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HomeMy WebLinkAbout02/17/2009, C3 - FLEET MANAGEMENT POLICY UPDATE council02-17-2009 j acEnaa nEpoin c3 CITY OF SAN LUIS OBISPO FROM: Jay D. Walter, Director of Public Works 4 D Prepared By: Dave Smith, Public Works Administrative Service Manager SUBJECT: FLEET MANAGEMENT POLICY UPDATE RECOMMENDATION Adopt a resolution approving an updated Fleet Management Policy. DISCUSSION Overview The City recently undertook a comprehensive evaluation of its fleet management policies and operations. The City's investment in its fleet is ah essential part of the delivering important services to the community. On the other hand, there is also a need to ensure that the City invests wisely in these important tools and are good stewards of these assets, both from a fiscal and environmental perspective. Given the City's fiscal situation and the upcoming budget review, this comprehensive evaluation is especially timely. The proposed revisions will help better guide fleet recommendations in the Preliminary 2009-11 Financial Plan and beyond. As detailed below, while there are several changes proposed for Council consideration, they focus on three key areas to ensure that: 1. The fleet is as small as possible in delivering City services by closely looking at vehicle utilization(right-sizing the fleet) and capitalizing on opportunities to share or rent equipment. 2. Replacement guidelines are realistic and that the City only replaces equipment when needed to efficiently and effectively deliver essential services. As discussed below, the proposed policy makes several revisions in our replacement guidelines, lengthening them in most cases. Regardless of the specific guidelines (and they are only that), "it's reached its replacement target" should never be the sole basis for making replacement decisions. There is no "one size fits all solution" in assessing when replacement makes sense. This decision needs to be based on a broad range of criteria as set forth in the proposed policy. This includes evaluating fleet size, functional needs, service history and current condition, new technology and available choices in fuel use types and performance standards in finding the "sweet spot" m replacing equipment that maximizes return on investment and improves productivity while minimizing maintenance costs, fuel usage and emissions. 3. City staff are good stewards of the environment in use of this tool, and recommend purchases of either alternative-fuel, high miles-per-gallon or smaller, light-weight vehicles whenever this will meet our service needs most of the time. In those cases where users might need a different capacity vehicle"sometimes,"they should either share vehicles or rent them.. 03 - / Fleet Management Policy Update Page 2 Based on internal budget reviews to-date, it is clear that staff will be recommending a number of fleet replacement deferrals in 2009-11 given our fiscal situation. However, this has the "upside" benefit of presenting opportunities to take advantage of technology improvements anticipated to hit the market with future replacement makes and models that are safer, less expensive, more fuel efficient and less polluting. Amending the Fleet Management Policy: Background and Summary of Changes Background The City Fleet Management Policy is set forth in Section 405 of the Financial Management Manual and provides the framework for how the fleet is managed and equipment specified, replaced, procured and disposed. It is guide post for the three fleet budget programs operating in Public Works (General and Transit Fleets) and in the Fire Department(the Fire Fleet). Fleet replacement and addition requests are presented to Council for approval as part of the Financial Planning process. Procurements valued under $100,000 may be approved by the City Manager unless he determines that review by Council is appropriate. Purchases valued over $100,000 must go to Council for approval to advertise for bid or to use Cooperative Purchasing. A common example of cooperative purchasing is when public bidding has occurred by another public agency and additional units can be purchased by the City through the same dealer at the same awarded bid price. The Public Works Department manages most of the fleet inventory and typically takes the lead in periodic updating of Fleet Management Policy. The intent is to update policy language to reflect changes in practices, technology, industry standards and to ensure compliance with other related policies and regulations. In 2007, the City Manager requested that the City's existing Fleet Management Policy be reviewed for general updating and to confirm it still reflects reasonable industry standards, especially in area of replacement guidelines. Spectrum Consultants, which was familiar with City fleet operations based on the management review it provided in 2001, was hired to assist with the review. They met with the reviewing department staff and made findings and recommendations for consideration. Provided in Attachment 1 is the proposed updated policy, which reflects the collective view point of the reviewing department and consultant input. A legislative draft of the proposed changes is also available in the Council offices. Summary of Changes. All twelve sections in Fleet Policy were reviewed by consultant and staff and there are revisions in sections. However, most of the changes are relatively minor, clarifying and updating language to reflect existing practice. The most significant changes are in sections 405 B, E and F summarized as follows: 1. 405-B: Responsibilities. The consultant recommended centralization of the General, Fire and Transit fleets. After considerable discussion among team members, the consensus was that though it may be a valid idea and a trend in similar agencies, it would be a complex change to make in the City and would require careful consideration and time to accomplish. The section now provides for ongoing review and analysis as key in-house fleet staffing vacancies or Transit contract changes occur. In the meantime, there are elements in common C3 -d, Fleet Management Policy Update Page 3 with all three fleet groups that staff is now exploring, which are discussed in the "Best Practices" section of this report. 