126DM010_Tire_Lease_SOW.pdf

Rorres Tire Lease Contract Specification 2026

STATEMENT OF WORK

FOR

LEASE AND SERVICE OF TRANSIT VEHICLE TIRES

The Denver Regional Transportation District (RTD) invites interested Vendors to submit Proposals in accordance with these solicitation documents. The purpose of the solicitation is to establish a Contract for the supply of Leased Tires for RTD-operated buses together with Related Tire Services, for up to a period of five (5) years.

The intent of the solicitation is to obtain the most cost-effective Leased Tires and Related Tire Services for RTD while maximizing availability, quality, and level of service. Qualified Vendors must have the capability to provide leased tires and related services in all respects in accordance with the solicitation documents and to the satisfaction of RTD.

The Contract period, if awarded, is anticipated to begin on January 1, 2027, and to end December 31, 2031. The successful proposer shall be ready and able to start the required services on the above date.

This statement of work describes the requirements for this contract.

1. GENERAL CONDITIONS

1.1. All material, equipment and tire services furnished under this contract shall conform to all applicable Federal, State, Local Laws and Regulations, including but not be limited to DOT and OSHA regulations, manufacturers’ recommendations and industry recommended practices.

1.2. RTD requires a complete turn-key contract for the supply of leased tires and the related tire services for RTD’s owned and operated buses. No advantage shall be taken by the Contractor or subcontractor in the omission of any part of the detail of this specification, which goes to make the tires and related services complete and ready for implementation.

1.3. The contractor shall assume responsibility for all labor, equipment, materials, and warranties required in the execution of the Contract.

1.4. Presently, RTD contracts up to 58% of its fixed route service, as mandated by the State Legislation. This percentage is subject to change. Further changes of the service privatization could affect the numbers of RTD operated subfleets/buses up or down. Tires on privatized vehicles are not covered under this contract.

1.5. At RTD or Contractor’s request, any adjustment to tire service requirements due to a fifteen (15) % or more increase or decrease in the number of buses, or service miles, or addition or deletion of service locations, that can be clearly shown by RTD or Contractor to result in necessary adjustment of manpower, equipment, and supplies, will be subject to a service charge adjustment determined on a mutually agreeable basis and in line with the contract rate.

1.6. Definitions:

For purposes of this Statement of Work, the below terms have the meanings set forth as follows:

1.6.1. Contract – the contract resulting from the RFP, to which this Statement of Work is attached.

1.6.2. Previous Contract means RTD’s tire lease contract preceding the Contract.

1.6.3. Previous Contractor means the contractor under the Previous Contract, which is Michelin North America.

1.6.4. Proposer or Bidder means a vendor who submits a proposal the RFP.

1.6.5. RFP means RTD RFP No. 126DM010.

1.6.6. Successful proposer or Contractor means the vendor who is selected by RTD and awarded the Contract.

2. BEGINNING OF THE CONTRACT

2.1. If the Successful Proposer is not the previous contractor, the successful proposer will, within thirty (30) days of the commencement of the contract, purchase from the Previous Contractor the inventory of tires in RTD possession as of the commencement of this contract, both on vehicles and in inventory (the “Existing Tires”). The purchase prices for the Existing Tires (the “Buy-Out Amount”) will be based on the value of the Existing Tires at termination of the Previous Contract, as determined by the Previous Contractor and approved by RTD within thirty (30) days of termination of the Previous Contract.

2.2. Pursuant to the Previous Contract, the Previous Contractor shall determine the remaining usable rubber of the Existing Tires and provide RTD a net cost of the tires based on their remaining rubber and the tire mileage rate in effect for the twelve (12) month period immediately preceding termination of the Previous Contract. The remaining usable tire mileage shall be based on the product of the remaining rubber as a percentage of a brand new tire’s usable rubber, and the average life miles of the tires of the same model experienced by RTD during the last 12 months of the contract.

After RTD reviews and approves the net cost determined by Previous Contractor (i.e. the Buy-Out Amount), the Previous Contractor shall invoice Successful Proposer the Buy-Out Amount, which shall be due and payable immediately. Upon Successful Proposer's payment of the Buy-Out Amount in full, Successful Proposer will acquire title to the Existing Tires and be entitled to charge mileage for such tires. The current value of the Existing Tires is estimated to be approximately $1,059,751. RTD will negotiate with the Previous Contractor to finalize the value of the Buy-Out Amount at the end of the Previous Contract, with the goal of agreeing on the Buy-Out Amount at or below the above-stated value.

