City Of Murfreesboro Fleet Service Evaluation

CITY OF MURFREESBORO FLEET SERVICES EVALUATION

BACKGROUND

City Manager Roger Haley recommended, in his 10/10/00 report to the city council, that the city purchase a site and building for a centralized garage to consolidate most of the city’s vehicle and equipment repairs and maintenance. The purpose of this acquisition was to lower costs, improve service and obtain better record keeping. Mr. Haley’s report presented a description and an overview of costs of fleet maintenance for the various city departments. The report recommended that the city’s new centralized fleet operation be configured as a separate department reporting to the city manager. A new position of manager or department head would be created, and assets (equipment and personnel) from current operations would be relocated to the new fleet management department.

The City Manager asked MTAS’ assistance on developing an implementation plan including facility improvements, equipment procurement recommendations, staffing recommendations, with job descriptions, and budget recommendations. Specifically, MTAS’ report will:

 review current operations;  evaluate current and proposed facilities;  recommend organization, staffing, work activities and equipment needs;  present budget information for the implementation plan;  propose an implementation plan for switching from separate fleet maintenance operations (in various departments) to a centralized fleet services operation; and  outline future needs

I. CURRENT OPERATIONS

The City of Murfreesboro currently operates decentralized fleet management operations. Each department – fire (except fire equipment is serviced at the water/sewer garage) the golf course, parks, police, solid waste, streets, urban environment, water and sewer - acquires and maintains its own equipment. A brief description of fleet maintenance staff, their routine work, outsourced work, facilities and budgets for each department follows. Not included is any vehicle and machinery attributed to the senior center, the airport or to cable TV.

1 The city’s total FY 2001 expenditures for vehicle and equipment maintenance are projected to run over $1,250,000 including personnel, operation and maintenance and additions to fixed assets. The city fleet consists of approximately:  300 cars, trucks and sport utility vehicles (SUVs);  26 dump trucks;  6 backhoes;  85 pieces of heavy equipment such as garbage trucks, street sweepers, etc; and  numerous small machinery (mowers, blowers, weed eaters, etc.)

The estimated replacement value of the city’s fleet is $15 - $20 million. The city currently employees 8 mechanics and 1 mechanic apprentice; 3 mechanics are certified (one at the police fleet operation and two at water/sewer fleet operation). The golf course and street department each have 1 service bay; the solid waste department has approximately 10,000 square feet with multi bay possibilities and the water/sewer service center has one pull through bay and another one-half bay with pit. Generally, departments operate without formal equipment replacement policies or preventive maintenance schedules. Only one department is beginning to use maintenance tracking software. Several departments maintain limited files on maintenance activities.

Fire Department

Staff and routine work – one equipment mechanic performs preventive maintenance, minor and major repairs including brake replacements/repairs and muffler/exhaust system repairs but excluding tire replacement. The fire department’s mechanic works from the water/sewer department’s garage; personnel costs are divided between the departments and parts are charged to the appropriate department. Outsourced – tire installation, front end alignments, transmissions, and warranty work. Facilities – one pull through bay, one half bay w/pit and one wash bay; one 15,000 pound lift, various jacks, compressors, stands, welders, and diagnostic equipment. Budgeted vehicle maintenance expense - $110,000.

Golf Course

Staff and routine work – one equipment mechanic performs preventive maintenance, sharpens and grinds reels and rotary blades, changes tires, overhauls motors, welds, works on hydraulics, maintains parts inventory and operates all equipment. Outsourced – tire installation; major repairs. Facilities – 1 bay garage. Budgeted vehicle maintenance expense – $78,000.

2 Parks and Recreation

Staff and routine work – This department has no mechanics. Crew leaders and laborers perform minor preventive maintenance (i.e. checking oil, changing filters, sharpening mower blades). Outsourced – all work is outsourced. Facilities – no garage. Budgeted vehicle maintenance expense = $39,600.

