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Home My WebLink AboutTR-105-89 REPORT #3 TOWN OF NEWCASTLE S REPORT File # Res. # By-Law # %°. MEETING: COUNCIL DATE: December 11, 1989 REPORT #: TR-105-89 FILE #: SUBJECT: LEASE AGREEMENT - MAIL PROCESSING EQUIPMENT RECOMMENDATIONS: It is respectfully recommended to Council the following: 1. That Report TR-105-89 be received; 2 . That Council accept the written proposal (Attachment "A" ) from Friden Alcatel, to lease the mail processing equipment and furniture at a fixed lease cost of $ 856 . 00 plus Provincial Sales Tax, per month for a period of sixty (60) months; 3 . That the funds be drawn from the Capital Lease Account 7007-X-0520, which are allocated in the 1989 Capital Budget (page 10, Item A) for the lease payments of the mail processing equipment; 4. That the procedures set out in the Purchasing By-Law #82-92, Section 5, Paragraph 04, be waived for this particular transaction; Page - 2 - TR-105-89 LEASE AGREEMENT - MAIL PROCESSING EQUIPMENT 5. That the attached By-Law be forwarded to Council for approval; and 6 . That in accordance with Section 64 of the Ontario Municipal Board Act, authorization be obtained from the Ontario Municipal Board prior to the execution of this agreement. BACKGROUND AND COM KENT: With the centralization of staff in the New Administrative Facility the mail processing equipment for all Departments must now be addressed as was proposed through the 1989 Capital Budget. The lease for the existing equipment expires December 31, 1989 . This equipment is outdated and will no longer handle the volume. It is proposed that the necessary equipment be installed in the "Central Mail Room" area, which will be located in the basement of the Town Hall . For information purposes, the following is a summary of the current mail processing equipment and the costs incurred for all Town of Newcastle Departments . Note: All prices quoted are: plus Provincial Sales Tax Model 5600 Maintenance (mailing machine and scale) $ 541.00 per year Meter Rental ($110.25 per quarter) $ 441. 00 per year Mailing Machine Rental (extension of lease, $ 459 . 68 per year Purchase Order #5434) $1441. 68 per year Page - 3 - TR-105-89 LEASE AGREEMENT - MAIL PROCESSING EQUIPMENT The lease for the above noted equipment actually expired February 1988 . Since that time, one ( 1) year extensions have been negotiated. Prior to consolidation of all staff in the Town Hall, three (3) rental units were being utilized. Once staff were settled in the new building, all rental agreement units with the exception of the Model 5600, were cancelled. In view of the increased mailing requirements resulting from a centralized mail processing system, proposals were received for upgraded equipment as follows: Purchase Price Pitney Bowes Friden Alcatel Mail Machine $ 7,478 . 75 $ 7,353 .00 (includes $1,274 .25 trade-in) Electronic Scale $ 2,885 .75 $ 1,715 . 00 (includes $ 509 .25 trade-in) Inserter Folder $17,845 . 00 $18,284 . 00 Burster $ 7,995 .00 $ 3, 334 .50 Mail Centre Furniture $ 3, 184 . 00 $ 3,933 .00 $38,388 .50 $34,619 .50 Meter Rental $ 110 .25/quarter$ 30. 00/month Lease Cost Per Month Based on a 60 month period $ 955 . 83 $ 856 . 00 Page - 4 - TR-105-89 LEASE AGREEMENT - MAIL PROCESSING EQUIPMENT Service and Maintenance Costs Pitney Bowes Friden Alcatel Mail Machine $ 798. 00 $ 741.00 Electronic Scale $ 216 . 00 $ 162 . 00 Inserter Folder $ 1,711. 08 $ 1,488 . 00 Burster $ 1,238 . 04 $ 315.00 $ 3,963. 