HomeMy WebLinkAboutPR 17106: BANCLEASING PROPOSAL Memorandum
City of Port Arthur, Texas
Finance Department
To: John Comeaux, Acting City Manager
From: Deborah Howey Echols, Director of Finance 0
Date: June 1, 2012
Subject: Proposed Resolution 17106
Proposed Resolution 17106 is presented for City Council consideration and approval. This resolution
authorizes the City Manager to accept the financing proposal from Banc Leasing, LLC in the amount of
$1,466,291.84 for the purchase of equipment for Public Works including three 12 -14CY Dump Trucks,
two Street Sweepers, a Mini Excavator and Trailer, a Commercial Garbage Truck, two Residential
Garbage Trucks and two 1/4 Ton Service Trucks. The lease is a five year term at 2.515% with a total
interest cost of $112,464.56 over the term. The City Attorney will review and approve the final
documentation.
The City received the following proposals for financing this project:
Gala Capital Group 3.414%
BancLeasing, Inc. 2.515 %
Chase, Cal First and Capitol One did not respond.
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P. R. NO. 17106
DHE: 06/01/12
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE APPROVAL OF A
FINANCING PROPOSAL FOR $1,466,291.84 FROM
BANCLEASING, INC. TO LEASE/PURCHASE CAPITAL
EQUIPMENT FOR PUBLIC WORKS
WHEREAS, the City Council of the City of Port Arthur, Texas on September 20, 2011, approved and
adopted Ordinance 11 -46, the budget ordinance, which included approval of $1.1 million lease /purchase
financing for equipment for Public Works; and
WHEREAS, the City Council, on May, 29, 2012, approved Ordinance 11 -35, a budget amendment,
which included approval of an additional $366,291.84 lease /purchase financing for equipment for Public
Works; and
WHEREAS, the City Council deems it in the public interest to lease /purchase three 12 -14 CY Dump
Trucks, two Street Sweepers, two Residential Garbage Trucks, two 3 /4 Ton Service Trucks, a Mini Excavator, a
Trailer and a Commercial Garbage Truck; and
WHEREAS, the Equipment is essential for the City of Port Arthur, Texas to perform its governmental
functions; and
WHEREAS, the City of Port Arthur has taken and is taking the necessary steps to arrange for the
acquisition of the Equipment; and
WHEREAS, the City of Port Arthur proposes to enter into the Lease with BancLeasing, Inc.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT
ARTHUR:
Section 1. It is hereby found and determined that the terms of the Lease Financing Proposal is in the
best interest of the City of Port Arthur for the acquisition of the equipment.
Section 2. The City Manager of the City of Port Arthur is authorized to accept the financing
proposal received from BancLeasing, Inc as attached hereto as Exhibit "A ".
Section 3. The Financing Documents and the acquisition (lease /purchase) and financing of the
Equipment under the terms and conditions as described in the Master Lease Agreement previously entered into
with BancLeasing. The City Manager is authorized to execute, acknowledge and deliver the Financing
Documents with any changes, insertions and omissions therein as may be approved by the officers who execute
the Financing Documents, such approval to be conclusively evidenced by such execution and delivery of the
Financing Documents. The City Secretary is authorized to affix the official seal of the City of Port Arthur to
the Financing Documents and attest the same.
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Section 4. Pursuant to Section 265 (b) of the Internal Revenue Code of 1986, as amended (the
"Code "), Lessee hereby specifically designates the Lease as a "qualified tax - exempt obligation" for purposes of
Section 265 (b)(3) of the Code.
READ, ADOPTED, AND APPROVED, this day of June, 2012, AD, at a Regular Meeting of the
City Council of the City of Port Arthur, Texas by the following vote:
AYES: Mayor:
Councilmembers:
NOES:
Mayor
ATTEST:
Sheri, Bellard, City Secretary
APPROVED AS TO FORM: APPROVED AS TO THE AVAILABILITY OF FUNDS:
/
A 411 _d
Val Tizeno, C y i tf ey Deborah Howey Echols,
1 ector of Finance
APPROVED FOR ADMINISTRATION:
John A. Comeaux, Acting City Manager
S:\Finance \Resolutions \Lease Agreement- BancLeasing.doc
EXHIBIT "A"
S:\Finance \Resolutions \Lease Agreement- BancLeasing.doc
CashFlow Asf.
1, L� ank
OF TEXAS
Friday, June 01, 2012
Deborah Echols
Director of Finance
City of Port Arthur, Texas
PO Box 1089
Pont Arthur, Texas 77641
Dear Ms. Echols:
1 appreciate the information you have provided and am pleased to provide you with the following lease proposal. This
proposal is subject to final credit approval and assumes use of our standard lease documentation. Rates are fixed (not
floating). All pricing is net of taxes. This quote is valid through 30 June 2012.
Lessee: City of Port Arthur, Texas
Lessor: BancLeasing, Inc. and /or its Assigns
Equipment Type: 12 -14 CY Dump Truck, Street Sweeper, Mini Excavator, Trailer for Excavator,
Commercial Garbage Truck Chassis Packer Body, 3 4 Ton Service Truck
Equipment Cost: $1,446,291.84
Base Lease Commencement: Upon final Acceptance of Equipment
Payments Due: In arrears (Annually)
Lease Type: Municipal /Capital ($1.00 Purchase Option)
Base Lease Tenn: 5 years
Annual Payments: 5,751.28
Interest Rate: 2.515%
Advance Payments: -0-
End -of -term: Purchase the configuration for $1.00
Documentation Fee: -0-
Lease Rate Adjustment: The lease payment is fixed from the Commencement Date to the end of the initial
lease term. It may be adjusted on the Commencement Date to reflect any upward
change from the date of this proposal in either the Prime Rate of interest or like -term
U.S. Treasuries as published in the Wall Street Journal.
Lease Accounting: The Lessee and/or its accountants are responsible for determining Lessee's
accounting treatment of any lease schedule, including lease classification and
tax treatment.
Additional Terms: This quote is subject to the Lessee designating the agreement as a "qualified
tax - exempt obligation" as defined in Section 265(b)(3)(B) of the Internal
Revenue Code.
Thank you for the opportunity to work with you. Please contact me with questions or requests for additional information.
1 look forward to developing a mutually beneficial relationship with you.
Regards, Agreed To & Accepted By:
/136.,4%ess., Lessee: City of Port Arthur, Texas
Bart Shaw
Senior Account Executive Signature:
BancLeasing, Inc.
PH: 877.274.5327 Ext. 1847 Name:
tbshawebancleasing.com
Title: Date:
Toll Free: (877) 274 -5327 Ext. 1847 Direct: (214) 778 -1847 Fax: (214) 778 -1841