Police Department

Staff and routine work – one mechanic performs light maintenance for over 170 vehicles, obtains estimates, tracks all repairs and maintenance and issues purchase orders. Outsourced – All brake repairs, computer tests, alignments, radio repairs, transmissions, shocks, tires, engine work and oil changes. Facilities – storage garage for vehicles being readied for service. Budgeted vehicle maintenance expense = $253,000.

Solid Waste Department

Staff and routine work – 4 mechanics maintain 6 automated and 7 semi-automated loaders, 5 knucklebooms, 4 pickups, 2 street sweepers, and other heavy equipment. The department performs all preventative maintenance and most major repairs, including engine rebuilds and tire changes. Outsourced – wheel balancing, front end alignments, muffler/exhaust system repair/replacement. Facilities – multi bay garage available in 75’ x 150’ area. Budgeted vehicle maintenance expense - $378,000.

Street and Sign Department

Staff and routine work – 1 mechanic’s apprentice and one helper maintain 13 dump trucks, 1 backhoe and other heavy equipment. Outsourced – tire installation, air conditioning work, transmission repairs, hydraulic pump repairs, machine shop work, front end alignment, major welding and major diagnostic repairs. Facilities – one large bay area capable of servicing 2 dump trucks or 4 pick-up trucks. Budgeted vehicle maintenance expense - $101,600.

3 Urban Environmental Department

Staff and routine work – no mechanics, but all employees engage in minor repairs/maintenance tasks such as oil changes, minor tune-ups and repairs on small equipment. Outsourced – major engine repairs, brake systems, exhaust systems, carburetor and fuel injector repairs, tire installation and balancing, hydraulic systems, and electrical system problems. Facilities – no garage facilities available. Budgeted maintenance expense - $10,000.

Water and Sewer Department

Staff and routine work – 1 mechanic provided by the water/sewer department and one mechanic provided by the fire department service do preventive maintenance and major repairs for water, sewer and fire equipment. Outsourced – tire installation, front end alignments, transmission repairs and warranty work. Facilities – 1 pull through bay, one half bay w/pit and one wash bay; 15,000 pound lift, various jacks, compressors, stands, welders, and diagnostic equipment. Budgeted vehicle maintenance expense - $174,000.

II. CURRENT AND NEW FACILITIES

Current Facilities and Equipment

The water/sewer fleet service center is fairly new, services water, sewer and fire department vehicles and is well equipped, including diagnostic equipment. The 3,600 square feet service area includes one and one-half bays.

The largest fleet service area - about 10,000 square feet - is located at the solid waste shop. While not all the area is needed for service activities, the area is utilized for overnight parking of garbage trucks, street sweepers and knuckleboom during freezing weather. The solid waste shop is adequately equipped with hoists, welders, compressors, and hand tools.

The streets department garage has about 3,600 square feet of service area with additional area for office, parts storage and sign making and storage. This shop is equipped with two welders, an air compressor and hand tools.

4 Newly Acquired Bluebird Facility

The city recently purchased, for $650,000, property at 906 Industrial Drive (Bluebird Facility) for use as a central garage and impound storage lot. The site is 2.5 acres and features a 1988 pre-engineered metal building containing approximately 1,900 sq. ft. of office area, 8,000 sq. ft. of service area and 3,600 sq. ft. of open work area under canopy. The parking lot is partially paved, and the remainder is gravel.

The facility was constructed as a repair facility for buses. It has 3 bays approximately 58’ long by 25’ wide and a 25’ x 58’ paint bay. Currently, bays are accessed on one side of the building via chain operated 12’ x 14’ overhead doors. The city also purchased a 2.98-acre parcel on the other side of the Bluebird facility to facilitate the construction of drive through bays. The second parcel costs $100,000. The facility has numerous electrical outlets, skylights, and an adequate floor drain system. The site is partially fenced. The current owner plans to remove all existing steel shelving, office furniture and tools upon departure by October 2001.

A review of calendar year 2000 utility bills shows a total electrical expense of $5,252 or $438/month; a total water expense of $1,215 or $101/month; and a total gas expense of $2,053 or $171/month. This is a total annual utility budget of about $8,500.