3. END OF THE CONTRACT:

The following requirements are applied to this Contract at the end of the Contract, as applicable.

3.1.1. RTD anticipates executing a separate and subsequent contract providing tires and tire services for RTD-owned and operated upon termination of the Contract (the "Future Tire Lease"). The Future Tire Lease may require the contractor that is a party to the Future Tire Lease ("Future Tire Lessor") to purchase from Contractor the full inventory of tires provided pursuant to the Contract ("End of Contract Buy-Out"), including both tires mounted on RTD-owned and operated buses and tires housed in spare inventory (the "Contractor-Provided Tires"). The purchase price for the Contractor-Provided Tires (the "End of Contract Buy-Out Amount") will be based on the value of the tires at the termination of the Contract, as determined by Contractor and approved by RTD within thirty (30) days of termination of the Contract. Should the Future Tire Lease require an End of Contract Buy-Out.

Contractor hereby agrees to sell the Contractor-Provided Tires to the Future Tire Lessor at such time specified in the Future Tire Lease.

3.1.2. During the last year of the contract, the contractor will perform an inventory of all tires upon written request by RTD. From this inventory, Contractor shall determine the remaining usable rubber of these tires and provide RTD a net cost of the tires based on their remaining rubber and tire mileage rate in effect at the inventory time. RTD will include this net cost in the solicitation of a tire lease contract as an estimated cost of the tires that will be transferred to the new contract. Contractor shall perform another tire inventory at the contract expiration to determine the End of Contract Buy-Out Amount. The End of Contract Buy-Out Amount shall be based on the remaining usable tire miles and the rate or rates of tire mileage in effect for the twelve-month (12) period immediately preceding the contract expiration. The remaining usable tire mileage shall be based on the product of the remaining rubber as a percentage of a brand new tire’s usable rubber, and the average life miles of the tires of the same model experienced by RTD during the last 12 months of the contract. After RTD reviews and approves such End of Contract Buy-Out Amount, Contractor shall invoice the Future Tire Lessor for the entire sum of the End of Contract Buy-Out Amount, which shall be due and payable immediately. Upon the Future Tire Lessor's payment of the End of Contract Buy-Out Amount in full, the Future Tire Lessor will acquire title to the Contractor-Provided Tires and be entitled to charge mileage for such tires.

4. PRICE FOR LEASE OF TIRES

4.1. The bid price shall include all items of labor, materials, tools, equipment, and any other costs necessary to fully equip and maintain all tires and wheels required by the RTD for its buses pursuant to these specifications at all RTD facilities.

4.2. The bid price shall be stated on a per tire mile basis for each group of tires for the tire lease cost and a fixed tire service cost. The same price per mile shall also apply to mileage accumulated by recapped traction type snow tires.

4.3. Cost of recapping traction tires and regrooving tires shall be borne by the Contractor.

4.4. Monthly lease payments shall be determined by multiplying the actual tire mileage of each Contractor’s provided tire for the month by the rate per tire mile for the appropriate type of tires, plus the fixed monthly service cost.

4.5. No additional charges (i.e., damaged tire charges, for tires damaged during revenue service, abnormal wear, casing charges, tire disposal charges, interest penalties, severance pay, and tire service labor overtime, etc.) shall be permitted. All charges shall be included in the per tire mileage rate. Notwithstanding the foregoing, RTD will pay for tires that are damaged by RTD mechanics during routine maintenance. The value for these tires will be the product of the remaining rubber, as determined and agreed by both parties, and the tire mileage rate prevailing at the time.

Further, RTD will be responsible for costs of tires that are damaged beyond repair as a result of (i) a vehicular accident (curbing incidents are not considered as vehicular accidents), fire or theft, or (ii) missing as a result of bus disposition/leasing, but only to the extent the incidents listed in subsections (i) and (ii) are not caused by Contractor’s actions, omissions or negligence.

5. MILEAGE RECORDS

5.1. Tires will be tracked by quantity, not by brand number.

5.2. Contractor shall record daily all service work performed and supply the data to RTD for inputting into the RTD’s

Maintenance Reporting System.

5.3. The monthly mileage report shall be provided by RTD by the 20th of the following month, and shall be used by the

Contractor in computing the monthly statement.

