Title
A RESOLUTION AUTHORIZING THE CITY MANAGER TO TERMINATE THE CURRENT GOLF CAR LEASE WITH LAKE ERIE GOLF CARS AND ENTER INTO A NEW GOLF CAR LEASE AGREEMENT WITH LAKE ERIE GOLF CARS; AND DECLARING AN EMERGENCY.
Executive Summary: This Resolution will provide authorization for the City Manager to enter into a 5-year lease agreement with Lake Erie Golf Cars for a new 70 car fleet for Ellsworth Meadows Golf Club
Body
Legislative History
Ellsworth Meadows Golf Club entered into a 7-year lease agreement with Lake Erie Golf Cars in 2014
Purpose & Explanation
In 2013 the Golf Advisory Board suggested that when negotiating the next golf car fleet, that we ask for a 7-year term versus a 5-year term. This strategy was to try and reduce our annual expenses by stretching out the lease. In 2014, a new agreement was reached with a 7-year term (reducing our annual expense by $8,190.00) a savings of $57,330.00 over the 7 years. This new lease also contained a clause that required Lake Erie Golf Cars to supply the Ellsworth golf car fleet with new batteries after year 3, knowing that the original batteries would never make it to year 7.
The golf course fleet is now at the timing of having the cart batteries replaced per the lease agreement. We have been recently approached by Lake Erie Golf Cars to change the current lease agreement. They have voiced that they would not like to replace the batteries now because of the high cost factor to them to do so. They have suggested that they would be willing to supply Ellsworth Meadows with an entire new fleet of 70 golf cars, for a new 5-year lease (at the same price as the extended 7-year lease rate). This option would be of value to the golf course for three reasons. Not only will we receive a new fleet of cars on 3-1/2 year-old carts that are already showing wear and tear, but will remain at the 7-year extended rate for a 5-year lease (continuing the $8190.00 savings moving forward). The third item would eliminate the risk of keeping the current fleet for the entire 7 years that we knew was a risk by agreeing to the extended 7-year lease. By keeping the existing fleet, the full 7 years, the overall condition of the fleet would be in poor shape both in appearance and operationally. Lake Erie Golf Cars have stated that they will not offer a 7-year lease again moving forward. Golf staff has also contacted the only other golf car vendor (Southeast Golf Cars) and they are substantially higher in price than Lake Erie Golf Cars price.
Timing Considerations
This fleet of golf cars is needed for the 2017 golfing season; therefore, staff requests emergency language be added to the legislation.
Fiscal Impact
X__Currently Budgeted
Supplemental Appropriation Required
Appropriation Not Required.
Recommendation
Suggested Action
Staff recommends City Council authorize the City Manager to enter into a 5-year lease agreement with Lake Erie Golf Cars 26565 Miles Rd. Warrensville Heights Oh, at an annual cost of $57,750.00 for 70 golf cars.
Submitted by,
Jane Howington, City Manager
Frank J. Comeriato, Jr., Assistant City Manager - Operations
Trent Wash, Assistant Public Works Director