Item - 2024.GG14.12

The General Government Committee recommend that:

1. City Council authorize the General Manager, Fleet Services Division to:

a. Amend contract 47023317 with Cummins Canada ULC., to extend the target date by one (1) year from December 1, 2024 to November 30, 2025, with the option to renew the contract for four (4) additional (1) one year periods, at the sole discretion of the City, increase the total target value by $685,175 net of Harmonized Sales Tax and all applicable charges ($697,235 net of Harmonized Sales Tax Recoveries), revising the current Blanket Contract value from $500,000 to $1,185,175 net of all taxes and charges ($1,339,248 including all taxes and charges, $1,206,034 net of Harmonized Sales Tax Recoveries); and,

b. Include the provision of warranty and non-warranty service bulletins, safety recalls, services, tools, subscriptions, and training on Cummins engines.

2. City Council authorize the Fire Chief and General Manager, Toronto Fire Services to negotiate and execute a non-competitive contract with Cummins Canada ULC., for the amount of $250,758 net of all applicable taxes ($255,172 net of Harmonized Sales Tax Recoveries) for an initial term of one (1) year from December 1, 2024 to November 30, 2025, with the option to renew the contract for four (4) additional (1) one year periods, at the sole discretion of the City, for a total potential value of $1,331,312 net of all applicable taxes $1,354,746 net of Harmonized Sales Tax Recoveries).

3. City Council authorize the Chief of Toronto Paramedic Services to negotiate and execute a non-competitive contract with Cummins Canada ULC., for the amount of $76,883 net of all applicable taxes ($78,237 net of Harmonized Sales Tax Recoveries) for an initial term of one (1) year from December 1, 2024 to November 30, 2025, with the option to renew the contract for four (4) additional (1) one year periods, at the sole discretion of the City, for a total potential value of $408,186 net of all applicable taxes $415,372 net of Harmonized Sales Tax Recoveries).

4. City Council direct that the agreements in Parts 1 through 3 above be based on the condition that Cummins Canada ULC., continues to be the exclusive distributor for the provision of warranty and non-warranty service bulletins, safety recalls, services, tools, subscriptions, and training on Cummins engines, and on other terms and conditions satisfactory to the General Manager, Fleet Services, and in a form satisfactory to the City Solicitor.

The purpose of this report is to request authority from City Council to amend non-competitive Blanket Contract 47023317 with Cummins Canada ULC for the supply and delivery of labour, materials, and equipment necessary to provide warranty and non-warranty Original Equipment Manufacturer (OEM) authorized parts and services for Cummins engines to extend the contract validity date by an additional five (5) year term and increase the budget by $685,175 net of Harmonized Sales Tax and all applicable charges ($697,235 net of Harmonized Sales Tax Recoveries and to increase the scope to include the provision of service bulletins, safety recalls, services, tools, subscriptions and training;

The term extension for Blanket Contract 47023317 will revise the maximum duration from five (5) years to ten (10) years, where all optional extension years are exhausted. This blanket contract value increase will revise the overall target value from $500,000 to $1,185,175 net of Harmonized Sales Tax ($1,339,248 including all taxes and charges, $1,206,034 net of Harmonized Sales Tax Recoveries).

This report also requests that Non-Competitive Blanket Contracts be established with Cummins Canada ULC for Toronto Fire Services for a total potential value of $1,331,312 net of all applicable taxes $1,354,746 net of Harmonized Sales Tax Recoveries) and for Toronto Paramedic Services for a total potential value of $408,186 net of all applicable taxes $415,372 net of Harmonized Sales Tax Recoveries). These non-competitive contracts will be for an initial term of one (1) year from December 1, 2024 to November 30, 2025, with the option to renew the contract for four (4) additional (1) one year periods, at the sole discretion of the City.

The amended contract will be for the provision of warranty and non-warranty service bulletins, safety recalls, services, tools, subscriptions, and training on Cummins engines for which Cummins Canada ULC is the only authorized service facility. These services, tools, subscriptions, and training cannot be obtained through the competitive procurement process as Cummins Canada ULC is the only authorized services facility in the Greater Toronto Area.

Access to warranty and non-warranty service bulletins, safety recalls, and services pertaining to Cummins engines will allow the City to optimize fleet performance, and equipment health and safety. This information and these services are required to increase fleet availability and reliability to ensure that units are able to deliver critical services across the City of Toronto, specifically to support Toronto Fire Services and Toronto Paramedics Services. A better return on investment is also expected, with well maintained vehicles having a lengthy lifespan, and yielding greater returns at the end of their life cycle.

Access to Cummins authorized technical training, tools, and subscriptions, will ensure that technicians stay up to date with industry leading service knowledge, capabilities, technology and trends. This will support Fleet Services’, Toronto Fire Services’ and Toronto Paramedic Services’ ongoing work to reduce downtime and increase fleet availability by giving technicians the training and tools to complete warranty and non-warranty repairs in house.

City Council approval is required in accordance with Municipal Code Chapter 195-Purchasing, where the current request exceeds the Chief Procurement Officer's authority of the cumulative five (5) year commitment for each vendor, under Article 7, Section 195-7.3 (D) of the Purchasing By-Law or exceeds the threshold of $500,000 net of Harmonized Sales Tax allowed under staff authority as per the Toronto Municipal Code, Chapter 71-Financial Control, Section 71-11.1.