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HomeMy WebLinkAboutFollowUp1 Julia Medzegian From:Jamie D. Thomas Sent:Monday, April 16, 2018 12:35 PM To:Don Persson; Ed Prince; Ruth Perez; Armondo Pavone; Randy Corman; Ryan McIrvin; Carol Ann Witschi Cc:Julia Medzegian; Jay B Covington; Denis Law; Jan Hawn; Kelly Beymer; Michael Kirk; Jeffrey Minisci; Ronald Kahler; Gregg A. Zimmerman; Hai Nguyen Subject:Follow up to 4/9/18 Finance Committee Meeting Attachments:IP New Fleet Replacements.docx Follow Up Flag:Follow up Flag Status:Flagged Hello –    The Finance Committee reviewed the 2018 Carryforward and 1st Quarter Budget Amendment request at their 4/9/18  meeting.  The attached memo is the response to the questions raised during that meeting.  There will also be an agenda  item topic for discussion at the 4/23/18 Finance Committee meeting to review the Committee’s questions and the  attached response.    Thank you,    Jamie Thomas Fiscal Services Director  City of Renton  425‐430‐6929    c:\users\jmedzegian\desktop\ip new fleet replacements.docx ADMINISTRATIVE SERVICES M E M O R A N D U M DATE: April 16, 2018 TO: Ed Prince, Council President Members of Renton City Council VIA: Denis Law, Mayor FROM: Jamie Thomas, Fiscal Services Director STAFF CONTACT: Ron Kahler, Fleet Manager Jeff Minisci, Facilities Manager SUBJECT: 2018 Carry Forward and 1St Quarter Budget Adjustment – Fleet Vehicle Replacements and New Vehicle Request BACKGROUND As part of the 2018 Carryforward and 1st Quarter 2018 Budget Adjustment, the Fleet Division is seeking approval for the purchase for 15 vehicles/equipment. Nine of these vehicles were previously approved in the 2017 budget, but the purchase has not yet been made (carry forward request). Two of these vehicles/equipment exist in the fleet inventory and are fully funded for replacement, but not yet put on the replacement schedule (1st Quarter Budget Adjustment Request). One vehicle was unexpectedly totaled (1st Quarter Budget Adjustment Request). The last three vehicles are new requests by the facilities division (1st Quarter Budget Adjustment Request). The finance committee has requested a formal explanation for the budget adjustment request of the six vehicles that had not been previously approved by Council. The goal of this memo is to: 1. Explain the circumstances behind the three replacement vehicles, fully funded but not previously approved, and 2. Explain the business need for adding three new vehicles to facilities’ fleet. ISSUE 1. Replacements, Three Vehicles/Equipment When a vehicle becomes fully funded for replacement, it is not automatically added to the replacement schedule. Ron Kahler, Fleet Manager, assesses how much money and time is spent on repair and maintenance for each vehicle. Even after the replacement value is fully funded, vehicles with minimal repair and maintenance costs will continue to be kept in service until maintenance and repair costs start to exceed the value and usefulness of the vehicle. In the past couple of months, there have been circumstances that have necessitated replacement for three vehicles/equipment. Page 2 of 2 C:\Users\jmedzegian\Desktop\IP New Fleet Replacements.docx B107, 2002 Chevy Express Van used by Human Services, requires several thousand dollars in safety upgrades and ultimately has only a couple of years, at most, in useful life remaining. The cost to make the safety enhancements exceeds the value the City will recoup over the next couple of years. This vehicle is fully funded for replacement. P059, 1988 York Rake used by Parks, is a piece of equipment regularly used during the spring and summer. When it was pulled out of storage this spring, it was no longer working and replacement parts can no longer be purchased. The rake is fully funded for replacement. E134, 2015 Crosswind Sweeper used by Street Maintenance, caught on fire while being used on Maple Valley Highway. The fire was not fully extinguished until the RRFA arrived onsite. Total damage amounted to $175,000, which will be covered by insurance. The remaining funding will come from the salvage value and the replacement reserves already set aside for replacement on this vehicle. There will be remaining reserves left over after insurance and salvage value is applied. 2. NEW, Three Vehicles for Facilities Facilities currently has 23 employees on day-shift and only 16 vehicles. Out of the 16 vehicles 8 are assigned to the 8 facility technicians, and the remaining 8 vehicles are available for the 12 day-shift custodians. Currently, the Facilities Manager and 2 Facilities Coordinators use their personal vehicles to visit job sites throughout the day. To compound the vehicle-to-staff ratio issue, most of these vehicles are over 10 years old and often there is 1 or more in the shop for maintenance or repairs. With a limited fleet, facilities staff often car pool and/or drop staff off at building and park locations and pick them back up later in the day. This wastes a lot of time, for both the drivers and the staff that are being chauffeured, and takes away staffing resources that could be used for cleaning and repairs. The purchase of 3 vehicles will increase efficiency and productivity to provide better customer service and response time. It will also help limit staff’s use of their personal vehicles. FISCAL IMPACT B107 - $42,000 (fully funded from replacement reserves) P059 - $10,000 (fully funded from replacement reserves) E134 - $245,000 (insurance reimbursement, salvage value, replacement reserves) NEW (3) Trucks for Facilities - $107,000 (transfer from Facilities fund) RECOMMENDATION Staff recommends the City Council approve the amended fleet replacement schedule, and related budget adjustment, to include three vehicle replacements and three new facility vehicles, not previously approved.