2. 405-E: Alternative Fuel Units. This section has been re-titled Environmental Stewardship. This change more accurately reflects the intent of reducing fuel consumption and emissions by taking a broader approach beyond simply alternative fuels as the sole focal point. Because fleet equipment is so diverse, there is no "one size fits all" solution. Alternative fuel may be one of many solutions in conjunction with others like alternative transportation, extended range gas/electric hybrids, clean diesel buses, downsized vehicles or simply "best in class" conventional fueled equipment that get the best fuel economies. In short "Environmental Stewardship" represents a more comprehensive view. The revision also retains the additional 20% baseline cost premium for alternative fuel vehicles, consistent with the guidelines used in preparing the 2007-09 Financial Plan. 3. 405-F: Age and Mileage Targets Before Replacement. This section hasbeen re-titled "Fleet Use Target Guidelines Before Replacement". The title change reinforces the intent to have clear, realistic targets for replacement with the flexibility to extend or reduce the life of equipment, as needed, based on its repair and use history, new technology and other factors as set forth in the policy. The following table highlights changes in replacement targets from the current policy. Equipment Group Current 'Consultant Staff ,_Target Recommendation, Recommendation Police Patrol Motorcycles 25,000 mi 35,000 mi Same as consultant Other Public Safety Vehicles New Not specified 80,000 mi Police Sedans 7 /80,000 mi 8 /90,000 mi Same as consultant All Other Sedans 10 yr/80,000 mi 11 /90,000 mi Same as consultant Station Wagons 10 /80,000 mi 11 /90,000 mi Same as consultant -Passenger Vans 10 /80,000 mi 11 /90,000 mi Same as consultant -Utility Vehicles I I /90,000 mi 12 /100,000 mi I 1 /90,000 mi -Utility Scooters 6 /30,000 mi 6 /30,000 mi/10,000 hr 6 /30,000 mi/5,000 hr Street Sweepers 5 /5 yr * Not specified 8 yr* Vacuum Flusher Trucks 8 Yr ** Not specified 12 yr ** Construction Equipment 17 yr 17 yr/5,000 hr 12 yr/5,000 hr Mowers 17 yr 7 yr Same as consultant * Sweepers were on 10 year cycle shown as 5 years in front line service and 5 years in backup service. Back line service has been discontinued. ** As with sweepers, there will no longer be any backup service units now that more than one piece of equipment will be in front line service simultaneously. As shown above, in the virtually all cases, changes reflect an extension in useful life targets. However, the best practice in managing a large organizational fleet is not strictly to maximize mileage; it is also to be able to surplus (sell) a vehicle at the strategically best time financially. This "best time" is when the vehicle still holds some economic value, but before it has become a costly maintenance drain. This is different than the choices people sometimes make at home (e.g. to sell a vehicle when it has much useful life in order to buy something newer or more attractive; or conversely, to drive a vehicle "until the wheels fall off' — past the point of diminishing returns, when far too much has been invested on maintenance). 0 3 =3 . i J Fleet Management Policy Update Page 4 Best Practices The following"Best Practices"were identified for follow-up evaluation and action: 1. Bulk Fuel Purchasing. The City currently has on-site fueling at seven locations. It would be difficult for the City to get out of the fueling business completely without impacting production and affecting fuel availability in an emergency. However, alternative commercial fueling can complement use of City bulk fueling. Staff is currently evaluating the benefits of a cooperative agreement with the County for bulk fuel purchasing. In addition, a commercial fueling card is available through a cooperative agreement with the State of California, which is also being considered on a pilot basis. 2. Fuel System Management. Key to optimal fleet management is accurate, integrated maintenance and fuel use history in order to develop solid, reportable benchmarks for fleet miles driven, miles per gallon achieved and help with general analysis of use. This information will also be essential in developing the "Green Fleet Plan" discussed below. The Corp Yard on- site fueling system is being replaced and will restore dependable data collection. This system can also be linked to other remote City fueling sites such as the Water Treatment Plant, Water Reclamation Facility, Laguna Lake Golf Course and Fire Stations. This could allow those sites to be managed independently by departments but use a unified data base for central access of all fueling transactions. 3. Green Fleet Plan. This will be developed by fleet staff with input from a fleet advisory group represented by stakeholder departments. The plan will build on the many changes as the automotive industry passes though tumultuous times, hopefully leading to improved vehicle technology entering the market and clearer"green" goals. As stated previously, it is likely that most City fleet replacement will be deferred beyond 2009-11. While largely due to the City's fiscal circumstances, the "upside" of this deferral is that during this next two year period, there are likely to be significant changes in regulatory requirements, performance standards and technology improvements, which will be important components of the planGreen Fleet goals will focus on realistic targets aimed at reducing emissions and increasing gas mileage for the entire City fleet, while assuring that functional needs are met. 4. Fleet Equipment Sharing. There are two areas where the potential for sharing equipment can be expanded: passenger car pool vehicles (sedans) and maintenance crew construction equipment (dump trucks, back hoes). This primarily involves Public Works and Utilities Departments, which will be identifying opportunities for appropriate changes. 