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ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: June 26, 2007 <br />Action Agenda <br />Item No. ~- -,° _ <br />SUBJECT: Approval of Financing Arrangement for Efland Volunteer Fire Company, Inc. to <br />.Purchase a Fire Engine Truck <br />DEPARTMENT: Budget PUBLIC HEARING: (Y/N) No <br />ATTACHMENT (S): <br />Attachment 1. Letter from Efland <br />Volunteer Fire Company, Inc. Board of <br />Directors President <br />Attachment 2. May 14, 2007 Public <br />Hearing Notice <br />INFORMATION CONTACT: <br />Donna Coffey 245-2151 <br />Attachment 3. Notes from 5/14/07 Public <br />Meeting <br />Attachment 4. Fire Service Agreement <br />Attachment 5. Certificate of Approval <br />PURPOSE: To approve a request from Efland Volunteer Fire Company, Inc. to enter into a <br />financing arrangement to purchase a fire truck and authorize the Board of Commissioner Chair <br />to sign the appropriate documents related to the financing arrangement. <br />BACKGROUND: In the attached letter addressed to the Orange County Budget Office, Ronnie <br />McAdams, Chairman of the Efland Volunteer Fire Company, Inc., indicated the department's <br />intent to purchase a new fire truck (Attachment 1 of this abstract). Mr. McAdams confirmed that <br />the department went through a competitive bid process and awarded the bid to Ferrara Fire <br />Apparatus, Inc. of Holden, Louisiana. Projected delivery date for the truck is July 2007. <br />According to Attachment 1, the purchase price of the truck totals $205,000. The Department's <br />Board of Directors- agreed to borrow $105,000 from Branch Banking and Trust Company <br />(BB&T), and to pay the remaining $100,000 from the Department's capital reserves as well as <br />$40,000 from their County-held fund balance. The interest rate for the 5-year note is 4.23 <br />percent with monthly payments of $1,944.65. The total repayment, including principle and <br />interest, equals $116,679. It is important to note that these figures may vary slightly depending <br />upon the actual loan closing date. <br />Section 147 of the Internal Revenue Code of 1986 outlines specific steps that must occur when <br />a tax supported fire department enters into a financing arrangement. <br />