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City of Missoula, Montana Item to be Referred to City Council Committee Committee: A & F Item: Master Equipment Lease-Purchase – FY 10 CIP Items Date: August 13, 2010 Prepared by: Brentt Ramharter Initiated by: Brentt Ramharter Action Required: Approve the "RESOLUTION AUTHORIZING THE EXECUTION AND DELIVERY OF SUPPLEMENT NOS. 4 AND 5 AND RELATED DOCUMENTS TO A MASTER GOVERNMENTAL LEASE-PURCHASE AGREEMENT FOR THE LEASE OF VARIOUS ITEMS OF CAPITAL EQUIPMENT AND DETERMINING OTHER MATTERS IN CONNECTION THEREWITH". This is for equipment budget6ed to be lease financed in the FY 10 CIP budget. Recommended Motion: I move the City Council approve the: RESOLUTION AUTHORIZING THE EXECUTION AND DELIVERY OF SUPPLEMENT NOS. 4 AND 5 AND RELATED DOCUMENTS TO A MASTER GOVERNMENTAL LEASE-PURCHASE AGREEMENT FOR THE LEASE OF VARIOUS ITEMS OF CAPITAL EQUIPMENT AND DETERMINING OTHER MATTERS IN CONNECTION THEREWITH" Timeline: Referral to committee: August 13, 2010 Committee discussion: August 18, 2010 Deadline: Have Council approve at August 23rd meeting Background and Alternatives Explored: The City entered into a capital Master Equipment Lease/Purchase Agreement with Wells Fargo Brokerage Services, LLC on October 8, 2009 to obtain tax-exempt lease financing for capital equipment purchased in the FY 2009 budget. The attached list of equipment to be financed under this same Master Lease agreement is for the FY 2010 capital purchases in the FY 2010 budget. Attached is a resolution to be considered by the Missoula City Council on August 23 regarding Supplements No. 4 & No. 5 for the lease of capital equipment pursuant to the Master Lease Agreement adopted last October. The principal amounts of the two supplements are $285,000 year) and $565,000 (10-year), with interest rates at 3.520% (3-year) and 4.740% (10-year). The three year financing is for 6 Police vehicles and 3 wastewater vehicles. The 10 year financing is for a fire engine, a wheel loader for Streets and a tandem axel flusher for Streets. Closing is scheduled for September 9. ---PAGE BREAK--- The City ran a request for proposals, with advice from Springsted Incorporated (the City’s financial advisor), to finance the Equipment and certain other capital equipment anticipated to be purchased in the next few fiscal years and the Lessor submitted a proposal to the City that provided the lowest financing cost for the Equipment. The City took the necessary steps, including those relating to any applicable legal bidding requirements, to arrange for the acquisition of the Equipment. The equipment is essential for the City to perform its governmental functions. Financial Implications: General Fund implications – required debt service with annual payments (see attached schedule - in Master Lease Spreadsheet). Attachments: Master Lease Spreadsheet Resolution