ACTION REQUESTED:
Title
Communication from the City Manager and Director of Public Works with a Request for the Following:
A. Exercise a Lease Purchase Option with ENTERPRISE FLEET MANAGEMENT and to APPROVE the PURCHASE of Four Vehicles Previously Leased from Enterprise Fleet Management, in the Amount of $95,000.00.
B. ADOPT an ORDINANCE Amending the City of Peoria 2019 REVISED ANNUAL BUDGET Relating to the Transfer of Funds from the General Fund to the Capital Fund to Purchase Four (4) Vehicles Previously Leased from Enterprise Fleet Management, in the Amount of $95,000.00.
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BACKGROUND: In November 2016, the city of Peoria entered into a negotiated agreement with Enterprise Fleet Management, Inc. to lease four (4) vehicles as a pilot program for a period of three (3) years for an annual amount not to exceed $25,000 for a period three (3) years.
We are near the end of the lease agreement and need to exercise our options either to 1) continue with the lease program at a new higher monthly rate with new vehicles delivered; 2) discontinue the vehicle lease program and return vehicles without exercising the buy-out option; or 3) discontinue the vehicle lease program and purchase the lightly used vehicles at a discounted rate and increase the fleet assets of the city of Peoria.
Under the third option, the buy-out term of purchase is one (1) vehicle at $25,563.64 and three (3) vehicles at $23,020 for a total of $94,623.64. The purchase was not included in the 2019 fleet replacement capital purchases and therefore requires staff to find alternate funding options. The recommended funding for this purchase is reprogramming from supply lines that have been postponed due to weather-related conditions. Late season roadway paint and thermal paint supply purchases can be ordered in early spring 2020 rather than fall 2019 surrendering $95,000 in available budget balance to be reprogrammed for the lease buy-out option.
FINANCIAL IMPACT: This purchase was not included in the 2019 fleet replacement capital purchases; however, the leasing cost was included in the operating budget. To purchase the vehicles, Staff needs to reprogram operating budget savings from traffic supplies and equipment lines.
NEIGHBORHOOD CONCERNS: N/A
IMPACT IF APPROVED: If approved, Public Works will proceed with the purchasing option negotiated with Enterprise Fleet Management, which will increase the City’s fleet assets.
IMPACT IF DENIED: The City will lose the additional fleet assets and a monthly auto allowance would be reestablished.
ALTERNATIVES: N/A
EEO CERTIFICATION NUMBER: N/A
WHICH OF THE GOALS IDENTIFIED IN THE COUNCIL’S 2017 - 2032 STRATEGIC PLAN DOES THIS RECOMMENDATION ADVANCE?
1. Financially Sound City
WHICH CRITICAL SUCCESS FACTOR(S) FROM THE COMPREHENSIVE PLAN DOES THIS RECOMMENDATION IMPLEMENT?
1. Have an efficient government.
DEPARTMENT: Public Works