III. PROPOSED ORGANIZATION, STAFFING, WORK ACTIVITIES AND COST SAVINGS

Fleet Services Organization

The city administration recommended centralized fleet management. As stated above, the city’s current operations are decentralized in that each city department acquires and maintains its own equipment. Under centralized management, the fleet services department would be responsible for all vehicles on a city-wide basis. Vehicles are owned and maintained by the centralized fleet services department and leased back to municipal departments. This arrangement concentrates fleet management skills in one department and provides for a uniform approach to vehicle replacement, purchasing of parts, preventive maintenance, inventory control, records management and so forth.

A hybrid option is partially centralized fleet management. Under this arrangement, ownership of equipment resides with the individual departments, and maintenance and repair are centralized. This arrangement allows fleet maintenance/repair skills to be concentrated in one department, and may allow for specialization of mechanics. However, it does not allow the city to take advantage of centralized specification writing, replacement planning, fleet size control, bulk purchasing and so forth. The city has begun partially centralized fleet management by combining water/sewer and fire equipment fleet maintenance.

5 MTAS concurs with the city’s consolidation goals – namely lower costs, improved services and better record keeping. We believe those goals can be accomplished by consolidation of the management, personnel and functions of the various departments’ fleet service centers. Consolidation of facilities is probably not desirable or practical for reasons discussed later in this report.

Therefore, MTAS recommends that a new department – Fleet Management Services– be created having the same status as other municipal departments. This department would be charged with the responsibility for all city vehicles and machinery from acquisition through disposal. This organization will enable the city to realize life cycle cost and service efficiencies gained from equipment and parts standardization, employee training, purchasing histories, and overall operational oversight which should be linked to procurement decisions. Vehicle maintenance personnel, parts, inventory and facilities management for streets, solid waste, police, fire, water and sewer, and all other city departments would be assigned to the fleet services manager. Except for their light passenger vehicles, the golf course, parks and recreation, urban environment, senior center, airport and cable TV would be excluded. These departments generally have small equipment that is more efficiently maintained on-site.

The fleet services manager should report to the city manager. A suggested organizational chart is shown in Exhibit I. MTAS emphasizes that this position requires management capabilities. Ideally, the fleet manager should be brought on-board early and have a voice in staffing, organization and consolidation of fleet maintenance programs and facilities. Typical responsibilities of fleet operations are shown in Exhibit II. Suggested job descriptions for the fleet services manager, mechanics and parts supervisor are shown in Exhibit III. Comparable salaries for the fleet service manager position from selected Tennessee municipalities and other sources are shown in Exhibit IV.

Service Centers

Given the city’s shop facilities and current uses and practices, MTAS recommends that all but the heavy vehicles and equipment be centralized in the recently acquired Bluebird maintenance facility which consists of 8,800 sq. ft. The 10,000 sq. solid waste shop should continue to service solid waste and related equipment. Other heavy equipment would be serviced out of the 3,600 sq. ft. water/sewer garage.

The recommended service centers are illustrated on the following page.

6 Main Service Center (Bluebird)

Heavy Solid Waste Equipment Shop Shop (water/sewe r)

 The city should concentrate all of its light truck and vehicle service in the Bluebird facility (hereafter Main Service Center);

 Garbage trucks and related heavy equipment should be maintained out of the existing Solid Waste Shop;

 The street department garage should transfer its light trucks and vehicles to the Main Service Center and its heavy equipment to the water/sewer garage (hereafter Heavy Equipment Shop);

 Light trucks and vehicles at the water/sewer garage should be transferred to the Main Service Center. It may be necessary to adjust the work-load for heavy equipment between the Solid Waste Shop and the Heavy Equipment Shop.

 Light trucks and vehicles in the Parks & Recreation Department, Old Fort Golf Course, Urban Environment Department and other city departments should also be transferred to the Main Service Center.

 The Parks & Recreation Department would continue to maintain specialty equipment such as mowers, weed eaters, and other equipment.

