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HomeMy WebLinkAboutCOUNCIL MINUTES 2003-12-17 SPECIAL 34404 MINUTES OF THE TWO HUNDRED FORTY-FIRST SPECIAL MEETING OF DECEMBER 17, 2003 On December 17, 2003, the above special meeting was held at the City Hall, 33000 Civic Center Drive, Livonia, Michigan, and was called to order by the President of the Council at 7 00 p m Roll was called with the following result: Taylor, Laura, Brosnan, Knapp, Vandersloot, Dolan and Engebretson Elected and appointed officials present: Jack E Kirksey, Mayor; Sean Kavanagh, City Attorney; Alan Brandemihl, Fire Chief; Joan McCotter, City Clerk, Shad Whitehead, Fire Marshal, Dan Putman, Information Systems Director; Michael T Slater, Director of Finance, Yvonne Lillibridge, President of Local 192, Karen A. Szymula, Director of Legislative Affairs, Mark Taormina, City Planner; Robert Schron, City Engineer; Council-elect Tom Robinson, Council-elect Brian Meakin, Council-elect Frank Kokenakes, and Karen A. Tesner, Assistant City Clerk. On a motion by Laura, seconded by Dolan, it was #633-03 RESOLVED, that having considered a communication from Councilmember Joe Laura, dated December 17, 2003, the Council does hereby discharge the Committee of the Whole from further consideration of Council Resolution 626-03 relating to the purchase of one (1) 2002 American LaFrance Telesqurt Aerial Fire Truck, and does hereby direct that this matter be taken up for consideration by the Council at this time A roll call vote was taken on the foregoing resolution with the following result: AYES Laura, Knapp, Vandersloot and Dolan NAYS Taylor, Brosnan and Engebretson The President declared the resolution adopted Minutes of the Special Meeting of December 17, 2003 34405 On a motion by Laura, seconded by Dolan, it was #634-03 RESOLVED, that having considered the report and recommendation of the Fire Chief, dated November 14, 2003, which bears the signature of the Director of Finance and is approved for submission by the Mayor, the Council does hereby accept the quote of American LaFrance Michigan, 46944 Liberty Drive, Wixom, Michigan 48393, for supplying the Fire Department with one (1) 2002 American LaFrance 75 foot Telesqurt Aerial Fire Truck in the amount of $485,000 00, and the Director of Finance is hereby requested to solicit quotations for installment purchase financing for this purchase, such quotations to thereafter be submitted to Council for approval, FURTHER, the Council does hereby authorize the purchase of said item without competitive bidding for the reasons indicated in the aforesaid communication, and such action is taken in accordance with Section 3 04 140D4 of the Livonia Code of Ordinances, as amended Various individuals from the audience spoke, as reflected on the attached sign-in sheets The President relinquished the gavel to the Vice President at 7 43 p m to address this matter On a motion by Brosnan, seconded by Engebretson, it was RESOLVED, that the Council does hereby adjourn this matter at this time, to be continued after the Regular Meeting scheduled to begin at 8 00 p m On a motion by Laura, seconded by Dolan, it was RESOLVED, that the Council does hereby determine to substitute a resolution in lieu of the foregoing resolution which would continue the meeting A roll call vote was taken on the motion to substitute as follows AYES Laura, Vandersloot, Dolan and Knapp NAYS Taylor, Brosnan and Engebretson The Vice President declared the motion adopted Minutes of the Special Meeting of December 17, 2003 34406 A roll call vote was then taken on the original approving resolution with the following result: AYES Laura, Vandersloot, Dolan and Knapp NAYS Taylor, Brosnan and Engebretson The Vice President declared the resolution adopted, which also incorporates the following WHEREAS, an Installment Purchase Contract (the "Contract"), between the City of Livonia, County of Wayne (the "City"), American LaFrance Michigan (the "Vendor") and Banc One Leasing Corporation (the "Assignee") for the purchase and delivery of fire truck equipment (the "Equipment"), has been prepared, and WHEREAS, the total purchase price of the Equipment is $485,000 (the "Purchase Price"), and WHEREAS, pursuant to the Contract, the Purchase Price will be paid by the City to the Assignee in sixteen semi-annual installment payments of principal and interest, with interest payable at a rate equal to 3 40% per annum, and WHEREAS, the Contract is to be assigned to the Assignee, and WHEREAS, it is