5.4. A physical inventory of any preexisting and presently leased tires shall be taken monthly by the Contractor and a copy submitted to RTD. Normally, monthly physical inventory consists of a spare stock inventory. However, in the event of discrepancies, RTD may require a complete physical inventory of all tires.

5.5. A physical inventory shall be taken by the Contractor every six (6) months if requested by RTD, reporting all RTD owned tires by location and position on the vehicle, including spares and spare stock.

6. MATERIAL FURNISHED

6.1. All bus tires furnished by the Contractor shall be radial tires, as determined by size and type in Attachment #1.

6.2. Contractor shall install traction type snow tires between October 1 and April 30 on drive axles of Intercity, 16th St.

Freeride, and transit buses. Articulated buses shall have traction tires installed on center and drive axles. The exact tread design shall be approved by RTD.

6.3. Tires branded “BLEM” to indicate blemished tires shall not be furnished by the Contractor for RTD’s use.

6.4. Tires furnished under this Agreement shall be classified as follows:

Intercity bus tires must have the approved rating of at least 75-MPH.

City bus tires must have the approved rating of at least 68-MPH.

16th St. bus tires must be approved for the 16th St. unique service.

6.5. Retreads and methods of retreading shall be approved by RTD. During the contract period, Contractor shall notify RTD of any changes to these methods and seek RTD’s approval.

6.6. TIRE QUALITY: Tires shall be specifically designed and manufactured for transit bus application. All bus tires furnished by the contractor shall be approved by the bus OEMs for use on their buses. Tires shall have thick sidewall for resistance against tire curbing. Tires shall have long removal time. RTD prefers tires which have at least 50,000-mile life in normal use. Tires shall be proven as providing fuel efficient and good vehicle fuel economy. This fuel efficiency feature is an important evaluation factor. Because of the high price of diesel fuel, every 1% improvement in fuel consumption allowed by the tires could provide substantial operational savings. Proposers shall provide documents, evaluation/comparison test results, etc. to prove the proposed tire fuel efficiency feature.

6.7. Contractor will keep on hand, at each location, a sufficient number of front, rear, trailer and tag spare tires, mounted and balanced on wheels and ready for service, so that the RTD, at all times, will have a satisfactory stock of tires to ensure continuous operation of its fleet.

6.8. New industry standard tire service tools and equipment shall be provided by the Contractor at the beginning of the

Contract, unless agreed otherwise during negotiation between RTD and Contractor prior to the beginning of the Contract. All tools and equipment shall be heavy-duty, commercial type, of first-class quality and properly designed for the tire service purposes in order to prevent damage to wheels, tire beads, sidewalls and treads. Tools and equipment do not meet the requirements of this paragraph shall be rejected. RTD reserves the right to inspect and approve the necessary tools and equipment.

6.9. At no time shall any tire remain in service on RTD buses with less than 4/32 (front) and 2/32 (rear) of an inch tread depth when measured in a major tread groove. The measurement shall not be made where the tire bars, bumps, or fillets are located.

6.10. Wheel weights required for the balancing of tires within RTD’s fleet shall be provided by the Contractor.

6.11. Contractor shall provide metallic valve stem caps, grommets, valve stems, valve stem cores, and any other normal supplies used in prepping, mounting, and balancing tires.

6.12. The RTD reserves the right to test special mileage commercial tires other than the Contractor’s on not more than ten percent (10%) of its fleet at any point and for any duration during the Contract.

7. CONTRACTOR RESPONSIBILITIES

7.1. Contractor shall furnish all service necessary to properly maintain all tires within the RTD’s fleet, as accounted for in

Attachment 1, including tires from other suppliers, being tested and those owned by RTD. This service shall consist of, but not be limited to, the following:

7.2. Mounting and dismounting all tires to and from rims. Mounting/dismounting wheels on/off vehicles. RTD has aluminum wheels.

7.3. Ensuring that all air-operated tools are properly calibrated in order to provide correct torque on lug nuts. The contractor shall check calibration weekly. All improperly calibrated tools will be taken out of service immediately and corrected. The torque wrenches shall be calibrated at least semi-annually.

7.4. The Contractor shall apply lug nut indicators to lug nuts. Lug nut indicators shall be installed any time lug nuts are installed or retorqued. Lug nut indicators will be supplied by RTD.