 The Old Fort Golf Course would continue to maintain its equipment on site.

In this scenario, the only existing service center that would be eliminated is the one at the Streets Department. The service centers’ work loads would be distributed as shown on the next page.

7 Main Service Center Solid Waste Shop Heavy Equipment Shop 179 vehicles from police Garbage trucks large or special equipment from w/s and fire >120 light vehicles from Street sweepers, dump trucks, tractors, other departments knucklebooms, related heavy backhoes from other equipment departments

Total = ~ 300 vehicles Total = ~ 20 vehicles Total = ~ 85 vehicles

In making these recommendations, MTAS assumed:

1. The two mechanics at the water/sewer garage could continue to service all heavy fire, water, and sewer equipment plus heavy equipment from other departments if they were relieved of the fire, water, and sewer light passenger vehicles. This garage is fairly new, is well equipped, and has two of the city’s three certified mechanics.

2. Two of the four mechanics at the solid waste department could be reassigned to the main service center if responsibilities for purchasing and parts inventory, and service of the solid waste department’s light passenger vehicles were diverted to the main service center. Two mechanics remain at the solid waste shop.

3. The Parks & Recreation Department should continue with its existing personnel working on mowers and other specialty equipment. This department’s trucks and other light vehicles are currently outsourced. Therefore, transferring their 27 vehicles to the Main Service Center would not affect manpower in Parks & Recreation.

4. The mechanic at Old Fort Golf Course would continue at the golf course garage.

5. The lead mechanics at both the water/sewer and the solid waste service centers would act as supervisors.

6. Establishing centers for heavy vehicle service and another for solid waste equipment service furthers mechanic specialization.

7. Shop personnel at the satellite service centers would report to the fleet manager.

8. Administrative, clerical, purchasing, records management, parts control and all other management functions would be centralized at the main service center.

8 Staffing Needs

The city currently employs 8 mechanics and one apprentice. Under the scenario outlined above, one mechanic remains with the golf course. The remaining 7 mechanics and one apprentice are distributed among 3 service centers. The following staffing ratios are recommended:

 light passenger vehicles – equipment to mechanic ratio of 70–80 :1;  heavy equipment other than garbage trucks and street sweepers – equipment to mechanic ratio of 40:1; and  garbage collection vehicles and street sweepers – equipment to mechanic ratio of 14:1

Because of the low cost of outsourcing oil changes and transmission fluid changes, and because of the nature of transmission repairs, MTAS recommends that oil and transmission fluid changes and automatic transmission repairs continue to be outsourced at this time. This decision should be re-evaluated in the future.

Then four mechanics (ratio of 75:1) would be required to maintain 300 light vehicles. Two mechanics would be transferred to the main service center from the solid waste department; one mechanic would be transferred to the main service center from the police department; one mechanic apprentice would be transferred to the main service center from the streets department.

In addition to hiring a fleet manager, MTAS recommends that the city hire a parts supervisor. The following table lists current manpower and proposed manpower to staff the three service centers.

Current and Proposed Manpower Needs and Locations

Current Manpower Proposed Manpower and Location

1 mechanic - police 1 mechanic transfer from police to MSC 1 mechanic - fire 1 mechanic remains at HES 1 mechanic – water/sewer 1 mechanic remains at HES 4 mechanics – solid waste 2 mechanics remain at SWS; 2 mechanics transfer to MSC 1 mechanic apprentice - streets 1 mechanic apprentice transfers to MSC 1 new parts supervisor at MSC 1 new fleet services manager at MSC

Total = 8 Total = 10

MSC = main service center; HES = heavy equipment shop (water/sewer garage); SWS = solid waste shop

9 Work Activities

Currently, each department’s fleet service garage is contracting oil changes, tire installation, front end alignments, transmission work, muffler and exhaust system repairs, shock and brake repairs, air conditioning repairs, engine repairs, radio installation/repairs, electrical repairs and painting. In addition, the police department fleet is almost entirely serviced off-site due to the large number of vehicles – 179 and only one mechanic assigned to this department. Other repairs outsourced include fuel and water pump replacement, radiator flushing/repair, alternator replacement, filters, wiper blade replacement, ignition problems, and many routine preventive maintenance items.