necessary to approve the Contract and authorize the Mayor and Clerk to execute the Contract and authorize City officials to execute certain other documentation relative thereto NOW, THEREFORE, BE IT RESOLVED THAT 1 The form of Contract as attached hereto as Exhibit A is hereby approved The City shall incur the debt described in the preamble hereof through execution of the Contract by the officers authorized below which debt shall consist of the Purchase Price of $485,000, which Purchase Price shall be payable in not to exceed sixteen (16) semi-annual installments of principal and interest with interest thereon at a rate of 3 40% per annum The installments of principal and interest shall be payable semi-annually commencing May 1, 2004 as shall be determined by the City's Director of Finance dhp Minutes of the Special Meeting of December 17, 2003 34407 2 The Mayor and City Clerk are hereby authorized and directed to execute the Contract and deliver it to Vendor, substantially in the form as attached hereto as Exhibit A, with such additions, changes and modifications as shall be approved by the City's Bond Counsel, Miller, Canfield, Paddock and Stone, P L.0 3 The useful life of the Equipment is hereby determined to be not less than eight (8) years 4 The Mayor, City Clerk and Director of Finance are each hereby authorized and directed to execute such additional documentation and open such accounts as shall be necessary to effectuate the closing of the Contract and the assignment thereof 5 The City's Director of Finance is hereby authorized to finalize the maturity schedule, amend the date of delivery of the Equipment and amend the dated date of the Contract in a manner not inconsistent with this resolution 6 The assignment of the Contract by Vendor to the Assignee is hereby approved • 7 The City hereby agrees to include in its budget for each year commencing with the current fiscal year, a sum which will be sufficient to pay the principal of and interest on the Contract coming due before the next fiscal year In addition, the City hereby pledges to levy ad valorem taxes on all taxable property in the City each year in an amount necessary to make its debt service payments under the Contract, subject to applicable constitutional, statutory and charter tax rate limitations 8 The City hereby covenants that, to the extend permitted by law, it shall take all actions within its control necessary to maintain the exemption of the interest on the obligations under the Contract from general federal income taxation (as opposed to alternative minimum or other indirect taxation) under the Internal Revenue Code of 1986, as amended, including but not limited to, actions relating to the rebate of arbitrage earnings, if applicable, and the expenditure and investment of proceeds of the Contract and moneys deemed to be proceeds 9 The City reasonably expects that it will not issue more than $10,000,000 in tax-exempt obligations in calendar year 2003 The City hereby declares that its obligations under the Contract shall be designated as "qualified tax-exempt obligations" for purposes of deduction of interest expense by financial institutions under the provisions of the Internal Revenue Code of 1986, as amended Minutes of the Special Meeting of December 17, 2003 34408 10 All resolutions and parts of resolutions insofar as they conflict with the provisions of this resolution be and the same hereby are rescinded ATTACHMENT A INSTALLMENT PURCHASE CONTRACT THIS CONTRACT, dated as of December 23, 2003 by and between the City of Livonia, County of Wayne, Michigan (the "City"), American LaFrance Michigan (the "Vendor"), and Banc One Leasing Corporation, as assignee of the Vendor (the "Assignee"), is as follows 1 Purchase Price, Title and Useful Life The City agrees to purchase and the Vendor agrees to sell one custom fire truck (the "Equipment"), all as set forth in the Vendor's specifications (the "Specifications"), for the sum of$485,000 (the "Purchase Price"), which will be payable as set forth on Exhibit A, attached hereto and made a part hereof, with sixteen semi-annual installment payments of principal and interest due on the 1st day of May and November commencing with the first payment of principal and interest on May 1, 2004, through and including November 1, 2011 The installments of principal hereunder shall not be subject to prepayment without the prior approval of the Assignee The City shall pay interest on the unpaid balance of the Purchase Price to the Assignee