12 $ 2,706 .00 Note: Friden Alcatel and Pitney Bowes are the only two (2) known companies servicing Durham Region who offer a complete line of mail processing equipment. Accepting the proposal for the Friden Alcatel equipment over the proposal for the Pitney Bowes equipment will provide the following benefits to the Town: - lowest overall cost - the Friden equipment is covered by a one ( 1) year warranty where as the Pitney Bowes equipment is only a ninety ( 90) day warranty The following references have been provided by Friden Alcatel and have been qualified by the Purchasing and Supply Agent: Toronto Board of Education North York Board of Education Canada Post Regional Municipality of Durham Town of Markham Toronto Dominion Bank Page - 5 - TR-105-89 LEASE AGREEMENT - MAIL PROCESSING EQUIPMENT For information purposes, an analysis of the equipments ' use is indicated below. The numbers noted are estimates only based upon a review of the activities of the various departments . As well, an estimate of use by Newcastle Hydro who are prepared to purchase services from the Town, has been included. 1. TREASURY Tax Bills 2 mailings x 20,000 bills = 40, 000 units Revised Tax Bills 1 mailing x number revised = 1, 100 units Arrear Notices 4 mailings x 3,500 notices = 14,000 units Tax Certificates 12 mailings x 400 certificates = 4,800 units Accounts Payable 1 mailing every 2 weeks x 200 cheques= 4,800 units Payroll Cheques 1 run every 2 weeks x 350 cheques = 9 , 100 units Annual Estimate 73, 800 units 2 . CLERKS Planning - Public Meeting 5 x 21 x 60 = 6,300 units Rezoning Circulations 5 x 21 x 60 = 6,300 units Special Notices (General) 1 x 2,000 = 2 ,000 units Annual Estimate 14,600 units 3. PLANNING Public Meetings - O.P.A. 'S, Neighbourhood Plans Special Activities 12 x 200 = 4,000 units 4 . PUBLIC WORKS Notices Re: Construction Projects 6 x 100 = 600 units Estimated In-House Use= 93,000 units 5 . OTHER USES Newcastle Hydro Billings 900 units per week year round = 46,800 units (process on basis of fee for service - amount and method to be negotiated) Page - 6 - TR-105-89 LEASE AGREEMENT - MAIL PROCESSING EQUIPMENT Labour Cost Using Present Manual Procedure. 1. Treasury Labour Costs Including Regular and Overtime Rates Estimated At ± $ 8,000 annually 2 . Other Departments Regular Time Estimated At ± $ 2,000 annually Without considering the revenue which could be generated by outside users, it is estimated that approximately $ 10,000 . 00 is expended annually in wages directed at stuffing envelopes . The mail handling equipment would enhance the process, by doing the work quickly and efficiently and allow for a more efficient use of staff time within each department. Based upon the estimates of use in-house, the total cost of all of the mail handling equipment could be recovered in approximately three and one half (3 1/2) years . The funds required for the new equipment will be drawn from the Capital Lease Account, as provided in the 1989 Capital Budget. In view of the type of equipment and the fact that there are only two (2 ) known vendors servicing Durham Region who can supply all the necessary equipment it is requested that the procedures set out in the Purchasing By-Law #82-92, Section 5, Paragraph 04, be waived, for this particular transaction, which eliminates the tendering procedure. For the information of Council, the lease cost is fixed at a total cost of $ 856 .00 plus Provincial Sales Tax for the sixty ( 60) month term. However, the service contract for the equipment, as well as the meter rental are adjusted annually in accordance with inflation. Page - 7 - TR-105-89 LEASE AGREEMENT - MAIL PROCESSING EQUIPMENT After review and analysis of the equipment by both the Purchasing and the Clerk's Department, staff recommend that the proposal to lease the Friden Alcatel mail processing equipment