OLDS — Coun. James Cummings says Olds town council should have an ongoing multi-year capital plan.
That way, he said, council could avoid situations like it encountered last month when it had to approve big bucks for a couple of pieces of equipment that could take months to arrive.
Administrative staff hopes they'll arrive by next February.
Council voted unanimously to approve $925,000 that will be chalked up to its 2024 budget to order a new hydro vac truck and an electric ice resurfacer.
Both purchases replace existing equipment.
Council also passed a motion directing administrative staff to prepare a policy on the replacement of its light fleet.
A request for decision (RFD) in council’s agenda package notes that the current hydro vac truck was bought on a lease-to-own basis in 2015 and is thus now eight years old.
“The average life cycle of a hydro vac is five years, after which the reliability of the equipment becomes a concern," the RFD said.
“This piece of equipment is the most used piece of equipment within the town of Olds fleet (being used daily) and is the most difficult/cost-prohibitive piece of equipment to outsource.
“It currently takes eight to 12 months from time of order to possession of the Hydro Vac.”
“Given the age of our current truck and the reliance we have on this piece equipment, we’d like to get one for early 2024 delivery,” Finance director Sheena Linderman told council.
Linderman said the cost to buy the hydro vac is $725,000. Town staff expect to trade the old one in for about $125,000. That would leave a $600,000 price gap.
Given the current high interest rates, Linderman proposed obtaining that money from reserves and “paying it back” into reserves over a five-year period.
In the case of the ice resurfacer, the RFD said the current resurfacer, bought in 2013, has about 6,200 hours on it. Its batteries need to be replaced before the 2024 winter season and that’s expected to cost about $40,000.
Linderman noted that a $50,000 grant application by the town to the Municipal Climate Change Action Centre was approved.
“With this grant opportunity and with our current machine needing new batteries within the next season, it’s a good opportunity for us to replace this machine now," she said.
The total cost of the electric ice resurfacer is pegged at $200,000. Town officials figure they can trade their existing resurfacer in for about $40,000.
When the $50,000 grant is factored in, there’s a gap of about $110,000 which administrative staff said could be obtained from reserves.
“In order to utilize this grant fund, we would need to take delivery of the machine no later than February, 2024,” the RFD said.
“Due to the timeline from date of order to delivery, the ice resurfacer would need to be ordered immediately to meet the February, 2024 delivery date.”
In the end, council unanimously approved both purchases and the plan to pay for them.
But the process sparked Cumming’s concerns.
“I don’t know if it’s required by provincial law or regulations and policy to have our capital budget discussions in December for 2024 but we have such incredibly long lag time to purchase the equipment – it can be a year,” he said.
“We have to have some sort of alternative plan for capital purchasing and budgeting capital items that might be multi-year capital budget discussions,” he added.
“To drive down to the city and buy a big Hydro Vac truck off some Hydro Vac lot just isn’t the reality today.”
Cummings said he knew of some communities that are running three to four-year capital budgets.
"Thank you for all that information, Coun. Cummings and I’m sure administration has noted that for us," Mayor Judy Dahl said.
