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Home My WebLink AboutAGENDA REPORT 2013 1204 CCSA REG ITEM 10G ITEM 10.G. CITY OF MOORPARK,CALIFORNIA City Council Meeting MOORPARK CITY COUNCI ' _ -1/ / ._ r AGENDA REPORT � - TO: Honorable City Council , to FROM: Jessica Sandifer, Management Analys ,G, DATE: November 26, 2013 (CC Mtg. December 4, 2013) SUBJECT: Consider Approval of Chevrolet Volt Lease and Resolution Amending the FY 2013-14 Budget for the Lease BACKGROUND In July 2013, staff requested approval to release a Request for Proposals (RFP) to lease a Chevrolet Volt. The lease of a plug-in electric hybrid vehicle versus a gasoline vehicle allows the City to determine whether this type of vehicle is feasible as pool car and to demonstrate how it can decrease operation and maintenance costs and lower the City's carbon footprint by moving towards a low or carbon neutral City fleet. The decision to recommend leasing the vehicle rather than outright purchase is due to the rapidly changing electric vehicle technologies and lower commitment costs. The RFP was released in August 2013 and no responses were received. DISCUSSION Staff discovered that the main reasons as to why there was no response to the RFP was the fact that the dealership had no car in the inventory matching the specifications in the RFP and the fact that the fleet division did not consider the purchase of one Volt a fleet purchase. Since no response was received to the RFP, staff reached out again to the local dealerships to find out if a vehicle existed within the dealerships current inventory that met the City's criteria for which a lease could be negotiated. Only two of the five Ventura County dealerships had white Chevrolet Volts for which a lease could be negotiated, Paradise Chevrolet in Ventura and Silver Star Chevrolet in Thousand Oaks. Paradise and Silver Star both submitted lease quotes. However, Paradise was slow to respond regarding the vehicle and staff found out that the vehicle they quoted was sold. They have offered to prepare a lease quote for a 2014 vehicle, however, they do not currently have any white 2014's in stock and were not sure when the next shipment would arrive. Paradise was already higher on the vehicle purchase price then Silverstar Chevrolet ($40,055 vs. $36,585) and a 2014 model as compared to a 2013 model would be more expensive due to a small number of available discounts. 91 Honorable City Council December 4, 2013 Page 2 Staff has confirmed with Silverstar Chevrolet that the 2013 vehicle they quoted is still available. Silverstar's quote for the lease vehicle is as follows: Vehicle price: $36,585.00 Customer Discount: $1,685.00 Customer Rebate Reduction: $2,400.00 Selling Price: $34,900.00 Tax: $2,623.50 Fees: $414.75 Net Sales Price: $37,938.25 Out of Pocket (drive off): $1,500 down - monthly payment = $364.23 $2,000 down — monthly payment = $349.63 $3,000 down — monthly payment = $321.50 Total cost for each of the three out of pocket options for the 36 month term: $1,500 + $13,112.28 = $14,612.28 $2,000 + $12,586.68 = $14,586.68 $3,000 + $11,574 = $14,574.00 Mechanical problems with the pool cars, their relative age, and an increase in general usage of all of the pool cars dictates the need for another vehicle to be added to the City's fleet. Staff is recommending moving forward with the lease from Silverstar Chevrolet. Silverstar Chevrolet has agreed to keep the vehicle available to the City of Moorpark until after December 4 to allow for the City Council to approve the lease. FISCAL IMPACT Staff is recommending the 3rd option because even though the downpayment or "drive off' cost is more expensive, the monthly cost and the total cost for the 36 month term is the lowest. Silverstar is also offering a number of discounts off the vehicle price and a reasonable "drive off' amount. The lease payments may also be made up front, which would decrease processing time for Finance staff by eliminating the need to prepare a monthly check. At the conclusion of the 36 month term, the vehicle would be returned to the dealership and another vehicle would need to be purchased or leased. 92 Honorable City Council December 4, 2013 Page 3 The actual costs of the lease are higher than what was initially presented to the City Council, primarily due to the higher cost of the vehicle. Staff anticipated a vehicle cost of around $32,000, however, a vehicle with that price was not available in the existing dealer inventory in the County. The lease cost presented is less than 50% of purchasing the vehicle outright. There are no funds budgeted in the Fiscal Year 2013-14 budget. A budget amendment in the amount of $15,000 from the Traffic Systems Management Fund (2001) is needed to fund the vehicle lease. STAFF RECOMMENDATION (ROLL CALL VOTE) 1. Approve lease of a Chevrolet Volt from Silverstar Chevrolet and authorize the City Manager to execute all necessary documents; and 2. Approve Resolution No. 2013- Attachment: Resolution No. 2013- 9 3 RESOLUTION NO. 2013- A RESOLUTION OF CITY COUNCIL OF THE CITY OF MOORPARK, CALIFORNIA, AMENDING THE FISCAL YEAR 2013/2014 BUDGET BY APPROPRIATING $15,000 FROM THE TRAFFIC SYSTEM MANAGEMENT FUND (2001) FOR LEASE OF A CHEVROLET VOLT WHEREAS, on June 19, 2013, the City of Moorpark adopted the Operating and Capital Improvement budget for Fiscal Year 2013/14; and WHEREAS, a staff report has been presented to the City Council recommending approval of a lease for a Chevrolet Volt; and WHEREAS, a budget adjustment in the aggregate amount of $15,000 from the Traffic System Management Fund (2001) is requested for this work; and WHEREAS, Exhibit "A", attached hereto and made a part hereof, describes said budget amendment and the resultant impact to the budget line items. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. A budget amendment in the amount of $15,000 from the Traffic System Management Fund (2001) as more particularly described in Exhibit "A", attached hereto, is hereby approved. SECTION 2. The City Clerk shall certify to the adoption of this resolution and shall cause a certified resolution to be filed in the book of original resolutions. PASSED AND ADOPTED this 4th day of December, 2013. Janice S. Parvin, Mayor ATTEST: Maureen Benson, City Clerk Exhibit A— Budget Amendment 94 EXHIBIT A BUDGET AMENDMENT FOR Traffic System Management Fund (2001)for lease of Chevrolet Volt 2013/14 FUND ALLOCATION FROM: Fund Account Number Amount Traffic System Management Fund 2001-5500 $ 15,000.00 Total $ 15,000.00 DISTRIBUTION OF APPROPRIATION TO EXPENSE ACCOUNTS: Account Number Current Budget Revision Amended Budget 2001.8100.0000.9505 $ - $ 15,000.00 $ 15,000.00 $ - $ $ - Total $ - $ 15,000.00 $ 15,000.00 __A _A.,,j,..,,.- Approved as to Form: 95