Potential Cost Savings

Examples of potential cost savings from centralized fleet management can be seen by comparing the city’s total per hour labor cost (including benefits) of $23.33 versus the $50 per hour average cost the city pays for outsourced labor. A 50% reduction in costs for parts is a very reasonable assumption. Another example - one department of the city pays $8.00 per gallon for antifreeze and, another department pays $3.78 per gallon. Examination of city invoices for parts that are currently outsourced reveals that the city often pays more then twice what the parts could be purchased for on a competitive basis.

Analysis of expenditures totaling $716,223 that the city spent for operations/maintenance reveals that 25%, or $179,056 was spent for out-sourced labor and the balance of $537,167 was spent on parts. If the city performed in-house all of its maintenance, it would save $716,223 but, it will have to add labor (see page 12) and parts costs to replace costs currently performed by private garages. Since the city would continue, at least initially, to outsource oil and transmission changes, transmission repairs, and radio repairs, the city would not save this entire amount.

Assuming the city cuts its out-sourced labor cost by 60%, it will reduce expenses by $19,434 [-$107,434 + $88,000 (see page 12) = - $19,434]. A 40% reduction in parts expenses represents a savings of $214,867. Thus the combined annual net savings for labor and parts is estimated at over $234,000. Over a ten year period, this amounts to over $2.3 million. The exact amount of savings is difficult to predict. It will ultimately depend on the city’s commitment to a fleet management program that emphasizes preventive maintenance, more effective use and replacement of vehicles, improved record keeping and competitive purchasing.

Preventive Maintenance

Preventive Maintenance (PM) – PM is the heart and soul of good fleet management. 60-75% of mechanics’ time should be spent on preventive maintenance. Many department heads don’t want to give up control of their vehicle repairs to another

10 department because they fear being bumped to the rear of the line in the wait for fleet services. This is a legitimate concern since their staffs need vehicles in order to deliver good customer service. A good PM program can greatly alleviate their concerns. It is much more cost effective to replace, at the service center, anything on a vehicle that has approached the end of its useful life rather than waiting for breakdown. Road breakdowns are too costly – in manpower and lost service delivery.

To encourage vehicle users to co-operate in the PM program, it is essential for PM to be fast, efficient and comprehensive. The service centers must have the diagnostic equipment needed for the job. The PM waiting period should not exceed 30 minutes. This time frame encourages the vehicle user to bring his/her vehicle in for PM checks and to wait for them. For road breakdowns, a turn around repair time not to exceed 24 hours is desirable. This means that parts must be on hand.

IV. PROPOSED EQUIPMENT, RENOVATION AND STAFF COSTS

MTAS recommends that the following equipment be purchased for the main service center. The only significant equipment to be transferred (from the streets department) are two welders and one portable air compressor.

RECOMMENDED EQUIPMENT PURCHASES FY 2002 FY 2003

1 -4 POST VEHICLE LIFT $4,000 4-2 POST VEHICLE LIFTS 12,000 1 BRAKE TURN LATHE 5,500 1 TIRE CHANGER 5,000 1 WHEEL BALANCER 5,300 1- AIR COMPRESSOR 4,000 1 OTC ENGINE ANALYZER 5,000 8 JACK STANDS 600 6-3/8"RETRACTABLE AIR HOSES 1,200 METAL SHELVING 15,000 3-PERSONAL COMPUTERS 7,000 MANAGEMENT INFO. SYSTEM 12,000 OFFICE FURNITURE 4,500 1 FAX MACHINE 1,200 TELEPHONES 1,200 3-12X14 GARAGE DOORS 3,405 7-GARAGE DOOR OPENERS 3,535 MISCELLANEOUS EQUIPMENT 15,000 FORK LIFT 12,000 2-HOISTS 700 PAINT BOOTH* 40,000 DRIVE FOR REAR ENTRANCE 8,000

