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HomeMy WebLinkAbout040 - Equipment Rental Fund r , AUJINISTRATIVE ORDER NO . 40 TO: ALL DEPARTI4�"V.i TS May 11 , 1983 FRO[ f : Lee Kraft , City Manager I/ SUBJECT : EQUIIItTNT RENTAL FUND : DELINEATION OF RESPONSIBILITIES AND PROIiIUIGATION OF RULES AND REGULATIONS . Administrative Order No . 23 , issued on March 17 , 1981 , is hereby repealed and in lieu thereof the following Order is promulgated : PART I - DELINEATION OF RESPONSIBILITIES : Section 1 . The Director of Public Works , acting as Fleet Supervisor , shall be responsible for supervision over the garage in all matters relating to the operation of the garage , equipment pool , and warehouse . For purposes of organization , the equipment pool shall be deemed to be a division of the Public Works Department . In matters concerning cost accounting and inventory control as to the card index aspect of the inventory , the Director of Finance/Administrative Services shall have functional control over the type and substantive matter of the cost accounting records . The Public Works Department shall be responsible for the security of the warehouse facility and shall maintain item control over the inventory . • Section 2 . The duties of the equipment rental fund accountant shall be assigned by the Director of Finance/Administrative Services to one of the accountants in the department . The accountant performing these duties shall establish and maintain a complete and effective system of cost accounting records , with the objective of making maximum effective use of the city data processing system to help assure the maintenance of an adequate rental rate schedule on all pool-owned equipment . The incumbent of this position shall also maintain inventory- control over the garage stock room. The Fleet Supervisor or his designate shall schedule equipment into the garage . Any conflict with any department about assigning equipment into the shop shall be resolved by the Fleet Supervisor , whose decision shall be binding . Section 3 . The preparation of the preliminary expenditure budget for the Equipment Rental Fund for the ensuing year shall be performed by the Fleet Supervisor based on the recommendations of the Management Advisory Cormittee as approved by the City Manager . Section 4 . The Fleet Supervisor shall cause to be prepared and disseminated a preventive maintenance schedule to all using departments , showing the schedule when each piece of equipment is to cone into the shop for preventive maintenance . All. using departments shall adhere to this schedule and , failure to do so , will subject the responsible department head to disciplinary measures . • Section 5 . The Fleet Supervisor shall investigate and obtain remedial action from any department where equipment has been misused or abused . It shall be the duty of shop personnel to report to the. Fleet Supervisor immediately any instance of misuse or abuse of city equipment . Failure of departments to adhere to established operating procedures and maintenance schedules , and their further failure to adhere to directions of the Fleet Supervisor to cease and desist from misuse or abuse , shall be reported promptly by the Fleet Supervisor to the City Manager , with pertinent facts and recce mendation . PART II - STANDARDS Olt' OPERATION : Section 1 . Generally , no vehicle in the Equipment Rental Fund is to be replaced until it has paid into the reserve for replacement enough money for its full replacement cost . If expediency dictates an early replacement before enough money is accumulated in the reserve , the department ( s ) using the equipment will make up the difference between the actual cost of replacement and the amount paid into the reserve . Section 2 . The management policy shall be that the designated schedule of useful life for a particular piece of equipment or class of equipment is , at best , an estimate and will not constitute grounds for automatic replacement . Each year , prior to the preparation of the preliminary expenditure estimates for the next year , the Fleet Supervisor shall meet and confer with the affected department heads and shall analyze the condition of each piece of equipment that is scheduled for replacement and , using cost avoidance projections , shall determine if it will be cost effective to keep the particular piece of equipment for an extended life schedule . In making this analysis , the Fleet Supervisor shall confer with the appropriate department head and shall get the opinion of the department head on the desirability and consequences of extending the life schedule on the equipment in question . Section 3 . If the Fleet Supervisor and the department head , with the City Manager ' s concurrence , agree that it would be cost effective to keep a particular vehicle past its currently scheduled useful life , and if the vehicle has paid into the reserve account enough money to match its then replacement cost , the rental rate for the extended life schedule shall cover the operating and maintenance costs pertaining to the vehicle , and a reduced replacement charge to offset the effect of inflation . Any deficit imbalance at the actual time of the replacement purchase , shall be made up by the operating department having primary use of the equipment . Section 4 . Rental rates shall be adjusted each year to adjust for inflation and these rates and the method of their determination shall be subject to the review and approval of the management camittee . Section 5 . The expense of any equipment betterments and/or additions for a particular vehicle ( not integral to the vehicle when purchased) shall be charged to the operating budget of the department requesting the betterment . When these items wear out , their replacements shall be charged to the operating budget of the using department upon the request • and approval of the department head . The acquisition and replacement of this specialized type of equipment shall not be covered under the rental schedule of the Equipment Rental Fund . The acquisition , care and - 2 - maintenance , and replacesment of this type of equipment , shall be the direct • responsibility of the using department head , and all expenses for such shall be through the operating budget of the using department . ( This includes light bars and radios ) . When it appears beneficial and cost effective to add extras to the basic equipment ( for example , heavy duty tires ) , then such extras can be added upon the approval of the Fleet Supervisor and the expense thereof will be borne by the Equipment Rental Fund . Section 6 . Any additions to the Equipment Rental Fleet are to be made by a specific budgetary appropriation in the operating budget of the using department and , when purchase has been consummated , the acquired equipment shall immediately be transferred to the Equipment Rental Fund , whereupon operation and maintenance of the equipment shall be the responsibility of the Fleet Supervisor . Section 7 . The management policy on the accumulation for replacement shall be based on the premise of a cash flaw system , with enough extra funds being generated to keep the reserve account in a position to buy replacement equipment , when needed . Depreciation will be accrued and recorded on each piece of equipment on the straight line method according to the designated useful life schedule ; however , the accrued depreciation will not be fully funded but will be funded on a realistic cash flow basis . Each year , just prior to the preparation of preliminary expenditure estimates for the ensuing fiscal year budget , the Director of Finance/Administrative Services shall cause to be prepared a pro forma analysis of the entire • fleet operation , extending this projection into that point into the future when the longest life piece of equipment will need to be replaced . This pro fonna projection will show the amount of money which will be needed each of the years in the projection , all the way through to the piece of equipment with the longest life . This pro forma analysis shall be presented to the Management Committee prior to the preparation of the Equipment Rental Fund budget requests for the ensuing year . The Committee shall review the projections and shall make appropriate recc mendations to the City Manager for rental rates . The City Manager will have the final say on the amount of money to be raised for replacement purposes for any given year and shall promulgate the rental rate schedule to be effective for budget preparation purposes . Section 8 . All rolling stock shall be in the Equipment Rental Fund ; exceptions to this general rule shall be based on the merits of each particular case . Requests for exception should be routed through the Fleet Supervisor to the City Manager , giving full details , and the approving decision of the City Manager shall be required to keep any rolling stock out of the Equipment Rental Fund . Where there is merit to covering the operating and maintenance expenditure only on a particular piece of equipment , the Fleet Supervisor shall be empowered to make this decision . If the department head is in disagreement , the appeal shall be made to the City Manager , whose decision shall be binding . Section 9 . If by decision of the City Manager , based on the recommendation of the Fleet Supervisor and/or the department head , a piece of rental equipment is to be sold off and not replaced , the proceeds of sale by virtue of R . C . W . 35 . 21 . 088 and P . M . C . 3 . 68 . 050( 2 ) shall remain in the equipment rental fund . If the Management Committee , on appeal from the - 3 - affected department head , decides that the affected department should • receive sane credit for the replacement finds paid in but not used for replacement , it shall be authorized to recommend an adjustment in the rental rate for the department involved to offset all or some part of the unused replacement money , and this ree mnendati.on shall be subject to the approval of the City Manager . PART III - RULES AND RDGULATIONS : Section 1 . Using departments shall assure that operators of all equipment are fully qualified to operate equipment being used and shall , if necessary , establish appropriate training programs to deal with deficiencies . Any operating deficiencies shall be addressed immediately by the provision of training to make the operating personnel proficient for a particular piece of equipment . lhpl.oyees with a history of rough and improper use of city equipment , shall be identified and dealt with as the merits of the case may require . Using departments shall coordinate proposed