To:

Members, Board of Education

From:

Terry B. Grier, Ed.D.

Date:

December 19, 2006

RE:

Contract to Purchase Replacement School Buses

Session law 2005-276 authorized the State Board of Education to arrange for the purchase of replacement school buses through financing.  Bids were received for school buses on a cash basis and for financing through third party financing.  The best price to the state resulted in a third party financing arrangement offered by SunTrust Leasing Corporation, a third party finance company, based on the state contract for school buses awarded to Thomas Built Buses.  

By Master Facilitator Agreement (MFA) reached between the NC State Board of Education and SunTrust Leasing Corporation, each Local Education Agency (LEA) will enter into a Master Replacement Bus Financing Agreement (MRBFA) with SunTrust Leasing Corporation pursuant to which the LEA will finance the purchase of buses from Thomas Built Buses through SunTrust Leasing Corporation, on the terms and conditions as provided therein.

The finance agreement established between SunTrust Leasing Corporation and the LEA is contingent on appropriation of funds to make payments during year two and year three of the financing agreement.  These funds are being requested in the state’s continuation budget for 2007-2009.
 
The amount allotted to Guilford County Schools is $5,185,154.01 for the purchase of eight (8) 41 passenger school buses equipped with wheel chair lifts and sixty-seven (67) 72 passenger school buses.  The replacement buses are the Thomas Built Buses C2 model.  The North Carolina Department of Public Instruction will make the annual payments directly to SunTrust Leasing Corporation on behalf of the LEA and will notify the LEA when payment is made.

RECOMMENDATION: I recommend Board approval to authorize appropriate staff member(s) to proceed with ordering the 75 replacement buses as outlined above.