TO: Honorable Mayor and Council
FROM: Daniel P. Doyle, Chief of Police
SUBJECT:Title
Adopt Resolution No. 15-2981 Approving Tax-Exempt Non-Bank Qualified Municipal Lease Purchase Agreement with JPMorgan Chase Bank, N.A. for Acquisition of Motorola and Creative Communications Equipment and Declaring an Emergency
Body
FUNDING SOURCE:
General Fund
PURPOSE:
To approve a Tax-Exempt Non-Bank Qualified Municipal Lease Purchase Agreement for acquisition of equipment in accordance with City Code § 3.10.010.5(A)(10) and to declare an emergency.
BACKGROUND:
The Fiscal Year 2015-16 adopted CIP budget includes appropriation in the amount of $3,500,000 for upgrading the City-wide radio system with an identified funding source of lease proceeds.
A proposal was received by JPMorgan Chase Bank, N.A. for the purpose of securing a Tax-Exempt Non-Bank Qualified Municipal Lease Purchase in the amount of $3,046,010 for an estimated interest rate of 1.89% for a term of 7 years. Proceeds from the lease will be deposited via an initial escrow deposit with Deutsche Bank and disbursements will be made directly to the vendors or as reimbursements to Lake Havasu City as funds are required.
COMMUNITY IMPACT:
Since budget adoption, this project has been further refined and is estimated to be approximately $500,000 below budget. In addition to the savings on the project, an additional financing proposal was obtained that will result in savings of approximately $275,000 over the total budgeted debt service costs.
FISCAL IMPACT:
Appropriation for the expenditure related to the radio project is included in the Fiscal Year 2015-16 CIP budget, Project PD1050, account 351-1840-401-6204. The first semi-annual debt service payment will be due March 25, 2016 and appropriation for that payment will be transferred through a budget amendment from the CIP Fund to the General Fund. Administrative Services will bring forward a formal budget amendment by December 2015. Annual principal and interest payments are estimated to be $466,613 per year until September 25, 2022.
ATTACHMENTS:
Resolution No. 15-2981
Tax-Exempt Non-Bank Qualified Municipal Lease Purchase
SUGGESTED MOTION:Recommended Action
I move to adopt Resolution No. 15-2981 approving the Tax-Exempt Non-Bank Qualified Municipal Lease Purchase with JPMorgan Chase, N.A. for financing to acquire Motorola and Creative Communications equipment to replace the City's radio system, authorizing the City Manager to execute all related documents to effectuate the transaction on behalf of the City, and declaring an emergency.