Department of Finance
Reference: 2026 Snowplow Purchase Proposal
To: Mayor Gregory Mills and Members of City Council
Through: Michael P. Martinez, City Manager
Prepared By: Catrina Asher, Director of Finance
Date Prepared: October 21, 2025
PURPOSE
To propose plans for a lease-purchase to update the City’s snowplow fleet in 2026.
BACKGROUND
The City maintains a large fleet of vehicles and equipment. Plans are made to replace aging units each year and those costs are included in the City’s financial models and annual proposed budgets.
This item was discussed with City Council at the Study Session on October 14, 2025.
Snowplows
The City has a fleet of 8 snowplows used to maintain city streets. The majority of these plows were purchased in 2017 on a seven year lease-purchase arrangement (master lease agreement with purchase option). The 2017 lease-purchase agreement was paid in full in 2024.
The snowplow fleet is now aging and will need replacement in 2026. Due to the lead time needed to source a snowplow, staff began working on replacement planning in 2025 for delivery anticipated in spring 2026.
For 2026, staff recommends replacing all 8 snowplows through a lease-purchase arrangement similar to the one used in 2017. Staff have worked with our banking partners at Wells Fargo to secure preapproval for this lease-purchase arrangement. The total amount of the lease-purchase is estimated to be $4,200,000 and will be paid over an eight year period. The final amount will be determined when the units are ordered and the interest rate will be locked in when the units are delivered and the lease term begins in 2026. Annual lease payments are estimated to be $650,000 for the eight year period, and the new units are expected to have a useful life of ten years. Staff intends to request City Council’s approval of this lease-purchase arrangement for the acquisition of snowplows.
Once the new snowplows are received, staff intends to sell the aging plows and estimates proceeds will be $500,000 which will offset a portion of the lease costs in 2026.
CRITERIA BY WHICH COUNCIL MUST CONSIDER THE ITEM
Maintaining a municipal fleet requires periodic replacement of units which can be costly. Delaying replacement can result in higher maintenance costs and increased “downtime” of units which can impact staff’s ability to perform their responsibilities and to respond to weather events. Utilizing lease-purchase agreements helps to spread the cost over many years and evens out the annual spend on large equipment.
FINANCIAL IMPACT
The total cost to replace all snowplows will be approximately $4.2M. By utilizing a lease-purchase methodology, the annual cost to the City estimated to be $650,000 for eight years. Additionally, the City will sell the existing snowplows in 2026 and anticipate proceeds of $500,000 which will be used to offset a portion of the lease cost in 2026.
The annual cost as well as the proceeds from sale of the aging snowplows are incorporated into the City’s multiyear financial models.
STAFF RECOMMENDATION
Staff recommends approving the resolution as presented, allowing staff to move forward with procurement of snowplows scheduled for replacement in 2026.
Attachments:
Ø Resolution
Ø Presentation