7.5. After the initial installation, the Contractor will retorque each wheel installation once at 500 miles, plus or minus 100 miles and document this retorque on the service records.

7.6. Repair of all tire punctures and flat tires. All repairs must be performed according to approved industry standards.

7.7. Regrooveable tires must be in compliance with applicable federal law and requirements, including, but not limited to, Section 369.7, Volume 34, Number 16 of the Federal Register.

7.8. The Contractor shall be responsible for the distribution and handling of all tires and service equipment.

7.9. The Contractor shall scrap unusable tires after verification and written authorization by designated RTD personnel.

7.10. Contractor shall provide RTD notification of excessive tire wear due to probable misalignment/suspension wear by vehicle number and location to designated RTD personnel at each facility. Notification shall be accomplished by submittal of a three-part copy service/work order. Form used by Contractor shall be RTD approved.

7.11. Changing of flat tires promptly is required when Contractor’s service person is on duty at an operating division.

Tire service personnel shall have the legal authority and shall be required to sign off the driver’s D.O.T. defect report of all tire-related defects.

7.12. The Contractor is responsible for maintaining an adequate supply of mated rear duals and front tires, trailer and tag tires at each operating facility, in order for personnel to make emergency wheel changes, as determined by RTD.

Stock is to be clearly marked and ready for installation at all times.

7.13. It is the sole responsibility of the contractor to determine the number of trained personnel required in order to providing the necessary service to meet RTD service demand. If the contractor must make adjustments in the number of personnel during the term of the contract to meet RTD service demand, the adjustments made shall not result in any cost changes to the contract as long as there has been no significant change in RTD’s service demand as subject to Paragraphs 1.4 and 1.5 above.

7.14. Contractor tire service personnel are to wear uniforms that are of a different color than RTD uniform color, including a logo identifying the tire service company for security purposes. Contractor personnel will be provided with Contractor badges to access the service facility. Contractor personnel when at RTD facility must wear the Contractor badge. Lost badges will cost the Contractor $25 each for replacement.

7.15. Tire service personnel responsible for mounting and dismounting shall be thoroughly trained by the Contractor on all operating instructions and procedures regarding both manual and machine methods. Techniques for handling aluminum wheels will be included in the training. Contractor shall keep training records and make them available to RTD upon request.

7.16. Tire service personnel work schedule must be tailored for each division to support the needs of the division. As such, contractor shall discuss with RTD its general work schedule at each division, including scheduled days off, start and stop times, and any changes thereof, and obtain the approval from RTD.

7.17. Contractor shall be responsible for movement of vehicles within RTD property for tire service. However, Contractor’s service personnel shall not operate RTD vehicles off RTD property. A valid Colorado Commercial Driver’s License (CDL), with a “P2” endorsement is required. RTD will provide vehicle orientation training to Contractor’s employees in order to familiarize them with RTD vehicles. Contractor shall provide full insurance to cover any/all damage that may occur while Contractor’s personnel are operating RTD equipment. Insurance provisions shall meet all federal, state, city and local government and RTD requirements.

7.18. Contractor will be required to comply with and provide D.O.T. and/or FTA Substance Abuse testing requirements for all tire service employees.

7.19. Contractor will not be required to provide on-street tire service. RTD will provide service for all tire-related road calls.

7.20. Tire inflation pressures will be determined by the Contractor, approved by RTD, with consideration given to the approved standards of the Tire and Rim Association of America and the vehicle manufacturer’s recommendations.

Required inflation pressures shall not exceed the capability of RTD’s current air compressing equipment.

7.21. Tires should be gauged for proper inflation according to the wheel position before application to the vehicle.

7.22. Tire inflation must be performed in an approved safety cage. Under no circumstances is any tire to be left unattended during the inflation process.

7.23. Any vehicle designated for extended trip use shall be equipped with tires that substantially exceed the minimum D.O.T. tread depth specifications. RTD will give at least 24 hours of notice to the Contractor when this service is required.

7.24. If requested by RTD, spare tires will be required for intercity buses. Tires placed in the vehicle spare compartment must be suitable for front wheel application with a minimum tread depth of 6/32nd’s. Spare tire must be same size and type as is on the front positions of the vehicle. Spare tires must be marked or tagged to reflect the date installed in the spare compartment.

