 |  | 5919 MAIN STREET . NEW PORT RICHEY, FL 34652 . 727.853.1016 |
| TO: | City of New Port Richey City Council | | FROM: | Crystal S. Feast, Finance Director | | DATE: | 8/4/2020 | | RE: | Resolution No. 2020-40: Authorizing the Financing of the Purchase of an Aerial Ladder Truck |
REQUEST:
The City Council is being asked to review and approve Resolution No. 2020-40, which authorizes the financing of a purchase of an Aerial Ladder Truck, in an amount not to exceed $890,000, through a lease agreement with Truist Bank (formerly known as SunTrust Bank and BB&T Bank).
DISCUSSION:
On May 21, 2019, the City Council authorized the purchase of a 2020 75’ Aerial Ladder Truck from E-One, which would replace the City’s existing 1194 75’ Aerial Ladder Truck. The original intended funding source for this purchase was a loan through the United State Department of Agriculture (USDA). Staff began working with USDA to complete the application and funding process. Part of that process included obtaining 2 proposals from financial institutions that were also interested in financing the purchase. After obtaining proposals from Truist Bank (formerly SunTrust Bank and BB&T Bank) and Bank of America, the USDA determined that the proposal from Truist was better than what the USDA could currently offer and recommended that the City move forward with financing through Truist Bank.
The terms of the lease agreement are as follows:
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15 year repayment plan
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Interest rate of 2.40%
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Semi-annual payments of approximately $35,500 (payment amount will be adjusted based on final amount financed)
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1% prepayment for first half of term
RECOMMENDATION:
It is recommended that the City Council approve Resolution No. 2020-40.
BUDGET/FISCAL IMPACT:
Future debt service payments will be budgeted using Penny for Pasco funds and/or General Fund Revenue. | | | |