5. Mechanic Cross Training. Fleet maintenance staff in the each of the General, Fire and Transit fleets has distinct mechanic skill sets that are necessary to service a wide variety of equipment such as sedans, pickups, landscape equipment, boats, heavy equipment such as sweepers, construction equipment, Transit Buses Fire pumpers and Fire ladder trucks. While it is important to retain the specialty skill sets necessary to accommodate the wide variety of fleet equipment serviced, opportunities for cross training. Encouraging General Fleet mechanics to pursue training outside of their primary specialty could provides future opportunities leading to improved back up support, potential for in-house promotion and professional development. Fleet Management Policy Update Page 5 CONCURRENCES The departments participating in this review in Public Works, Fire, Police, Finance & Information Technologies and Utilities concur with the proposed revisions. Community Development agrees that development of a green fleet plan supports programs in the conservation and Open Space Element of the General Plan. FISCAL IMPACT There are no direct fiscal impacts related to adopting the recommended updates to the City's Fleet Management Policy. However, due to proposed revisions in replacement cycles and strategies for minimizing fleet size, these changes should result in long term cost savings along with a "greener"fleet. ATTACHMENT 1. Updated Fleet Management Policy 2. Resolution AVAILABLE FOR REVIEW IN THE COUNCIL OFFICE Legislative Draft of Updated Fleet Policy G:\Staff-Reports-Agendas-Minutes\_CAR\2009\Fleet\CAR Fleet Policy Review\_CAR Fleet Policy Review.doc 14 Attachment 1 Section 405 FLEET MANAGEMENT TABLE OF CONTENTS OVERVIEW A. Purpose and Objectives 2 B. Responsibilities 3 POLICIES C. Maintaining Proper Fleet Size 6 D. Buying New Versus Used 7 E. Environmental Stewardship g F. Fleet Use Target Guidelines Before Replacement 9 G. Equipping and Marking Newly-Acquired Units 11 PROCEDURES Budgeting H. Budgeting for Fleet Additions and Replacements 12 Budgeting for Fleet Additions Budgeting for Fleet Replacements Off-Cycle Fleet Additions and Replacements Replacing Damaged Fleet Units Purchasing I. Buying New Units: Cooperative Purchasing Contract 14 J. Buying New Units: Invitation for Bids 15 K Buying Used Vehicles 16 Surplus Units L. Disposing of Surplus Units 17 • Originally adopted by the Council on October 1, 1990(Resolution No. 6876) • Updated and revised by the Council several tines since then,most recently on February 17,2009(Resolution No. ????) Attachment 1 SECTION 405-A: OVERVIEW PURPOSEOBJECTIVES 1. Purpose The City's fleet represents a significant investment in the tools needed to deliver day-to- day services. This section of the Financial Management Manual outlines responsibilities, policies, and procedures for managing the City's fleet according to established objectives. 2. Objectives a. Minimize fleet life-cycle costs. Typically, it makes sense to get as much service life as possible out of a fleet unit. On the other hand, as fleet units get older and accumulate more miles, operation and maintenance costs eventually become excessive. Also, surplus value declines sharply after a certain point. Striking a sensible balance among these fleet management principles can maximize utility and minimise overall costs. b. Avoid unnecessary capital outlays for fleet expansion and replacement. Expanding the fleet or replacing an existing unit may not make sense if the unit is used only sparingly. C. Preserve and improve fleet safety, utility, reliability, and economy. Regular and competent inspection and maintenance can prevent safety problems, maximize reliability, and minimize long-term costs. Newer vehicles usually incorporate more advanced technology such as airbags, anti-lock braking systems, and engines that burn cleaner, last longer, and use less fuel. New construction equipment usually incorporates technology that improves the productivity and safety of equipment operators. Also,newer units are naturally more reliable. d. Maintain a positive image for the City. Routinely cleaning, maintaining, and repairing fleet units can demonstrate a commitment to good stewardship over City assets. Operating older vehicles and equipment can sometimes convey a positive impression of cost-consciousness, if the units are not allowed to become unsightly or noisy. Stylish features with marginal utility may project an inappropriate image of luxury or extravagance. e. Set a progressive example of environmental stewardship. Buying and operating alternative-fuel and high efficiency conventional-fuel units, where functionally and fiscally practical, can demonstrate the practicality of such units in reducing conventional-fuel use and enhancing air quality. It can also encourage the initial supply of innovative products until widespread demand makes them more feasible to produce. f. Encourage responsible use of City vehicles and equipment. Conscientious use of City vehicles and equipment can improve safety and reduce liability. 2 Attachment 1 405-B: Overview RESPONSIBILITIES 1. City Manager Responsibilities a. Oversee the acquisition, operation, and disposal of all City-owned and leased Fleet vehicles and equipment. b. Authorize replacement of fleet units that have been damaged beyond repair when the cost or method of replacement is within the City Manager's purchasing authority and adequate resources are available within existing budget appropriations. C. Amend fleet management policies and procedures as required to accomplish adopted fleet management objectives. 