Agenda - 09-06-2016 - 6-a - Minutes

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3 1 Gary Donaldson said yes because this is seen as a best practice of sustainable 2 management. 3 Commissioner Dorosin asked if there was a policy prior to 2011. 4 Paul Laughton, Financial and Administrative Services, said there was a 15% policy prior 5 to 2011, and the Finance Director at that time did some comparative analysis with other 6 counties and decided to raise the threshold to 17%. 7 8 2. Vehicle Replacement Schedule for FY 2016-17 9 Paul Laughton reviewed the following background: 10 11 BACKGROUND: 12 In FY 2012-13, the Commissioner Approved Budget established a second Internal Service 13 Fund, for County vehicle purchases. Internal Service Funds are an accounting device used to 14 accumulate and allocate costs internally among the functions of the County. Historically, the 15 County has used an internal service fund to account for one activity - its employee dental 16 insurance program. With the creation of this Vehicle Replacement Fund, vehicles purchased 17 occur through this fund instead of the departments' operating budgets. The change centralizes 18 vehicle purchases, which increases the effectiveness of vehicle performance and cost 19 monitoring. 20 21 The current internal services fund is still being subsidized by the general fund. In the spring and 22 summer of 2016, staff will be working with a recognized fleet services consulting firm to fully 23 optimize the internal services fund model for Orange County. This optimization will influence 24 recommendations for the internal services fund starting in FY 17-18. 25 26 Recommendations for vehicle replacements are based on vehicle age, mileage, maintenance 27 costs, fuel efficiency, and departmental mission need. The average age and accumulated 28 mileage of the recommended replacements are 12 years and 161,754 miles, respectively. The 29 vehicle replacement process is a dynamic process that unfolds over the course of a year. 30 During the replacement cycle vehicles originally listed for replacement may ultimately not be 31 selected for replacement as other fleet vehicles become a higher priority for replacement. 32 33 The FY2016-17 recommendation involves public safety vehicles only in anticipation of the 34 significant structural optimization expected within the Fleet Internal Services Fund to be 35 recommended for FY2017-18 and beyond. 36 37 Attachment 1 outlines the recommended vehicle requests for FY 2016-17. Pricing is based 38 upon the current state contract rates. If the Board of Commissioners approve of this 39 recommended list, the financing amount of $789,722 will be included in the FY 2016-17 Budget 40 Ordinance to allow these vehicles to be ordered and placed into service in the early fall of 2016. 41 42 Jeff Thompson, Asset Management Services, said the intention of the consultant study 43 is to have the internal service fund to be self-sustaining. He said the results of the study will be 44 presented to the Board of County Commissioners (BOCC) in the fall. 45 Commissioner Pelissier asked if there are any hybrid vehicles on the list. 46 Jeff Thompson said there are no hybrid vehicles that can meet the needs of the Sheriff's 47 department but hybrids and electric vehicles are being used for administrative needs. 48 Chair McKee asked if there are a typical number of vehicle replacements for the 49 Sheriff's office.