HomeMy WebLinkAbout09/30/77 Board of Public Works Special Meeting MinutesSPECIAL MEETING SEPTEMBER 30, 1977
A special meeting of the Board of Public Works was convened at
3:40 p.m. on Friday, September 30, 1977 by President Patrick
M. McMahon, with Mr. McMahon, Mr. Brunner and Mr. Mullen present.
Deputy. City Attorneys Terry A. Crone and Edward Mikesell,
Councilman Terry Miller and Brian Hedman, Executive Director of
Century Center, were also present.
Mr. Miller advised the Board that the Civic Center Board of Managers
has a list of furnishings in the amount of $104,000 and they are
recommending that the Board of Public Works lease such furnishings
from Nat -Lea, Inc. A proposal from Nat -Lea, Inc. was submitted
which would provide for the leasing of the furnishings at the rate
of $2,261.21 per month, with the lease being for a period of sixty
months, subject to the approval of the South Bend Common Council.
The Board of Managers has available in their Revenue Sharing
Budget $30,000 which will pay the lease agreement for the first
thirteen months. After the thirteen -month period, an additional
appropriation would be required for further lease payments. The
lease would not extend beyond the thirteen months until such
additional appropriation is approved by the Common Council. Mr.
Miller said this is an official request from the Board of Managers
and.they acted on this matter this morning. They are requesting
the Board of Public Works to act on behalf of the Civic Center
Board of Managers because the funds fall under the control of the
City Controller. Mr. Miller stated that this lease provides for
no payments beyond January 1, 1979 without Common Council approval.
Mr. Brunner asked. Mr. Miller if this was a lease -purchase agreement.
Mr..Miller said it was not. He said the Board of Managers has
no money to purchase this equipment. It is strictly a lease
agreement.
Deputy City Attorney Terry A. Crone stated that the law requires
that a purchase be bid and a lease -purchase agreement would be
considered a purchase requiring bidding. If this is a lease -
purchase agreement, as opposed to a lease, it would have to be bid
and the agreement would be void if entered into as a lease. The
law requiring bidding is strictly constructed with respect to what
is to be bid. If this is a lease -purchase agreement, the Board
cannot enter into it. Mr. Brunner asked Mr. Mikesell how the Board
of Managers construes the document before this Board. Mr. Mikesell
said they regard it as a lease, no mention being made in the
document as to purchase or transfer of title. He said specific
reference is made in Paragraph Five of the lease that no title or right
in said equipment shall pass to the lessee. Mr. Mikesell said, with
that language in the lease, it is his opinion that the document
could not be construed as a lease -purchase agreement. The City
will have no title and no right to title at the end of the five-year
period. Mr. Mikesell said he has not been involved in any discussions
with anybody concerning what will be done with this equipment at the
termination of the lease. Mr. Crone said, based on Mr. Mikesell's
assurance that the document is a lease, he would defer to Mr. Mikesell's
opinion as to the nature of the instrument.
Mr. Brunner asked Brian Hedman what his understanding of the document
was. Mr. Hedman said this was a lease agreement. Mr. Brunner noted
that a newspaper article appearing in the South Bend Tribune this
afternoon characterized the agreement as a lease -purchase agreement
and asked Mr. Hedman if that was incorrect. Mr. Hedman said it was
incorrect.
The list of equipment to be leased was then submitted to the Board
and filed.
044
SPECIAL MEETING
SEPTEMBER 30, 1977
Mr. McMahon made a motion that the Board of Public works approve
the lease presented by the Board of Managers between Nat -Lea, Inc.
and the City of South Bend for the leasing of those items listed
and on file as of this date, the obligation having been
established for a period of thirteen months and not to exceed
$2,261.21 per month, recognizing that any continuation of the
lease is subject to Common Council approval and that payment
for twelve months of the lease be encumbered from the Century
Center Operations Revenue Sharing Budget for 1977, said money
having been identified as unused funds in that budget. Mr.
Mullen seconded the motion and it carried.
There being
upon motion
carried, the
ATTEST:
no further business to come before the special meeting,
made by Mr. McMahon, seconded by Mr. Mullen and
meeting adjourned at 4:20 p.m.
Patricia DeClercq; Clerk
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