CC - Replacement of Unit #2 - Box 067~,f 7b
TO: HONORABLE MAYOR
AND MEMBERS
ROSEMEAD CITY COUNCIL
FROM: FRANK G. TRIPEPI, CITY
MANAGER0
DATE: FEBRUARY 6, 1986
RE: REPLACEMENT OF UNIT 42
Based upon the accumulated mileage and projected maintenance
necessary to maintain unit #2, it would be cost effective to replace
the vehicle at this time.
Currently, the Ford Motor Company is offering 7.9% financing on
selected 1986 models. As unit #2 was scheduled for replacement
during Fiscal year 1986-87, it would be to the City's benefit to take
advantage of the low interest financing.
To finance a vehicle at 7.9% interest for four years the City will
pay approximately $2053 in interest on a $12,000 purchase. If the
City leaves the $12,000 principal in an investment account averaging
11%, the interest income over four years would be approximately
$5,280. Therefore, by financing an automobile at 7.9% the City will
accrue approximately $3,227 in interest income over a four year
period.
The following quotations were received from area dealers:
1986 Ford Tempo GL
Dealer Bid
Bob Wondries Ford $10,443.30
San Gabriel Ford $11,045.04
E1 Monte Ford $10,916.25
It is recommended that the City Council authorize the purchase of
said vehicle and trade the current unit #2 (1980 Chevrolet Caprice).
FGT:js
COUNCIL AGENDA
ITEM No. de-4