ADMINISTRATIVE REPORT

                                           Date:  June 6, 1997
                                           Dept. File No.: H704-2
                                           CC File No.: 1805

   TO:       Vancouver City Council

   FROM:     General Manager of Engineering Services
             Manager of Purchasing Services

   SUBJECT:  Award of Tender No. 35-97-02,
             Supply of 4.5 Cubic Meter Wheel Loader


   RECOMMENDATION

        THAT Council accept the bid which represents best value to the City
        from Finning Ltd.  for one  (1) Caterpillar model  980G at a  total
        cost  of $370,203.00, plus the  Provincial Sales Tax,  the 7% Goods
        and  Services tax (less any  municipal rebate received)  and the BC
        Environmental  Levy,  subject to  a  contract  satisfactory to  the
        Director of Legal Services.


   COUNCIL POLICY

   The  policy  of Council  is  to  award  contracts for  the  purchase  of
   equipment, supplies and services that will give the highest values based
   on quality, service and price.

   Contracts with a value over $300,000.00 are referred to Council.


   DISCUSSION

   Tenders for the  above were opened on April 7, 1997, and referred to the
   General  Manager of Engineering  Services and the  Manager of Purchasing
   Services  for  report.   The  Provincial  Sales Tax,  the  7%  Goods and
   Services Tax  (less any  municipal rebate  received) and  the Provincial
   Environmental  Levy are in addition to all  pricing shown in this report
   and in the tabulation.  Funds of $480,000.00 are provided from the Truck
   Plant Account.

   This tender called for prices for one wheel loader to  replace the wheel
   loader at the Cambie Yards which has exceeded its economic service life.
   This   machine  is  used   for  aggregate,  rubble   and  asphalt  plant
   requirements.

   Five  bids  were  received  from four  suppliers  with  prices including
   options  and trade-ins  of a  surplus loader.   The  low bid  from Wajax
   Industries, at  $314,905.00, is a  smaller machine than  specified; does
   not meet  specifications for  machine weight, horsepower,  bucket reach,
   tire size  and  bucket breakout  forces  and is  not recommended.    The
   remaining four bids range from $347,992.00 to $370,203.00.

   However,  tenderers were  also  required to  include guaranteed  buyback
   prices for the purchased loader at the end of its seven year life.  When
   these  guaranteed  buyback  prices  are  taken  into  consideration  and
   adjusted for  future value using  a 4% interest rate,  the four adjusted
   bid values range from $279,017.59 (Finning Ltd.) to $321,833.43.

   The Finning Ltd.  bid meets  specifications and provides  the City  with
   best value at an adjusted value of $279,017.59.

   We are, therefore, recommending acceptance of the Finning Ltd. bid  at a
   total  purchase price of $370,203.00, which represents best value to the
   City,  for one (1) only Caterpillar model 980G wheel loader ($406,176.00
   less $510.00  for bias ply tires,  plus $2,537.00 for spare  wheel, less
   $38,000.00 for a surplus loader). 


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