4F, Lake Johanna Fire Dept Capital Expenditures

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MEMORANDUM DATE: December 14, 2009 TO: Mayor and City Council FROM: Ron Moorse, City Administrator SUBJECT: Lake Johanna Fire Department Capital Expenditures BACKGROUND The City has received two invoices from the Lake Johanna Fire Department (LJFD) for capital expenditures in 2009. One is related to the purchase of a demonstrator ladder truck with financing over three years. The other is related to the replacement of Car 1, which is used by the full-time Fire Department staff, and the reimbursement of the City of Shoreview for their payment of more than their share of past capital expenditures. In 2008, the Lake Johanna Fire Department purchased a demonstrator ladder truck with financing over a three year period. Attached is an invoice in the amount of $55,975.00, which is the City's share of the second of the three annual payments. In 2004/2005, the Cities who participate in the LJFD fire service reviewed the past funding of capital expenditures, and put in place the current cost allocation formula for capital expenditures. As part of that process, it was determined the City of Shoreview had paid more than its fair share of past capital expenditures. It was determined that this overpayment would be remedied through a reimbursement to Shoreview by the Cities of Arden Hills and North Oaks over a five- year period. During this period, when significant capital expenditures are funded, a portion of the Shoreview share of the expenditures will be paid by the Cities of Arden Hills and North Oaks. The reimbursement began in 2008, and will continue through 2012. Attached is a copy of the LJFD capital budget that reflects the reimbursements to Shoreview. The amount of the reimbursement is $ $21,815 per year, of which the Arden Hills portion is $13,165. The attached invoice includes the City's $12,609.65 share of the new vehicle, and an additional amount of $13,165.00 which pays a portion of Shoreview's share of the vehicle cost.