| | | | | | | | Agenda Item - 3.d.
City of Garden Grove
INTER-DEPARTMENT MEMORANDUM
| To: | Scott C. Stiles
| From: | Tom DaRé
| | Dept.: | City Manager
| Dept.: | Police
| | Subject: | Approval of lease agreements with Enterprise Fleet Management for two vehicles. (Cost: $54,000) (Action Item) | Date: | 6/22/2021 |
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| | | | | | | | OBJECTIVE
To obtain City Council approval to enter into 36-month operating lease agreements with Enterprise Fleet Management (Enterprise) for two Police Department undercover vehicles, pursuant to the terms of the existing standard Master Walkaway Lease Agreement. |
| | | | | | | | BACKGROUND
Leasing vehicles has been very successful for the Police Department, as it allows investigators to conduct operations in vehicles chosen to blend in with the general population, and to rotate them out every 36 months. The City has an existing Master Walkaway Lease Agreement with Enterprise, and two operating leases set to expire in August are being extended through the end of the year due to lack of vehicle inventory for replacements. Covid-related delays have increased manufacturer delivery lead times from 12-20 weeks to 20-22 weeks, so Enterprise must order the vehicles as soon as possible to try and have replacement vehicles by the end of 2021. |
| | | | | | | | DISCUSSION
Each vehicle will have a total allowance of 30,000 miles for the 36-month lease term and the dealer will complete any repairs that are covered under warranty. Enterprise will also provide physical damage coverage for the vehicles, as leased vehicles do not qualify for comprehensive coverage under the City’s self-insurance guidelines. |
| | | | | | | | FINANCIAL IMPACT
The total cost of the two leases is approximately $18,000 per year, or $54,000 for the full 36-month term of the agreements. This amount includes all monthly lease payments, physical damage insurance, annual license renewal fees, and all fees associated with initial delivery. The full cost of Enterprise lease agreements is incorporated into the Police Department’s budget as an ongoing expense. There will be no additional burden on the General Fund. |
| | | | | | | | RECOMMENDATION
It is recommended that the City Council:
- Approve the 36-month vehicle operating lease with Enterprise Fleet Management, in the amount of $54,000, for two (2) Police Department vehicles, pursuant to the existing Master Walkaway Lease Agreement; and
- Authorize the City Manager to execute the agreements on behalf of the City, and make minor modifications as appropriate thereto.
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