AGENDA MEMORANDUM

 

 

Meeting Date:           July 9, 2007

 

From:                          Bill Pfeilsticker, Finance Director                                                                              

Subject:                      Resolution authorizing execution of Amendment No.1 to Agreement For Rental Lighting Services for Walling Enterprises, Inc. (Palm Plaza)

 

 

Staff Recommendation:

Staff recommends approval of Amendment No.1 to the agreement for rental lighting for Walling Enterprises, Inc. as proposed. 

 

Analysis:

The City Electric Department has provided rental lighting services to Palm Plaza under a contract with Walling Enterprises, Inc. since July 23, 2001.   The initial agreement was for a term of five (5) years ending July 22, 2006.  The initial term was followed by automatic renewal with no described term limits with the provision that termination is allowed at any time by either party with ninety (90) days prior written notice.

 

Rental lighting agreements are negotiated, written and maintained by the Electric Department. During internal audits, the Finance Department found that errors had been made in the calculation of costs described by the initial Agreement. Those errors resulted in an estimated revenue loss of $29,470 from July 2001 to March 2007.  The discrepancies were reported to the Electric Department, but due to departure of key staff, the issue was not resolved in a timely manner.

 

The Finance Director mailed the required ninety (90) day written notice to be effective July 1, 2007 and therein offered the following options to Walling Enterprises, Inc.:

 

Option 1: The City would remove the poles and wiring in accordance with the Agreement and there would be no new charges attributable to the Agreement after July 1, 2007.

 

Option 2: Cooperatively agree to amend the total cost of installation of seventy-five 400w lights and twenty-eight poles from $46,152.40 to $75,044.68, and also monthly maintenance and energy costs may hereafter adjust monthly depending on wholesale cost of energy and other O&M costs.

 

Option 3: Termination of the Agreement and the Lessee may purchase the lighting system at the total cost of installation multiplied by the spent portion of the 13 year life of the poles and fixtures: $75,044.68 x 85/156 = $40,889.73 plus applicable tax.

 

Walling Enterprises, Inc. chose Option 2. and signed Amendment No. 1 to the Agreement.

 

Options:

1.   Approve the resolution as submitted; or, 

2.  Such alternative action as the Commission may deem appropriate

 

Fiscal Impact

Calculated at current rates, the total monthly cost for parking lot lighting at Palm Plaza is estimated to increase $433 per month from $2,783 to $3,216, or an additional $5,196 per year.

 

Submission Date and Time:    7/9/2007 4:53 PM____

 

Department: ______________________

Prepared by:  ______________________                     

Attachments:         Yes____   No ______

Advertised:   ____Not Required ______                     

Dates:   __________________________                     

Attorney Review :       Yes___  No ____

                                                 

_________________________________           

Revised 6/10/04

 

Reviewed by: Dept. Head ________

 

Finance  Dept. __________________                                     

                              

Deputy C.M. ___________________                                                                         

Submitted by:

City Manager ___________________

 

Account No. _________________

 

Project No. ___________________

 

WF No. ______________________

 

Budget  ______________________

 

Available _____________________


 

RESOLUTION NO._______________

 

A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF LEESBURG AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE AMENDMENT NO. 1 TO THE AGREEMENT FOR RENTAL LIGHTING SERVICES FOR WALLING ENTERPRISES, INC. (PALM PLAZA); AND PROVIDING AN EFFECTIVE DATE.

 

BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA:

 

            THAT the Mayor and City Clerk are hereby authorized to execute Amendment No. 1 to the Agreement for Rental Lighting Services between The City of Leesburg, Florida, as Lessor, and Walling Enterprises, Inc., the Lessee, whose address is P.O. Box 490329 Leesburg Florida 34749-0329, for rental parking lot lighting services.

 

             THAT this resolution shall become effective immediately.

 

PASSED AND ADOPTED by the City Commission of the City of Leesburg, Florida, at a regular meeting held the __9th___ day of ___July______ 2007

 

 

 

                                                                            __________________________

                                                                             Mayor

 

ATTEST:

 

 

__________________________

City Clerk