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AGENDA ITEM <br />Item No.: 9 <br />Date: October 23, 2023 <br />Item Description: Capital Lease Approval — Huntington Bank <br />Presenter: Ronald John Olson Agenda Consent Agenda <br />Finance Director Section: <br />1. Purpose. The purpose of the action item is to gain approval for staff to negotiate a lease agreement <br />with Huntington Bank for the purchase of the used 2017 Rosenbauer Pumper Rescue vehicle for the <br />Orono Fire Department. <br />2. Background. On August 28' the Council approved the purchase of the 2017 Rosenbauer fire <br />vehicle. The Council also directed staff to obtain competitive lease proposals for the financing of the <br />vehicle. After consultation with Ehlers's, the city's financial advisor, staff contacted Bridgewater Bank, <br />Huntington Bank, and Rev Financial services for proposals. Bridgewater, the city's current bank, does <br />not offer lease programs. Staff reviewed proposals by Rev Financial and Huntington Bank. The rates are <br />as follows: <br />Financial Inst <br />Rate <br />Term <br />Interest <br />Huntington Bank <br />5.0 <br />6 years <br />$ 82,360 <br />Rev Financial <br />6.3 <br />7 years <br />$101,120 <br />3. Cost. The total interest cost with Huntington Bank will be $82,360. There will be an additional $250 <br />documentation fee. <br />4. Funding. Funding will be from the Fire Capital Fund. The fund balance at the end of 2024 is <br />estimated to be $178,500. <br />5. Staff Recommendation. Staff recommends that Council grants staff the authority to negotiate and <br />enter into a lease with Huntington Bank based on the attached term sheet. <br />COUNCIL ACTION REQUESTED <br />Motion to allow staff to negotiate and enter into a lease agreement with Huntington Bank. <br />Exhibits: <br />A. Term Sheet <br />B. Payment Schedule <br />C. Draft Lease <br />Prepared By: SIC <br />Reviewed By: Ayo <br />Approved By: 7E <br />