training programs with the Fleet Supervisor . Section 2 . No unauthroized use of city equipment , whether during working hours or non- duty hours , shall be permitted . In no case , is any city- owned equipment to be used for private purposes not connected with an assigned official job which is a part of the regular city work program . Furthermore , no city employee is to use or take h(ial city-owned tools or equipment for private purposes . Failure to heed this restriction • will lead to prompt disciplinary measures being taken , including the possibility of dismissal . All using department heads have a responsibility to assure that all personnel are aware of this policy and fully understand the consequences of not adhering to it . Newly hired personnel in particular should be briefed on this policy . Section 3 . The department heads of using departments shall establish a secure system for dealing with keys for city equipment under their supervision . Qtly authorized personnel shall have access to the keys ; employees generally should not carry keys with them off the job for specific pieces of city equipment , unless the nature of their assigned responsibility requires a key to be carried . Department heads have responsibility to see to it that the privilege of carrying keys is not abused and , further , to assure that terminating employees turn in any keys they might have been assigned before the terminated employee gets his/her last pay check . PART IV - MANAGEMENT ADVISORY CObgffT IF : Section 1 . There is hereby created a "Management Advisory Committee " for the Equipment Pool , the membership of which shall comprise the Director of Public Works (who shall serve as Chairman ) ; Director of Finance/Administra- tive Services ; Police Chief ; and the Director of Parks and Recreation . The City Manager shall serve as an ex officio member of the Committee . Meetings shall be held when directed by the City Manager or when called by the Chairman . Minutes shall be kept of meetings and copies thereof • shall go to using departments and to the City Manager . - 4 - Section 2 . The primary duties of the Committee are as follows : ( 1 ) Meet periodically and review and pass judgment on the operation of the Equipment Pool . ( 2 ) Hear and act on any complaint regarding the equipment pool operation by recommendation to the City Manager . ( 3 ) Review cost accounting records and advise departments and City Manager on betterments and replacements . ( 4) Prepare annually , in advance of the preliminary budget preparation , a schedule of recommended equipment rental rates for the ensuing year , for approval of the City ",tanager . ( 5 ) Advise Fleet Supervisor on the "estimated life" schedule on classes or particular pieces of equipment . ( 6 ) Make recommendations on equipment that should not be covered by the Equipment Rental Fluid , with special attention to be devoted to specialized vehicles . ( 7 ) Advise in replacement situations if used vehicles from daily rental agencies offers opportunities for savings . ( 8 ) Review periodically if shop work is being done in an efficient and timely manner by comparing actual work time with standard times • recommended by established and competent sources . ( 9 ) Review periodically the potential for savings by contracting out repair jobs that require special tools and specialized expertise . ( 10 ) Assist in making recommendations for computerization of records for management information purposes . Section 3 . No equipment rental rates shall be effective unless first approved by the City Manager in advance of their implementation . Rental schedules , after having been approved by the City Manager , following action by the Advisory Committee , will be published by the Director of Finance/ Administrative Services and disseminated to using departments . LFK : pt - 5 - MEMORANDUM October 9 , 1985 TO : All Department s FROM : Gary Crutchfield y Xnager SUBJECT : PURCHASES ASSOCIATED WITH EQUIPMENT RENTAL VEHICLES Effective immediately , the following steps will be followed when purchases are made by using departments for parts or accessories associated with vehicles covered under Equipment Rental . 1 . Departments shall use their own LPO books for required purchases . 2 . The account number shall be left blank . 3 . The Department Head shall sign the LPO as the approving official and the employee receiving the service or goods shall sign accordingly . • The vehicle number shall appear on the face of the LPO or it will be returned to the Using Department for such . 4 . The LPO should then be routed to the Equipment Rental Shop . Personnel there will determine whether or not the purchase was a legitimate equipment rental purchase ; if it is , they will assign an appropriate account number and pass it on to the Finance Department ; if it ' s not , the LPO will be returned to the Using Department ( with an explanation ) and will have to be charged against the Using Department . Under no circumstance shall any Department charge anything to an open P . O . established for the Equipment Rental Fund unless specific authority has been granted by Equipment Rental personnel for that one specific purchase . Equipment Rental personnel will contact the vendor and acknowledge that permission has been granted to purchase the given item . GC : ew