1001_1.doc

State of Wisconsin AMENDMENT NO. 3 Department of Administration State Bureau Of Procurement STATE PROCUREMENT OPERATIONAL

DOA-3105A (R6/90)

BULLETIN NO. 15-93500-209

DATE December 29, 1995

COMMODITY OR SERVICE:

Master Lease Financing

��BULLETIN DISTRIBUTION:

All Agencies ��

CONTRACT EFFECTIVE DATES:

August 15, 1994 through August 14, 1999 This contract has no termination date.

COMMODITY 93500-00001

COMMODITY

DESCRIPTION: Lease Financing

REVISIONS: 1. Contract Extended through August 14, 1999

All inquires should be addressed to:

David Erdman State of Wisconsin, Department of Administration Capital Finance Office 101 E Wilson Street, 10th Floor Madison, WI 53702 Telephone: 608-267-0374

FAX; 608-266-7645

3. This amendment includes Detailed Procedures and Revised Forms.

For further information concerning this bulletin contact your purchasing or printing office.

For additional copies of this Bulletin contact: Dennis Mattson at 608-266-1559 For administration of this bulletin contact:

David C. Johnson, Purchasing Manager

STATE OF WISCONSIN

SUMMARY OF MASTER LEASE PROGRAM

�Eligible Lease Items The Master Lease Program is available for financing equipment and other intangibles associated with the equipment. Maintenance agreements and other related services must be classified as a capitalized asset to be eligible for financing through the Master Lease Program. The Master Lease Program cannot finance the acquisition of buildings, real estate or land.

NO Prior State Economic Interest The state of Wisconsin CANNOT have any prior economic interest in equipment to be financed through the Master Lease Program. Agencies should NOT make any payments directly to a vendor if it intends to use the Master Lease Program. Please notify the Master Lease Program if you desire to pay a portion of the equipment from current funds.

Lease Term The Master Lease payment term cannot exceed the useful life of the financed piece of equipment. In addition, no Master Lease payment term can exceed seven (7) years and no Master Lease payment term for computer related items can exceed three (3) years.

Interest Rate The interest rate is currently the 90-day LIBOR (London Interbank Offering Rate) Rate plus 0.56%. This is a variable rate and is applicable for a 90-day period starting the day of the equipment financing. The Department of Administration (DOA) will occasionally issue Certificates of Participation (COPs) which may convert this variable interest rate to a fixed tax-exempt rate. During the stage of your lease term subject to a variable interest rate, the Master Lease Program will periodically send you an "updated" Lease Schedule. Please contact the Master Lease Program at any time if you need an updated Lease Schedule.

Invoice Payments The Master Lease Program will make payments directly to the vendors after receipt of original invoices and corresponding "Notice of Equipment Acceptance" form(s). Projects which involve multiple vendors or multiple components from a single vendor should convey to the vendors that payment may not be made by the Master Lease Program until ALL related invoices have been received and ALL components of the project have been installed and accepted by the agency. Please let the Master Lease Program know if a payment is required by a certain date to meet contractual requirements.

Collection of Lease Payments The Master Lease Program "Request For Use & Approval" form asks for the specific and detailed WiSMART accounting string for the account which Master Lease payments are to be made from. The Lease Schedule, which is signed by your agency, acknowledges the removal of February 1st and August 1st lease payments from this appropriation. DOA will send a copy of the manual warrant for this transaction directly to the agency's accounting staff. Agencies MUST contact the Master Lease Program if it intends to change this appropriation at any time during the lease term. Prepayments on your lease balance can occur at any time and without penalty.

Thank you for your interest in the Master Lease Program. Please contact Dave Erdman at (608) 267-0374 with any questions on the Master Lease Program.

�OVERVIEW OF MASTER LEASE PROGRAM PROCEDURES

I. Complete the Master Lease Program "Request for Use & Approval" Form.

The following information is requested on the "Request for Use & Approval" form:

Agency, program, and purchasing or Master Lease contact person.

