Report to Mayor and City Council
Tuesday, November 21, 2017
Discussion
SUBJECT:
Title
ENTERPRISE FLEET MANAGEMENT, INC. VEHICLE LEASE ANALYSIS (CITY COUNCIL)
Body
I. SUMMARY
In June 2013, the City Council approved agreements with Enterprise Fleet Management, Inc. to provide leased vehicles to the City. Staff has prepared an analysis of the long-term fiscal impact of leasing vehicles; and recommends the City explore the option of extending the lease terms to take ownership of leased vehicles upon lease end. Additionally, the analysis indicates the City should purchase future vehicles rather than lease in order to constrain costs associated with ongoing lease agreements. Staff has also held discussions with Enterprise regarding continuing payments and taking ownership once vehicles are paid off and Enterprise has verbally agreed to allow the City to pursue that option.
II. RECOMMENDATION
Recommendation
DIRECT Staff to prepare an amendment to the agreement with Enterprise Fleet Management, Inc., to enable the City to take ownership of currently leased vehicles by extending the term of the lease.
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III. ALTERNATIVES
1. CONTINUE taking delivery of leased vehicles from Enterprise Fleet Management, Inc.; OR
2. TAKE another action deemed appropriate by City Council.
IV. BACKGROUND
On June 18, 2013, based upon Staff recommendation, the City Council approved an Equity Lease Agreement and Maintenance Agreement with Enterprise Fleet Management Inc. (Enterprise) to provide and maintain light-duty vehicles. In the process of reorganizing the vehicle fleet, 6 full time mechanic positions were eliminated and all vehicle maintenance was outsourced to private companies. The cost savings of the fleet changeover was realized in the first year, however as the leased fleet grew, the amount paid for leased vehicles grew; and at the end of the lease term, the City does not own the vehicles.
Over 3 years, the City has taken delivery of 67 vehicles under the agreem...
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