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® , <br /> THE CITY OF 16 <br /> PLEAS�4NTONe CITY COUNCIL AGENDA REPORT <br /> August 16, 2011 <br /> Operations Services <br /> TITLE: APPROVAL OF EQUIPMENT LEASE- MAINTENANCE EQUIPMENT WITH <br /> BANK OF AMERICA FOR CALLIPPE PRESERVE GOLF COURSE <br /> EQUIPMENT <br /> SUMMARY <br /> To assure that the Callippe Preserve Golf Course is operated as cost efficiently as <br /> possible, the City staff, in cooperation with CourseCo, the course operator, regularly <br /> review equipment needs and replacement schedules and determine required inventory <br /> and replacement timing. To manage cash flow and the integration of new equipment, <br /> equipment replacement occurs in regular phases with the last occurring in December <br /> 2010. Staff is now recommending a second phase of equipment replacement. After <br /> reviewing various acquisition options, including purchase, staff is again recommending <br /> a five year lease purchase agreement to acquire required equipment as it represents <br /> the best alternative for utilizing ongoing golf course revenues to cover equipment <br /> acquisition costs. <br /> RECOMMENDATION <br /> Authorize the City Manager to execute an Equipment Lease-Maintenance Equipment <br /> agreement with Bank of America (Attachment 1) in the amount of $298,300 for <br /> Callippe Preserve Golf Course maintenance equipment. <br /> FINANCIAL STATEMENT <br /> The quarterly lease payment for equipment acquisition will be $15,839 ($63,356 <br /> annually). Quarterly lease payments will begin in December 15, 2011 and end in <br /> September 15, 2016. Total interest paid on the $298,300 amount will be $18,472 for a <br /> total amount paid of $316,772. The City's Budget includes funding for the 2011/I2FY <br /> lease payments. Payments for subsequent years will be included in future budgets <br /> funded from Callippe Preserve Golf Course revenues. <br />