as the assignee of this Contract in accordance with Section 3 hereof, at a rate of interest equal to 3 40% per annum from the date funds are deposited by the Assignee as set forth in Section 3 hereof, computed on the basis of a 360 day year which interest shall be payable commencing May 1, 2004, and semi-annually thereafter, through the final date of payment of this Contract. The Purchase Price includes the Equipment and other rights assigned and conveyed by the Vendor to the City Upon delivery and acceptance by the City, title to the Equipment shall vest in the City The City agrees that the useful life of the Equipment is at least equal to or longer than the date of the final payment hereunder 2 Incorporation by Reference The Vendor agrees to all of the instructions, terms and conditions as may be outlined in the Specifications and any supplements thereto, which are hereby incorporated by reference in full herein In the event of a conflict in terms between this Contract and the Specifications, the specific terms of this Contract shall govern 3 Assignment to Assignee The Vendor hereby irrevocably assigns this Contract immediately to the Assignee in consideration for a payment from the Assignee in the amount of the Purchase Price to a fund to be held by a financial institution on behalf of the City and denominated "City of Livonia Fire Minutes of the Special Meeting of December 17, 2003 34409 Truck Acquisition Fund " The moneys in said Acquisition Fund shall be invested by the City and shall at all times be considered as City funds and said moneys in the Acquisition Fund shall only be used to pay the Vendor for the Equipment, a,,,,, only in accordance with written instructions of the City The City hereby consents to this assignment, except with respect to the warranties and other obligations of the Vendor set forth in Paragraph 2 and in Paragraphs 4 through 7, inclusive, of this Contract, all of which shall remain the sole responsibility of the Vendor and shall not be assignable With respect to the Assignee, the City hereby waives any defenses based upon warranty, failure or inability of the Vendor to perform its non-assignable obligations or the failure of the Equipment to perform its intended function To the extent that funds are disbursed into the Acquisition Fund by the Assignee in accordance with this paragraph, the City's obligation to the Assignee is absolute and unconditional and shall remain in full force and effect until the amount of the payment by the Assignee as specified in this paragraph together with interest thereon shall have been paid by the City to the Assignee, and such obligation shall not be affected, modified or impaired upon the happening from time to time of any event, including without limitation any of the following (a) Any failure of title with respect to the Vendor's interest in the Equipment specified herein or the invalidity, enforceability or termination of this Contract, (b) The modification or amendment (whether material or otherwise) of any obligation, covenant or agreement set forth in this Contract, (c) The voluntary or involuntary liquidation, dissolution, sale or other disposition of all or substantially all of the assets, marshalling of assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition with creditors or readjustment or other similar proceedings affecting the Vendor or any of its assets or any allocation or contest of the validity of this Contract, or the disaffirmance of this Contract in any such proceeding, (d) To the extent permitted by law, any event or action which would, in the absence of this clause, result in release or discharge by operation of law of the Vendor from the performance or observation of any obligation, covenant or agreement contained in this Contract, or (e) The default or failure of the Vendor fully to perform any of its obligations set forth in this Contract. It is expressly agreed between the Vendor, the City and the Assignee, by acceptance of the assignment of this Contract, that the City shall make all payments of principal and interest directly to the Assignee Assignee may further assign its rights, title and interest in and to the Contract, in whole or in part, to fib& any party at any time Any such assignee (the "Transferee") shall have all of the Minutes of the Special Meeting of December 17, 2003 34410 rights of the Assignee under the Contract. An assignment or reassignment of any of Assignee's right, title or interest in the Contract shall be enforceable