CITY COUNCIL: Resolution Authorizing Lease Agreement for a Pitney Bowes Postage Meter

Meeting Date: November 4, 2008
Prepared by: Joyce Giuffre,
Admin Services Director

City Council
Agenda Item Summary

Name: Consideration of a Resolution authorizing a lease agreement for a Pitney Bowes
postage meter, with a total lease cost of $10,304.

Description: The City now leases a DM 500 Pitney Bowes postage meter for City Hall. The lease term was four years and expires December 28, 2008. The City can either buy out the old machine or enter into a lease agreement for a new machine.

Staff recommends entering into a new lease agreement for a new DM 500 model postage meter, per the attached Exhibit “A”. The cost of the new lease is $214.67 per month for a 48-month period, or $10,304.16 for the term of the lease. The pricing is offered under the Western States Contract Alliance (WSCA) for state and local agencies and the agreement includes equipment maintenance.

The cost of leasing was compared to buying out the old machine at a fair market value (to be determined by Pitney Bowes at the end of the lease agreement) plus the cost of a maintenance agreement on the old machine of $150 per month. The new lease cost is about $65 per month more than the maintenance agreement. The new lease, however, would provide the City with a new, more reliable machine that is equipped with new software for postage replenishments. In addition, the new lease cost of $214.67 per month is about 36% lower than the existing postage meter lease cost of $334.00 per month.

FY 2008-09’s budget, account 01-88818, includes $3,006 to cover the cost of the existing lease agreement. If the City enters into a new lease, a mid-year budget adjustment will be required in the amount of $1,288.02 to cover payments from December 29, 2008 to June 30, 2009.

The new lease agreement was reviewed and approved by the City Attorney.

Overall Cost:
City Funds: $10,304.16 (48-month term beginning 12/29/08)
Grant Funds: N/A

Staff Recommendation: Approve the Resolution to ensure that City Hall has a functional postage meter with coverage for maintenance and repairs during the 48 month term of the lease.

Decision Record:

Reviewed by:


Rich Guillen, City Administrator Date


CITY OF CARMEL-BY-THE-SEA
CITY COUNCIL
RESOLUTION NO. 2008-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA AUTHORIZING A LEASE AGREEMENT FOR A PITNEY BOWES POSTAGE METER, WITH A TOTAL LEASE COST OF $10,304

WHEREAS, the City’s existing installment lease for its Pitney Bowes postage meter expires December 28, 2008; and

WHEREAS, the City desires to enter into a new installment lease agreement with Pitney Bowes for a new postage meter, model DM500 effective December 29, 2008, per Exhibit “A”.

NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA DOES:

1. Authorize the City Administrator to execute the attached four-year installment lease agreement with Pitney Bowes for a DM 500 postage meter.

2. Approve funds from account 01-88818 for the lease payments based on a FY 2008-09 budget adjustment to be made at mid-year.

PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA this 4th day of November 2008, by the following roll call vote:

AYES: COUNCIL MEMBERS:
NOES: COUNCIL MEMBERS:
ABSENT: COUNCIL MEMBERS:

SIGNED:

_____________________
Heidi Burch, City Clerk

ATTEST:

_______________________
SUE McCLOUD, MAYOR