Specific equipment (please feel free to attach copies of draft purchase orders, requisition requests or bid forms), intended use, and amount of equipment to be financed by the Master Lease Program.

Amount, if any, the agency would like to pay for the equipment "up front" (i.e. as an immediate lease prepayment on the day of the financing).

Time frame over which the agency would like the lease balance to be amortized. Please specify the dates the agency would like to begin and complete making payments. Lease payments occur each February 1st and August 1st.

Proposed funding source for the lease payments (GPR, SEG, other). Also indicate whether these lease payments are included in the agency's current, or proposed, base budget.

Alternative financing options, if available, as proposed by the vendor or other leasing company.

Include the detailed WiSMART accounting string for the account which is designated to make the lease payments. This detailed WiSMART information must include agency, org, suborg, appropriation, activity, object and subobject.

Accounting contact person, or individual, who should receive updates to the Lease Schedule.

Send completed "Request for Use & Approval" Form to:

David Erdman Master Lease Program Department of Administration Capital Finance Office 101 E. Wilson St., 10th Floor Madison, WI 53707-7864

Telephone: (608) 267-0374 Fax: (608) 266-7645

III. Department of Administration approves/denies request to use Master Lease Program.

DOA Capital Finance, Budget Office and Secretary's Office each review the request to ensure that (i) the request includes equipment that is eligible for financing through the Master Lease Program, (ii) lease financing is the best alternative for acquiring this equipment, and (iii) adequate funds exist for making the anticipated lease payments. DOA Division of Technology Management also reviews requests for information technology items to ensure the purchase is consistent with the goals and principles of Executive Order #242. DOA should complete this approval process within 10 working days.

After the request has been approved, a copy of the completed "Request for Use & Approval" form is returned to the Master Lease contact person.

IV. Preparation of Master Lease Purchase Order.

The Master Lease Procurement contact is Crescent Kringle (608/266-2313).

Release of the Master Lease purchase order can occur before or after you receive the approved "Request for Use & Approval" form. These procedures are not meant to prohibit an agency from securing quotes or bids prior to receiving approval to utilize Master Lease financing. However, Master Lease financing of an equipment item can only be guaranteed after your agency's receipt of the approved "Request for Use & Approval" form.

Please follow these steps when completing a Master Lease PO:

Contact Crescent Kringle (608/266-2313) to obtain a Master Lease PO number.

Manually prepare the Master Lease purchase order. (See attached PO as an example). Do not enter the information from this PO into an accounting system. To encumber the PO, refer to Section VIII, "Semi-Annual Lease Payment Encumbrance Procedures".

All Master Lease POs must include the following items:

Master Lease PO# ("_______MLP_____________")

Order type code

Date

Vendor federal employer identification number (FEIN)

Vendor name and address

Appropriate procurement commodity code(s)

State Bureau of Procurement bulletin number (if applicable). The bulletin number assigned to an RPA may also be used. Do not use the Master Lease bulletin number.

Item Description must include the following phrase acknowledging Master Lease Program involvement; "[vendor name] will invoice the [state agency] for the total of $[dollar amount of PO]. This equipment will be paid for and acquired by Firstar Bank, Milwaukee under a Master Lease Agreement with the state of Wisconsin. Payment on outstanding invoices will not occur until all invoices for the project have been received and all components of the project have been accepted by the [state agency]."

Release the Master Lease PO to the equipment vendor and send the "State Purchasing" copy to the Master Lease Program. Incomplete POs will be returned to the agency for additional information. Do not send a copy of the PO to the State Bureau of Procurement.

Please only use the Master Lease PO number during this transaction. DO NOT secure a Master Lease PO number and then continue to use your agency's own PO number. These steps result in erroneous and inflated State purchasing figures.

Processing Invoices for Master Lease Payment.

Please follow these steps for processing invoices for Master Lease payment. The agency should not make any payments directly to the vendor.

