Orangeburg County, located in the Midlands of South Carolina, is a fairly rural county with a population of 92,501. The 1,104 sq. mi. of road in the county is maintained by 45 employees of the Orangeburg County Public Works Department. Considering the amount of road these employees have to cover, their need for reliable equipment is evident.
A decade ago, members of the Orangeburg County Public Works Department partnered with Blanchard Machinery Company on a five-year machine lease agreement. This program was so successful that Orangeburg County has opted for two additional leases since 2001. With each lease agreement, at the end of the five year term, Blanchard buys back the leased machines and also gives the county the equity earned on the machines (based on current market value) so that they may in turn transfer that to a new lease.
On Oct. 26, Blanchard Machinery delivered 35 new Caterpillar machines to Orangeburg County under their latest lease agreement.
“Orangeburg County is able to lease the machines, knowing they will get the equity at the end of the lease and turn that over to a new lease. At the same time, Blanchard is doing the service, including preventive maintenance, oil changes and warranty work on each of the leased machines,” said Jim Johnston, Blanchard Machinery’s heavy equipment territory manager. “Before we set up the agreement in 2001, the repair costs on their fleet of machines was horrific. Under the agreement, the lease cost on the new machines was relatively the same as what they were paying in repair costs, so the county was able to do this without raising taxes or millage.”
Butch Looper, assistant public services director, Orangeburg County, agrees. “The best part of this deal has been the availability of equipment that is up and running. Before we started with our lease program we ran a mixture of different types of equipment. The down time killed us. Since we started this lease program, we don’t experience excessive down time like we have in the past.
“Having reliable motorgraders that are up and running, puts us in a better position to minimize the time it takes to cycle through the approximately 870 miles of unpaved roads that we maintain.” Looper continued,
Earl Whalen, deputy administrator of the Division of Public Services, Orangeburg County, added, “The partnership with Blanchard has given us the ability to construct rather than just maintain our roads. Within the past 10 years, we’ve actually improved nearly 120 miles of roads to hard surface in the county. With a county that has about a thousand miles of roads in its maintenance system, every mile we can improve for our citizens is quite advantageous.
“Using Capital Projects Sales Tax funds specifically identified for road improvements and, most recently, State Gas Tax C-Funds combined with the acquisition of reliable paving equipment and the expertise of in-house labor force has kept the County within and mostly under budget on our projected seven-year road improvement plans. The equity of the machines at lease end can go towards the next lease and/or back to the county as revenue,” Whalen stated.
Every county has to deal with acquiring and maintaining heavy equipment to some degree. Based on the success of this partnership, both Orangeburg County and Blanchard Machinery have been approached by officials from multiple counties for more information on the Machine Lease Program.
“The ability of Caterpillar to maintain the value of their equipment over a period of years is proven. It was a large financial leap back in 2001 and I know the cost is the biggest hurdle for local governments, but many Public Works Directors and equipment operators envy our position now. I’m definitely a strong advocate of this lease agreement plan,” Whalen said.
Additionally, the South Carolina Association of Counties features the competitive J. Mitchell Graham Memorial award that they offer every year recognizing counties for innovative and unique projects that are a benefit to the community technologically or financially, which, Whalen mentioned, Orangeburg County won for the first time ever in 2003 thanks in part to their relationship with Blanchard and Caterpillar.
Another key ingredient to this partnership is communication. The open line of communication between Orangeburg County and Blanchard also has been beneficial to Caterpillar. Using the county operator experience on the machine, Orangeburg County is always providing feedback to Blanchard. If something comes up that isn’t just an anomaly, Blanchard will share that with Cat, which in turn helps them in making modifications to the machines.
“From the leadership of our County Council and County Administrator in comprehending the advantages of this lease plan combined with a group of dedicated equipment operators that appreciate being outfitted with the latest and best heavy equipment technology we are progressively preparing our community for the long road ahead. Our equipment operators are awesome, working hard every day to make our roads better and safer,” Whelan concluded. CEG
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