be accepted. Delivery of the equipment will not be accepted until the Centralized Mail Room is completed. Respectfully submitted, Recommended for presentation to the Committee, Marie Marano, H.BSc . , La rence/` Kotseff, Treasurer. Chief A istrative Officer. at '. �rk. rie, A.M.C.T. , T n LAB/hjl Attachments FUNNS FR|[lEkJ Attachment oAn November 23rd, 1989 nmen AWN Canada onwoxom on,v Scarborough,Ontario m1emas Tel: (416) 298-2100 Fax: (^1o) onu*n6* Toll Free: 1-800-387-5309 Mrs. Lou Ann Birkett The Corporation of the Town of Newcastle (Bowmanville) 40 Temperance Street Bowmanville, Ontario L1C 3A6 Dear Lou Ann: Enclosed is our current quotation with respect to your postage equipment and folding/inserting requirements. (See quotation dated April 18th, 1988. ) NOTE: ALL PRICES QUOTED INCLUDE A 10% GOVERNMENT DISCOUNT OFF OUR PUBLISHED LIST PRICES. (SEE ENCLOSURE - JULY 01 , 1989) I MODEL TR2 HEAVY DUTY TWO STATION FOLDER/INSERTER ___________________________________________________ (FEEDS AND FOLDS FROM BOTH STATIONS AUTOMATICALLY. ) NOTE: NO "EAST-WEST SIDE FEED AND FOLDER REQUIRED. REQUIRED: (SYSTEM 700 HEAVY DUTY FOLDER/INSERTER) PURCHASE PRICE: IN2 HEAVY DUTY INSERTER $ 9, 977. 00 TR2 TRANSPORT UNIT $ 4, 570. 00 F01 FOLDER $ 1 ° 481 . 00 FE1 FEED UNIT $ 1 , 128. 00 FE1 FEED UNIT $ 1 , 128. 00 TOTAL PRICE: $18, 284. 00 ========== 60 MONTH LEASE TERM (FRIDEN ALCATEL LEASING CANADA) PER MONTH MONTH (7. 5% PURCHASE $ 453. 00 OPTION) FULL MAINTENANCE INCLUDES ALL PARTS AND LABOUR INCLUDING RUBBER PARTS PER ANNUM $ 1 , 488. 00 v IsmaRvIlmls mxvv #700 IN2 HEAVU DUTY FOLDER/INSERTER OFFERS TWO VERY SIGNIFICANT BENEFITS: 1 . INTEGRITY OF DOCUMENTS I . E. NO DAMAGE. 2. EASE OF OPERATION (OPERATOR FRIENDLY) . MODEL #9180 HEAVY DUTY ELECTRONIC AUTOMATIC POSTAGE MACHINE ___________________________________________________________ PURCHASE PRICE: $ 7, 353. 00 (FIRST YEAR METER RENTAL ON MODEL # 9255 ELECTRONIC POSTAGE METER IS $30. 00 PER MONTH, FLAT RATE, IRRESPECTIVE OF POSTAL VOLUMES. 60 MONTH LEASE TERM $ 182. 00 PER MONTH (7. 5% PURCHASE OPTION) FULL MAINTENANCE, INCLUDES ALL PARTS AND LABOUR INCLUDING RUBBER PARTS. $ 741 . 00 MODEL #8512 5 KG. ELECTRONIC COMPUTING SCALE WITH CANADA POST RATES, FULL IINTERNATINAL RATES, COUNT MODE, PRIORITY POST, REGISTRATION, SPECIAL DELIVERY, A. R. , ETC. _____________________________________________________________ PURCHASE PRICE $ 1 , 715. 00 60 MONTH LEASE TERM $ 42. 00 PER MONTH (7. 5% PURCHASE OPTION) MAINTENANCE AGREEMENT INCLUDES ALL PARTS AND LABOUR $162. 00/ANNUM FRIDEN ALCATEL' S MODULAR HEAVY DUTY ( 10 GUAGE) STEEL SORTING AND DISTRIBUTION MAILROOM FURNITURE OFFERS TABLES OF 33" WIDTH WITH ROUNDED CORNERS AND PROTECTIVE MOLDING ALONG THE EDGE OF THE TABLE TOPS, AS WELL AS FULL TABLE HEIGHT ADJUSTABILITY. REQUIRED: THREE TABLES 68"L X 33"W WITH BACK AND SIDE PANELS. $855. 00 X 03 = $2, 565. 00 ONE TABLE 45 1/2"L X 33"W WITH BACK AND SIDE PANELS. $738. 00 X 01 = $ 738. 00 ONE SORT MODULES 68"L X 15"D X 16"H (25 SORTS) . $630. 00 X 01 = $ 630. 00 TOTAL PRICE $ 3, 933. 00 v WIEWSW FROM / h 60 MONTH LEASE TERM $97. 00 PER MONTH (5 YEAR WARRANTY ON FURNITURE AGAINST STRUCTURE DEFECTS) NOTE: ALL OF THE ABOVE EQUIPMENT IS FRIDEN ALCATEL MANUFACTURED. NOTE: ALL FRIDEN ALCATEL CARRIES A FULL ONE YEAR WARRANTY ON PARTS AN LABOUR. F. S. T. INCLUDED P. S. T. EXTRA NO DELIVERY CHARGES; SET UP AND FULL INSTRUCTION BY FRIDEN ALCATEL AT NO CHARGE TO THE CUSTOMER. DELIVERY: SEVEN TO FOURTEEN DAYS. Should you have any questions whatsoever , please call me per sonnally. Sincerely, FRIDEN ALCATEL Bruce Dow Government Marketing Representative BD/jh / �-'� / '� � / �� [) � . �^/ ' -' ' � v '