HomeMy WebLinkAboutItem 06.h
Item No.
LAKEVILLE POLICE DEPARTMENT LEASE-PURCHASE AGREEMENT WITH
MOTOROLA SOLUTIONS INC. AND RESOLUTION AMENDING THE 2018
EQUIPMENT FUND BUDGET
Proposed Action
Staff recommends adoption of the following motion: Move to approve Equipment Lease -
Purchase Agreement with Motorola Solutions Inc, an LLC and Resolution Amending the 2018
Equipment Fund Budget.
Overview
The purchase of about half of the 800 MHZ replacement radios was included in the 2018
Equipment Fund budget. The remainder of the radios/equipment was programmed in 2019 per
the 2018-2022 Capital Improvement Plan. This lease-purchase agreement will complete the
entire equipment purchase in 2018, will defer payment until January of 2019 and will save the
City $32,679 by agreeing to the terms of the lease-purchase. Equipment is procured in one
transaction, saving time and reducing future maintenance costs on end-of-life equipment.
The following chart provides a summary of the purchase:
2018
Budget
2019 CIP Total Less Trade-
In Value
NET
Proposed Lease-Purchase 501,908 0 501,908 (57,500) $444,408
Expenditures (budgeted /
programmed at net of trade-
in)
266,866 210,221 477,087 0 477,087
Change 235,042 (210,221) 24,821 (57,500) (32,679)
With a lease-purchase of equipment, the gross expenditure and trade-in value will be recognized
on the financial statements in the year that the equipment is received (2018) versus when the
actual payment is made (2019). The 2018 Equipment Fund budget will need to be amended to
reflect the gross expenditure for all the equipment as well as the updated trade-in amounts.
The lease-purchase agreement is a three-year agreement (2018-2021). If full payment is made on
1/21/2019, no interest expense is incurred. Staff anticipates that full payment would be made in
2019 but would evaluate this transaction and other cashflow needs for the Equipment Fund.
December 18, 2017
Primary Issues to Consider
• 800 MHZ encrypted radios are needed and in the 2018 budget.
• A portion of the project will be paid for with 2019 funds.
• The agreement will facilitate all equipment being replaced at the same time instead of
over a period of two budget cycles.
• The agreement results in a 6.8% or $32,679 savings over the programmed amount in the
2018-2027 CIP plan.
Supporting Information
• Lease-Purchase Agreement with Motorola Solutions Inc.
• Resolution
Financial Impact: Budgeted: Y☒ N☐ Source:
Related Documents: (CIP, ERP, etc.):
Envision Lakeville Community Values: Good Value for Public Services
Report Completed by: Deputy Chief John Kornmann; Finance Director Jerilyn Erickson
$444,408
Equipment Fund
2018 Budget & 2018-2022 CIP
CITY OF LAKEVILLE
RESOLUTION NO. ________
RESOLUTION AMENDING THE 2018 EQUIPMENT FUND BUDGET
WHEREAS, the 2018 Equipment Fund budget included the purchase of about half of the
800 MHZ replacement radios and the remainder of the radios/equipment was programmed in
2019 per the adopted 2018-2022 Capital Improvement Plan; and
WHEREAS, the City can purchase all the planned radio/equipment replacements per a
lease-purchase agreement with Motorola Solutions Inc and realize a $32,679 savings; and
WHEREAS, the 2018 Equipment Fund budget was adopted on December 4, 2017.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lakeville,
Minnesota as follows:
1. The recitals set forth above are incorporated herein.
2. The 2018 Equipment Fund budget is amended to reflect the gross expenditures and revenues
associated with purchasing the radios/equipment per the lease-purchase agreement with
Motorola Solutions Inc. as follows:
a. Expenditures - $501,908
b. Revenues - $57,500
ADOPTED by the Lakeville City Council this 18th day of December 2017
CITY OF LAKEVILLE
___________________________
Douglas P. Anderson, Mayor
ATTEST:
_____________________________
Charlene Friedges, City Clerk