Upon receipt of an invoice which is to be paid by the Master Lease Program, complete the Master Lease Program "Notice of Equipment Acceptance Form" and send both the original invoice and completed acceptance form to the Master Lease Program at the address at the top of the acceptance form.

DO NOT complete this acceptance form until the equipment has been installed and operating per your specifications. The Master Lease Program cannot "undo" a payment once it has been made to the vendor.

Upon receipt of all related invoices, the Master Lease Program will arrange for a payment to be made directly to the equipment vendor. Please notify the Master Lease Program if payment is needed by a certain date in order to meet contractual arrangements.

Three days prior to the payment date, the Master Lease's lending facility will inform us of the interest rate that will be charged for the first 90-day period. The Capital Finance Office will prepare the Master Lease documents, including the Lease Schedule. This Lease Schedule is the only form which must be executed by the agency, and includes the estimated lease payment amounts that will be due each February 1 and August 1 for the duration of the lease term. The amounts are "estimated" since the initial interest rate is a variable rate until the issuance of the COPs, which may convert the variable interest rate to a fixed rate.

On invoice payment date, the state will instruct the lending facility to wire the total invoice amount to the vendor. If the agency intends to pay for any portion of the equipment "up front", the Master Lease will make the full payment, the portion of agency funds will be withdrawn from the agency's identified appropriation and wired to the lending facility immediately after the payment to the vendor. This procedure allows for the agency to make a "down payment" on the equipment without violating the requirement of the state having no prior interest in the equipment.

VI. Semi-Annual Lease Payments.

The Master Lease Program will periodically send agencies revisions to the original Lease Schedule. These revisions are needed due to the allocation of prorated Master Lease Program fees or changes in the applicable variable interest rate. It should be noted that each subsequent schedule replaces the one before it.

The February 1st and August 1st lease payments are automatically deducted from the agency's previously identified appropriation and accounting string. The state wires these lease payments directly to the lending facility for the duration of the lease term. If the February 1st or August 1st falls on either a Saturday, Sunday or holiday, the Master Lease payment will occur on the next business day.

VII. Changes to Semi-Annual Lease Payment Appropriation/Accounting String.

You MUST receive Master Lease approval to any changes to the previously approved appropriation or accounting string. Please submit these requests to the Master Lease Program. The request must include the new accounting string in the detailed WiSMART format, such as agency, organization, sub-organization, appropriation, activity, object, and sub-object.

VIII. Semi-Annual Lease Payment Encumbrance Procedures.

The Master Lease Accounting contact is Scott B. Thornton (608/266-5051).

Your agency may encumber the February 1 and August 1 Master Lease payments. Please follow these steps in completing this process.

If your agency is on-line with WiSMART and you wish to encumber your scheduled lease payments for a given fiscal year, use the PD transaction. You may complete one blanket PD to cover both the estimated August and February lease payments. If you have multiple Lease Schedules, you may combine all into one PD. Please also include the following information:

Reference the original Master Lease purchase order number you received from the State Bureau of Procurement in the reference field for each Lease Schedule. DO NOT use the automatic numbering system.

The VEND CODE MUST be 39-0968144, establishing the vendor as First Bank Milwaukee.

Enter the code L in the Order Type field and the code ML in the Spec Inst field.

Reference the accounting string(s) that DOA should withdraw the lease payment from. You must receive Master Lease approval before making any changes to this accounting string.

Send a copy of the printed PD document (or a print screen) to Scott B. Thornton, Master Lease Accounting, State Controller's Office, 101 East Wilson Street, 8th Floor. Do not send a copy to the vendor nor the State Bureau of Procurement. The State Controller's Office will process a manual warrant transaction for the lease payment due date referencing the PD document ID. The February payment will be indicated as final and fully liquidate the remaining purchase order amount for the fiscal year.