2. Department Head Responsibilities a. Ensure fleet management policies and procedures are followed.. b. Budget for fleet additions and replacements not funded through the Fleet Replacement Fund. C. Ensure that all department employees who operate fleet units have appropriate and valid operator licenses. d. Ensure discussion between management staff occurs to identify and consider incremental changes when Transit contracts renew or key fleet staff positions vacate. Potential opportunities could include combining business activities to take advantage of economies of scale, better integration or centralized administrative support, integration of fleet asset management data collection and reporting, establishing equipment standards and using master contracts for outsourced service providers. 3. General Fleet Coordinator Responsibilities a. Manage the acquisition, disposal and replacement of all units not assigned to the Fire or Transit Fleet. b. Service and repair all vehicles and other related fleet equipment including portable and fixed emergency generators not assigned to the Fire or Transit Fleet. C. Manage inventories of the fuel, oil, tires, and replacement parts needed for all units not assigned to the Fire or Transit Fleet. d. Document the maintenance history and cost, the fuel use, and the accumulated mileage (or hours) for each unit not assigned to the Fire or Transit Fleet. e. Identify units to be disposed of. 4. Fire Fleet Coordinator Responsibilities The City has established a separate Fire Fleet to address the specific needs of this specialized equipment. Fire equipment has a special roll and demands that require special Q 3 �3�CJ Attachment 1 certification and record keeping in maintaining unique equipment. A Fire Mechanic position and Fire equipment maintenance facilities based at Fire Station One has been a long standing and successful norm for managing the Fire Fleet. This practice is intended to continue indefinitely, however, when Fire maintenance staff positions vacate, the Public Works and Fire departments should take the opportunity to identify and consider potential opportunities that could be beneficial for consolidating some or all elements of the Fire and General Fleets. Examples may be combining business activities to take advantage of economies of scale, better integrated or centralized administrative support, integration of asset data collection and reporting, adoption of common equipment standards and using master contracts for outsourced service providers. a. Manage the acquisition, disposal and replacement of all units assigned to the Fire Fleet. The Fire Fleet includes all vehicles and other related fleet equipment including portable and fixed emergency generators assigned to the Fire Department. b. Service and repair all units assigned to the Fire Fleet. C. Manage inventories of the fuel, oil, tires, and replacement parts needed for all units assigned to the Fire Fleet. d. Document the maintenance history and cost, the fuel use, and the accumulated mileage (or hours) for each unit assigned to the Fire Fleet. e. Identify units to be disposed of. 5. Transit Fleet Coordinator Responsibilities The City has established a separate Transit Fleet to address the specific needs of this specialized equipment. Transit equipment has a special roll and demands that require special certification and record keeping in maintaining unique equipment. A Transit Management position, comprehensive Service Contract, and Transit equipment maintenance facilities based at 29 Prado Road has been a long standing and successful norm for managing the Transit Fleet. This practice is intended to continue indefinitely, however, when Transit contracts are up for renewal or key Transit management staff positions vacate, Public Works should take the opportunity to identify and consider potential opportunities for consolidating some or all elements of the Transit and General Fleet. Examples may be combining business activities to take advantage of economies of scale, better integrated or centralized administrative support, integration of fleet asset data collection and reporting, adoption of common equipment standards and using master contracts for outsourced service providers. a. Manage the acquisition, disposal and replacement of all units assigned to the Transit Fleet. The Transit Fleet includes buses and service vehicles owned by the City and used by the City's transit service contractor. Because such contractors prefer to service and repair the vehicles they operate, the Transit Fleet is kept separate from other City units. b. Oversee the maintenance and operation activities of the Transit Fleet that are performed by the transit service contractor. C. Identify units to be disposed of. C 3-9 4 Attachment 1 6. Vehicle and Equipment Operator Responsibilities a. Exercise good judgment. b. Consult a supervisor or the fleet coordinator if any operator responsibilities are not clear. C. Use City units only for conducting City business unless 1) a vehicle has been approved as a part of compensation or 2) personal use of a vehicle has been specifically approved by the City Manager. d. Arrange for emergency repairs whenever consulting with the fleet coordinator would be impractical. Pay for emergency repairs by either using a City credit card or paying for the repair and submitting receipts for reimbursement. e. Wash and vacuum units periodically to maintain appearance and prevent premature deterioration of surfaces and materials. Use City-owned washing facilities if available. If City-owned washing facilities are not available, use a commercial car wash. Use commercial waxing and detailing services only with prior approval of the fleet coordinator. f. Pay for any parking fees and tolls required while on City business. Submit receipts for reimbursement. g. Pay any traffic and parking fines incurred. These payments are not reimbursable. h. Carry a valid California driver license. i. Obey all traffic laws. j. Except for emergency response, strictly observe speed limits and avoid rapid acceleration in order to minimize fuel use. k. In order to minimize fuel use, avoid vehicle idling except when required for safety, emergency response, vehicle maintenance, equipment activity, or recommended warm-up. 1. Drive defensively. in. Use turn signals. n. Use seat belts and ensure all occupants the use seat belts. o. In case of accident, follow instructions included in the accident folder. P. Observe no smoking in City vehicles policy requirements in accordance with City policies pursuant to City Municipal Code Title 8, Health and Safety, 8.16.030 paragraph C. q. Observe cell phone use policy requirements during operation of City vehicles. 