SERVICE TRUCK 24,000

11 TOTAL $150,140 $40,000 *fourth bay at the main service center is being used as a paint booth by Bluebird. The city may want to acquire equipment and use this bay as a paint booth in the future

Recommended Staff for Fleet Services

ESTIMATE D COST FY CURRENT PROPOSED 2002*

1-MECHANIC FROM SOLID WASTE $36,693 $36,693 $36,693 1-MECHANIC FROM SOLID WASTE $32,011 $32,011 $32,011 1-MECHANIC IN SOLID WASTE $36,693 $36,693 $36,693 1-MECHANIC IN SOLID WASTE $36,693 $36,693 $36,693 1-MECHANIC FROM POLICE DEPARTMENT $37,109 $37,109 $37,109 1-MECHANIC APPRENTICE FROM STREETS $28,957 $28,957 $28,957 1-FIRE CHIEF MECHANIC $41,888 $41,888 $41,888 1-WATER/SEWER MECHANIC $35,418 $35,418 $35,418 1-FLEET SERVICES MANAGER $62,000 $51,667 1-PARTS SUPREVISOR $26,000 $14,000 TOTAL STAFF = 10 $285,462 $373,462 $351,129

ADDED COST $88,000 $65,667

Assumptions: Fleet Manager budgeted for 10 months in FY 2002; parts supervisor budgeted for 6 months in FY 2002.

For FY 2002, approximately $220,000 in new expenditures should be budgeted to purchase equipment, make building modifications and staff the department of fleet management services. This includes $150,000 for equipment and renovations and $66,000 for new staff.

V. PROPOSED IMPLEMENTATION PLAN

MTAS recommends that the city create a new department for the management of fleet services for the purposes of (1) lowering fleet costs, (2) improving fleet service and (3) improving data management. Fleet services would be delivered from three primary service centers.

The City of Murfreesboro anticipates taking possession of the main service center (Bluebird Facility) in October 2001. In order for the city to place this facility in use, it

12 will be necessary to (1) hire staff, (2) make modifications to the facility, (3) purchase and install equipment, (4) provide training, and (5) determine overall fleet management policies. These are briefly explained below.

Hire Staff. MTAS recommends that the Fleet Services Manager be employed in late summer, 2001. This employee’s initial duties should be to oversee the building modifications, purchase and install equipment, and train mechanics. The manager would need to establish an office, procure furniture and supplies, personal computers, and vehicle maintenance software.

The parts supervisor would be employed in December, 2001. The parts supervisor would be responsible for working with the purchasing department to procure, stock, and maintain an inventory of parts. In addition the parts supervisor should be available to assist with minor repairs and modifications to new equipment.

Modifications to the Main Service Center. The Bluebird Facility is a very good maintenance garage. It has served well as a school bus maintenance garage and will be a good shop for the city to maintain its fleet of light trucks and passenger vehicles. The facility has four long bays, one of which serves as a paint shop. Three of the bays are large enough that they can be divided in half to make a six bay maintenance shop. But, it will be necessary to install three new garage doors, equip all garage doors with automatic door openers, and install a driveway connecting the back of the building. An air compressor and retractable air hoses will also be needed. This work should begin in October and be completed no later than December 1, 2001.

Purchase and Install Equipment . Since so much fleet maintenance work for light vehicles is outsourced, the city does not have much workable equipment to transfer to the main service center. Equipment identified elsewhere in this report should be ordered in October and installed no later than mid-December 2001.

Provide Training. The manager should identify three employees to receive electronics training. These individuals should be the highest skilled mechanics. Other training should be provided for alignments, brake repairs, and other minor repairs. Major engine repair training and hydraulics should also be provided. Training should be scheduled for October, November and December 2001.

Determine Overall Fleet Management Policies. Development of fleet management policies should begin with adoption of this report and initiation of the effort to centralize fleet management. MTAS recommends that the city develop policies that:

1. Establish a central fleet management program with the goal of completing transfer of city vehicles to fleet services by the beginning of FY 2003.

