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HomeMy WebLinkAbout7.A.2. First Amendment to Lease Agreement with Metropolitan Council for Regional (Transit) Fleet Vehicles CITY OF SHAKOPEE 'l Fl. 1, · MEMORANDUM CASELOG NO: Not Applicable CONSENT TO: Honorable Mayor and City Council Mark McNeill, City Administrator FROM: R. Michael Leek, Community Development Director SUBJECT: Approval of First Amendment to Master Lease Agreement between the City of Shakopee and the Metropolitan Council for Regional (Transit) Fleet Vehicles MEETING DATE: August 15,2006 INTRODUCTION: The Council is asked to approve the "First Amendment to Master Lease Agreement between the City of Shakopee and the Metropolitan Council for Regional Fleet Vehicles" DISCUSSION: Because they are purchased with regional bond funds, transit vehicles in the Metropolitan Area are part of the regional fleet, and are leased out to other public transit providers. These leases do not involve lease payments, but the lease agreements are intended to make sure that the vehicles are kept within the regional fleet, and, when returned, in operational condition. Working with Suburban Transit Providers through the Suburban Transit Association (STA) of which the City is a part, the Metropolitan Council has developed the attached amendment to the Master Lease Agreement. ALTERNATIVES: 1. Offer and pass a motion approving the First Amendment to Master Lease Agreement between the City of Shakopee and the Metropolitan Council for Regional (Transit) Fleet Vehicles 2. Do not approve the First Amendment to Master Lease Agreement between the City of Shakopee and the Metropolitan Council for Regional (Transit) Fleet Vehicles 3. Table the item for additional information. STAFF RECOMMENDATION: Staff recommends alternative number one, i.e. offer and pass a motion approving the First Amendment to Master Lease Agreement between the City of Shakopee and the Metropolitan Council for Regional (Transit) Fleet Vehicles. RELATIONSHIP TO VISIONING: Housekeeping Item, F H:\CC\2006\08-15\Transit Lease Agreement.doc 1 ACTION REQUESTED: Offer and pass a motion approving the First Amendment to Master Lease Agreement between the City of Shakopee and the Metropolitan Council for Regional (Transit) Fleet Vehicles. ~ R. Michael Leek Community Development Director H:\eC\2006\08-15\Transit Lease Agreement.doc 2 Contract No. 04M024 FIRST AMENDMENT TO MASTER LEASE AGREEMENT BETWEEN THE METROPOLITAN COUNCIL , AND THE CITY OF SHAKOPEE FOR REGIONAL FLEET VEHICLES THIS AGREEMENT is made and entered into by and between the Metropolitan Council ("the Council") and the City of Shako pee ("the Lessee"). RECITALS: 1. On September 26, 2005, the Council and the Lessee entered into a Master Lease Agreement identified as Council ContraCt No. 04M024 under which the Council leased certain Regional Fleet Vehicles to Lessee for the operation of public transportation. 2. On February 22, 2009, the Council authorized it Regional Administrator to enter into a contract. amendment with the Lessee in order to clarify several terms of the. Agreement. NOW THEREFORE, pursuant to Section. 9.01 of Contract No. 04M024, and in consideration of the promises and covenants contained in this Agreement, the Council and the Lessee agree that Contract No. 04M024, shall be amended in the following particulars: 1. Article I, PURPOSE OF AGREEMENT, is amended to read as follows: The Metropolitan Council was established by Minnesota law to plan for the orderly and economical development, public and private, of the Twin Cities Metropolitan Area. The Council is required by Minnesota lawto coordinate transit operations within the Twin Cities Metropolitan Area. This includes the administration of a regional transit capital bonding program to provide local funding for transit capital investments, and the allocation and distribution of federal funds for transit capital investments. . Because of this, the Council is responsible for ensuring that all federal and state requirements are met for funds that are allocated and distributed by the Council. The Lessee operates public transportation within the Council's jurisdiction. To provide the transit service, the Lessee has leased Regional Fleet Vehicles from the Council. This agreement expresses the understanding of the parties regarding the lease of the Regional Fleet Vehicles, some of which may have been purchased in whole or in part with federal funds, so as to promote the Council's interests in coordinating and maintaining the integrity of the metropolitan transit system and in ensuring adequate documentation of the operation and maintenance of the leased Regional Fleet Vehicles. The Lessee's vehicle requirements as defined in its service plan, replacement plan, or expansion plan shall be reviewed and considered by the Council before the Council reassigns any Regional Fleet V"ehicle hereunder. However, the Council will not reassign a Regional Fleet Vehicles from a Lessee so long as the Regional Fleet Vehicle is being utilized by the Lessee to provide public transit services. Page.1 of 4 If the. Council and Lessee have entered into any grant and/or operating agreements under which the Lessee utilizes any of the vehicles covered by this lease, and if any such agreement addresses the same topics covered in this lease agreement, the provisions of that contract which are more stringent shall apply to. the vehicles covered by such agreement. 2. Article IV, VEHICLE MAINTENANCE, REPAIR AND SAFETY, Section 4.02, Repair and Replacement, is amended to read as follows: 4.02 Repair and Replacement. In addition to theLessee's obligations under Section 3.05,Lesseeshall be responsible for the repair and/or replacement of any Council Vehicle that is mechanically or electrically broken, worn, damaged or misplaced if such breakage, wear, damage or misplacement occurs before the earliest of: . the end of the useful life of the vehicle, or . the time at which the vehicle is returned to the location designated by the Council in accordance with ArticleS The Council shall notify Lessee of any warranties in force on the vehicles at the time of transfer to Lessee. Lessee shall have all warranty service on Council Vehicles carried out by the manufacturer's authorized dealers in the State of Minnesota orindependent repair garages capable of providing both warranty service andreplacement parts sufficient for fleet operators, in . order