7. Finance Division Responsibilities a. Dispose of surplus vehicles in accordance with City policy in section 480 or the Finance Management Manual. 5 � 3 -/p Attachment 1 Section 405-C: Policies MAINTAINING PROPER FLEET SIZE 1. Minimum Fleet Size. The number of units in the fleet should not exceed the minimum number of units needed to effectively conduct City business. 2. Reviewing Vehicle Use. When budgeting for fleet replacements, average annual mileage or hours should be calculated for each unit to be replaced. If average annual use appears to be much lower than the average annual use within the same vehicle or equipment category,the following options should be considered instead of replacement: a. Using a vehicle assigned to a convenient vehicle pool b. Occasionally borrowing from, or establishing on-going shared equipment with another operating program. C. Renting a vehicle or equipment item for a limited period of time in accordance with Financial management Manual requirements and City Manager approval where required. d. Reimbursing employees for use of privately-owned personal vehicles where it is a practical or necessary alternative to City vehicle use., particularly if such use may result in reduction in fleet size and does not conflict with trip reduction efforts. e. Leasing of select construction or alternative fuel equipment. 3. Reimbursement for Business Use of Personal Vehicles. When use of a privately- owned personal vehicle is authorized for City business, reimbursement will be made at the current Internal Revenue Service rate allowed for business use of vehicles. Consistent with the IRS calculation of this rate, the per mile reimbursement rate will reflect all costs associated with operating a vehicle, including, but not limited to, depreciation, lease payments, maintenance, repairs, fuel, oil, insurance, and vehicle registration fees. 4. Timely Disposal of Replacement Units. Replacement of units will not be used as a strategy to expand the fleet either temporarily or permanently. When a unit is replaced, it will expeditiously be declared surplus and be disposed of, except that the City Manager may approve a one-time temporary retention and use not to exceed 180 days. a. The General Fleet Coordinator may retain one surplus general purpose sedan or pickup truck for a loaner vehicle to be used by departments when their vehicles are being serviced. b. The General Fleet Coordinator may retain one surplus backhoe/loader for light- duty use at the Corporation Yard. 5. Authority to Dispose of Surplus Units. The Director of Finance & Information Technology is authorized to: a. Declare replaced units as surplus whenever the Council has previously approved replacement through the budget process or other Council action. b. Dispose of surplus units by sale, auction, trade-in, or other disposal method according to City policies and procedures. 6 � 3 -j� Attachment 1 Section 405-13: Policies BUYING NEW VERSUS USED 1. Based on past experience with purchase of used general fleet equipment, and to ensure reliability and value,the City's primary practice should be purchasing new vehicles and equipment when replacements are needed. Buying new fleet equipment takes advantage of design advancements and improvements in fuel usage at reasonable cost from competitive bidding through state and local cooperative purchase opportunities. This does not preclude the option to buy used on a case-by-case basis if there are specific reasons why used vehicles or specialize equipment is a more practical and cost effective alternative to buying new. 2. Exception. One standing exception to this policy will be that the City will purchase used general-purpose police sedans. Police Department has found that it needs general- purpose sedans that: a. Are not typically specified for government fleet use and have modest exterior trim levels so the sedans do not stand out as stripped-down government vehicles. This is important because these cars are often pressed into service for detective or undercover work. b. Have large interior capacities with plenty of seat width and legroom in the rear. This is important because these cars must occasionally respond to emergencies carrying four fully equipped patrol officers. To meet these two criteria and keep replacement budgets reasonable, the City should buy used vehicles to replace general-purpose police sedans. This procedure is common practice in California cities when replacing similar police vehicles. 7 Attachment 1 Section 405-E: Policies ENVIRONMENTAL . - D . 1. The City should incorporate "green" vehicles into its General, Fire, and Transit Fleets when such units: a. Will produce significantly less air pollution, use less fossil fuel or have higher miles-per-gallon ratings than comparable conventional units. b. Will not compromise fleet safety, utility, and reliability. C. Can be fueled or recharged locally. d. Can be serviced economically and locally. e. Have a projected life-cycle cost that no more than 20% higher than the projected life-cycle cost of comparable conventional-fuel units. The impact of environmental externalities, such as secondary pollution or market impacts from bio fuel production and distribution, should be considered with potential decisions in procuring alternative fuel vehicles. 