HomeMy WebLinkAboutS3- Finance FY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: BARBARA PACHON, Subject: EXECUTION OF LEASE/PURCHASE
DIRECTOR OF FINANCE AGREEMENT TO FINANCE FIFTEEN
NEW POLICE VEHICLES.
Dept: FINANCE
Date: MARCH 27, 1996
Synopsis of Previous Council action:
Recommended motion:
ADOPT RESOLUTION.
Signature
Contact person: BARBARA PACHON DIRECTOR OF FINANCE Phone: x - 5242
Supporting data attached: STAFF REPORT, LEASE SCHEDULE "A" Ward:
FUNDING REQUIREMENTS: Amount: $330,833.69
Source: (Acct No.) 001-213-5803
(Acct Description)
Finance: dL xn,
Council Notes: THE FY 96197 BUDGET FOR THE POLICE DEPARTMENT WILL INCLUDE THE FIRST TWO
PAYMENTS FOR A TOTAL COST OF $165,416.84 FOR THIS LEASE/PURCHASE OF FIFTEEN POLICE VEHICLES.
u BsTi7vr� �
Agenda Item No. '
r
CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
STAFF REPORT
BACKGROUND
The City of San Bernardino orders Police patrol vehicles once a
year. Prior to this fiscal year, patrol vehicles were ordered in
spring of the current fiscal year for delivery after July 1 of the
following fiscal year. Manufacturers of police vehicles restrict
the ordering period so production of regular vehicles can be halted
for a limited period of time and production of police units can
occur. If orders are not placed within the allotted time frame,
police cars cannot be ordered again until the following year. This
year's only manufacturer of police vehicles, Ford, set a cutoff
date almost four months earlier than in prior years, November 15.
Due to staff changes in the Fleet Division and the manufacturer's
change in ordering dates this year, the deadline to order police
vehicles direct from the manufacturer was missed.
Although the City missed the opportunity to order direct from the
manufacturer, the new Fleet Manager advised the Purchasing Division
that surplus white cars could be obtained from Wondries Fleet Group
through the use of a cooperative purchasing agreement with the
County of Los Angeles. Based on his experience with a previous
city, the Fleet Manager suggested the Police Department purchase
white cars for use by non-patrol staff for one year and then place
them into patrol service for three additional years. This plan will
extend the life of patrol units by one year and reduce the
frequency of vehicle replacement.
The Fleet Manager also advised staff that patrol units are
routinely placed out of service when their mileage limit is reached
or if they are damaged. For this reason, some police patrol units
need to be on hand throughout the year. Additionally, Fleet needs
time to equip new units before they are ready to be placed into
service. If the Police Department were to decide not to order
police vehicles from Wondries' surplus, the Police Department could
run the risk of running out of patrol vehicles before the next
opportunity for delivery, spring of 1997 . Taking this into
consideration, an order was placed with Wondries Fleet Group for
fifteen of the surplus vehicles on their lot. Because Wondries
Fleet Group had the vehicles in stock, delivery of the FY 96/97
patrol vehicles occurred immediately.
FISCAL IMPACT
Due to the early delivery of the FY 96/97 patrol vehicles, staff
has obtained bids on lease/purchase agreements to finance the
$310,772 . 55 cost of the fifteen new police vehicles. Purchasing
has determined Ford Motor Credit Co. to be the lowest, most
responsive bidder. The lease will run for two years at 5. 10%
interest rate with semi-annual payments of $82 , 708 . 42 . The first
payment is due on October 3 , 1996 . A copy of the lease schedule is
r attached. The schedule is an addendum to a Master Lease Purchase
Agreement, Number 33915, dated July 27, 1992 between Ford Motor
Credit Company and the City of San Bernardino.
(PAGE 1 OF 2)
(PAGE 2 OF 2)
At this time, it is anticipated that the Police Department will not
be purchasing vehicles again until FY 97/98.
RECOMMENDATION
Staff recommends approval of the attached resolution authorizing
the execution of a lease/purchase agreement with Ford Motor Credit
Co. to finance fifteen new police vehicles.
A/ ' /V--)
Wayne Harp, Assistant Police Chief
P
John urphy, Purchas g Ma ger
Jim indlay, Acting Fleet Manager