HomeMy WebLinkAbout2014-108-12/02/2014-AUTHORIZING THE PURCHASING AGENT TO LEASE ADDITIONAL EQUIPMENT UNDER THE CITY'S STANDARD MASTER LEAS RESOLUTION 2014-108
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AUTHORIZING THE PURCHASING AGENT TO LEASE ADDITIONAL EQUIPMENT
UNDER THE CITY'S STANDARD MASTER LEASE AGREEMENT WITH
PINNACLE PUBLIC FINANCING, INC. AND TO ENTER INTO A FIRST
AMENDMENT TO THAT STANDARD MASTER LEASE AGREEMENT
WHEREAS, the City of Fort Collins (the "City") and Pinnacle Public Finance, Inc.
("Pinnacle") have previously entered into that certain "Standard Master Lease Agreement" dated
February 15, 2011, (the "Agreement"); and
WHEREAS, the Agreement provides that Pinnacle will lease to the City certain
"Equipment" as generally described in Section 1.1 of the Agreement and as specifically
described in each "Schedule of Equipment" that is agreed to in the future and added to the
Agreement as Exhibit A by the City and Pinnacle (collectively, the "Equipment"); and
WHEREAS, the Agreement contemplates an initial term of. one year, with up to four
additional one-year terms, not to exceed a total of five years; and
WHEREAS, Article V of the Agreement grants the City the option to purchase any or all
of the Equipment in accordance with the provisions of Article V of the Agreement; and
WHEREAS, the Agreement also expressly provides that all of the City's obligations
under the Agreement are subject to the City Council's annual appropriation of each year's lease
payments and, if such appropriation does not occur, Pinnacle's sole remedy is to repossess the
Equipment; and
WHEREAS, since entering into the Agreement, the City's Purchasing Agent has, after
approval by the City Council, leased Equipment on the City's behalf from Pinnacle under seven
separate schedules of equipment and corresponding payment schedules; and
WHEREAS, the Purchasing Agent has negotiated with Pinnacle the lease of additional
Equipment under the Agreement as described in the "Schedule of Equipment No. 8" dated
December 9, 2014, attached hereto as Exhibit "A" and incorporated herein by reference
("Schedule of Equipment No. 8"); and
WHEREAS, the Purchasing Agent has also negotiated with Pinnacle quarterly lease
payments of Sixty Six Thousand Five Hundred Fifty One Dollars and Fourteen Cents
($66,551.14) for five years for the Equipment being leased in Schedule of Equipment No. 8 as
set forth in the parties' "Payment Schedule, Equipment Schedule #8" dated December 9, 2014,
(the "Payment Schedule"); and
WHEREAS, the funds needed for the City's quarterly lease payments that will be owed
to Pinnacle in 2015 for the Equipment being leased in Schedule of Equipment No. 8, have been
budgeted and appropriated in the City's 2015 annual budget that was adopted by Council on
November 18, 2014; and
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WHEREAS, the Purchasing Agent and Pinnacle have also negotiated the "First
Amendment to Master Lease Agreement" attached hereto as Exhibit `B" and incorporated herein
by reference (the "First Amendment"); and
WHEREAS, the purpose of the First Amendment is to amend certain language in Section
1.2 of the Agreement to clarify the City's and Pinnacle's original (and current) intent with
respect to the language in Section 1.2 that provides that the City is to be listed as the owner on
the titles of motor vehicles included in the Equipment leased under Schedule of Equipment No. 8
and that have been leased under the previous seven schedules of equipment; and
WHEREAS, that such original (and current) intent of this motor-vehicle-title language
was and is not to change the lease-purchase nature of the Agreement, but solely for the purposes
of establishing ownership of the leased motor vehicles for federal tax purposes, reducing
Pinnacle's liability for any civil claims arising from the City's use of the motor vehicles, and for
the City's administrative convenience in establishing clear title to vehicles when the City
exercises its option to purchase any of them; and
WHEREAS, this intent is further supported in the First Amendment by the addition of a
new Section 1.4 to the Agreement to establish a process by which the originals of the State of
Colorado certificates of title for the leased motor vehicles will be kept in the possession of a
third-party escrow agent until the City either exercises its option under the Agreement to
purchase a leased motor vehicle, in which event the vehicle's title will be delivered to the City,
or the Agreement terminates as a result of nonappropriation, as a result of a default under the
Agreement by the City, or upon reaching the end of the lease term, in which events the
certificates of title will be delivered to Pinnacle; and
WHEREAS, the City is authorized in Section 8(c) of Article V of the City Charter,
Article IV in Chapter 8 of the City Code, and in C.R.S. Section 31-15-801 to enter into multiple-
year lease-purchase agreements provided each year's lease payments are subject to annual
appropriation; and
WHEREAS, the lease of the Equipment in Schedule of Equipment No. 8 under the Lease
will not constitute a "multiple fiscal year direct or indirect debt or other obligation" of the City
within the meaning of Section 20(4)(b) of Article X of the Colorado Constitution and, therefore,
this lease of Equipment under Schedule of Equipment No. 8 can be entered into without voter
approval; and
WHEREAS, the City Council has determined that it is in the City's best interests to lease
from Pinnacle all of the Equipment described in the Schedule of Equipment No. 8 in accordance
with the terms and conditions of the Agreement; and
WHEREAS, the City Council has also determined that it is in the City's best interests for
the City to enter into the First Amendment.
