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Which is More Cost-Effective to Operate?
Posted: Mon May 09, 2005 1:34 pm
Through the years I've heard arguments on both sides of the issue of whether a private contractor can sweep for less, over time, than a municipality's inhouse sweeping department. Please add your opinion to the poll, and click on 'Post Reply' to tell why or why not.
-Ranger Kidwell-Ross, site administrator
Posted: Thu Aug 04, 2005 6:37 am
The private sweeper co. could do it for less than the cities (assuming they're not high-balling the bid to begin with).
Private contractors tend to squeeze options for repairs and maintenance (canibalizing old units, shopping around for used parts, welding and mickey-mousing, using after-market parts, etc...), but cities seem to just order anything they need straight from the manufacturer. If a city maintenance worker is tending to many various city machines, he'll never spend all his time solely on street sweepers, like the private contractor does. Add to this, it's not his money he's spending, so why should he care to penny-pinch, innovate, etc....?
Around here, labor costs have become a union issue on this: There was many years, where the state labor code mandated prevailing wage for street sweeper drivers. This was merely a union ploy to force private contractors (that may have been non-union) to pay the same scale as the union city drivers were making, and thus protect their cash cow. Therefore, private contractors could not save in that area of the bids. Recently though, under gov. Arnold Shwarzeneger, this has been reversed. Street sweeper drivers are outside the requirements to be paid prevailing wages, when it's non-construction related. Paving and const. with taxpayer money remains prevailing wage. It remains to be seen how this will affect the cities that consider out-sourcing their sweeping
Posted: Tue Feb 07, 2006 10:59 pm
If it were 1990 I might agree that Contractors would be cheaper. However now its 2006 and considering new EPA & AQMD rules (Rule 1186 / PM-10), requiring Contractors be held to the same requirements as a City would be, depending on fleet size.
When dealing with complaints, in house turn around time beats that of a Contractor, who would be pushing it just to finish one job and get to the next. The term, "We'll do a better job next week" comes to mind.
City's Cost of Operation
Posted: Wed Mar 22, 2006 4:06 pm
Here is my break down of my cost of operation.
Replacement Cost $187,500
Sweeper Service Life 7 years
Annual Maintenance Cost $15,000
$187,500 replacement cost divided by 7 years service life = $26785.71
+ $15,000 annual maintenance = $41,785.71
divided that by 2080 annual hours = $20.09 + 35% overhead (Fuel) = $27.12 sweeper hourly rate.
Sweeper Operator Costs
$23.78 operator hourly rate @ step E + 5% night shift pay differential = $24.97 + 35% benefit overhead = $33.71 operator hourly rate.
$27.12 Sweeper Hourly Rate
+33.71 Operator Hourly Rate
$60.83 Current Hourly Rate
This is only an average and was based upon using mechanical broom, deisel driven. I have not yet recalculated since the arrival of two new A7000 CNG.
Nice break down
Posted: Fri Mar 24, 2006 12:09 am
That's a pretty slick and easy way to break it down. Not including all the other expenses. On our S348I (our newest), it cost aproximatly 54.76 per hour to run.
Posted: Fri Mar 24, 2006 10:53 am
One of the advantages a municipality has is our overhead cost. We do not take in account for all the other things that are required to operate as a private business such as rent, office supplies, tools and any other purchases required for the business as most of these cost come out of our general fund and support our other operations like traffic paint, asphalt and concrete sections and so forth.
Though, when we do provide sweeping services to private entities such has HOA complexes, we charge our straight rate with a 16.7 % administrative charge to handle things like billing cost and maybe supervisor inspection time. We really do not like to get into the private industry side but when an organization within our City limits approach us, we provide a “bid” at our cost with the admin charge added.
I have started to formulate another post in which I should have up by next week on how the municipality side of sweeping may be growing/moving into more of the private side and start providing bids to shopping centers and other large developments to enhance revenue generation.