Others have provided good advice about the technical skills a good sysadmin should have. They're totally right (I'm a sysadmin/developer, and what they described is what works best for me...)
I don't understand your business at all or the state you're in, but is having a full-time, on-site sysadmin really necessary? By restricting yourself to local candidates you've just shut out the majority of people with the skillset you're looking for.
Rails is still young. Finding someone with Rails experience who prefers system administration is a challenge no matter what. It may be that there simply are no people in your area who A) have the skills you require and B) need a new job.
I'm not trying to tell you how to run your business of course, this is just something to consider. Are you sure you're going to have enough work to keep someone busy ~40 hours a week? And are you sure they need to be close enough to touch?
Good luck at any rate. Wish I was looking 
Ben