Summary
To: Town Commission
From: Micah Maxwell
Date: 1/10/2017
______________________________________________________________________
Subject:
Title
Approval of Vehicle Purchase
Summary:
Staff is requesting the Town Commission approve the purchase of vehicles for 2016-2017End
Body
Previous Commission Action: The Board approved a Budget Amendment in line with the purchases in January, but staff felt that the Board should have a full understanding of the plan moving forward.
Background/Problem Discussion: Last year the town looked at some alternative purchase options for vehicles, which included a lease purchase plan. In reassessing that issue this year, staff came up with what it believes is a better option. As identified in the previously, staff has suggested that the LOGT fund be the sole purchase point for all vehicle purchases within the General Fund.
This however needs to be coupled with a change in past practices of holding a vehicle for 8-10 years. Staff is recommending that we shift to a five year replacement schedule for vehicles. Doing so would allows for the LOGT to be sustainable long term and would relieve the general fund of all vehicle expenditure obligations by 2020/2021.
What makes this possible is the a review of the annual cost to the town of vehicles over a 5 and 10 year lifecycle. The town took the fair purchase price of a base F150 on the open market over the last 10 years, and the value drops over those ten years (all out years used the value based on the lowest level condition type) to come up with an expected drop in value (estimated value in the year of sale/original fair market purchase price) We then took the fair market purchase price for this years vehicle and multiplied it by the percentage of expected value drop to come up with an expected value. We then took the original fair market price and subtracted out our discounted purchase to come up with our discount savings. The expected value was then subtracted by t...
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