against the City only after the City receives written notice of assignment which discloses the name and address of each such Transferee, provided, that such notice of any further assignment shall not be so required if Assignee assigns the Contract to Bank One Corporation or any of its direct or indirect subsidiaries The Vendor represents and warrants that the assignment to the Assignee of this Contract does not violate any agreement, contract or loan agreement to which it is a party, and that the Contract has been duly executed and delivered by the Vendor 4 Date of Acceptance The date of acceptance for the Vendor shall have been the date when all of the Equipment has been delivered to the City in accordance with the Specifications and the City has accepted the delivery of the Equipment in writing Upon acceptance, the City shall notify the depository bank, in writing, that the depository bank shall disburse the sums owing to the Vendor 5 Warranty Vendor warrants its Equipment as set forth in the Specifications and pursuant to the manufacturer's warranties and warrants its installation of the Equipment, if any Any warranties with respect to the Equipment shall not be assigned, but shall remain enforceable by the City 6 Entire Contract. This Contract and the documents expressly incorporated by reference herein constitute the entire agreement of the parties All prior or contemporaneous agreements, understandings, representations, and statements, oral or written, are hereby terminated 7 Amendments Any attempt to modify the terms of this Contract or of any supporting document shall be ineffectual unless in writing, signed by all parties and the City agrees to secure the consent of Assignee to any such modifications 8 Security and Tax Covenant. The obligation of the City to pay principal and interest under this Contract is a general obligation of the City The City shall include in its budget and pay each year, until this Contract is paid in full, such sum as may be necessary each year to make all payments hereunder, when due The City covenants that it shall comply with all requirements of the Internal Revenue Code of 1986, as amended, that must be satisfied subsequent to delivery of this Contract in order that interest thereon be (or continue to be) excluded from gross income for federal income tax purposes 9 Annual Audit. During the term of this Contract, within 30 days of the City completing its annual audit, the City, if so requested in writing, shall provide Assignee with said annual audit. Minutes of the Special Meeting of December 17, 2003 34411 10 Counterparts This Contract may be signed in any number of counterparts AMERICAN LAFRANCE MICHIGAN as Vendor By. Its Authorized Representative CITY OF LIVONIA By. Its Mayor By. Its City Clerk BANC ONE LEASING CORPORATION, as Assignee By. Its Minutes of the Special Meeting of December 17, 2003 34412 EXHIBIT A PRINCIPAL AND INTEREST PAYMENT SCHEDULE Date Principal 05/01/04 $28,844 88 11/01/04 $26,952 48 05/01/05 $27,410 89 11/01/05 $27,877 09 05/01/06 $28,351 22 11/01/06 $28,833 41 05/01/07 $29,323 81 11/01/07 $29,822 54 05/01/08 $30,329 76 11/01/08 $30,845 61 05/01/09 $31,370 23 11/01/09 $31,903 77 05/01/10 $32,446 39 11/01/10 $32,998 23 05/01/11 $33,559 46 11/01/11 $34,130 23 Total $485,000 00 AND RESOLVED, that having considered communications from the Director of Finance, dated November 26, 2003 and December 17, 2003, approved for submission by the Mayor, regarding the installment purchase financing for the Telesqurt Aerial Fire Truck, the Council does hereby approve a budget adjustment closing Fund 457 (Fire Station Construction Fund) and transferring the remaining balance in this fund (approximately $70,000 00) to the General Fund to be used for payment of the first year's debt service on the installment contract. On a motion by Laura, seconded by Dolan, and unanimously adopted, this 241st Special Meeting of the Council of the City of Livonia was adjourned at 8 05 p m , December 17, 2003 "i'� Joa i McCotter, City Clerk SIGN IN SHEET CITY COUNCIL SPECIAL MEETING OF DECEMBER 17, 2003 ****************Please Sign-In**************** PLEASE PRINT NAME ADDRESS OPPOSED NOT OPPOSED /re A L T /3-c;L:LI _7 02;2 /C) Z,5, , / '730,-)7/ 4Ved-4_4',Ef- /G�Orx 5,1 D.Z y 6 t runt �� . LkbS //�'U v 1.-01/(-//live ,� SIGN IN SHEET CITY COUNCIL SPECIAL MEETING OF DECEMBER 17, 2003 ****************Please Sign-In**************** PLEASE PRINT NAME ADDRESS OPPOSED NOT OPPOSED i/�fa 'tip �..' e- A /.-'i I./e_Tel=