HomeMy WebLinkAbout2004-04-12 04-115 RESOLVEItem No. 0Y115
Date: 4-12-04
Item/Subject: RESOLVE, Appropnadng $38,4601n Revenue Sharing for Me Purpose of Purchasing a
Used Printing Press
Responsible Department: Finance
During the F 004 budget process, the City was advised to hold estimated Revenue Sharing revenues flat
based upon actual receipts in Fy2003. Thus the City budgeted for $3,110,000 in Revenue Sharing for
this year. In September, the City received revised estimates from the Stare Treasurer's Office indicating
Mat Barl estimated Revenue Sharing far Ftt004 was $3,589,000. After nine months of receipts, it
appears that actual State Revenue sharing will be at least this amount. To date she City has appropriated
$285,000 of the excess N replace a 1982 fire ergine. The attached resolve would appropriate an
additional $38,460 of the excess to replace a 35 year old ane color printing press,
Based upon the need and the Otys capital plan, staff andapated replacing the printing prey as part of
the H2005 annual appropriation resolve. However, City staff found a 1 year-old press with only 3
months of use, resulting in an $8,000 savings ever the estimated cost of a new press. In order W obtain
this press, the request has m be evaluated outside of Me budget process. The current press Is prone to
maintenance delays due M its' age, Is outdated for use in high volume reproductions, limited to 8'h x 11
work, hall to one color runs, and is not longer in compliance with OSHA safety standards. The
proposed replacement will more effectively and efficiently handle high volume jobs, paper in excess of 8
lh x 11, two color runs, and meets OSHA standards. It Is estimated that the new printing press will result
in $8,000 of additional revenue M this cost center. The finance Committee reviewed this request and
recommends approval by a 3 — 2 vote. /f . n
Department Head
Manager's Comments:
It is dear that a new press is required to handle the Otys current requirements for high volume printing.
Normally this would be considered as a pan of Me budget process. However, given the savings that can
W realized by the opportunity that has been presented, l would recommend your approval of mowng
forward on this now. pp W
ol ivu i:"W 4iat J 1Ta F~u 45mW61W City Manager
Associated Information
Budget Approval:
Finance Director
Legal Approval:
city Sold
Introduced for
Passage
X First Reading Page _ of
Referral
Aeeigoed to councilor Farrington April lz, zooa
CITY OF BANGOR
(TITLE.) Resolve, Appropriating $38,9 D In Revenue Sharing for the Purpose of Purchasing a Used
Pdntln9 Press
By the Gly Couwl of Me Uy ofHamgor.
BE IT RESOLVED THAT the sum of $36,960 In additional current year Revenue Sharing Funds
be appropriated as a transfer to the Capital Projects Fund for the purpose of purchasing a used
Printing Press.
IP LIT[ COUNCIL
April 12. 2006
First Heading
T4
IN CRY COUCIL
April 26, 2006
Motion Mede soul Secoaded
for Passage
Notice Doubted
Vote: I yea, 1 0o.
1 absent
Couacilora voting yes:
Casbaell. D'Hrrico, Farrington,
GraMck, Nealley. Palmer and
Tremble
Councilor voting go: Allen
Comcilor absent:CGreea
Passed
C CLCD
(TITLE( AppruPriating $38,660 in Reveaae
Sharing for the Furpose of Furconsing a
Used Printing Presaa
Aaelgnatl to Councilor 411M
o
'fib.
it of
Br ire
w bgrme.on
To:
Ed Barrett
From:
Debbie Cyr
Re:
Financing Option- Printing Press
Date:
April 81 2004
04-115
24794s4400
rax 21T1945-4446
aebbie.cyr®bgmie.org
FINANCE DEPARTMENT
Deboxb A. Cyr, Fownce DirMor
Background
On April 5, 2004, the France Committee discussed whether or not to purchase a
refurbished printing press now saving approxlmately $8,000 versus Considering
the purchase of a new press during the budget process. Included in the
proposal from the vendor, A.B. Dick, was the option to lease the equipment.
Lease
A.B. Dick offered the City a lease with a $1 purchase option a[ the end of five
years. The imputed interest rate in the proposed lease is 8.85%. This rate far
exceeds the Interest that the City would earn on funds invested over either the
short-term or long-term basis. At the Committee meeting there was some
consideration given to leasing the equipment over some period of time.
Regardless of the lease term, the City would incur on average an additional
$1,800 in interest charges per annum.
Recommendation
Staffs recommendation to the Finance Committee was to appropriate the
$38,460 from unanticipated revenue sharing funds and purchase the equipment
outright, which Is reflected in the Council Resolve included for first reading on
April 12, 2004. Over the years, as the City's financial position has improved, and
especially of late as investment earnings have decreased, the City has moved
away from the lease purchase arrangement. Thus recognizing that the City's
Cost of funds exceeds the Investment potential.
73 Harlow Street • Bangor, Maine 04401