(A) Legislative findings. The County Council finds that the ownership and maintenance of a functional, economical and safe fleet of vehicles and equipment is necessary in order to permit the county to provide an adequate level of governmental services to its citizens. The County Council further finds that federal revenue sharing funds and other sources of revenue historically used for the purchase of new vehicles and equipment have diminished, and that it is prudent and advisable for the county to establish methods and procedures for the orderly replacement of county vehicles and equipment.
(B) Purpose. The purpose of this section is to create and establish the “York County Vehicle/Equipment Fund” or “the fund” to provide for the timely replacement of county vehicles and equipment in order to maintain a highly functional, economical and safe fleet of vehicles and equipment.
(C) Vehicle equipment replacement criteria.
(1) It is hereby declared to be the policy of the county to maintain its vehicle/equipment inventory so as to allow its utilization in an optimum manner. In determining the useful life, and in deciding to replace or retain vehicles and equipment, the following factors will be considered:
(a) Costs of operation;
(b) Reliability (amount and frequency of down time, safety);
(c) Job performance capability (including applicability);
(d) Capability to meet standards and regulations (such as, C.O.S.H., E.P.A., and the like); and
(e) Costs to repair versus replacement (due to accident or breakdown).
(2) Each of the factors enumerated above shall be considered in reaching a decision to replace or retain an item. Each factor enumerated above is directly affected by the degree and nature of utilization. Utilization shall be used as basis of projecting useful life for replacement planning purposes.
(D) Replacement rates.
(1) A replacement rate will be established for each inventory item in order to accrue monies for the timely replacement of the item. This replacement rate shall be established by the office of the county manager on the basis of the following formula:
RR = C-S
P
P
(a) “RR” is the annual replacement rate.
(b) “P” is the estimated period of use in years.
(c) “C” is the estimated cost of a like item at the time of replacement (including make ready costs).
(d) “S” is the estimated salvage value of the existing item at time of replacement.
(2) Rates shall be billed to each department on an annual basis as a charge to each department’s operating and maintenance budget. Monies accrued from such charges shall be credited to the fund.
(3) Replacement rates may also be adjusted independently of the above formula to allow for balancing the fund as necessary.
(4) Replacement rates for all inventory items shall be developed and updated annually by Equipment Maintenance and submitted to the office of the county manager for approval.
(E) Estimated period of use.
(1) An estimated period of use shall be established for each inventory item at the time of acquisition. This period shall encompass that time frame from the date of acquisition to the estimated replacement date.
(2) The determination of this calendar period shall be based on an analysis of the anticipated rate of utilization of the item, combined with performance experience with similar items.
(3) Estimated periods of use shall generally be set for item groups with similar characteristics, rather than on an individual item basis.
(4) Estimated periods of use for all inventory item classes shall be developed and updated annually by Equipment Maintenance and submitted to the office of the county manager for approval.
(5) The estimated period of use is a replacement program planning guide only. Individual items may be replaced on a shorter or longer time frame depending upon their status or upon the status of the replacement fund. The county manager will review the status of the entire inventory on an annual basis in order to make the determinations.
(F) Replacement costs.
(1) Replacement cost shall be established for each inventory item at the time of purchase. This cost shall be the estimated purchase cost of an equivalent item at the appropriate end of its estimated period of use. The basis for determining an equivalent unit shall not include allowances for extras or upgrading, the items being necessarily funded as a supplementary capital outlay item by the using department at the time of replacement.
(2) Included in the replacement cost shall be make-ready cost, which includes such items as transfer of radios, installation of decals and special equipment such as hoists, tanks, and similar special equipment. These costs will be borne by the fund if the replaced unit was so equipped. Additional or new capitalized items shall be the financial responsibility of the using department.
(3) It is recognized that some degree of speculation is involved in estimating future replacement cost particularly for items having a period of use of more than three years. Factors such as inflation, more stringent federal and state regulations, technological advances and product availability all can generate significant fluctuations in such cost.
(4) To achieve some degree of consistency in projecting such cost, projections will be made on the basis of a three-year moving average of the cumulative purchase cost increases for the following categories of inventory items:
(a) Staff passenger and service vehicles. Passenger sedans, vans, pickups, police cruisers and similar vehicles;
(b) Light equipment. Dump trucks, flat bed trucks and similar light equipment;
(c) Heavy equipment. Motorgraders, loaders, backhoes, dozers and similar heavy equipment; and
(d) Off-road equipment. Landfill compactors, motorgraders, backhoes, tractors, and similar off-road equipment.
(5) The three-year moving average allows for more gradual adjustments in replacement rates. Equipment Maintenance shall be responsible for reviewing and updating replacement costs on an annual basis. Updated replacement costs must be submitted to the office of the county manager for approval.
