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515 Little Canada Road, Little Canada, MN 55117 -1600 <br />(612) 484 -2177 / FAX: (612) 484 -4538 <br />MEMORANDUM <br />TO: Mayor Hanson & Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />DATE: April 22, 1994 <br />RE: Authorization for Fire Truck Bids <br />MAYOR <br />Raymond G. Hanson <br />COUNCIL <br />Beverly Scalze <br />Jim LaValle <br />Steve Morelan <br />Bob Pedersen <br />ADMINISTRATOR <br />Joel R. Hanson <br />At our last Truck Committee meeting (a copy of my notes are <br />attached for your review), it was the recommendation of the <br />Committee to pursue the bidding of the new fire truck at this <br />time. You will note from these minutes that the estimated <br />purchase price of the truck is now at $292,000 verses the <br />$250,000 we had budgeted in our capital improvement process. <br />This higher price is attributed to added items deemed necessary <br />to achieve a functional vehicle for the next 20+ years as well as <br />recent price increases from truck manufacturers. It was also <br />stated that if full payment of the truck were made upon order, <br />the purchase price would be reduced to $278,000. This equates to <br />a 6.7% return on investment assuming a nine month delivery date. <br />I have been provided with a copy of the specifications for the <br />truck and will have completed my review by Wednesday's meeting. <br />Based upon our Committee meetings, it is my opinion that the Fire <br />Department has provided reasonable justification for the <br />inclusion of the items listed. I also feel they have done a good <br />job of structuring the specifications to maximize competition <br />among bidders. As a result, we should see these estimated prices <br />fall below the numbers stated in this memo. <br />The Fire Department still owes $35,350 on the repayment of the <br />$125,000 loan made for the purchase of the aerial ladder truck. <br />It is my understanding that we should be in receipt of an <br />additional payment of between $5,000 and $6,000 in the next few <br />days. This would reduce the balance to under $30,000. The Fire <br />Chief anticipates repayment of that amount within the next few <br />months. The Fire Department has further committed to providing <br />between $25,000 and $40,000 to cover the additional cost of the <br />truck over the $250,000 figure. The source of this money would <br />be future gambling proceeds. Depending on when the payment date <br />for the truck is, this amount may have to be advanced by the City <br />and repaid on a loan basis. <br />Page 128 <br />