2. Develop a vehicle replacement policy, with the Fleet Services Manager as a central figure in procurement of vehicles.

13 3. Develop/implement a work order reporting system as part of a vehicle maintenance software program to provide decision makers a detailed and accurate history on vehicle or equipment purchase price, labor, miles/gallon, fuel cost and hours of usage.

4. The city should undertake a concerted effort to reduce the size of its fleet. A policy should be developed to identify low usage vehicles and either pay a mileage amount for use of personal vehicles or a mileage allowance for low usage vehicles that are needed. Low usage vehicles that are not needed should be surplused and sold.

5. A formalized preventive maintenance program is central to reducing fleet maintenance cost. At least 60% of the best mechanics’ time should be devoted to preventive maintenance. Absence of a formalized program (that is strictly adhered to) contributes to more costly repairs and excessive down time.

6. Develop a Fleet Management Safety Program for all vehicle and equipment maintenance employees. Such a program could be coordinated with the city’s existing safety program.

7. All light vehicle maintenance should be performed in house except automatic transmission repairs and oil and transmission fluid changes. The manager should, however, have flexibility to outsource any work during those times when the city’s mechanical work load is excessive.

These policies should be in place no later than January 1, 2002, at which time the Main Service Center should be open for business. Key action steps are summarized in the timeline below.

ACTION STEPS 2nd Qt. 3rd Qt. 4th Qt. 1st Qt. 2001 2001 2001 2002 A. Complete study of city fleet operations x B. Board approval of centralized fleet services x C. Board approval of FY 02 budget for x centralized fleet services D. Begin preparing staff for transition x E. Advertise, interview and hire fleet manager x F. Develop specifications, procure equipment, x shelving, tools for new main service center-MSC G. Modify service space at MSC x H. Move mechanics (from solid waste, police, x streets) parts & equipment (from streets) to MSC I. Hire parts supervisor x J. Schedule fleet services between 3 service x centers (begin reducing outsourcing) K. Settle into normal operations of fleet services x

14 L. Transfer assets (equipment and personnel) x from various departments to fleet services M. Strengthen areas listed in Section VI below x VI. FUTURE NEEDS

After centralizing and consolidating fleet services, hiring a fleet manager and moving into newly acquired facilities, the following area should be addressed and or strengthened.

 Preventive maintenance checklists  Scheduling worksheets  Make ready inspection procedures  Safety inspection forms  Ideas for fleet size reduction  Vehicle use policy  Ideas for management information systems (MIS)  Vehicle replacement guidance and  Training plan requirements

CONCLUSIONS

MTAS commends the city for the steps you are taking to realize centralized fleet services. Centralizing fleet management has saved money for other municipalities and private companies. Savings come from having a uniform approach to vehicle replacement, fleet reduction, purchasing, inventory control, records management and especially from a strong approach to preventive maintenance.

The city will have to make investments now in order to reap the benefits of centralized fleet management later. It is difficult to quantify the savings, but the cost of doing fleet maintenance in-house, if properly managed, should be considerably less expensive than out-sourcing. MTAS estimates that the city may be able to save over $200,000 annually.

Establishing a centralized fleet services operation will not be easy. Difficulties include:

 Buying department heads into the idea of “giving up control” of their fleets and fleet budgets;

 Transferring mechanics from their present work locations to a new environment and having them report to a new manager;

 Procuring a professional fleet services manager. In order to reap the full benefits of the proposal outlined in this report, the city will have to acquire a seasoned

15 fleet manager at a salary that fits within the city’s salary structure for department heads;

 Budgeting additional fleet services expenses for FY 2002 and beyond. A return on investment will take some time to realize;

 Transferring assets from various departments to fleet services at the beginning of FY 2003; and

 The usual challenges of setting up a new operation.

We believe that these challenges can be overcome, and that the city’s fleet operations will benefit. Ultimately, the citizens of the City of Murfreesboro will benefit from efficient municipal fleet operations. MTAS appreciates the opportunity to work with the city on this project.