7.25. All spare tires are to be rotated on a six (6) month basis to ensure tire is always serviceable.

7.26. Before applying tire to rim, Contractor shall apply corrosion preventive lubricant to both bead areas and to the bead seat area of the wheel.

7.27. Contractor shall reverse tires on a rim, switch tires side to side to accommodate for unusual wear, pulling, cupping or sidewall wear.

7.28. Regrooved or repaired tires may not be applied to front wheel position.

7.29. Contractor shall balance all tires using a RTD approved balancer, prior to installation on vehicle. Total wheel weight(s) will not exceed 24 ounces. If more than 24 ounces are required to balance, tire and rim will be inspected to determine which is defective. If the tire is found to be defective, it will be returned to the Contractor at no cost to the RTD, and it shall not be reused on any RTD coaches.

7.30. All tires shall be marked “OK” if no weights are applied for balance.

7.31. Mating of rear tires in a dual assembly is required whether original tread or retreaded tires are used. Make sure all valve stems are accessible. Maximum difference permitted is ” in diameter or ½” in circumference on all drive axle positions on each coach.

7.32. All mounted spare stock must be appropriately marked indicating the tire size, proper vehicle wheel position

(front or rear trailer, or tag), and diameter dimensions for rears. Wheel mating surfaces will be cleaned, prepared, and ready to be mounted.

7.33. Before applying the tire and wheel assembly to the vehicle, all studs shall be thoroughly inspected and cleaned with a wire brush to remove corrosion and foreign particles. Brake drum screws shall be checked to ensure they are below the mating surface and are tight.

7.34. All wheel studs and nuts will be inspected for excessive wear, stripped threads and excessive corrosion.

7.35. A final inspection of applied tire/wheel assembly shall display wheel properly seated against hub and drum, all wheel nuts torqued to RTD’s specifications, and lug nut indicators.

7.36. Contractor will sort wheels for reuse, reconditioning, or disposal.

7.37. Inner duals will never be mounted on the outside. A rear wheel will never be mounted on the front.

7.38. Contractor shall remove all corrosion from wheel and hub, flange and coin-hole area by use of a scraper, wire brush, grinder, or buffing device. Contractor shall repair wheel rim flange wear according to the wheel manufacturer’s criteria and procedures.

7.39. Contractor shall inspect the valve stem assembly and always change the valve stem grommet and valve core each time a tire is mounted on a wheel. Recondition the threads on the existing stem or apply a new stem if necessary. Contractor must be certain that the hex nut on the valve stem assembly is properly tightened.

7.40. Contractor shall notify the RTD of any tire design or size rating changes.

7.41. All tire work shall be performed in a timely manner to meet RTD’s service demand.

7.42. During the servicing of the tires, if RTD buses/equipment or its facilities are damaged due to negligence or mistake by the tire contractor, the contractor shall be responsible for the costs of the repair of the damaged buses/equipment or facilities to restore them to the original conditions. RTD, at its sole discretion, will determine which party or outside service center will perform the repairs. If the repair is performed by RTD, RTD will bill contractor for the cost of the repair at $85 per hour plus invoiced material cost and 15% handling charge on material.

If the work is done by an outside service center, the contractor shall pay the service center directly.

7.43. Contractor shall ensure that any and all of Contractor's service equipment are operated and maintained in a safe, careful, skillful and workmanlike manner, Including, but not limited to, securing such equipment to the floor of RTD facilities. Contractor agrees to secure the service equipment in accordance with industry practices and standards.

7.44. Contractor shall be liable for any personal injury caused by Contractor or Contractor's operation and maintenance of such service equipment, in addition to its responsibilities under Section 7.42 above.

7.45. Contractor shall relocate or remove its service equipment whenever RTD finds such action reasonably necessary. In such event, Contractor shall bear the reasonable cost and expense incurred in connection with relocation or removal of the service equipment.

8. QUALITY ASSURANCE AND INSPECTION

8.1. Contractor shall have a quality assurance program in place to ensure the safety and quality of the tires and their service provided to RTD and to minimize tire issues on the street. RTD prefers the quality assurance program to comply with industry guidelines or be certified by quality standards bodies.

8.2. Contractor shall check for tire wear, tread and sidewall depth, misalignment, flat tires, gauge inflation pressure and the overall condition of the tires. On a weekly rotation, Contractor shall complete the inspection of the whole fleet except the 16th St. vehicles. The 16th St. vehicles require daily inspections. Inspection records shall be submitted to RTD monthly for review. Failures to perform inspections as required shall be grounds for termination of the contract.

