Department: Universal Services
Department Head: Sindhu Menon, Executive Director and CIO
Regular or Supplemental RCA: Regular RCA
Type of Request: Investment Memo
Investment Memo Type: Final Investment Memo
Project Name: Fleet Vehicles
Project ID (if applicable): NB001
Vendor Legal Name (if applicable): N/A
MWDBE Contracted Goal (if applicable): N/A
MWDBE Current Achievement (if applicable): N/A
Justification for 0% MWDBE Participation Goal: N/A - Goal not applicable to request
Managing Entity: Universal Services
Incremental Authorization Requested: $46,717,521
Total Estimated Project Cost: $71,697,000 (FY25-FY26 2-year total estimate)
Request Summary:
title
Request for approval of the Final Investment Memo for the Fleet Vehicles project (continuous) for an additional incremental authorization of $46,717,521 for a total FY2025 authorization of $57,057,420.
end
Project Description:
This project is to purchase and replace owned, non-specialty, non-EV vehicles, the largest component of County vehicle purchases by value. Leased vehicles are not eligible to use capital funding. EVs are being piloted and have their own separate project set up for purchase.
Project Scope:
This investment memo asks for funding for the third year of the capital vehicle program. So far in FY24, this project has purchased $32.6M worth of vehicles and accessories and encumbered approximately $17.9M more, of which $7.5M is expected to be expended in FY24.
This project is not intended to restrict departments’ use of their General Fund on vehicles, and departments will continue to pay into Fund 5101 for vehicle maintenance and other costs.
Currently, there are approximately 4,100 vehicles in service that are impacted by this policy. The current ask is expected to cover the purchase of approximately 1,165 vehicles-approximately 314 vehicles encumbered but not yet purchased in FY24, due to manufacturer schedules, and approximately 851 vehicles for purchase in FY25. The recommended amount for this year also considers the County’s fiscal position and future years’ plan for fleet purchases.
|
Fiscal Year |
Number of Vehicles |
Cost |
|
FY24 (Encumbrance) |
~314 |
$10.4M |
|
FY25 Planned expenditures |
~719 |
$38.1M |
|
FY25 Leased to owned vehicle conversation |
~132 |
$8.6M |
|
Total Requested FY25 |
~1165 |
$57.1M |
The division of the budget by department is based on each department’s current fleet size and age.
There might be changes in the County’s needs that results in minor operational changes for the project throughout the Fiscal Year, but the overall scope will remain the same and any additional authorization would go through Commissioners Court approval.
Justification:
Vehicles, as assets with a medium-term life, should generally be purchased with CIP funds, rather than cash. Using funding sources that match the asset’s lifespan allows the County to make better use of its limited resources, freeing up General Fund for departments to use on non-capitalizable operational expenses. It also is a more efficient way of leveraging taxpayer dollars to provide services.
Furthermore, using debt to purchase vehicles allows the County to replace vehicles more quickly, providing safer, higher quality vehicles for County employees to perform their duties and serve constituents as well as reducing maintenance costs and vehicle maintenance downtime.
Alternatives and Engagement:
Harris County could not carry forward budget from FY24, but this may unfairly penalize those departments that were unable to place vehicle orders due to unusual market conditions.
Harris County could purchase fewer vehicles. This would also lessen the amount of CIP funds used to purchase vehicles, but it would mean County departments would have to keep older vehicles longer. It would also increase overall maintenance and repair costs, which are higher for older vehicles.
Harris County could purchase more vehicles. This would speed up the replacement of older vehicles, but it could lead to a less regular replacement cycle in the future and less predictability. Furthermore, new vehicle prices are at record highs and used vehicle prices are near record highs. It would be unwise to replace vehicles aggressively under such market conditions.
Anticipated Project Expenditures and Timeline:
|
Scope of Work |
Estimated Cost |
Estimated Completion |
|
FY24 Encumbrances (~314 vehicles) |
$10,339,899 |
9/30/2025 |
|
FY25 purchases (~851 vehicles) |
$46,717,521 |
9/30/2025 |
|
Total |
$57,057,420 |
- |
Alignment with Goal(s):
_ Justice and Safety
_ Economic Opportunity
_ Housing
_ Public Health
_ Transportation
_ Flooding
_ Environment
X_ Governance and Customer Service
Previous Court Action:
|
Date |
Agenda Item # |
Action Taken |
|
10/13/2015 |
|
Request for approval of funding for project cost $7,000,000 |
|
11/10/2015 |
|
Request for approval of commercial paper funding for $7,000,000 |
|
12/18/2018 |
|
Request for approval of funding for project cost $4,000,000 |
|
1/8/2019 |
|
Request for approval of commercial paper funding for $4,000,000 |
|
2/11/2020 |
|
Request for approval of funding for project cost $5,500,000 |
|
2/25/2020 |
|
Request for approval of commercial paper funding for $5,500,000 |
|
8/24/2021 |
21-4490 |
Request for approval of commercial paper funding for Universal Services for the HCSO Vehicles project in the amount of $750,000. |
|
8/15/2022 |
22 |
Approval of a reimbursement resolution to allow CIP funds to reimburse non -CIP vehicle expenses, applies to all eligible expenditures made on or after a date 60 days prior to approval |
|
2/21/2023 |
23-1090 |
Request for an initial FY23 authorization of $41,562,716 |
|
3/14/2023 |
23-1418 |
Request for approval of commercial paper funding for $24,000,000 for a total of $40,500,000 |
|
8/8/2023 |
23-4406 |
Request for approval of commercial paper funding for $15,000,000 for a total of $55,500,000 |
|
10/10/2023 |
23-5762 |
Request for an additional incremental authorization of $33,560,000 for FY24 authorization of $41,360,000 |
|
10/31/2023 |
23-6369 |
Request for approval of commercial paper funding for $10,000,000 for a total of $65,500,000 |
|
3/26/2024 |
24-1526 |
Request for approval of commercial paper funding for $5,000,000 for a total of $70,500,000 |
Address: Multiple
Precinct(s): Countywide
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Fiscal and Personnel Summary |
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Annual Fiscal Cost |
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Recurring Expenses |
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Funding Sources |
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Existing Budget |
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Total Current Budget |
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Additional Budget Request |
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Total Additional Budget Request |
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Total Funding Request |
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Personnel (Fill out section only if requesting new PCNs) |
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Current Position Count for Service |
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Additional Positions Request |
- |
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Total Personnel |
- |
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Anticipated Court Date: TBD
Anticipated Implementation Date (if different from Court date): 10/1/24
Legal funding compliance confirmed by: Paige Abernathy, Assistant County Attorney, 7/25/2024
Department Approval by: (Will be Tommy Ward once he returns)
OMB CIP Team Approval by: Amiel Chen, CIP Manager, OMB, 7/25/24
Commercial Paper Request (For OMB use only):
Receiving Department: N/A Choose an item.
Project PeopleSoft ID: N/A
CP Series Description: N/A
OMB Financial Management contact: N/A