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HomeMy WebLinkAbout10927RESOLUTION NO. 10927 A RESOLUTION APPROVING A MUNICIPAL LEASE AGREEMENT BETWEEN PUEBLO, A MUNICIPAL CORPORATION AND NEBRASKA NATIONAL BANK RELATING TO THE ACQUISITION OF GOLF COURSE MAINTENANCE EQUIPMENT AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAME WHEREAS, the funding for the lease /purchase of new golf course maintenance equipment was identified and approved in the 2007 City adopted golf course budgets; and WHEREAS, the City Council has determined that a true and real need exists for the acquisition of the golf course maintenance equipment described in the Municipal Lease Agreement; and WHEREAS, the City has taken the steps necessary, including legal bidding requirements, under applicable law and Charter provisions to arrange for the acquisition of the golf course maintenance equipment, NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Municipal Lease Agreement between Pueblo, A Municipal Corporation and Nebraska National Bank dated as of February 12, 2007 (the "Agreement'), a copy of which is attached hereto, has been approved as to form by the City Attorney is hereby approved. The President of the City Council is authorized to execute and deliver the Agreement in the name of the City and any related documents necessary to the consummation of the transactions contemplated by the Agreement, and the City Clerk is directed to affix the seal of the City to the Agreement and attest same. SECTION 2. The City Council hereby represents that the reasonable anticipated amount of qualified tax - exempt obligations, which have been and will be issued by the City will not exceed $10,000,000.00 in calendar year 2007. Accordingly, the City hereby designates the Agreement as a qualified tax - exempt obligation for the purposes of Section 265(b)(3) of the Internal Revenue Code. SECTION 3. The obligation of the City to make Rental Payments under the Agreement is subject to annual renewal and annual appropriation by the City Council. No provision of this Resolution or the Agreement or the acquisition of the golf course maintenance equipment shall be construed or interpreted as creating or constituting or giving rise to a multiple - fiscal year direct or indirect City debt or other financial obligation whatsoever nor a general obligation of the City within the meaning of any constitutional, charter or statutory debt limitation, nor a mandatory charge or payment obligation against the City beyond a fiscal year for which City has appropriated funds to make any such payment obligation. SECTION 4. The City Council hereby determines that the Rental Payments due under the Agreement do not exceed a reasonable amount so as to place the City under an economic compulsion not to terminate the Agreement or to exercise its option to purchase the golf course maintenance equipment pursuant to the Agreement. SECTION 5 This Resolution shall become effective upon final approval and passage. INTRODUCED February 12, 2007 BY Michael Occiato Councilperson APPROVED: Qz& j p� e , &Xv — FFRESIDLINTof City Council ATTESTED BY: CITY CLERK �o � to�a� Background Paper for Proposed RESOLUTION AGENDA ITEM # DATE: February 12, 2007 DEPARTMENT: PARKS & RECREATION, RICH ZAJAC, DIRECTOR MIKE ZAREMBA, GOLF COURSE MANAGER TITLE A RESOLUTION APPROVING A MUNICIPAL LEASE AGREEMENT BETWEEN PUEBLO, A MUNICIPAL CORPORATION AND NEBRASKA NATIONAL BANK RELATING TO THE ACQUISITION OF GOLF COURSE MAINTENANCE EQUIPMENT AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAME ISSUE Should City Council approve a five -year Nebraska National Bank for the acquisition equipment for the two municipal golf courses? Municipal Lease Agreement with of new golf course maintenance RECOMMENDATION Approval of this Resolution As part of the adopted 2007 City budgets for the two municipal golf courses, City Council approved specific funding for the lease /purchase of new course maintenance equipment to replace the old and unreliable existing equipment. Bids were received on November 3, 2006, for 20 specific pieces of new golf course maintenance equipment, which includes the following: • Four (4) Fairway Mowers • Four (4) Greens Mowers • Three (3) Rotary Rough Mowers • One (1) Sand Trap Bunker Rake with Front Blade • Seven (7) Utility Vehicles One (1) Heavy Duty Utility Vehicle with Vicon Fertilizer Spreader Mounted on the Bed. A bid summary is attached. The new equipment will be delivered 45 days after acceptance of the agreement and will be available for the spring maintenance season at both courses. FINANCIAL IMPACT The City will be entering into a tax- exempt purchase agreement with an automatic transfer after five years. The City will pay a $90,000 cash down payment in 2007 and then pay $86,309.36 per year lease payment starting in 2008 for four years. The cash down payment and the annual lease payments are to be paid out of the golf courses' annual operating budgets. These funds are contingent on the availability of annual appropriation by the City Council. In the event of non - appropriation of funds in any given year, the City will not be held liable to complete the lease /purchase contract and the golf course maintenance equipment will be surrendered. Per the low bid of $397,084.71 from Colorado Golf and Turf, the total cost of the lease/purchase agreement is $435,238.44. Funds are approved and specifically identified in the acquisition of the new golf course maintenance equipment in each respective 2007 golf course budget: $45,000 at Elmwood and $45,000 at Walking Stick under debt service payments.