8.3. Contractor shall remove and repair any tire found 15-PSI lower than the recommended pressure. Contractor shall check for valve core leaks, loose valve stem assemblies, defective rubber seal on check valve caps, and ensure proper tightened caps.

8.4. Contractor shall inspect all tires carefully for abnormalities or injuries such as: exposed cord, cuts, objects imbedded in the tread, evidence of excessive curbing (sidewall snags, rip, tearing or a bulge) and remove any tires displaying such conditions.

8.5. Contractor shall visually inspect all wheels and valve stem assemblies for any abnormal conditions, i.e., missing or loose wheel nuts, stripped or broken studs, cracked or damaged wheels, excessive rim flange wear on aluminum wheels, missing valve caps, loose hex nuts on the stem assembly, leaking valve cores, bad valve grommets, excessive wear at coin holes, missing or misaligned lug nut indicators etc. Unsafe wheels due to damages shall not be used and shall be presented to RTD for review and determination for disposal.

8.6. At a minimum, Contractor’s management team shall meet with designated RTD personnel twice a year to report its contractual performance, issues and solutions. The meeting will be held at RTD facilities.

9. TITLE TO TIRES AND TIRE EQUIPMENT

9.1. Ownership and title to the leased tires and tire maintenance equipment shall remain with the Contractor, unless provided otherwise in the contract.

10. VEHICLE PROCUREMENT

10.1. The RTD expects to make purchases of new or used buses during the term of this tire lease contract to add to and/or replace various buses currently within its fleet. RTD may purchase some vehicles with new or preexisting tires.

During the life of those tires, the Contractor shall be requested to provide necessary service and replacement tires as needed. The service rates for such tires shall be included in the overall service rate. If RTD acquires any vehicles outside those set forth in Attachment #1, the mileage rates may be negotiated based on industry experience with tires of the same type if applicable. The replacement of RTD owned tires shall not be made without the specific written approval of RTD authorized personnel. A separate rate shall apply to any other make/model bus(es) place into operation during the term of this Contract only if a different size and/or type of construction tire is required.

10.2. The Contractor shall, when requested by RTD, deliver lease mileage tires to a manufacturer in the Continental United States or Canada for mounting on new vehicles. The shipping coordination, land freight, delivery and handling shall be at the contractor’s expense. RTD will pay all ocean freight and any U.S. or foreign custom duties and expenses incurred in furnishing tires to coach manufacturers in foreign countries and the subsequent importation of the tires into the United States. Any tires lost, stolen or damaged while in the possession of the bus manufacturer, dealer or seller, or while the bus is being delivered shall be paid for by RTD. If any OE buses equipped with leased tires shall be driven overland instead of being shipped, RTD shall pay contractor the following month for use of such tires at the billing rate in effect.

11. DELIVERY

11.1. All tires furnished for use by the RTD shall be delivered directly to the Contractor’s personnel stationed at the

RTD’s service garages. All freight or delivery charges shall be paid for by the Contractor. The delivery times to each Division are to be approved by RTD.

11.2. Disposal of tires and related materials delivered to the RTD shall be the responsibility of the Contractor and shall be disposed of according to government regulations.

12. WORK SPACE AND STORAGE OF TIRES

12.1. The RTD will furnish adequate storage space and workspace for storage and maintenance of tires used on its vehicles. RTD will install and maintain in its garage air lines and electrical outlets for the operation of Contractor owned service equipment.

12.2. The Contractor will be responsible for proper disposal of tires, scrap, etc. in a timely manner to keep work/storage area clean. Total scrap tires stored at each Division shall not exceed 20 tires unless other quantities no greater than 30 tires are requested by Contractor and approved by RTD in writing.

12.3. The Contractor shall post in the work area, all the rules and regulations pertinent to the job; keep the work and storage areas clean; and maintain good housekeeping at all times. Security of all tires and spare wheels in storage is the Contractor’s responsibility.

12.4. All labor for the delivery and storage of tires at the divisions will be the responsibility of the Contractor.

13. REMOVAL OF BUSES FROM SERVICE

13.1. If the RTD removes from service or sells certain buses equipped with Contractor’s tires, such tires shall be removed by the Contractor and used on other RTD buses, or, the RTD may sell the tires to any person or company at a price satisfactory to the Contractor, and, in line with the rates set forth in the Contract.

