NEEDLES — The city of Needles agreed to enter an agreement with Enterprise Fleet Management, Inc., for the lease of nine light-duty vehicles not to exceed an annual payment of $57,01.76.
An Enterprise representative, who was at the meeting, stated that the parties had looked at 14 but through fine-tuning the program to fit the city’s budget and identifying the vehicles that the staff had pointed out , the nine-vehicle total was reached.
The background information provided by city staff states that to ensure the best use of public funds and resources, staff analyzed alternative vehicle replacement programs. City staff concluded that the city’s vehicles are aged, in poor condition and missing current safety features now required in vehicles.
The background information stated that a five-year replacement cycle best suits the city’s needs. The program could be addressed best through an “open-ended” lease structure which would allow the city to replace more vehicles with less upfront capital.
The Enterprise representative stated that after five years, the city will have three options to choose from: It can replace the vehicles through Enterprise, which they would sell and use the profit toward the annual payment; it can continue to hold on to them and not replace them and make payments on them to take it all the way down to zero; or the city can write a check at any time to get out of the lease.
Some of the highlights proposed in the program are.
• No mileage restrictions, no abnormal wear and tear and no early termination penalties;
• The city has all rights and ownership and can equip vehicles with aftermarket parts (utility bodies, toolboxes, etc.);
• Leasing will minimize the amount of large capital outlays necessary for purchasing vehicles;
• The city would establish a proactive fleet replacement plan to acquire vehicles on a more consistent basis, thus ensuring the most up-to-date safety and fuel standards;
• Manufacture warranty included: three years, 36,000 miles, five years 100,000 miles powertrain.
City staff stated that the fleet maintenance account is estimated to save $42,000 annually and at the end of the five-year term, the estimated equity is $95,233 which could be used to reinvest in a new fleet.
Councilor Shawn Gudmundson posed a question if this process would be available for the city’s bucket trucks. An Enterprise representative who was at the meeting stated that there is a program available for vehicles that weigh over 1 ton but the program is different and that is something that they could look into.
The city council approved the agreement.