I would first exhaust the "amicable" ways of trying to resolve the matter, such as talking to the chief and commissioners, just because it would save so much time and money if this resolved it. If not, you will have to sue the department for conversion of chattels. This will involve the sovereign immunity issue, so you will probably have to deal with the requirements of some sort of governmental tort claims act. If the lawsuit goes through, you can conduct discovery. If the records magically turn up at this point, they will likely settle and give you the guns. If not, or if the records don't turn up, you will have to prove by a preponderance of the evidence that they wrongfully deprived you of possession of property that you had a legal ownership or right of possession of, causing damages to you. If you prove this, you collect however much the judge or jury thinks the property was worth.
Another issue you have to consider is the statute of limitations. For a tort, this usually runs from the time the injury was discovered... which would be the time that the PD informed you that they don't have any record of the guns and can't return them to you. Sometimes state law will put a shorter statute of limitations on claims against governmental units, so be careful and talk to a lawyer to make sure you aren't running out of time. If you are close to the SOL, you should go ahead and get something filed ASAP so you don't lose your rights.