13.2. The Contractor shall be responsible for any tire transfer or removal as a result of buses being reassigned between the RTD and the private sector.

13.3. Contractor shall furnish “No Value Tires” to RTD for the sole and exclusive purpose of equipping RTD’s obsolete or retired vehicles. It is understood that a “No Value Tire” means any tire furnished under the Contract that has been determined by Contractor as permanently unfit for further service. Title and all other incidents of ownership to the “No Value Tire” shall be transferred from Contractor and vested in RTD at the time Contractor delivers to RTD.

14. DESCRIPTION OF FACILITIES

14.1. RTD operates three (3) widely separated service garages within its District. Each facility has an area assigned for tire work.

14.2. The divisions are listed below:

Platte Division, 3333 Ringsby Court, Denver, Colorado

East Metro Division, 14100 East Colfax Avenue, Aurora, Colorado

Boulder Division, 1707 Exposition Drive, Boulder, Colorado

14.3. NOTE: RTD may acquire additional facilities during the term of this contract. Necessary adjustment of manpower, equipment and supplies shall be determined on a mutually agreeable basis and in line with the established contract rate.

15. WASTE TIRE

15.1. Contractor shall comply with State of Colorado’s waste tire regulations. Colorado regulations require haulers of waste tires and facilities that generate, collect, store, process and / or use waste tires register with the Colorado Department of Public Health and Environment. Contact the Colorado Department of Public Health and Environment for further information. The contractor, at its expense, shall obtain and maintain all applicable permits and licenses as required by federal, state, and local regulations for the work described by this statement of work.

15.2. The Contractor shall indemnify, defend and hold harmless the RTD from all liability (including reasonable attorney's fees) for removal or remedial actions under the State of Colorado law incurred as the result of the disposal of material covered by this contract. The contractor shall warrant that all transport, transfer, recycling and disposal facilities are in compliance with pertinent regulations. The contractor shall further warrant that all handling transport, recycling and disposal of the material covered by this contract be in compliance with all applicable federal, state and local laws and regulations. The contractor shall indemnify, defend, and hold harmless the RTD against all claims, damages, suits, penalties, fines and liabilities arising out of the breach of the above warranties including without limitation, liabilities for violation of laws or regulations, for injury or death to persons or for loss or damage to property or the environment.

15.3. In the interest to protect the environment and the public health, RTD prefers that Contractor recycles the used tires into other usages such as making asphalt, cement, or other tires.

16. PRICE ESCALATION:

This solicitation requires locking in pricing for multiple years. RTD understands that at times raw material pricing might fluctuate exceedingly beyond the vendor’s proposed escalation for future years. To provide reliefs under such conditions, RTD will allow Contractor to request for price adjustment from initially offered price. A request for adjustment of Contract pricing may be made under the following conditions:

1) Offered prices must be firm for at least six (6) months after commencement of the Contract.

2) The Contractor shall provide written notice of any requested price increases.

3) Price adjustment shall apply to tire mileage rate only. Service labor rate and rate for optional items shall not be adjusted.

4) Allowable price adjustment shall be capped at no more than 5% of initially offered price.

5) Contractor shall use Producers Price Index (PPI) WPU07120105, Truck and Bus Pneumatic Tires as evidence of market conditions resulting in increased costs. Contractor shall compare the escalation in PPI between the time of the request and the PPI on the first month of the contract, to the offered price escalation for the same period. Only when the PPI escalation is 50% or more than the offered price escalation, then RTD will consider the increased cost request.

6) All revisions to Contract pricing shall become effective when they are approved by RTD. RTD will issue a contract amendment to approve the price change and state its effective period.

7) All approved price changes resulting from this escalation clause shall be firm for the period between RTD’s approval and the last day of the year of this price change. At the first day of the subsequent year, the new originally offered price for that year will become effective.

8) Contractor shall notify RTD of subsequent price de-escalations from where pricing increases were previously implemented. The Contractor will reduce its pricing to RTD to pass on such de-escalations unless otherwise agreed by the parties.

9) Only one (1) increased price request is allowed for each year of the contract.

ATTACHMENT 1 – FLEET INFORMATION AND APPROXIMATE BUS COUNTS