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HomeMy WebLinkAboutRes2009-027Sponsored by: Oates CI'T'Y OF SEWARD, ALASKA RESOLUTION 2009-027 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AUTHORIZING THE EXECUTION OF AN EQUIPMENT LEASE/PURCHASE AGREEMENT BY AND BETWF.F,N THE CITY OF SEWARD AND MUNICIPAL ASSET MANAGEMENT, INC., PROVIDING FOR RELATED MATTERS, AND APPROPRIATING FUNDS WHEREAS, the City of Seward, Alaska ("City ') is a home rule city and under Section 11 of Article X of the Alaska Constihttion may exercise all legislative power not prohibited by ]aw or by the Charter of the City, and it has been deterniined that the matters set forth in this Resolution arc not prohibited by law or the Charter; and WHEREAS, the City desires to enter into a capital lease financing agreement for the purchase of a Triple Combination Pumper 1~ ire Truck and a Light Rcscuc Apparatus ("Equipment") with Municipal Asset Management, hlc. ("Lessor") and the Lessor desires to lease the Equipment to the City; and WHEREAS, the City considers that the acquisition and lease of the Equipment from Lessor is in the public interest and will promote the public purposes of the City; and WHEREAS, there has been presented to the City the fornr of an Equipment Lease/Purchase Agreement ("Agreement") which the Cily proposes to enter into in connection with the lease of the Equipment; and WHEREAS, it appears that the Agreement which is now before the City is in appropriate form and is an appropriate instrument for the purposes intended. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA that: Section 1. The lease by the City of the Equipment from the Lessor under the Agreement is hereby approved. The aggregate principal component of lease payable under the Agreement shat l not exceed $516,842 and said amount shall bear interest at a rate per annum not exceeding 3.295°/~, resulting in five annual payments paid in advance, of $110,176.78. Section 2. The form and content of the Agreement are hereby, in all respects, authorized, approved, and confirmed, and the City Manager, Finance Director, and City Clerk each is hereby authorized, empowered and directed to execute and deliver the Agreement to the counterparty for and on behal f o f the City in substantially the forn~ and content now before this meeting but with such changes, modifications, additions and deletions therein which shall to him seem necessary, desirable ,,_, and appropriate, the execution thereof to constitute conclusive evidence of the approval of any and all changes, modifications, additions or deletions therein from the form and content of the CITY OF SEWARD, ALASKA RESOLUTION 2009-027 Agreement now before this meeting, and from and after the execution and delivery of the Agreement, the City Manager ,Finance Director, and the City Clerk each is hereby authorized, empowered, and directed to do all such acts and things and to execute all documents as maybe necessary to carry out and comply with the provisions of the Agreement as executed. Section 3. The City Manager, Finance Director, City Clerk or any other person authorized by the Cily each hereby is authorized to execute and deliver for and on behalf of the City any and all additional certificates, documents, opinions or other papers and perform all other acts as they may deem necessary or appropriate in order to implement and carry out the intent and purposes of this Resolution. Section 4. The City covenants that it will not use any of the proceeds of the Agreement in such mvlncr, or take or omit to take any other action in such manner, as to impair the execution of the interest component or rent payable under the Agreement from federal income taxation. The Agreement is hereby designated as a "qualified tax exempt obligation" for purposes of Section 265(b)(3) of the Internal Kevenue Code of 1986 as amended (the "Code"). The City hereby covenants that it shall not issue during the calendar year of 2009 more than S30 million in aggregate principal amount of tax-exempt obligations other than tax-exempt obligations described in Section 26~(b)(3)(C)(ii) of the Code. The City further covenants that no part of the gross proceeds of the Agreement or any other funds of the City shall at auy time be used directly or indirectly to acquire -•.. securities or obligations, the