDV Custom Specialty Vehicles with a down payment of one-third of the total cost. Vehicle delivery is anticipated in Spring 2025.
Background
The Fire Department currently has three (3) rescue squads – 2 frontline and 1 reserve. The FY2025 Capital Budget reflects $388,565 in funding for the replacement of a Fire Department Rescue Squad. Historically, our desired rotation has rescue squads serving 7-8 years frontline and the remainder of their lifecycle as a reserve. The squad needing replacement is a 2011 Ford F-550 custom rescue squad that was purchased in 2011 and will be past the end of its lifecycle once the replacement vehicle is received. This vehicle has an estimated 16-month lead time for delivery once a purchase order is signed. When the Village takes delivery of the new rescue squad, it will go into frontline service in District 2, sending a 2019 LDV Ford Rescue Squad with 6 years of service into reserve status. The 2011 Ford F-550 will be removed from the fleet and sold at auction.
Apparatus Cost
The Fire Department has received a formal proposal from LDV Custom Specialty Vehicles (Burlington, WI), the manufacturer of all of the department’s rescue squads. The LDV Custom Ford F-550 Rescue Squad is available for purchase in the amount of $473,510 through an active joint purchasing contract in effective between LDV Custom Specialty Vehicles and the Houston-Galveston Area Council Purchasing Cooperative, of which the Village is a member.
Submitting an order for this vehicle before the end of calendar year 2023 will secure delivery in calendar year 2025, the year that the squad is scheduled for replacement, and will avoid a scheduled January 1, 2024 price increase. A down payment of one-third ($157,840) is due at the time of chassis arrival at the manufacturing plant. An additional one-third will be due at the time of body fabrication and mounting, and the final payment will be due upon delivery.
Cost Trends
Traditionally, the Fire Department has budgeted for a 3% annual increase for each new apparatus purchase. From approximately 2006 until 2021, this amount was sufficient. A post-pandemic labor and materials market has seen multiple increases greater than 3% within each year, and significant vehicle lead times. The current proposal of $473,510 is about $85,000 (approximately 22%) more than the 2025 budget estimate submitted a few years ago.
In addition to increased labor costs, below are some of the supply and material increases experienced by vehicle manufacturers:
Notable increases prior to November 2021
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Steel – 268%
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Aluminum – 77%
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Fabricated Parts – 22%
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Labels – 32%
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Air horns – 42%
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Frame Rails – 34%
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Water tanks – 17%
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Fuel Tanks – 32%
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Additional increases after November 2021
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Steel – 28%
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Aluminum – 24%
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Fabricated Parts – 7%
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Logistics – 6%
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Consumables (drill bits, brushes, gloves, etc.) – 9%
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Indirect materials (welding gas, wire, machining, oils, etc.) – 23%
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Recommendation
It is recommended that the Fire Department proceed to request Village Board approval for the purchase of a Fire Department Ford F-550 Custom Rescue Squad from LDV Custom Specialty Vehicles of Burlington, WI in the amount of $473,510 and authorize staff to execute the necessary documents. Funding for this vehicle will be available in the Fleet Capital Budget, Account No. 621-9003-550050 VH9504. The additional cost which exceeds the currently budgeted amount (approximately $85,000) will be covered by Fleet Fund reserves.