2. Each new and replacement unit should have the best fuel-efficiency and the lowest emissions available while performing its primary program use. Incidental or occasional program uses should not compromise good fuel-efficiency and low emissions. For example, if the primary use is local transportation for one or two people, then a small or ultra-small vehicle should be selected. If the program occasionally needs a larger unit to transport three or four people to an out-of-town conference, such a unit should be rented or borrowed from another program area. 8 Attachment 1 Section 405-F: Policies FLEET USE TARGET GUIDELINES BEFORE REPLACEMENT 1. The following table shows the age and mileage expected from City units in front-line operation before replacement or assignment to backup service: Years Vehicle or Equipment Category Age Mileage Allowed in Hours in Years Backup Service* Police Patrol Vehicles --- 80,000 --- Police Patrol Motorcycles --- 35,000 --- --- Fire Pumper Trucks 16 --- 4 --- Fire Aerial Ladder Trucks 20 --- 4 --- Other Fire Trucks 10 --- --- --- **Other Public Safety Vehicles -- 80,000 --- — Police Sedans 8 90,000 --- Sedans 11 90,000 --- Station Wagons 11 90,000 --- Passenger Vans 11 90,000 --- Utility Vehicles 11 90,000 --- Pickup Trucks(under I ton) 11 90,000 --- Light Trucks(under I ton) 12 100,000 - Medium Trucks(I to 2 tons) 12 60,000 Heavy Trucks(over 2 tons) 12 60,000 --- Utility Scooters 6 30,000 5,000 Street Sweepers 8 60,000 6,000 Vacuum Flusher Trucks 12 60,000 Trailers 18 --- --- Construction Equipment 12 --- 5,000 Buses 12 --- --- Mowers 7 --- 5,000 Boats 21 --- Other Portable Equipment 15 -- --- * Backup service defined as setting aside a unit from front line or regular service for the sole purpose of being available during down time of the front line unit. ** Includes any 24/7 scheduled units that are primarily assigned as a front-line,first responder emergency- call vehicle. As of November 2008, this includes the Police CSI Truck, Police Sergeant SUV and Fire Battalion Chief SUV. 9 C3 -/ Attachment 1 2. For units bought used, the age and mileage targets apply to age and mileage since new, rather than age and mileage since acquired by the City. 3. Age/mileage/hours standards will be periodically reviewed and may be adjusted because of improvements in technology or maintenance practices. 4. In order to maintain the high level of reliability required for emergency response vehicles, police patrol units should be replaced when they reach their mileage targets. For the same reason, fire safety units should be replaced when they reach their age targets. 5. For non-safety units, the age/mileage/hours targets are only guidelines. Units in exceptional condition with low-cost repair histories may continue in service beyond expected age/mileage/hours targets at the discretion of the fleet coordinator. On the other hand, units may be recommended for replacement before expected age/mileage/hours targets are reached if there are problems with irreparable damage, high maintenance cost, unreliability, unsafe components, or technological obsolescence. 10 C3 /✓� Attachment 1 Section 405-G: Policies EQUIPPING AND NEWLY-ACQUIRED UNITS 1. The fleet coordinator will equip each unit with the following articles: a. Vehicle registration forms b. Proof of insurance C. An accident folder that includes an incident report form, an information exchange card, and witness information cards 2. General-purpose sedans, station wagons, and passenger vans do not require any special markings. However, these vehicles must be identified as belonging to the City of San Luis Obispo through such means as a license plate holder or window decal. 3. Utility vehicles, pickup trucks, and special purpose units will be marked with the current standard City logo and logo colors on each side and the City fleet identification number on the tailgate or other conspicuous area. 4. Police patrol vehicles and patrol motorcycles will be marked so that they will be immediately recognizable as City public safety vehicles. Marking schemes for patrol vehicles will be approved by the City Manager. 5. Emergency response apparatus in the Fire Fleet will be painted base red and will be marked so that they will be immediately recognizable as City public safety vehicles. Other emergency response units in the Fire Fleet will be painted base white and will be marked so that they will be immediately recognizable as City public safety vehicles Marking schemes for emergency response units will be approved by the City Manager. General-purpose sedans in the Fire Fleet will be marked as described in paragraph 2. 6. Transit Fleet vehicles will be marked with a distinctive scheme that includes the term "SLO Transit. " Any changes to Transit Fleet markings will be considered by the Mass Transportation Committee and approved by Council. 7. The City Manager must approve any deviations from the provisions of paragraphs 2 through 5 and any additional special markings on any units. Any significant change to established vehicle markings may, at the discretion of the City Manager,require Council approval. Attachment 1 Section 405-H: Procedures BUDGETING FOR FLEET ADDITIONS AND REPLACEMENTS Budgeting for additions and replacements will be pursuant to the City's budget policies and the budget instructions issued for each Financial Plan cycle. Except as noted below, all fleet additions and replacements are approved by the Council through the budget process. 1. Budgeting for Fleet Additions a. Prepare a Capital Improvement Plan (CIP) project request for each unit to be added. b. Group similar units within one operating program into a single request. C. Understand that the City's budget policies will apply to all such requests. 