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City of San Leandro <br />Meeting Date: January 4, 2021 <br />Staff Report <br />Agenda Section:File Number:20-593 CONSENT CALENDAR <br />Agenda Number:8.M. <br />TO:City Council <br />FROM:Fran Robustelli <br />Interim City Manager <br />BY:Debbie Pollart <br />Public Works Director <br />FINANCE REVIEW:Susan Hsieh <br />Finance Director <br />TITLE:Staff Report for a City of San Leandro City Council Resolution Authorizing the <br />Execution and Delivery of an Equipment Lease/Purchase Agreement with <br />Respect to the Acquisition, Financing and Leasing of Certain Equipment for the <br />Public Benefit; Authorizing the Execution and Delivery of Documents Required in <br />Connection Therewith; and Authorizing the Taking of All Other Actions Necessary <br />to the Consummation of the Transactions Contemplated by this Resolution <br />(approval to finance energy conservation and resiliency equipment to be installed <br />at the City’s Water Pollution Control Plant for $8,893,876.20) <br />SUMMARY AND RECOMMENDATIONS <br />Staff recommends that the City Council approve the resolution and documents required to <br />execute and deliver an equipment lease/purchase agreement (Agreement) with Banc of America <br />Public Capital Corp. (Bank), as lessor, to finance energy conservation and resiliency equipment <br />(Equipment) to be installed at the City’s Water Pollution Control Plant (WPCP) pursuant to the <br />executed Installation Agreement between the City and Climatec. The principal amount to be <br />financed under the Agreement is estimated at $7,624,924 (which is equal to the total estimated <br />project cost of $8,045,781 minus a PG&E grant of $420,857). Annual lease payments on the <br />15-year Agreement are expected to equal $592,925.08, with total principal plus interest paid <br />anticipated to equal $8,893,876.20. <br />The Agreement is an appropriation lease, which means that the City will need to budget and <br />appropriate lease payments (to come from the WPCP Enterprise Fund or any other legally <br />available funds of the City) in each year. In the event the City elects not to budget and appropriate <br />lease payments in a given year, the Bank, as lessor, will have the right to remove the leased <br />equipment. The General Fund is not obligated to pay for any amounts due under the Agreement. <br />DISCUSSION <br />On September 28, 2020, the City Council approved an Installation Agreement for a proposed <br />energy efficiency/resiliency project at the WPCP, to be financed with a $420,857 PG&E Self <br />Generation Incentive Program (SGIP) grant plus a tax-exempt lease with a bank or other financial <br />Page 1 City of San Leandro Printed on 12/30/2020 <br />275