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    Default Who Gets Priority?

    I am working with some local departments, doing everything I can to make sure they get a vehicle this year. One department has me in a quandry. This is a tough one.
    They have a 77 pumper, a 84 "supply" truck and a 95 tanker. The pumper needs to be replaced. However, they were just awarded a zero-interest loan to replace that pumper. So, they asked do they attempt the pumper with AFG? The pumper will not technically be placed out of service when the loan truck comes in, so in one sense, the AFG would still be replacing the old truck. Another argument is that who knows what would happen with the loan. It is through the state, and anyone around Illinois knows that the state finances are troubled. So, a person could go for the AFG and if awarded say that there was no guarantee that the loan would be valid when the time comes.
    But let's say that the facts would not allow two grants at the same time. Bummer. So try for another truck. Like the tanker, perhaps? Well, it is an old tank without baffles and marginally sufficient for power and braking. But the age just sticks out like a sore thumb. 14 years just doesn't cut it in the AFG.
    So, who gets the priority when applying for two grants for one truck?
    BAClair

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    [quote=4caster;1061072] However, they were just awarded a zero-interest loan to replace that pumper. QUOTE]

    IMHO You sort of answered your own question here with the statement above. If they have a zero interest loan, why do they need the grant? Their financial need just went in the toilet. If they have placed an order for that truck prior to AFG submission, it will have to be disclosed and listed on the application and that is going to destroy your "aging, older fleet" arguement and throw the average age of fleet back at you.
    Kurt Bradley
    Public Safety Grants Consultant

    "Never Trade Skill for Luck"

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    The problem is that the loan will not purchase a complete rig. The bad thing is either pay off the truck in 20 years or get it at 5 cents on the dollar! The chief didn't know whether or not to turn down the loan in hopes of getting through AFG, but if they lose, then they are out two chances instead of one. It is a pickle!
    Fortunately, no truck has been spec'd or ordered, so they have avoided that land mine. My thought was to wait as long as they can before placing the order for the new truck with the loan.
    ***I just had a thought. What would the argument be if the afg grant was used to pay off the loan. In reality, it is being used to buy a truck. I know it's not likely, but just a thought.***
    BAClair

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    Quote Originally Posted by 4caster View Post
    The problem is that the loan will not purchase a complete rig. The bad thing is either pay off the truck in 20 years or get it at 5 cents on the dollar! The chief didn't know whether or not to turn down the loan in hopes of getting through AFG, but if they lose, then they are out two chances instead of one. It is a pickle!
    Fortunately, no truck has been spec'd or ordered, so they have avoided that land mine. My thought was to wait as long as they can before placing the order for the new truck with the loan.
    ***I just had a thought. What would the argument be if the afg grant was used to pay off the loan. In reality, it is being used to buy a truck. I know it's not likely, but just a thought.***
    Playing the Devil's Advocate here but that would be a pre-award expense which is handled on a case by case basis with NO guarantee they will approve it. If I was the tech review specialist I would still want to know why you needed a grant if you got the loan? Again your financial need is going out the window here, as the grant is supposed to be last resort technique. AFG on trucks is a "long shot" at best. $167 million for trucks and $2 billion worth of requests. Only roughly 775 trucks given a year from that. If you have the deal, I would take it! Bird in the hand is worth 2 in the bush. AFG odds for truck awards are not that good.
    Last edited by ktb9780; 05-09-2009 at 03:12 PM.
    Kurt Bradley
    Public Safety Grants Consultant

    "Never Trade Skill for Luck"

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    If they can afford to buy the truck with the loan then like Kurt said, the truck could be in the station before the end of the year, and you could be set waiting until Feb 2010 for a turndown. Less than 650 trucks awarded in 2008, fewer in 2009. I ran into so many people that didn't realize that applicants could do a truck and an ops grant that we might see 10,000 vehicle apps, which would put it more at a 1 in 19 odds versus the 1 in 8 of past years.

    Even if approved you're 18-24 months away from seeing the truck instead of 6. Or if you find a demo even shorter.

    If the loan has no expiration then they could apply for the grant and use the loan to pay the difference. It's not federal money, and loans are cash-equivelents so they can be used for matching funds. Only way I wouldn't personally take the loan and run is if it wasn't more than $150k or the loan payment will be too high compared to current finances. Don't want to get strapped by the payment and jeopardize other things.

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