Modesto eyes $5.4 million deal for fire engines, ladder trucks

Modesto is considering spending nearly $5.4 million over 10 years to lease five new fire engines and two new ladder trucks from Wisconsin-based Pierce Manufacturing.

Fire Chief Sean Slamon says this is a smart way to replace aging equipment without increasing the Fire Department’s cash-strapped budget. The money for the lease payments would come from savings from reduced maintenance costs and from money now being used to pay off the recent purchase of two Pierce fire engines. Those payments end in 2018, and the lease payments begin in 2017.

Officials say the proposal will result in big savings to the Fire Department and provide firefighters with reliable equipment. “We have found a way to address a very serious aging apparatus problem and do it with the existing budget,” Slamon said. “This is something to be celebrated.”

But Slamon and other city officials stumbled at times Monday when they presented this proposal to the City Council’s Great Safe Neighborhoods Committee, which is composed of council members Jenny Kenoyer, Kristi Ah You and Doug Ridenour. The meeting also drew John Borges and Ken Howenstine from Modesto-based Burton’s Fire, a dealer for South Dakota-based Rosenbauer, one of Pierce’s competitors.

When committee members and Borges and Howenstine asked why the city had not sought competitive bids, officials said that in 2006 the City Council determined Modesto would use Pierce exclusively for its fire apparatus. But that arrangement ended in 2013, and the city used a competitive process for this proposal. As cities do at times, it used the bidding results from another agency, in this case the Houston-Galveston Area Council.

“There was some confusion on that,” Slamon said Tuesday. “And we’ve clarified that. We did do competitive bidding. It just got misstated” at Monday’s meeting.

But after Monday’s meeting, Borges — who is Burton’s operations manager — and Howenstine — a sales engineer — said the Houston-Galveston Area Council is a good start but those bids are for basic fire engines and trucks and not the specialized equipment Modesto wants. They expect four or five companies would submit bids if Modesto solicited them.

“Are they truly getting the best price?” Borges asked. “With an order of this magnitude, would you not want to verify that you are getting the best price?”

All but one of Modesto’s nine engines, two ladder trucks and three backup engines and one reserve ladder truck are from Pierce. Officials say one of the benefits of the proposal is it allows the Fire Department to have standardized fleet, which reduces training and other expenses. But Borges and Hownestine said other manufacturers can build fire engines and ladder trucks to Modesto’s specifications, though Pierce is the only manufacturer that uses the Detroit Diesel engine.

City officials also touted the price discounts Pierce is offering Modesto, including using 2013 pricing for the engines and trucks and a multi-vehicle discount. “We’re confident this is a very good deal,” Slamon said. “Is there a better deal or worse deal around the corner? I don’t know.”

Still, Borges and Howenstine said many of the discounts are standard and offered by other manufacturers.

The lease proposal was the recommendation of a committee the city formed about eight months ago to look into how the Fire Department could update its aging fleet. Committee members came from several city departments.

The proposal calls for the city to enter into an agreement with Pierce and PNC Equipment Finance for the fire engines and ladder trucks. At the end of the 10 years, the city could purchase the engines and ladder trucks, extend the lease for five years or enter into a new lease for new engines and ladder trucks.

Though Ridenour and Ah You raised questions and Ah You said she wasn’t sure how she would vote when this came to council, they joined Kenoyer in forwarding the proposal to full council. It is expected to be on the agenda for the council’s Feb. 23 meeting.

This story was originally published February 10, 2016 at 6:45 PM with the headline "Modesto eyes $5.4 million deal for fire engines, ladder trucks."