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Home My WebLink AboutSS5 - Council Policy F-9 aEW�Rr CITY OF �� mz NEWPORT BEACH City Council Staff Report October 13, 2015 Agenda Item No. SS5 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Municipal Operations Department Mike Pisani, Director 949-644-3055, moisani(a).newportbeachca.00v PREPARED BY: Cynthia Owens, Administrative Manager TITLE: City Council Policy F-9 (City Vehicle/Equipment Guidelines) ABSTRACT: An amendment to City Council Policy F-9 (City Vehicle/Equipment Guidelines) is proposed which would extend the useful life of certain City vehicles and equipment items. Following comments from the City Council and public, staff will present the revised policy for adoption at a future meeting. RECOMMENDATION: Provide comments on the proposed changes to the policy and, if desired, direct staff to return to a future Council meeting for adoption of the revised policy. FUNDING REQUIREMENTS: None at this time; however, if the policy is revised as proposed, the internal service fees collected from each department for vehicle and equipment replacement will be adjusted based on an increased life span of some vehicles and equipment. This change is estimated to result in an annual savings of approximately $1,039,000 to the City's General and Enterprise Funds. DISCUSSION: City Council Policy F-9 (Attachment A) establishes definitive standards for the replacement of City vehicles and equipment. This policy ensures that the full service life of each vehicle or piece of equipment is utilized to its fullest potential. Additionally, it provides a timeline for funding the replacement of these items and implements uniform guidelines for all departments. This policy was initially established on December 14, 1992 and has been revised three times since its inception (1994, 1995 and 2001). City Council Policy F-9 (City Vehicle/Equipment Guidelines) October 13, 2015 Page 2 The City has an Equipment Maintenance Internal Service Fund that is utilized to collect "rents" from the departments in order to pay for annual maintenance as well as equipment replacement of City vehicles and large pieces of equipment. Each year the Municipal Operations Department and Finance Department work with each department to determine their operational needs. Vehicles and equipment that have reached their useful life based on age of the vehicle, maintenance costs, mileage and fuel efficiency are scheduled for replacement through the Equipment Maintenance Fund. The Equipment Maintenance Fund supports 7.5 full-time employees who are responsible for maintaining approximately 340 vehicles and other pieces of equipment managed by the Municipal Operations Department. Additionally, the Police Department has two fleet mechanics separate from the Municipal Operations Department and a budget of $1,970,313 funded through the General Fund. The proposed policy changes would affect the useful life of police vehicles and equipment as well as all other City vehicles/equipment. There are two components to the fund: 1) the Equipment Maintenance Premium and 2) the Equipment Replacement Premium. City Council Policy F-9 refers to the Equipment Replacement Premium and would not affect the Maintenance Premium. Currently, many City vehicles and pieces of equipment exceed the life and/or mileage guidelines listed in the current F-9 Policy. These vehicles are still mechanically functional and have low annual maintenance costs. It is recommended that Council Policy F-9 be updated to reflect the longer useful life the City is attaining from its vehicles and equipment. Increasing mileage and/or expected years of service of vehicles and equipment would have a significant financial benefit. If the policy is revised as proposed, City departments will see a reduction in their budget in the form of reduced replacement rates. The City will capture the replacement cost of the vehicles over a longer period of time, which will result in an estimated annual cost savings to the General and Enterprise Funds of$1,039,000. Clarifying language has been added to the policy in regards to frontline and reserve equipment in the Fire Department. After a fire engine or truck has reached its useful life, the unit may be placed into reserve status for five to fifteen years. This allows additional equipment available for the Fire Department in case of a major emergency or to replace a frontline unit that is out of service for repair or maintenance. As an example, the City Council approved the purchase of two new fire engines in February. The engines are expected to be delivered around the end of the year. When the units are placed in service in