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NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF
FORT COLLINS as follows:
Section 1. That all of the recitals set forth above in this Resolution are hereby
adopted as the City Council's findings in support of this Resolution.
Section 2. That the First Amendment is hereby approved and the Purchasing Agent is
authorized to enter into it on the City's behalf. The Purchasing Agent, in consultation with the
City Attorney, may agree to modifications and amendments to the First Amendment as may be
needed to protect the City's interests and that are consistent with the stated purposes of this
Resolution.
Section 3. That the lease of the Equipment in Schedule of Equipment No. 8 under the
Agreement, as amended in the First Amendment, and the Payment Schedule are hereby.
approved, and the Purchasing Agent is hereby authorized to enter into the Schedule of
Equipment No. 8 and the Payment Schedule on the City's behalf. The Purchasing Agent may
agree, in consultation with the City Attorney, to modifications and amendments to Schedule of
Equipment No. 8 and the Payment Schedule as may be needed to protect the City's interests and
that are consistent with the stated purposes of this Resolution.
Passed and adopted at a regular meeting of the Council of the City of Fort Collins this
2nd day of December, A.D. 2014.
OF FO
ayor
ATTEST: o
tr
City Clerk .'.q�Do
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EXHIBIT A
Schedule of Equipment No. 8 December 9,2014
RE: STANDARD MASTER LEASE AGREEMENT entered into as of February 15, 2011, ("Agreement"),
between Pinnacle Public Finance("Lessor") and the City of Fort Collins, Colorado ("Lessee"). All terms
used and not otherwise defined herein have the meanings ascribed to them in the Agreement.
The following items of Equipment are hereby included under this Schedule to the Agreement:
Item Department(Fund Description Oty Cost Term
Streets
Transportation Pavement Milling Machine 1 660,000.00 5 yrs
Streets/
Transportation Sidewalk Tractor with accessories 1 93 200.00 5 yrs
Streets/
Transportation Dump Body for Plow truck 1 61,000.00 5 yrs
Police/General KFCG Ford Police Interceptor AW D 1 26 700.00 5 yrs
Police/General Police Vehicle Equipment 1 lot 7,800.00
5 vrs
Police/General Ford Police Interceptor AWD 4 106,800.00 5 Yrs
Police/General Police Vehicle Equipment 1 lot 49,500.00 5 yrs
IT/Data& Dell OptiPlex 9020 Mmitower 25 22,000.00
Communications 5 yrs
IT/Data& Dell OptiPlex 9020 Small Form Factor 50 44,100.00
Communications 5 rs
Data&
Communications Dell Latitude E6440 CTO&case 91 126,100.00
Co 5 vrs
IT/Data& Dell Venue 11 Tablets 10 13,500.00
Communications 6 rs
IT/Data& Dell Latitude E6430 ATG 10 24,000.00
Communications 5 rs .
IT/Data& E Porte Plus 95 8,300.00
Communications 5 rs
IT/Data& Dell 22 Monitor- P2214H 20 3,300.00
Communications 5 yrs
IT/Data& Dell 24 Monitor-P2414H 10 2,500.00
Communications 5 yrs
IT/Data& Computer accessories 1 lot 6,750.00
Communications 5 rs
Total: 1,255,550.00 s yrs
Lessee hereby represents, warrants and covenants that its representations, warranties and covenants set
forth in the Agreement are true and correct as though made on the Commencement Date of Payments
under this Schedule. The terms and provisions of the Agreement(other than to the extent that they
relate solely to other Schedules or Equipment listed on other Schedules) are hereby incorporated
into this Schedule by reference and made a part hereof.
