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Date
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January 7, 2008
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Agenda
Item No. 24 Roll
Call No. 08- Communication No. 08-005 Submitted by: Allen McKinley, Finance Director |
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AGENDA HEADING:
Setting Date of Hearing for Supplement C-1 to the
City’s Master Lease-Purchase Agreement for the purchase of various vehicles and
equipment for the Public Works Department.
SYNOPSIS:
Recommend
approval to schedule a public hearing for January 28, 2008, to consider
lease-purchasing six trucks with attachments for the Public Works
Department. Council will be asked to approve
the acquisition of the vehicles at a subsequent council meeting(s). This action initiates the financing process
to align with the anticipated acquisition approvals.
FISCAL IMPACT:
Amount:
Not to exceed $750,000 plus interest.
Funding
Source: Fiscal Year 2007-08 Operating Budget, Finance
Department – Debt Service Funds, Debt Service Administration, FIN900100, page
155.
ADDITIONAL INFORMATION:
Each
year the City replaces a variety of equipment and vehicles that have exceeded
their useful lives. In previous years, approximately
30 police units were replaced annually using a lease-purchase funding mechanism
while various public works units were replaced out of the equipment replacement
fund on a pay-as-you-go basis. This
year the police units will be purchased on a pay-as-you-go basis and six Public
Works units are recommended for replacement via the lease-purchase arrangement.
The useful life of the Public
Works equipment is over 10 years and the lease supplement term will be for a
period of 7 years. The change in vehicle
types to be included in the lease-purchase program is intended to reduce the
administrative burden associated with financing the larger number of Police
vehicles.
Equipment
items to be acquired under the lease-purchase arrangement are:
2
- Two-wheel drive – 1-Ton Utility Body Trucks
3
- Tandem Axle Dump Trucks with Snow and Ice Control Equipment
1
- Single Axle Truck with
More
detailed information will be provided on each vehicle to be lease-purchased,
including environmental considerations, prior to purchase.
Sixteen
lease supplements totaling $8,589,019.33 were approved by the City Council
under an earlier lease arrangement with Banc of America. The lease-purchase
method provides flexible, affordable financing for City equipment. Under the current lease arrangement five
lease supplements have been approved and executed by the City Council totaling
$2,969,630.76.
PREVIOUS COUNCIL ACTION(S):
Date: October 25, 2004
Roll Call Number: 04-2279
Action:
Approved Master Lease-Purchase Agreement with Banc of
BOARD/COMMISSION ACTION(S): NONE
ANTICIPATED ACTIONS AND FUTURE COMMITMENTS:
Hearing and approval of Master Lease Supplement
C-1
Award of bids
for various Public Works equipment and vehicles