early 2016, they will replace 2003 and 2005 American LaFrance fire engines that currently have 91,870 and 64,013 miles on them, respectively. The two American LaFrance engines will become reserve units and replace two 2001 engines currently used in that capacity. If the policy is revised, they will remain in a reserve status until 2024, when the next engines (2011 models purchased in 2010) are due for replacement. Although the mileage on these vehicles City Council Policy F-9 (City Vehicle/Equipment Guidelines) October 13, 2015 Page 3 appears low based on a normal consumer vehicle, it is important to note that fire equipment typically reaches the end of its frontline status as it is in service every day. Keeping equipment in frontline status after the recommended useful life will experience increasing downtime for maintenance and repair. Other major changes to Council Policy F-9 include: • Extending the life/mileage of police motorcycles, sedans and wagons, SUVs, pickup trucks, vans, heavy trucks, welders, saws, pumps, radios and beacons, and fire engines; • Adding a category for police detective/plain vehicles; • Adding ATV's and SUV's to the equipment list; • Adding personal watercraft to the equipment list; • Eliminating small emergency boats from the proposed policy; • Adding Reserve categories for fire engines, fire trucks, and ambulances; and • Eliminating refuse trucks, paint stripers and refuse transfer trailers, as the City no longer operates these programs in house. The Finance Committee reviewed this item at their August 13, 2015, meeting and recommended approval of the proposed changes to the City Council. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENT: Attachment A - Redline Copy of City Council Policy F-9 (City Vehicle/Equipment Replacement Guidelines) ATTACHMENT A F-9 CITY VEHICLE/EQUIPMENT REPLACEMENT GUIDELINES PURPOSE To establish the policy to iensure that the full service life of each City vehicle or item of equipment is autilized to its fullest potential, provide for a funding timelines and that-implement uniform guidelines be implemented among all departments. POLICY It shall be the policy of the City that the funding and replacement of all motor vehicles shall be normally based on the expected service life of the vehicle described on the following schedule: Police Patrol/Traffic Vehicles 75,000 miles or 4 years Police Motorcycles 6077000 miles or 5 years Police Detective/Plain Vehicles 80,000 miles or 8 years Beach Vehicles ATV's 4 Years Sedans and Station Wagons SUV's 80120,000 miles or 812 years Pickup Trucks (1/4 to 3/4 Ton) 8-5100'000 miles or 9-Hears Vans, excluding Paramedic Vans 80100,000 miles or 8-100 years Paramedic Vans/Ambulances 80100,000 miles or 6-8 years Reserve Ambulances 4 years Heavy Trucks (1 Ton and larger) 100120 000 miles or A-bears Beach Cleaners 8 years Street Sweepers 7-10 years Small Boats/Personal Watercraft 10 years Sma'�zergency Boats tears Large Emergency Boats 25 years Heavy Equipment 10 years or 5,000 hours Trailers 1-2-LO-Years Refuse Transfer Trailers; 6 years Vactors/Sewer Rodders 10 years Welders, Saws, Pumps 4&13 years Transfer Equipment (Radios/Beacons) 8-10 years Fire Engines -Frontline 40-13 years Fire Trucks -Frontline 15 years Fire Engine -Reserve 5-7 years 1 SS5-4 F-9 Fire Truck - Reserve 10-15 years 2 SS5-5 F-9 After these rpAe terse Fire engines, trucks and ambulances are reaehedplaced within stations as frontline vehicles when they are purchased. They will remain in a frontline status until the expected useful life is over. At that time, the engines and trucks will be placed in reserve status for an additional period of time as described above. theThe Gpnt-�sMunicipal Operations Department shall inspect the equipment annually to determine the appropriateness of replacing the vehicles. F..etOrS to c-Onsi er c4*4eeach piece of equipment in conjunction with the assigned Department. All non- emergency vehicles shall be replaced based on, but are-not limited to, the following factors: expected service life, lifecycle maintenance and upkeep costs, fuel efficiency, purchase price (cost), environmental rating etc. The City will actively seek opportunities to use cleaner burning fuels and higher efficiency vehicles when possible. Should the expected life of the equipment be less than expected, the Municipal Operations Department in conjunction with the Finance Department and the assigned Department will make a recommendation to the City Manager or his designee on the disposition and replacement of equipment. Adopted- December 14, 1992 Amended-January 24, 1994 Amended-March 27,1995 Amended - May 8, 2001 Amended - October xx,2015 Formerly F-26 3 SS5-6