| | | | | | | | CITY OF OAKLAND PARK, FLORIDA
CITY COMMISSION AGENDA ITEM REPORT
AGENDA ITEM NO. 3 | | MEETING DATE: 11/3/2021 |
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| | | | | | | | | PREPARED BY: | Andrew M. Thompson, CGFO
CFO, Department of Financial Services | DEPARTMENT HEAD APPROVAL: | FINANCIAL SERVICES |
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| | | | | | | | | SUBJECT: Vehicle & Equipment Financing |
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| | | | | | | | | 1. | BACKGROUND/HISTORY
| | | Issue Statement: The FY 2022 budget included a planned issuance of debt to finance the purchase of vehicles and capital equipment for the General Fund. On September 22, 2021, the City issued a request-for-proposal for external financing not-to-exceed $3,000,000 for the purpose of financing the purchase of fourteen (14) vehicles, including a Fire Ladder Truck & two (2) Rescue Transport vehicles, and Fire-Rescue equipment. The City received and reviewed six (6) proposals.
Recommended Action: The City Commission pass an ordinance on first reading approving the loan with Sterling National Bank in the amount not to exceed $3,000,000 at an interest rate of 1.31%
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| | | | | | | | | 2. | CURRENT ACTIVITY
| | | The City Commission adopted a fiscal year 2022 budget that included the issuance of debt to fund vehicle and equipment purchases. On September 22, 2021, the City released RFP-101421-0-2021 to secure this planned loan. Responses were due on October 14, 2021 and the City received six (6) proposals:
- BB&T
- BCICapital, Inc.
- JP Morgan
- Key Government Finance, Inc.
- Sterling National Bank
- Synovus Bank
On October 22, 2021, the evaluation committee met with the City's financial advisor, Dunlap & Associates, and reviewed the proposals. The consensus decision was to recommend award to Sterling National Bank. The evaluation committee memorandum is attached as reference.
The attached ordinance establishes the legal authority to enter into the loan agreement with Sterling National Bank. |
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| | | | | | | | | 3. | FINANCIAL IMPACT
| | | The amount of the Sterling National Bank loan will not exceed $3 million. Staff are in the process of receiving vehicle quotations and the exact dollar amount of the loan will be finalized in advance of second reading.
The proposed loan would close by November 23, 2021 and the last payment would be made on July 1, 2028. The length of the loan is effectively six years and seven months. The loan may be prepaid without penalty beginning year 4 of the loan. The loan would be paid in monthly installments. With the maximum amount of $3 million, the monthly payments would be $39,667.81, or $476,013.72 on an annual basis.
Debt service funding for the loan was included within the FY 2022 budget. |
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| | | | | | | | | 4. | RECOMMENDATION
| | | The City Commission pass an ordinance on first reading approving the loan with Sterling National Bank in the amount not to exceed $3,000,000 at an interest rate of 1.31% |
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