Mac Pro "cheese grater". Budge about $1,500 to replace.
Computer is still running a non-PhysIT image. Thus, need to upgrade software in order to enable effective support and ensure contemporary software. (Ex. MS Office 2010 => MS Office 2013.)
Computer is 2.5 years old (9/28/2011) so retain no matter what choice is made.
Consider keeping hardware, and use CIT's VDI service which would allow one to retain hardware even longer:
Timing: Per John, consider avoiding making changes this summer due to other factors. Michael to touch base with Rosemary to seek out her preferences.