2013-12-16 Committee Report - Government Management Committee

City Council on December 16, 17 and 18, 2013, adopted the following:

1. City Council request the Director, Fleet Services, in conjunction with Director, Financial Planning, to develop a financing strategy to determine a minimum vehicle reserve balance, which fully funds and optimizes the replacement of vehicles for all affected divisions. The strategy is to be incorporated into the 2015 budget submission process. Options may include;

a. the utilization and rationalization of the current fleet complement;

b. extending vehicle life cycles;

c. increasing reserve contributions; and

d. a combination of the above.

2. City Council request the Director, Fleet Services, to establish a monthly replacement reserve contribution for all off-road vehicles and equipment and that the Director, Fleet Services in consultation with Director, Financial Planning determine the feasibility of including such contributions as part of the 2015 operating budget process.

3. City Council request the Director, Fleet Services, to continue to lead and educate Divisions on proper use and maintenance of vehicles in order to maximize useful life, minimize operating costs and maintain safety standards.

4. City Council request City divisions, agencies and corporations, for 2014 and beyond, to fund their respective vehicle replacement reserves that such reserves do not fall into a negative balance and the reserves are adequate to meet future vehicle replacement needs and City Council forward this direction to the Budget Committee as part of the 2014 capital budget process.

The Government Management Committee recommends that:

a. The utilization and rationalization of the current fleet complement;

b. Extending vehicle life cycles;

c. Increasing reserve contributions; and

d. A combination of the above.

4. City Council request City Divisions, Boards and Agencies, for 2014 and beyond, to fund their respective vehicle replacement reserves that such reserves do not fall into a negative balance and the reserves are adequate to meet future vehicle replacement needs and that this direction be forwarded to the Budget Committee as part of the 2014 Capital Budget process.

This staff report is in response to the Government Management Committee's meeting of September 9, 2013 item # GM24.15 – 2014 Service Level Review – Government Management Committee Programs, recommendation #3 with respect to divisions that have not been committing sufficient capital reserve contributions for vehicle replacements and the associated replacement/sustainability concerns and increased costs. Fleet Services in collaboration with Divisions and Financial Planning will develop a strategy to establish minimum reserve balances to be maintained by all City Programs and Agencies.