Lessee: the City of Fort Collins, Colorado Lessor: Pinnacle Public Finance
By By
Gerry S. Paul
Director of Purchasing& Risk Management Name
Title
Date: Date:
Schedule of Equipment No 8 1 December 9, 2014
FIRST AMENDMENT TO STANDARD MASTER LEASE AGREEMENT
This First Amendment to Standard Master Lease Agreement (this "Amendment") is
entered into this day of 2014, by and between Pinnacle Public Finance,
Inc. ("Lessor') and the City of Fort Collins, Colorado, a home rule municipal corporation
("Lessee"). The Lessor and Lessee are hereafter sometimes jointly referred to as the "Parties".
RECITALS
WHEREAS, the Lessor and Lessee have previously entered into that certain "Standard
Master Lease Agreement" dated February 15, 2011 (the "Agreement"); and
WHEREAS, each "Schedule of Equipment"attached as Exhibit "A" to the Agreement and each
corresponding "Payment Schedule" attached as Exhibit "B" to the Agreement, together constitute a
"Schedule"; and
WHEREAS, each Schedule and the terms and provisions of the Agreement,together with
all exhibits attached thereto and any amendments and modifications to the Agreement, are
incorporated by reference into each such Schedule and constitute under the Agreement a separate
and independent lease and installment purchase of the Equipment therein described and are
referred to as a "Lease" in the Agreement; and
WHEREAS, under each Lease, the Lessor leases to the Lessee certain "Equipment" as
identified in Section 1.1 of the Agreement, which Equipment includes motor vehicles; and
WHEREAS, Article V of the Agreement also grants the Lessee the option to purchase
any or al I of the Equipment in accordance with the provisions of Article V of the Agreement; and
WHEREAS, Sections 1.3, 2.4, and 3.3 of the Agreement expressly provide that all of the
Lessee's obligations under each Lease are subject to annual appropriation by the Lessee's City
Council (the "Council") for the funds needed to meet those obligations, which appropriation is
entirely within the Council's sole discretion; and
WHEREAS, Section 3.3 of the Agreement provides that if the Council has not
appropriated the needed funds and the Lessee has not otherwise exercised its option to purchase
the Equipment, the Lessor is entitled to take possession of such Equipment; and
WHEREAS, consistent with the lease-purchase nature of each Lease, Section 1.2 of the
Agreement provides that during the term of each Lease, title to the Equipment will be in the
Lessor subject to any transfer of that title upon the Lessee's exercise of its option to purchase any
or all of the Equipment as provided in Article V of the Agreement; and
WHEREAS, notwithstanding this statement in Section 1.2 of the Agreement that the
Lessor holds title to the Equipment, Section 1.2 also states: "Lessor and Lessee agree that the
Lessee shall be listed as owner on vehicle titles and shall be treated as the owner for all purposes
and it will not be necessary for Lessor to be listed as lienholder on vehicle titles"; and
WHEREAS, the Lessee and Lessor now A;ish ,to clarify in this Amendment, that their
original (and current) intent in the Agreement for this motor-vehicle-title language in Section 1.2
was agreed to by the Parties solely for the purposes of: (1) establishing ownership of the
Equipment for federal tax purposes; (2) reducing the likelihood of the Lessor's liability for any
civil claims that might arise from the Lessee's use of the leased motor vehicles under the Lease;
and (3) for the Lessee's administrative convenience in establishing clear title to such motor
vehicles when the Lessee does exercise its option under the Agreement to purchase any or all
such motor vehicles; and
WHEREAS, it is also not the Parties' intention by entering into this Amendment to now
modify, change or in any way diminish the lease-purchase nature of the the Agreement and each
Lease with respect to the motor vehicles leased under a Lease or to do so with respect to the
contingent nature of the Lessee's obligations under each Lease being subject to Council's annual
appropriation or to do so with respect the Lessee's fully vested title ownership of the motor
vehicles being complete when the Lessee has exercised its option to purchase them under the
Agreement; and
WHEREAS, the capitalized words and terms used herein shall have the same meaning
given to them in the Agreement, except as expressly provided herein.
NOW, THEREFORE, in consideration of the mutual covenants and promises of the
Parties contained in this Amendment and other good and valuable consideration, the receipt and
adequacy of which are acknowledged, the Parties agree to the following terns and conditions of
this Amendment.
AGREEMENT
Section 1. That all of the recitals set forth above in this Amendment are hereby
incorporated into this Amendment and the Agreement, as amended by this Amendment, as
though fully set forth in the body hereof.