2. Budgeting for Fleet Replacements a. Examine units that are near or beyond age and mileage targets. Recommend replacement if justified by maintenance history, overall condition, value, and obsolescence. b. Prepare a CIP project request for each unit to be replaced. Group similar units within one operating program into a single request. Include the following minimum information for each unit to be replaced: • City identification number(e.g., 0405) • Model year(e.g.., 2005),make (e.g., Ford), and model (e.g., F-350) • Description(e.g., one-ton truck) • Assigned department(e.g., Public Works) • Assigned program(e.g., Signal and Light Maintenance) • Acquisition year(e.g., 2004-05) • Acquisition price • Recommended replacement year(e.g., 2010-11) • Estimated total replacement price (including the price of additional equipment such as radios and installation for new or transferred equipment) • Itemization of total replacement price (including base price, price of special equipment, price of special equipment installation, and five percent price contingency) • Estimated surplus value • Basis of estimated surplus value (e.g.,blue book,previous auction proceeds) • Current odometer or hourmeter reading • Projected odometer or hourmeter reading at replacement 12 ��- Attachment 1 • Maintenance cost since acquisition • Maintenance cost in the last full fiscal year • Justification for replacement before age or mileage targets • Justification for replacement with other than a like unit • An explanation of how the replacement unit conforms to the policies of Section 405-E regarding environmental stewardship 3. Off-Cycle Additions and Replacements Request fleet additions or replacements at times other than the normal budget cycle (Financial Plans, Mid-Year Budget Reviews and Financial Plan Supplements) when necessary due to exceptional circumstances. However, except for replacements due to damage beyond repair as discussed below, understand that Council approval is always required. 4. Replacing Fleet Units Damaged Beyond Repair Request City Manager approval to replace fleet units that have been damaged beyond repair, subject to all of the following conditions City Manager: a. The Fleet Coordinator has evaluated cost options and recommended replacement rather than repair as the most cost effective solution. b. The cost and method of replacement are within the City Manager's purchasing authority. C. Adequate resources are available for the purchase within existing budget appropriations. d. The City Manager Report includes (1) the same information about the unit being replaced described in paragraph 2b of this section and (2) a full description of the circumstances resulting in the damage. Request Council approval if the City Manager conditions in paragraph 4b and 4c are not met. 13 3 ��g f Attachment 1 Section 405-1: Procedures BUYING COOPERATIVE PURCHASING CONTRACT Note: All Fleet purchases such as Police patrol vehicles, general purpose fire trucks, sedans, station wagons, passenger vans, light to heavy trucks, utility vehicles, and construction equipment should generally be acquired new through State of California Multiple Award Schedule (CMAS) contracts. Specialized units not generally available though CMAS should generally be acquired new through "piggyback"purchases, where other local agencies have conducted competitive procurements and made those contracts available to the City. 1. Obtain a copy of the purchasing contract that extends contract prices to other government agencies. 2. Ensure that the specified unit along with options is appropriate for the intended use. 3. Contact any local dealers that might have been potential bidders to ensure that the cooperative contract price is a good value and prudent alternative to advertising for bids. 4. Include only those options needed to meet work requirements and typical comfort needs. Avoid options like fancy wheels or leather upholstery that might be perceived as luxurious or extravagant, even if there is no difference in price compared to ordinary options. 5. Specify the exterior paint color to be white. Specify another base color (preferably solid and non-metallic) if authorized or if it will demonstrably improve safety, enhance utility, or reduce cost. 6. Prepare a purchase order to the contract dealer. Depending on the cost, submit a Council Agenda Report or City Manager Report requesting approval of the purchase order. 7. Receive the unit and examine it for defects and conformance to specifications. If satisfactory, mark the dealer's invoice "okay to pay," initial it, and forward it to Accounting with a copy of the purchase order. Note: CMAS contracts often include substantial cash discounts for payment within a stated period of time. For this reason, invoices should be processed promptly to earn such discounts. 8. Forward any title documents to Accounting. 9. Pay any State of California CMAS invoices and charge the appropriate project account. The State assesses a nominal service charge—typically one percent of the base price—for CMAS procurements. Invoices for these service charges usually arrive two or three months after the procurement. 14 i Attachment 1 Section 405-J: Procedures BUYING NEW UNITS: INVITATION • - s Note: Where appropriate vehicles and equipment are not available through cooperative purchasing contracts, they should be acquired new through invitations for bids. 1. Use the standard invitation for bids (IFB)template to create the specification. 2. In Section A (Description of Work), list the dimensions, capacities, ratings, and options that will adequately describe the unit needed for the intended use. Avoid describing a unit available from only one manufacturer. 3. Include only those options needed to meet work requirements and typical comfort needs. Avoid options like fancy wheels or leather upholstery that might be perceived as luxurious or extravagant, even if there is no difference in price compared to ordinary options. 