Friday, July 06, 2012
 
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Lincoln fire and finance committees discuss a new city fire truck

Part 2

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[July 06, 2012]  Prior to the voting session of the Lincoln City Council on Monday evening, there was a joint meeting of the finance and fire committees. During that meeting eight members of the council were present, with Aldermen David Armbrust and David Wilmert absent.

Mark Miller, city fire chief, told the committees that he and Chuck Conzo, the city treasurer, had contacted some of the local lending institutions about financing the purchase of a fire truck. They had also talked to sellers about their finance plans.

Miller said the manufacturers' finance programs carried interest rates from 2.99 to 4.5 percent and loan terms from five to 10 years. He said local lenders were competitive with those rates, and even lower.

He also noted that there was one lender, CEFCU, that had not yet responded to a request for a rate because they had asked for more specific information that had only recently been provided to them.

Talking about the ailing engine 5104, Miller said the biggest problem right now was the leaking water tank. He said the tank had been replaced four years ago with one that had no lifetime warranty. It was a poly tank and bought based on being the low bid for replacement. He said the city could replace the tank again, but to do it properly with a tank built for the truck and with a good warranty would cost about $20,000.

He told the council that he had talked to a dealer who appraised the engine as being worth only about $3,000. Miller said the dealer had said all the old truck was good for was scrap.

When asked about the mileage and hours on the engine, Miller said the miles were not as important as the hours of service. He said the engine doesn't have an excessive number of miles on it, as it has operated mostly within the city. However, the number of hours operated is very high.

Alderwoman Marty Neitzel said she had made a trip to Springfield to see a truck that was in the state surplus warehouse. She said it was a 1993 with 60,000 miles, good tires and a 1,200-gallon water tank. She said she thought the city could look at something like that as a temporary replacement, meant to last only two to three years, but that it would get them through for right now. She asked Miller to go look at the truck, and he said he was willing to do that.

Miller said he has found three new vehicles that are available right now. Of the three, two would have to be modified to fit inside the fire station, and that would involve extra costs.

The third one would fit in the building but would have to be fitted with some of the lights and city signage. He said if the council committed to buy it today, it would still be 40 days before it could be put on the streets for use.

Miller was asked about the $3,000 trade-in scrap value. He said he thought he could do better than $3,000. He said he had talked to a firm that will buy old trucks for parts, and while he hasn't talked to them recently, he is working to get their contact information and talk to them again.

Alderman Buzz Busby told the council that he did not plan to vote yes on purchasing a new truck. He said he could not justify spending up to $368,000 for a vehicle when the city was facing the financial strains that it is. He said he'd prefer to invest in a new tank and wait a while.

However, Neitzel disagreed with that, saying she had looked at engine 5104 and it was a piece of junk. Fixing the tank was not going to solve all the problems with the truck. She noted, "It isn't safe, and I don't like it."

Anderson turned the discussion to money. If the city is going to buy a truck, paying for it is going to be one very big issue.

In December of 2010, the city started a new general obligation bond that will be good until December of 2013. Approximately $446,000 is left in that bond. The figure had been lower, but the city recently received a promised $156,000 from the state of Illinois for the roof replacement on City Hall. The roof had been replaced and financed, with the payments coming out of the bond. With the recent payment from the state, that money was returned to the bond.

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Anderson said that looking ahead at what she knew would be coming out of the bond, she felt the city had about $334,000 to work with over the next 15 to 16 months.

She said she was not comfortable depleting the full balance available but would be comfortable using $218,000 to $268,000 for a down payment and financing the balance.

Anderson said she was not at all comfortable with the idea of putting more money into engine 5104. It was also noted that if the city delays on the purchase, interest rates could go up, as well as the purchase price of the vehicle.

Monday evening Miller also told the council that he was in the process of writing a new grant application for the fire department. He said the application he is working on now provides money for firefighter clothing, but there is also a provision for making payments on a fire truck. He said he plans to include a request of $150,000 for that purpose. He noted that grants can be a "stab in the air," but it was still worth trying.

Conzo talked briefly about CEFCU, telling the council that they were not a typical bank, and as such they offer cash back to their members in the form of "extraordinary dividends." He said the city currently benefits from this because they have a pension fund account set up with CEFCU. As a result, the city earns about $1,000 a year in dividends. He said if CEFCU is competitive on their interest rate, that might be the way to go, because having a loan there would increase the dividend.

Conzo said he would recommend that the city pay as much as possible and borrow as little as possible.

In a final comment, Miller told the council he was looking at this as an emergency purchase. "I don't want to create debt for the city," he said. "This is something we need to do, not want to do."

As the discussion wound down, Anderson said the finance committee would recommend that the city use up to $268,000 from the general obligation bond and finance $100,000 in the purchase of a new fire truck.

Neitzel, however, questioned why the city shouldn't at least look at the used one in Springfield, but Alderwoman Kathy Horn, who chairs the fire committee, countered that a new purchase would have a longer life.

By then it was past 7 p.m. and time for the regular voting session of the council to begin. The committee meeting was adjourned and the council went right into their voting session.

[By NILA SMITH]

Part 1: Lincoln aldermen, fire chief agree city has to do something about engine 5104
 

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