(G) Salvage values.
(1) Salvage values shall be established for each inventory item at the time of purchase. This value shall be the estimated worth of the item at the approximate end of its estimated period of use.
(2) Long term salvage value estimates will be derived from a three-year moving average of the cumulative salvage value increases or decreases for the same categories of inventory items as outlined in the previous section.
(3) These projections shall be developed and updated annually by Equipment Maintenance and submitted to the office of the county manager for approval with the base figure being the adjusted current year salvage value for the item category. The detail may not be developed on an annual basis for all special category items. Some items may have no salvage value.
(H) Creation of Vehicle Equipment Replacement Fund.
(1) There is hereby created and established the York County Vehicle/Equipment Fund, which shall be administered, invested and disbursed as provided herein. Replacement rates for each inventory item shall be accrued in the Fund on the basis of annual billings to each user department.
(2) The fund shall be the source of capital for all necessary replacements for inventory items. The fund shall not be used for the purchase of additional inventory items, upgrading inventory items at replacement, or item extras over standard unit components, all costs being a supplementary capital outlay responsibility of the user department. Subject to the exceptions contained herein, the fund shall be administered, invested and balanced as a separate single fund, rather than on an item basis related to replacements of individual items. If, at the time of replacement of any item, a surplus or deficit exists in the replacement monies for that item, the surplus or deficit shall be reconciled within the fund. In order to minimize the need for reconciliations, and when necessary, to minimize their impact, the surpluses or, losses shall be amortized over a six-year fiscal period. All inventory items, corresponding replacement rates, period of utilization, replacement costs and salvage values will be logged into the fund status balance sheet for the purpose of assessing existing or projected surpluses or deficits over this period.
(3) Fund surpluses or deficits for any given year shall be determined on the basis of the following formula:
FN = RRN + SN - CN
(a) “FN” is the fund status in any given year.
(b) “RRN” is the cumulative accrued replacement monies for the inventory for that year.
(c) “SN” is the cumulative estimated salvage values for inventory items to be replaced that year.
(d) “CN” is the cumulative estimated replacement costs for inventory items to be replaced that year.
(4) For the purpose of fiscal planning and management, fund surpluses or deficits shall be maintained within the following ranges:
(a) First three years of planning period: maximum allowable average yearly deficit of 5% of estimated replacement costs; maximum allowable average yearly surplus plus 5% of estimated cumulative replacement costs;
(b) Last three years of planning period: maximum allowable average yearly surplus or deficit plus or minus 5% of estimated cumulative replacement costs.
(5) If the project fund balance falls outside of these ranges, the county manager shall recommend to the County Council that adjustments in the fund be made through either:
(a) An overall adjustment upward or downward in annual replacement rates for either the entire inventory or a given category of inventory items; or
(b) A capital supplement or deduction from the fund.
(I) Authorization to transfer funds. The county treasurer is hereby authorized, empowered and directed to transfer from the York County Medical Services for the Indigent Fund to the Vehicle/Equipment Replacement Fund the sum of $1,554,000 in order to provide initial funding for the county vehicle equipment replacement fund. The County Vehicle/Equipment Replacement Fund shall be administered, invested and disbursed as provided in this section.
(J) County Treasurer’s authority. The county treasurer shall hold, administer, invest and re- invest all funds transferred to the County Vehicle Equipment Replacement Fund as a fund separate from all monies or accounts held by the county; provided, however, that all funds deposited or accruing to the account of the County Vehicle/Equipment Replacement Fund may be invested jointly with other county funds to obtain the optimum return on the funds. The county treasurer shall have all powers and authority to invest and re-invest movies, funds or assets transferred to the vehicle equipment replacement fund as are generally conferred upon county treasurers by statute, law, ordinance or properly promulgated rule or regulation.
(K) Replacement, review and approval; establishment of committee.
(1) The final decision to replace or retain vehicles/equipment shall lie with the County Council. To aid in this process, a review/replacement committee shall be established by the county manager.
(2) The committee shall be comprised of the county manager, CFO/assistant county manager, public works director, fleet manager, a representative from the Sheriff’s Department, and a representative from the Procurement Department. The committee shall be appointed at the beginning of each fiscal year and shall serve until the end of the fiscal year.
(3) The review/replacement committee shall make recommendations to the county manager as to the need for replacement of vehicles or equipment based on the “replacement criteria” established above. The review/replacement committee will review on a semi-annual basis all vehicles and equipment and make recommendations with respect to the retention or replacement of vehicles and equipment based on the criteria established above.
(4) The review/replacement committee shall not make any recommendations for replacement unless funds to make purchases are available through procedures established by this section.
(‘77 Code, § 2-6) (Ord. 2085, passed 11-18-85; Am. Ord. 1620, passed 6-15-20)