4. Specify the exterior paint color to be white. Specify another base color (preferably solid and non-metallic) if it will demonstrably improve safety, enhance utility, or reduce cost. 5. If the unit will be picked up at the dealer or delivered by common carrier, eliminate insurance requirements from Section B (General Terms and Conditions) and eliminate Section E (Insurance Requirements) from the specification. 6. Eliminate the contract requirements from Section B (General Terms and Conditions). Eliminate Section D (Form of Agreement) from the specification. 7. In Section C (Special Terms and Conditions), change language about awarding a contract to language about issuing a purchase order. 8. Along with the bid form, include a specification conformance form on which the bidder affirmatively indicates that its product meets the description included in Section A of the Invitation for Bid. 9. Depending on estimated cost, submit a City Manager Report or Council Agenda Report requesting authorization to invite bids. If a Council Agenda Report is submitted, request that the City Manager be authorized to award a purchase order if the cost is within budget. 10. Advertise for bids. 11. Open bids. 12. Prepare a purchase order to the successful bidder. Submit a City Manager Report requesting approval of the purchase order. 13. Forward the purchase order to Accounting. 14. Receive the unit and examine it for defects and conformance to specifications. If satisfactory, mark the dealer's invoice "okay to pay," initial it, and forward it to Accounting with a copy of the purchase order. 15. Forward any title documents to Accounting. 15 3 a D Attachment 1 Section 405-K: Procedures BUYING USED VEHICLES Note: Although the City's past policy has been to buy used vehicles through dealers who sell used rental vehicles for major rental companies, there have been two disadvantages with using this procedure: 1)prices have tended to be at the high end of the retail range, above what is commonly referred to as "high blue book"value and 2) long-term reliability has been dubious because of the effects of multiple drivers and hard rental service. To avoid these problems and,particularly, to find vehicles in excellent overall condition with relatively low mileage and reasonable prices, the City should use local auto brokers to find suitable vehicles at auction. This approach avoids high dealer markups and allows purchases of vehicles from leased corporate fleets. Such vehicles are usually in better shape than rental vehicles because they have typically had only one driver and have been subject to strict lease conditions regarding condition and mileage at the end of the lease. 1. Depending on estimated cost, submit a City Manager Report or Council Agenda Report requesting authorization to buy a used vehicle. 2. The Fleet Coordinator will initiate a search for a vehicle through brokers who buy and sell vehicles. 3. Select a late model, low mileage vehicle that appears to be in excellent overall condition. Consider only vehicles with options needed to meet work requirements and typical comfort needs. Avoid vehicles with options like fancy wheels or leather upholstery that might be perceived as luxurious or extravagant, even if there is no difference in price compared to ordinary options. 4. Perform a technical inspection to confirm the vehicle is in excellent condition. 5. Negotiate a purchase price, including an extended warranty as appropriate, to be included in a written buyers order from the dealer. 6. Prepare a payment voucher and submit a City Manager Report for approval authorizing the appropriate Fleet Department Head to approve the purchase. 7. Forward the payment voucher to Accounting. 8. Receive the vehicle and examine it for defects and conformance to the buyers order. If satisfactory,pick up the check from Accounting and pay the broker. 9. Forward any title documents to Accounting. 16 3 ' Attachment 1 Section 405-L: Procedures DISPOSINGOF SURPLUS1. When a unit is replaced or otherwise permanently removed from service, report to Accounting that it is surplus and available for sale. 2. Include in each such report the following information for each unit reported: • City identification number(e.g., 9901) • Vehicle identification number(VIM • License number • Model year(e.g.,2005), make(e.g., Ford), and model (e.g., F-350) • Description(e.g.,one-ton truck) C Assigned department(e.g., Public Works) • Assigned program(e.g., Signal and Light Maintenance) • Acquisition year(e.g., 2004-05) • Estimated surplus value • Basis of estimated surplus value (e.g., blue book, previous auction proceeds) • Current odometer or hourmeter reading • Justification for replacement • Current location • Authorization to surplus (e.g., budget document that authorized replacement or other Council authorization to replace or dispose of the unit) 3. Finance Division will dispose of surplus vehicles in accordance Section 480 of the Finance Management manual. 17 3 '� Attachment 2 RESOLUTION NO. ####(2009 Series) A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO AMENDING THE FLEET MANAGEMENT POLICY WHEREAS, the City's fleet represents a significant investment in the tools needed to deliver day-to-day services; and WHEREAS,the Council wants to minimize fleet operation and maintenance costs;and WHEREAS,the Council wants to avoid unnecessary capital outlays for fleet expansion and replacement; and WHEREAS,the Council wants to improve fleet safety, utility, reliability and economy; and WHEREAS,the Council wants to maintain a positive image for the City;and WHEREAS, the Council wants to encourage responsible use of City vehicles and equipment; NOW THEREFORE BE IT RESOLVED, that the Council of the City of San Luis Obispo hereby adopts the amended Section 405 of the Finance Management Manual. Upon motion of , seconded by and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted February 17,2009. David F. Romero, Mayor ATTEST: Audrey Hooper City Clerk APPROVED AS TO FORM: Jonathan Lowell City Attorney � 3 -a