The city is asking to finance the purchase of 12 vehicles included in the 2019 budget using short-term debt available to local governments.
Six are Ford Hybrid Police Utility Vehicles totaling $195,780 when fully equipped. All 16 vehicles the city is asking the Hot Springs Board of Directors for authorization to purchase would be acquired through the Arkansas Cooperative Purchasing Program, the state and local government syndicate that uses its buying power to negotiate lower prices.
The board will consider the authorizing resolution at its Tuesday night business meeting. According to information submitted to the board, the 16 vehicles cost $473,244 in total.
The board will also consider a separate action item selecting U.S. Bancorp as a short-term lender. The city said the Minneapolis-based bank has agreed to finance $1,013,500 in capital expenses budgeted for 2019 for 32 basis points above the rate for the five-year U.S. Treasury note, which closed at 2.50 percent Friday.
Using the 2.53-percent rate the government-backed security closed at Feb. 5, the city estimates a $217,725 annual debt service obligation over the five-year term of the loan.
The city can issue short-term debt under Amendment 78 of the Arkansas Constitution. Passed by voters in 2000, the City and County Government Redevelopment Bond and Short Term Financing Amendment allows local governments to finance purchases with a useful life of more than one year for up to five years.
The enabling statute allows short-term financing for purchases totaling up to 5 percent of the assessed property value within a local government's taxing authority. Hot Springs said it had a $37,015,000 short-term debt cap and $2,244,241 in short-term debt at the end of last year.
In addition to six police vehicles, four-wheel drive Dodge Ram 1500 Crew Cabs for the fire and planning and development departments would also be purchased under Amendment 78. A Chevrolet Traverse for the planning and development department, a Chevrolet Express utility van and a Ford F-350 truck for the parks and trails department and a Dodge Durango for the public works department would also be financed.
The six Ford hybrids are part of the $425,000 the city's 2019 budget allocated for new police vehicles. According to the pricing sheet presented to the board, the $32,630 sport-utility vehicles have a 3.3-liter police pursuit engine with an all-wheel-drive powertrain.
The ordering form the police department submitted said older vehicles in its fleet will be removed from service when the new units arrive. The city said under its surplus vehicle program, vehicles 10 years or older or with 100,000 or more miles are sold at auction.
The city has asked to purchase the following 16 vehicles:
• Six Ford Hybrid Police Utility Vehicles -- $32,630 each.
• Four-wheel drive Dodge Ram 1500 Crew Cab for fire department -- $27,050.
• Four-wheel drive Dodge Ram 1500 Crew Cab for planning department -- $25,621.
• Chevrolet Traverse for planning department -- $26,213.
• Four-wheel drive Dodge Ram 1500 Crew Cab for airport -- $25,512.
• Ford F-350 for parks and trails department -- $29,978.
• Chevrolet Express Utility Van for parks and trails department -- $21,877.
• Four-wheel drive Ford F-250 Crew Cab for wastewater department -- $29,660.
• Four-wheel drive Dodge Ram 1500 Crew Cab for water department-- $25,266.
• Four-wheel drive Dodge Ram 2500 Crew Cab for water department -- $39,170.
• Dodge Durango for public works department -- $27,117.
Local on 02/18/2019