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Home My WebLink About2007 Ordinance No. 007• • • CONTRAC't NO,~ f-J.a:,7 9 b Ill ORDINANCE NO. L SERIES OF 2007 BY AUTHORITY COUNCIL BILL NO . 8 INTRODUCED BY COUNCIL MEMBER TOMASSO AN ORDINANCE OF THE CITY OF ENGLEWOOD, COLORADO AUTHORIZING ANL) APPROVING THE LEASE-PURCHASE OF FIRE TRUCKS FOR THE CITY AND PROVIDING DETAILS IN CONNECTION WITH THE LEASE-PURCHASE TRANSACTION AND DECLARING AN EMERGENCY . WHEREAS, the City of Englewood, Colorado (the "City"), is a home rule municipality of the State of Colorado (the "State") duly organized and operating under the Home Ruic Charter of the City (the "Charter") and the constitution and laws of the State ; and WHEREAS, pursuant to Section 30 of the Charter, the City Council of the City (the "Council") has all municipal legislative powers as conferred by general law, except as provided by the Charter; and WHEREAS, in December of 2006, following the competitive bidding procedures set forth in Section 113 of the Charter, the City approved a purchase order to be supplied by Transwest Trucks Inc . for the building, equipping and acquisition of two fire trucks generally consisting of a heavy rescue pwnpcr and a 1500 gallon-per-minute pumper (collectively, the "Fire 1 sks") which arc expected to be delivered to the City prior to year-end 2007 ; and WHEREAS, purswmt to Section 31-15-101 of the Colorado Revised S.a •1tes , the City has the power to lease-purchase personal property and the Council desires to spread ·"• cost of acquiring the Two Fire Trucks over a period not to exceed eleven years through the lease-purchase of such equipment ; and WH IJREAS, the City will advance funds for payment of a portion of costs of the Fire Trucks in anticipation of finar,cing their building, equipping and acquisition by lease-purchase in order to take advantage of certain discounts offered by the supplier; and WHEREAS, the City has received a proposal from Stifel Nicolaus & Company, Incorporated to effect the lease-purchase of the Fire Trucks at a net effective rate not in excess of 5. 75% per annum, which rate is to be detcnnined at the time of the closing on the transaction; and WHEREAS, the details of the transaction are more fully set forth in a Master Equipment Lease/Purchase Agreement (the "Lease Agreement"), and the financial obligation of the City under the Lease Agreement shall constitute currently budgeted expenditures of the City; and WHEREAS, the Council is desirous of authorizing and directing the transaction described above; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ENGLEWOOD, COLORADO, AS FOLL(••.,'$: Section I. Approval of Lease Purchase Tenns. The City Council hereby approves the lease- purchase of Two Fire Trucks for an amount not to exceed $950,000 (which amount, in whole or in part, shall reimburse the City for funds which the City currently intends to advance), with annual payments not to exceed $135,000 . The City Council hereby delegates to the Mayor, or in the absence thereof, the Mayor Pro Tern, the authority to dctcnninc the net effective rate for the lcasc-purcbasc, which rate shall not be in excess of 5. 75% per annum, and the term of the lease-purchase financing, which term shall not exceed eleven ycan . Section 2. Approval of Lease Agreement . The Lease Agreement, in substantially the form and with substantially the content presented to the City, is in all respects approved, authorized and confirmed . Section 3. ~tion end Deljvcry of Documents . The Mayor or, in the absence thereo f, the • Mayor Pro Tern is hereby authorized and directed to execute the Lease Agreement , and the signature of the Mayor or Mayor Pro Tern shall conclusively determine acceptance of the final form and content of the Lease Agreement and the va lid execution of t.te Lease Agreement by the City . Additionally, the Mayor, other officia ls and employees of the City are hereby authorized and directed to execute and deliver for and on behalf of the City any and all additional agreements, certificates, documents and other paper.; and to perform all other acts that they may deem necessary or appropriate in order to implement and carry out the transaction authorized and contemplated by this Ordinance, including but not limited to an Internal Revenue Service Form 8038-G . Section 4. Declarations and Findings . The Cit y Council hereby determines and dec lares that the rental payments under the Lease Agreement (the "Rental Payments") represent the fair va lue for the use of the Fire Trucks, and that the Purchase Price (as defined in the Lease Agreement) represents the fair purchase price of the Fire Trucks . The City Coun~il hereby determines and declares that the Rental Payments do not exceed a reasonable amount so as to place the City under an economic or practical compulsion to appropriate moneys to make payments under the Lea se Agreement or to exercise its option to purchase the Fire Trucks pursuant to the Lease Agreement. In making such determinations, the City Council has given consideration to the current market value of the !'ire Trucks, the cost of building, equipping and acquiring the Fire Trucks, the option of the City to purchase the Fire Trucks, and the expected eventli!II vesting of full title to the Fire Trucks in the City. The