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The use of leased cars prior to using city owned cars would also save on the addition of <br />wear to our own fleet during those months, as the leased cart would be first to be used. <br />This would add additional life span to the fleet of vehicles. <br /> <br /> <br />The attached are lease rates as Exhibit A; purchase rates as Exhibit B. <br /> <br /> <br />Summary <br /> <br />The City of Mounds View has leased four cars for the cost of $2632 annually. The City <br />could purchase five new replacement golf cars for an annual payment of an estimated <br />$3810 annually, thus eliminating the need to lease additional cars. Golf Car Midwest <br />provides a payment program financed at 4.5% over five years with six month deferred <br />billing. The Bridges would have access to golf cars for the full length of the golf season. <br /> <br />Purchasing cars for replacement would be an increase of $1200 annually over the cost of <br />leasing four cars for four and a half months. Purchase would end the need for leasing <br />cars on an annual basis. This would also allow the fleet to be managed so that the Golf <br />Course would not need to incur an expenditure of $35,000 in replacement cost plus <br />continues expenditures of $2600 per year. The additional fifth golf car for 4.5 months will <br />generate $2430 if rented our average of 1.5 times per day. The course would have <br />additional revenue by the 15 carts being available during the all months of the golf <br />season. Revenue of $48,600 or an increase of $18,000 per year potentially could be <br />generated at the average of $18 or 1.5 rentals of each car. <br /> <br />The golf cars would be replaced on a basis of 15-year rotation. However, the cars that we <br />currently have would be used up to 19 years under this plan. <br /> <br /> <br /> <br />Recommendation <br /> <br />Option1: Council authorize staff to obtain quotes for the purchase of golf cars and <br />discontinue lease of golf cars annually. <br /> <br />Option 2: Should council determine to continue to lease rather than purchase, extend <br />the lease to a three-year agreement for the lower rate. <br /> <br />Respectfully Submitted, <br /> <br /> <br /> <br />Mary Burg, Golf Course Manager <br /> <br /> <br /> <br /> <br />