If you agency is a WiSMART interface agency, and you wish to encumber the lease payments, process and encumbrance through the WiSMART interface. You should encumber the estimated fiscal year lease payments for both August and February. Include this Master Lease encumbrance only on the tape you send to WiSMART, it should not be included on the tape sent to State Bureau of Procurement. Please also include the following information:

Reference the original Master Lease purchase order number you received from the State Bureau of Procurement.

Enter the code L in the Order Code field.

The State Controller's Office will process a manual warrant transaction for the lease payment due date.

The agency should liquidate all Master Lease payment amounts encumbered two working days before each payment date so that the manual warrant is not held up. The agency should have fully liquidated all Master Lease encumbrances as of February 1 of each year.

IX. PLEASE CONTACT THE MASTER LEASE PROGRAM AT (608) 267-0374 WITH ANY QUESTIONS.

Master Lease Program

DOA-2480 (C08/95)

Master Lease Program

REQUEST FOR USE & APPROVAL

Request Date ��Requesting Agency�Program Name ��Division / Bureau�Contact Person ��Agency Address

Zip & 4�Phone No. ( )

Fax No. ( ) ��Equipment to be Financed�Use / Purpose of Equipment

��Total Amount of Equipment �Amount (if any) to be paid up front���Proposed Vendor(s)�Proposed Delivery Date ��Master Lease Purchase Order Number(s)�Proposed Acceptance Date ��Requested Payment Period In Number of Years �Are anticipated lease payments part of base budget?

��SYMBOL 168 \f "Wingdings" \s 14 \h� Alternative Financing Options attached�� �Agy.�Org.�Sub Org�Appr�Actv.�Obj.�Sub.

Obj.�Rptg.

Cat.�Proj #�FY�$ Amount OR %��WiSMART Accounting Codes (from which lease payment will be made) �������������If different from contact listed above, Name person to receive UpdatedLease

��State Budget Analyst Approval Date

���DOA Secretary's Office Preliminary Approval Date

�Master Lease Program

NOTICE OF EQUIPMENT ACCEPTANCE

Date����This Notice and ORIGINAL invoice (s) must be returned to the Master Lease Program for payment to be issued.��Agency�Division / Bureau�����Vendor�Master Lease Purchase Order No.�����Invoice Number(s)����Equipment������������������������������������������������������ The equipment listed above has been delivered, installed according and accepted to agency specifications. The Department of Administration is advised that corresponding invoices can be paid.

Agency Authorized Representative

Type or Print Name Title

Signature Date

"AGENCY NAME" Master Lease PO Number "ABC" MLP "0001"

"AGENCY ADDRESS 1"

"AGENCY ADDRESS 2"

"AGENCY ADDRSS 3"

Type Code "L" (Master Lease Program)

FOB "Installed" Terms "Net 30" Delivery "3/99" Agency Bid No. "432-AD" State Procurement Bulletin No. "12-34567-890"

Item Quantity Unit Commodity Code Unit Price Total

1 1 "12-345-67890" .00 .00

"(VENDOR NAME) WILL INVOICE THE (STATE AGENCY) FOR THE TOTAL OF $(AMOUNT OF THIS PO). THIS EQUIPMENT WILL BE PAID FOR AND ACQUIRED BY FIRSTAR BANK, MILWAUKEE, UNDER A MASTER LEASE AGREEMENT WITH THE STATE OF WISCONSIN. PAYMENT ON OUTSTANDING INOVICES MAY NOT OCCUR UNTIL ALL INVOICES FOR THIS PROJECT HAVE BEEN RECEIVED AND ALL COMPONENTS OF THE PROJECT HAVE BEEN ACCEPTED BY THE (STATE AGENCY)."

SAMPLE SAMPLE SAMPLE SAMPLE SAMPLE SAMPLE

MASTER LEASE MASTER LEASE MASTER LEASE

"AGENCY CONTACT NAME"

"PHONE NUMBER"

� PAGE �6�

Master Lease Program

DOA-2481 (C08/95)