Title
Approval of a Resolution Authorizing a Lease Agreement with Western Peterbilt, LLC for a Refuse Collection Truck
Recommended Action
Committee Recommendation:
Not referred to a committee.
City Manager Recommendation:
Move to approve a Resolution authorizing a Lease Agreement with Western Peterbilt, LLC for the lease and option to purchase of one roll-off refuse collection truck.
Report
Issue:
Whether to approve a Resolution authorizing a Lease Agreement with Western Peterbilt, LLC for the lease and option to purchase of one roll-off refuse collection truck.
Staff Contact:
Ron Jones, Waste ReSources Director, Public Works Department, 360.753.8509
Presenter(s):
None - Consent Calendar Item.
Background and Analysis:
The Waste ReSources Utility has a need to add a fourth roll-off refuse collection truck to its fleet. The Utility has operated with three roll-off trucks since the 2008 economic recession, when the fleet was reduced by one truck in response to a significant decline in service demand.
Since 2012, roll-off service demand has steadily increased. Estimated 2026 activity is approximately 5,000 combined hauls and deliveries, which exceeds service demand experienced in 2006, when the Utility operated four roll-off trucks. In addition to approximately 5,000 annual hauls, the Utility makes between 180 and 300 roll-off box deliveries each year for customers requiring temporary service. A single roll-off truck can complete approximately seven hauls during a regular workday, depending on travel distance, disposal times, traffic, and other operating conditions.
Over the past 15 years, the City has seen growth in the need for drop box and compactor services. There has been dramatic growth in apartment and mixed-use complexes, the addition of two shared compactors in downtown Olympia, drop boxes for glass in two locations, and more construction projects.
This current service demand has resulted in ongoing overtime, including regular weekend work and weekday overtime to meet customer demand. Adding a fourth truck is expected to provide sufficient capacity to eliminate routine overtime associated with roll-off collection, except during unusual or unforeseen circumstances. The overtime savings is expected to help offset the annual lease cost. A fourth truck would also improve fleet reliability and operational flexibility.
Staff evaluated both purchasing and leasing a fourth roll-off truck. Leasing is considered the most viable option at this time because it provides the additional capacity needed to address current service demand while maintaining flexibility if demand declines in the future. Under the proposed lease, the City may return the truck without penalty after completing the two-year minimum lease term. The maximum lease term is five years, with an option to purchase the truck at the end of the lease.
Climate Analysis:
While the Waste ReSources Utility remains committed to long-term fleet electrification, current technology does not yet meet operational requirements for the City’s residential or commercial collection routes. Electric collection trucks remain largely untested in long-term, high-demand applications, and current pricing is nearly twice as expensive than comparable diesel-powered trucks.
Equity Analysis:
The Agreement has no implications regarding the City’s equity work and goals.
Neighborhood/Community Interests (if known):
Having reliable waste collection trucks allows the City to efficiently provide services to high-volume waste producing customers, such as hospitals, grocery stores, apartment complexes, mixed-use buildings, big box stores, and construction sites.
Financial Impact:
The purchase price of the proposed roll-off collection truck from Western Peterbilt, LLC is $368,835.74.
The proposed lease is $84,000 annually, with a minimum lease term of two years and a maximum term of five years. The lease also includes an option to purchase the truck at the end of the lease term.
Sufficient funding is available in the Waste ReSources Utility operating budget for the proposed rental/lease expense. Leasing the truck allows the Utility to add needed collection capacity without committing the full purchase price upfront and provides flexibility to adjust the fleet if service demand changes in the future.
Options:
1. Move to approve a Resolution authorizing a Master Equipment Lease Agreement with Western Peterbilt, LLC for the lease and option to purchase of one roll-off refuse collection truck. This will improve customer service reliability and reduce ongoing regular overtime.
2. Do not approve a Resolution authorizing a Master Equipment Lease Agreement with Western Peterbilt, LLC for the lease and option to purchase of one roll-off refuse collection truck. The Utility will not be able to meet increasing demand for drop box services and regular overtime will continue.
3. Direct staff to take other action and return to Council at another date.
Attachments:
Resolution
Agreement