City Council hereby determines and declares that the duration of the Lease Agreement , ii.eluding all optional renewal terms , authorized under this Ordinance, does not exceed the weighted average useful life of the Fire Trucks . Section 5. Bank.Qualified Detennination . The City hereby designates the Lease Agreement as a "qualified tax-exempt obligation" for purposes of Secti on 265(b)(3) of the Internal Revenue • Code of 1986, as amended . Section 6. Obligations of the City. No provision of this Ordinance or the Lease Agreement shall be construed as creating or constituting a general obligation or a multiple-fiscal year direct or indirect indebtedness or other financial obligation whatsoever of the City nor a mandatory payment obligation of the City in any ensuing fi sca l year beyond any fiscal year during which the Lease Agreement shall be in effect. Section 7. Ratification of Prior Actions. All actions heret ofore taken (not inconsistent with the provisions of this Ordinance) by the City Council or by the officers and employees of the City regarding the acquisition or lease-purchase of the Fire Trucks, or directed toward satisfaction of the City's obligations under the Lease Agreement, are hereby ratified, approved and confirmed. Section 8. ~-It is hereby expressly decl ared that all provisions hereof and their application are intended to be and are severable. In order tu implement such intent, if any provision hereof or the aoplication thereof is determined by a court or administrative body to be invalid or unenforceable, i I whole or in part, such determination shah not affect, impair or invalidate any other provision hereot or the application of the provision in question to any other situation; and if any provision here<': or the application thereof is detennined by a court or admini strative body to be valid or enforceable only if its application is limited, its application shall be limited as required to most fully implement its purpose. Sect ion 9. Effcctjyc Date. The Ordinance shall be effective immediately after final adoption . • • • Section 10. ~-All ordinances, or parts thereof, inco111istent or in conflict herewith are hereby repealed to the extent only of such inco111istency or conflict. Section 11 . Emen!ency Declaration. The City Coun,.:il recoaru-that market intereat rstes are changing materially from day to day, and that the City desira to effect the financina of its iesse and ensure it docs not incur greater costs to the City; therefore, the City Council hereby finds and determines that this Ordinance is necessary for the immediate preservation of public prope11y, health, peach and safety and sruill be in full for:cc and effect immediately upon final pusaae by the City Council . Introduced, read in full, and passed ss an emergency bill for an ordinance on first reading on the 5th day of February, 2007 . Published ss Ill' Emergency Bill for an Ordinance on the 9th day of February, 2007 . A public hearing wss held on February 5~, 2007 . Read by title and passed on final reading ss an Emergency Ordir:ance on the 20th day of February, 2007 . Published by title ss Emergency Ordinance No . 2-., Series of 2007, on the 23'" day of February, 2007 . I, Loucrishia A. Eilis, City Clerk of the City of Englewood, Colorado, hereby certify that the ..., ... ..., .... ,,.""''"'""'~'""""''' title as Ordinance No . ...:.L___, Series of 2007. -4 -.~ Loucrishia A. Ellis • • COUNCIL COMMUNICATION D111: A1tndl Item: Subject: February S, 2007 11 a Ill A bill for an emergency ordinanc~ auth nrizing and app roving the lease-purchase of a Hea vy Rescue Pumper and a 1 500 GPM Pump er lnllllled ly: Finance and Administrative Services Department I Slaff Source: Frank Gryglewicz, Director COUNCIL GOAL AND PREVIOUS COUNCIL ACTION City Council discussed th e acquisition of a Heavy Rescue Pumper and 1500 GPM Pumper at the Budset Retreat on September 23, 2006 an d at a stud y session held on Novemb er 6, 2006 . Council awarded the bid,, by Motion, to Summit Emergency Equipment on December 4, 2006 . RECOMMENDED ACTION Staff recommends the City Co unc il approve the attached Bill for an Emergency Ordinanc e approving the lease-purchase of a Heavy Rescue Pump er and 1500 GPM Pumper. Th is ac tion is be ing done as an emergency to pro tect the City of Englewood from the possibility of an adve rse fluctuating in in terest rate s that could increase debt service requi rement of the lease. BACKGROUND, ANALYSIS, AND ALTERNATIVES IDENTIFIED Th is bill for an ordina nce allows the City to conserve its capital and take advantage of :nterest rates . This equ ipment will be leased over 10 years . Delivery of this equipment will most li ke take place al the end of 200 7 or early 2008. FINANCIAL IMPACT This action preserves a low interest rate not to exceed 5.75 percent. The annual principal and interest payments •aver the term of the lease will not exceed $135 ,000. The tota l prin cipa l paid wi ll not exc eed $950 000. Tota l payments over th e ten -year term will not exce ed $1 ,350,000 . The first payme11t for th e lease will be paid from funds paid into the Capi tal Equipment Rep lacement Fund . The source of th ~ remaining payments will be determ in ed during th e annual budgeting process . LIST OF ATTACHMENTS • ~roposed BIii for an Ordin ance