TO: Mayor and Members of City Council
THRU: Jeffrey Yates, Assistant City Manager
FROM: Jody Picarella, Chief Financial Officer
DATE: June 10, 2024
RE:
Title
Approval of Installment Financing and Adoption of Resolution for Various Vehicles and Equipment Purchases
end
COUNCIL DISTRICT(S):
Council District(s)
All
b
Relationship To Strategic Plan:
Goal 5: Financially Sound City Providing Exemplary City Services.
Objective 5.1: Ensure strong financial management with fiduciary accountability and plan for future resource sustainability by aligning resources with City priorities.
Executive Summary:
The City has issued a Request for Proposal (RFP) for installment financing to be used for the purchase of various vehicles and equipment. Staff is recommending TD Equipment Finance, Inc., to finance these purchases.
Background:
In the Approved FY 2024 Budget, City Council authorized staff to move forward with the purchase of various vehicles.
On April 23, 2024, staff electronically distributed an RFP to financial institutions. The RFP was for an amount not to exceed $3,200,000 for the purpose of financing vehicles and equipment. The desired term of financing was 48 months with a fixed interest rate for the entire term.
On May 14, 2024, the City received financing proposals from nine financial institutions. Staff evaluated the proposals and recommend that Council authorize the execution of a financing agreement with TD Equipment Finance, Inc., which provided one of the lowest costs of financing and the most favorable non-financial terms, such as contract compliance with e-verify and title holding. The proposal terms include a financing amount of $3,186,000 with an interest rate of 4.360% for a term of 48 months and a fixed interest rate for the entire period.
With the attached resolution, the City Council would be approving the attached Installment Financing Agreement and Security Agreement in substantially the forms presented at this meeting. The Mayor, the City Manager and the Chief Financial Officer of the City would each be authorized to execute and deliver the documents in substantially the forms presented at this meeting. The City Clerk or Deputy City Clerk of the City would be authorized and directed to affix the official seal of the City to said documents and to attest to the extent required.
Issues/Analysis:
TD Equipment Finance, Inc., provided one of the lowest interest rates and favorable non-financial terms, as shown in the attached summary of proposals.
Budget Impact:
The FY2024-2025 budget includes sufficient funds to cover the debt service associated with financing the equipment and vehicles.
Options:
Accept the financing proposal received from TD Equipment Finance, Inc., and approve the resolution authorizing the execution and delivery of an installment financing agreement and related documents in connection with the financing of various vehicles and equipment.
Do not accept the financing proposal received from TD Equipment Finance, Inc., and provide guidance to staff.
Recommended Action:
Staff recommend that City Council accept the financing proposal received from TD Equipment Finance, Inc., authorize the execution of the financing agreement, and approve the resolution authorizing the execution and delivery of an installment financing agreement and related documents in connection with the financing of various vehicles and equipment.
Attachments:
RFP 2024 Various Vehicles
Summary of Proposals
Vehicle and Equipment List
Installment Financing Agreement
Security Agreement
Approving Resolution