Village's truck leasing agreement with Ford was above board, village attorney concludes

Warwick — The Village of Warwick’s contract with Ford is not a violation of bid law, according to the village’s attorney, Michael Meth. “I’m not a judge,” Meth said. “But I’ve looked into all cases that past judges used to determine if agreements were leases or purchases. Seems to me because they can’t alter the trucks and must return them at the end of the lease exactly as they received them, this is a lease, not a purchase.” The board had entered into an agreement with Gordon Ford in Haverstraw to lease several trucks through the Ford Motor Credit: a 2004 Ford F-350 dump truck, a 2004 Ford F-250 Crew Cab with plow and a 2004 Ford F-350 stake body and plow. Last June, the board leased an additional two 2005 Ford F-350 4X4s with plow. Municipalities must go to bid on any purchases over a certain amount or use a state bid list. Questions arose about a year after the board entered into the original agreement, saying the agreement was actually a purchase and not a lease. Meth said he spoke with four different lawyers from Ford regarding the agreements. “It took a long time to get these people on the same page,” he said. “I’m satisfied this is a lease.” And so is Ford. Meth said that Ford feels this is, indeed, a valid lease. He said Ford signed an amendment regarding the village’s tax exempt status, something that would not be necessary if this was a purchase. ”If it was a purchase, they wouldn’t need that,” Meth added. “Ford would get hit with a different tax structure if this was not a lease.” Competitors will get a shot at bidding on these trucks if the municipality decides to buy them after the leasing period of 48 months. “Competitors can bid if the municipality decides to buy out,” Meth said, referring to the end of the lease. The agreement between Ford Motor Credit and the village states that the village cannot alter the trucks. Also, there is a residual payment for the vehicles at the end of the lease. “Everything was done properly,” Meth said. “We received a good price. We’re not overpaying at all. Everything was done above board and on the record during the budget sessions.” The lease agreement also raised questions about using local businesses more and whether preference was shown to this Rockland County dealership because trustee George McManus is employed there. The Village Board referred the matter to its Ethics Committee last fall. Meth said his determination is separate from the Ethics Committee’s, but added he found nothing inappropriate about how the board acted. “Nobody made out,” he said. “No one got any personal advantage because of this.” Mayor Michael Newhard said he was relieved after hearing Meth’s opinion. “The interest of the board was to save the village money,” said Newhard. “We acted in good faith. We were doing business in unchartered territory here. I’m relieved — with some lessons learned.”