to preserve the manufacturer/vendor warranty on the vehicles. Warranty service may also be accomplished by reimbursing the Lessee. for expenses incurred ata repair facility mutually agreed upon between the Lessee and the Councilor by reimbursing the Lessee for mutually agreed expenses incurred at the Lessee's maintenance. facility, provided that all such work must have the manufacturer's or vendor's prior written approval before Lessee initiates any warranty work. Lessee shall notify the Council in a timely manner of any failures relating to systems or components under warranty. The Council must approve any resolution of warranty issues. Lessee shall notify the Council within three working days upon the occurrence of any engine, transmission or lift failure. The Council will reimburse the Lessee Opt-Out provider. for the cost of replacing said engine, transmission or lift; provided, however, that the failure of the aforementioned item was not caused by the Lessee's negligence, lack of tnaintenance, or misuse, and if the Council has funds available for said replacement. For all other Lessees, theCouncil will procure the lift, engine or transmission under the Council's own procurement procedure; provided, however, that the failure ofthe engine, transmission or lift was not caused by the Lessee's negligence, lack of maintenance, or misuse, and if the Council has funds available for said replacement. For Metro Mobility vehicles, the Council will only procure engines and transmissions, not lifts. Each vehicle leased from the Council which has a l2-year life expectancy (or more) will be eligible for one planned midlife overhaul. As part of the midlife overhaul, the Council will reimburse Lessee for the cost of painting the exterior and replacing any damaged passenger seats or articulated curtains; provided, however, that the need for such painting or replacement was not caused by the Lessee's negligence, lack of maintenance, or misuse, and if the Council has funds available for said painting gr nm!acement. The reimbursement for the replacement of the drive train, heating/air conditioning, steering and suspension, body and frame, fuel tanks, cooling system, electrical controls, front/rear axel assemblies and undercoating will be negotiated on a Page 2 of4 case by case basis; however, to qualify for such reimbursement, the cost of any such replacement must exceed $5,000. IftheCouncil has a funding shortfall, the priority will be to pay for unexpected failures and not midlife overhauls. Lessee shall en~ure that repairs are made in a timely manner and a vehicle shall not be placed back in service until all safety related repairs are made. No vehicle shall be placed in service that does not pass Minnesota state inspections or that does not meet all local, state and federalsafety standards. Replacement engines for buses will be certified to the most current EP A standards or better.. Lessee shall follow all applicable laws and regulations relating to competitive procurement for any component replacement. The Lessee shall submit requests for payment to the following address: Metropolitan Council Attn: Metropolitan Transportation Services 390 North Robert Street Saint Paul, Minnesota 55101 The payment request shall be prepared. in a form developed by the Council and shall be supported by copies of invoices and other documents as may be requested by the Council. The Council will review the Lessee's request for payment and willissue a check in payment within thirty (30) calendar days from receipt of a properly completed request for payment. All requests for payment and related records are subj ectto audit by the Council. If, as aresult of further reviews, corrections or audits, it is determined that the Council has overpaid the Lessee, the Lessee shall, within thirty (30) calendar days of demand, refund to the Council the amount of the overpayment. The Lessee may retain the amount of any overpayment arising out of a payment under this agreement or arising out ofa previous funding agreement with the Lessee from .funds otherwise payable under this agreement. Within thirty (30) calendar days of completion of an audit, the Council shall make a final payment to the Contractor of the amount of any unpaid balance in accordance with the provisions ofthis agreement. 3. Article V, RETURN OF VEHICLES, Section 5.01 Return of Vehicles, is amended to read as follows: 5.01 Return of Vehicles. Upon termination of the lease term or upon earlier termination as may be provided by this agreement, all Council Vehicles in Lessee's possession shall be retumedby the Lessee to the CounciL at a location designated by the Council within the Twin Cities Metro Area unless the Council directs Lessee to dispose of or transfer the Council Vehicles in another manner. In addition, individual Council Vehicles shall be returned by the Lessee to the Council in the manner specified in this section in any of the following cases: . when such a vehicle is no longerbeing used by Lessee for the purposes specified in S~ction 3.02, or Page 30f4 . when the grant or operating agreement for which the vehicle was assigned terminates, unless the Council authorizes the Lessee in writing to utilize the vehicle under another operating agreementthen in effect, or A Council V ehiclemust be returned without Lessee's graphics if requested by the Council. Unless directed otherwise by the Council's Authorized Representative, each. CounCiIVehicle. upon return must be in a good enough working condition so that it may be brought to an auction or storage underits own power. . Upon the return of each vehicle, the originals of the Vehicle Record File arid any other records held by the Lessee applicable to the vehicle shall be provided to the Council. IN WITNESS WHEREOF, the Council and Lessee have caused this agreemenfto be executed by their duly authorized representatives. This. amendment is effective on the date of final execution by the Council. Approved as to form: METROPOLITAN COUNCIL By: Associate General Counsel Regional Administrator Date: LESSEE By: Its: Date: Page 4 of4 ExhibitA 5/2006 CouncilVehicles@Shakopee BUS# Year Make Model VIN Notes... . . 3068 2000 FEDRL Cutaway 1FDXE45F6YHB44715 3069 2000 FEDRL Cutaway 1 FDXE45F4YHB.42686 . 3070 2000 FEDRL Cutaway 1 FDXE45F1YHB51281 4001 2005 GOSHN GCII 1FDXE45PX5HA60241 4002 2005 GOSHN GCII 1 FDXE45P15HA60242 4003 2005 GOSHN GCII 1FDXE45P35HA60243 . .