acquisition of which would cause the Agreement to be or to become an "arbitrage bond" as defined in Section 148 of the Code. The City shall not permit any of the proceeds of the Agreement, or any products purchased with such proceeds, to be used in any manner that would cause the Agreement to constitute a "private activity bond" within the meaning of Section 141 of the Code. Section 5. The provisions of this Resolution are hereby declared to be separable and, if any section, phrase or provision shall for any reason be declared to be invalid, such declaration shall not affect the validity of the remainder of the sections, phrases or provisions. Section 6. Upon adoption of this Resolution, the Clerk of the City shall cause a true copy of same to be posted on the City Hall bulletin board and notice of the same to be published as provided in Seward City Code Section 2.15.035(D). Section 7. Funding in the amount of 528,236.78 is hereby appropriated from the Motor Pool Internal Service Fund net assets account no. 102-0000-3050 to the Motor Pool principal account no. 102-1020-5810 0,43,200.78) and interest account no. 102-1020-5820 (minus $14,964) for the purpose of paying the 2009 portion of debt service which exceeds that budgeted in the original 2009 Budget. Section 8. This Resolution shall become effective upon passage and approval in accordance with Seward City Code Section 2.15.050(C). CITY OF SEWARD, ALASKA RESOLUTION 2009-027 PASSED AND APPROVED by the City Council of the city of Seward, Alaska, this 13`"day of April, 2009. THE CITY OF SEWARD, ALASKA ~~ /~ Clark Corbridgc, Mayor AYES: Dunham, Valdatta, Bardarson, Smith, Kellar, Kcil, Corbridge NOES: None ABSENT: None ABSTAIN: None ATTEST: ~ ~. ~ , Jean Lcwis ~ityClcrk (City Seal) ,~ •'` `' a'~a K ~~, Ar°r k~` ` l 5~ h'fF r r ., J a. ~4- , A: A A, *U 4 ~r~ M~ aa~.y rr ~~d {Y~'Y o~ae La~~ P~~ +1~~ ''~'aerceea+m~° COUNCIL AGENDA STATEMENT Meeting Date: April 13, 2009 Through: Phillip Oates, City Manager KK,~ From: Kristin Erchinger, Finance llirector Agenda Item: Fire Department Equipment Capital I,ease/Purchase Financing BACKGROUND & JUS"1'IFICATION: The Seward City Council approved Resolution 2008-134 on December 8, 2008, authorizing the purchase of a Triple Combination Pumper Fire Truck in an amount not to exceed $550,000. As a result of competitive bids, the cost of this the truck will be $354,965. On February 3, 2009, Council approved Resolution 2009-012, authorizing the purchase of a Light Rescue Apparatus in an amount not to exceed $161,877. 'l'he purchase of these two pieces of equipment followed a competitive bid process. The purpose of this resolution is to authorize the financing to pay for this eyuipment, which the City will own outright at the end of the lease term. The City solicited bids to finance a total of $516,842.00. The City received tight (8) proposals from financial firms, with Municipal Asset Management, Inc. offering the lowest cost of financing with five annual payments of $110,176.78, and an interest rate of 3.295%. Overall, the interest cost over the five year term is $34,041.90. As a result, the administration recommends awarding the contract to Municipal Asset Management, Inc. 7'he table below usts the ro usais , Proposer ccc,vou. Total Annual Payment Interest Rate Municipal Asset M gmt. Inc. $110,176.7 8 3.295% Leasource Financial Services $110,686.88 3.54% Leasing 2, Inc. $110,794.52 3.59% Key Ciovernmettt Finance, Inc. $113,136.53 4.73°io Republic First National $113,23.71 4.77°% Saysume Financial Services $] 13,448.52 4.85% Municipal Capital Markets $114,207.75 5.25°~" Academic Capital Group $114,845.99 5.56% FISCAL NOTE: The 2009 budget included $81,940 for the lease of the fire truck only (since the light rescue apparatus was not included in the 2009 budget). The first required payment on both pieces of equipment totals $110,176.7 ft, which requires an additional 2009 approp iati~o-n~from the~~ I internal Service Fund of $28,236.78. Approved by Finance Department _~~~ RECOMMENDATION: Council approve Resolution 2009-0~~1 authorizing the execution of an eyuipment lease/pturchase agreement by and between the City and Municipal Asset Management, Inc. and providing for related matters. and appropriating funds in the amount of $28,236.78 to pay for principal and interest on debt service.