sr-110811-3gQ
Iowa
City of City Council Report
Santa 3101lica
City Council Meeting: November 8, 2011
Agenda Item:
To: Mayor and City Council
From: Martin Pastucha, Director of Public Works
Subject: Purchase Order Modification for the Lease of Three Scrubber /Sweepers
Recommended Action
Staff recommends that City Council modify Purchase Order No. 19143 with U.S.
Bancorp Business Equipment Finance Group, a Minnesota -based company, in the
amount of $20,000 for taxes and fees for the lease of three scrubber /sweepers. This
will result in a total purchase order amount of $348,673 for a period of four years.
Executive Summary
In June 2010, Council approved the lease of three scrubber /sweepers to replace three
scrubber /sweepers used by Promenade Maintenance primarily for sidewalk cleaning. A
purchase order modification in the amount of $20,000 is required to pay for property
taxes and fees not included in the initial contract amount. The total amount of the four -
year lease and maintenance contract for the three scrubber /sweepers is $348,673
including applicable sales tax, property tax, and processing fees.
Discussion
On June 8, 2010, Council approved a lease agreement with Tennant Sales and
Services Company for the lease and maintenance of three scrubber /sweepers in an
amount not to exceed $328,673, including sales tax, over a four -year term. At that time
staff did not include the property tax and processing fees in the purchase order amount
of $328,673. Tennant is the vendor who was awarded the lease and maintenance
contract for the scrubber /sweepers. Tennant uses U.S. Bancorp as the finance
company for this lease and maintenance agreement. Payments are made to Tennant
through U.S. Bancorp. Staff recommends a purchase order modification in the amount
of $20,000 to pay for $9,705 in property taxes and handling fees; $2,455 in late fees for
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unpaid property taxes; and a $7,840 contingency. This would result in a new purchase
order amount of $348,673 for a period of four years.
Financial Impacts & Budget Actions
The purchase order modification to be awarded to U.S. Bank Corporation is $20,000, for
a new purchase order total of $348,673 for a period of four - years. Funds for the lease
of the three scrubber /sweepers are included in the FY2011 -13 budget at account
C540167.589200, Fleet Vehicle Replacement Program. Budget authority for
subsequent years will be requested in each budget cycle for Council approval. Future
funding is contingent upon Council approval.
Prepared by: Rick Sikes, Fleet Management Superintendent
Approved:
artin Pastucha
Director of Public Works
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Forwarded to Council:
Rod Gould
City Manager