Section 2. That Section 1.2 of the Agreement is hereby amended to read in full as
follows:
1.2 Title
During the term of each Lease, title to the Equipment will be in Lessor subject to the
transfer to Lessee upon Lessee's purchase of the Equipment as provided herein. Upon the
termination of the Lease for any reason other than Lessee's purchase of the Equipment, title to
any Equipment not purchased by Lessee at the time of termination shall remain in Lessor.
Lessor at all times will have access to the Equipment for the purpose of inspection, alteration and
repair. Notwithstanding that Lessor holds naked legal title under each Lease until title has fully
vested in Lessee, Lessee and Lessor agree Lessee shall be the owner of the Equipment for federal
tax purposes and that during the Lease Term, Lessee shall have all the beneficial and equitable
rights of ownership and the associated obligations and liabilities including but not limited to
insurance, taxes, and maintenance associated with the Equipment. Lessee and Lessor further
agree that Lessee shall be listed as "Owner" on the vehicle titles and shall be treated as the owner
for all the purposes stated herein. It will not be necessary for Lessor to be listed as lienholder on
vehicle titles. Upon the payment of all rent payable pursuant to Section 4.1 for the original term
and all renewal terms, or exercise of the option to purchase as specified herein, Lessor shall
immediately transfer title to any Equipment so purchased to Lessee, and Lessor's interest in such
Equipment shall terminate. Following a non-appropriation of funds by Lessee or an event of
default by the Lessee under any Lease, the Lessee will, at the Lessee's expense, execute and
deliver such additional instruments, certificates or documents, and will take all such actions as
the Lessor may reasonably request for the purposes of implementing or effectuating the
provisions of such Lease with respect to title in the Equipment vesting in Lessor or for the
purpose of more fully completing, perfecting, continuing, preserving or renewing the rights of
the Lessor with respect to the Equipment.
Section 3. That a new Section 1.4 is hereby added to the Agreement to read in full as
follows:
1.4 Title to Leased Motor Vehicles.
Notwithstanding the provision in Section 1.2 of the Agreement that the titles of the motor
vehicles leased by the Lessee under the.Agreement will list the Lessee as the owner, the
Lessee and Lessor acknowledge that naked legal title of each such motor vehicle shall
remain in the Lessor unless and until the Lessee exercises its option to purchase the
motor vehicles in accordance with Article V of the Agreement. To further clarify that
this is the intent of the Parties, the Lessee agrees to promptly deposit with First National
Wealth Management, a division of First National Bank of Omaha, the "Escrow Ageni"
identified in Exhibit "D" ("Escrow Agent"), the original of all of the State of Colorado
motor vehicle certificates of title now in the Lessee's possession for the motor vehicles
leased under the Agreement and all original certificates of title the Lessee receives in the
future for motor vehicles it hereafter leases under the Agreement. Lessor and Lessee
shall also enter into an escrow agreement with the Escrow Agent which shall instruct the
Escrow Agent to safely keep and maintain all of the motor vehicle certificates of title
delivered into its possession. The escrow agreement shall also provide the following: (1)
in the event the Lessee notifies the Lessor under Section 3.3 of the Agreement of a non-
appropriation by the Lessee's City Council of funds needed for any or all of the motor
vehicles leased under the Agreement, that the Escrow Agent shall have the Lessee's
power-of-attorney to execute on behalf of the Lessee the assignments of title for each of
the certificates of title of the motor vehicles leased hereunder for which funds have not
been so appropriated; or (2) in the event that the Lessee has exercised its option to
purchase any or all of the motor vehicles leased under the Agreement, the Escrow Agent
shall return the original certificates of title for those motor vehicles to the Lessee and the
Lessee's original power of attorney for each such motor vehicle. Lessee agrees to be
responsible for all costs incurred with the Escrow Agent with respect to the escrow
agreement.
Section 4. That except as expressly amended in this Amendment, the Parties
agree that all of the other terms, conditions and provisions of the Agreement shall remain
unchanged and in full force and effect.
IN WITNESS WHEREOF, this Amendment has been executed by the Parties as of the
date and year first stated above.
PINNACLE PUBLIC FINANCE, INC.
By:
Cathy Jimenez, Managing Director/SVP
ATTEST:
(Corporate Seal)
THE CITY OF FORT COLLINS, COLORADO
By:
Gerry Paul
Director of Purchasing & Risk Management
ATTEST:
Lessee:
Wanda Nelson, City Clerk
APPROVED AS TO FORM:
John R. Duval
Senior Assistant City Attorney