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Home My WebLink About2019/11/11 - Briefing Packet BOARD OF MASON COUNTY COMMISSIONERS BRIEFING/SPECIAL MEETING NOTICE 411 North Fifth Street, Shelton WA 98584 Week of November 11, 2019 Monday, November 11, 2019 NO BRIEFINGS DUE TO VETERAN'S DAY HOLIDAY Tuesday, November 12, 2019 Briefing - Commission Chambers 9:30 A.M. Executive Session — RCW 42.30.110 (1)(i) Potential Litigation 9:45 A.M. Support Services Briefing 10:00 A.M. General Fund Vehicle Fleet Recommendation — Public Works/Equipment Rental & Revolving (ER&R) 10:30 A.M. Request for Proposal Recommendation for General Fund Vehicle Fleet— Frank Pinter, Support Services BREAK 1:00 P.M. 2020 Budget Workshop Review of Budget Requests SPECIAL JOINT MEETING 6:00 P.M. Special Joint Meeting with City of Shelton Council 525 West Cota Street, Shelton Thursday, November 14, 2019 Special Briefing - Commission Chambers 1:00 P.M. KMB Architect Criminal Justice Interview Briefing Agendas are subject to change,please contact the Commissioners'office for the most recent version. Last printed 11/08/19 at 11:33 AM If special accommodations are needed,contact the Commissioners'office at ext.419,Shelton#360-427-9670;Belfair #275-4467,Elma#482-5269. MASON COUNTY COMMISSIONER BRIEFING INFORMATION FOR WEEK OF November 12, 2019 In the spirit of public information and inclusion, the attached is a draft of information for Commissioner consideration and discussion at the above briefing. This information is subject to change, additions and/or deletion and is not all inclusive of what will be presented to the Commissioners. Please see draft briefing agenda for schedule. coU�r� 1854 Mason County Support Services Department Budget Management Street 411 North 5 th Commissioner Administration Emergency Management Shelton, WA 98584 Facilities, Parks&Trails 360.427.9670 ext. 419 Human Resources Information Services Labor Relations t. *a Risk Management MASON COUNTY COMMISSIONER BRIEFING ITEMS FROM SUPPORT SERVICES November 12, 2019 • Specific Items for Review o Review of 2019 Budget Amendments -Jennifer Beirele • Commissioner Discussion J:\,DLZ\Briefing Items\2019\2019-11-12.docx MASON COUNTY BRIEFING ITEM SUMMARY FORM TO: BOARD OF MASON COUNTY COMMISSIONERS FROM: Jennifer Beierle DEPARTMENT: Support Services EXT: 532 BRIEFING DATE: November 12, 2019 PREVIOUS BRIEFING DATES: November 4, 2019 If this is a follow-up briefing, please provide only new information INTERNAL REVIEW (please check all that apply): ❑ Budget/Finance ❑ Human Resources ❑ Legal ❑ Other — please explain ITEM: Requests for Supplemental Appropriations and Amendments to the 2019 Budget EXECUTIVE SUMMARY: Requests for 4th quarter supplemental appropriations and amendments to the 2019 budget are attached. This is the last scheduled budget hearing to amend the 2019 budget. BUDGET IMPACT: Total of increase to 2019 authorized expenditure appropriations: General Fund (001): $326,750 Community Support Services (117): $51,125 Community Services Health (150): $67,200 Skokomish Flood Zone (192): $410,000 Landfill (402): $312,500 Total impact to ending fund balances: General Fund (001): Decrease of$120,267 (Cumulative 2019 Decrease to EFB is $721,029) Community Support Services (117): Decrease of $51,125 PUBLIC OUTREACH: RCW 36.40.100 requires the Board to publish notice in the official county newspaper for two consecutive weeks prior to the budget hearing. RECOMMENDED OR REQUESTED ACTION: Request to set a public hearing for December 10th at 9:15 a.m. to consider and approve supplemental budget requests and budget transfers to the 2019 budget. ATTACHMENTS: Proposed 2019 Budget Amendment #4 Detail & Detailed Budget Entries Briefing Summary 11/6/2019 ATTACHMENT A TO RESOLUTION NO. 2019 BUDGET AMENDMENT#4 DETAIL 2019 2019 FUND REVENUE EXPENDITURE LINE NO. FUND NAME DEPARTMENT CHANGE CHANGE DESCRIPTION EMERGENCY New Grants:FY 19 EMPG$35,677,FY 19 SHSP 1 001 GENERAL FUND MANAGEMENT 64,060 64,060 $28,383 EMERGENCY FY 2018 SHSP Grant expenditure. Revenue was 2 001 GENERAL FUND MANAGEMENT 23,124 previously put into the budget. 3 001 GENERAL FUND DISTRICT COURT 7,000 7,000 Increaed UA's ordered by the judge Leaking irrigation system has caused a rise in the cost of water. On track to spend $30k in 4 001 GENERAL FUND PARKS 12,634 2019. IS is planned to be repaired in 2020. Public Disclosure Grant$13,578,Off/On Duty 5 001 GENERAL FUND SHERIFF 135,423 135,423 Patrol Contracts$123,192 Jail Control Panel Maintenance$46,658& 6 J001 JGENERAL FUND SHERIFF 79,509 Hardware$32,851 7 001 GENERAL FUND NON DEPARTMENTAL 5,000 Increased codification costs COMMUNITY Authorized additional funding from Housing 8 117 SUPPORT SERVICES 51,125 Authority Authorized additional funding from Housing 10 150 PERSONAL HEALTH 67,200 67,200 Authority revenue SKOKOMISH FLOOD 9 192 ZONE 410,000 410,000 Mason Conservation District Revenue Higher than budgeted SW fees$270K&LSWFA 11 402 LANDFILL 312,500 312,500 IMP DOE Grant$42.5K GENERAL FUND TOTAL 206,483 326,750 OTHER FUNDS TOTAL 789,700 840,825 ALL FUNDS GRAND TOTAL 996,183 1,167,575 Page 1 of 1 ATTACHMENT B TO RESOLUTION NO. 2019 BUDGET AMENDMENT#4 DETAILED BUDGET ENTRIES Proposed Budgeted Account Type I/D Revenue Expenditure EFB Chane EFB Total Description 001.000000.050.000.333.97.304219.0000.00 2 1 35,677 FY 19 EMPG 001.000000.050.000.333.97.306720.0000.00 2 1 28,383 FY 19 SHSP _ 001.000000.050.000.525.10.535011.0000.00 2 1 35,677 EM PG Equipment 001.000000.050.000.525.10.535021.0000.00 2 1 28,383 SHSP Equipment 001.000000.100.173.342.33.302000.0000.00 2 1 7,000 Urinalysis Fees Collected 001.000000.100.173.523.33.541010.0000.00 2 1 7,000 UA Fees:Sterlin Labs 001.000000.205.265.334.00.330020.0000.00 2 1 13,578 Public Disclosure Grant 001.000000.205.265.521.10.535099.0000.00 2 1 6,273 Trackable Tools&Equipment 001.000000.205.267.521.22.535099.0000.00 2 1 7,305 Trackable Tools&Equipment 001.000000.205.267.342.10.300400.0000.00 2 1 396 Off Duty Patrol-MCFD#6 001.000000.205.267.342.10.300500.0000.00 2 1 602 Off Duty Patrol-USMS 001.000000.205.267.342.10.300700.0000.00 2 1 847 Off Duty Patrol-Lake Trask 001.000000.205.267.521.22.512000.0000.00 2 1 1,845 Overtime 001.000000.205.267.342.10.300610.0000.00 2 1 80,000 On Duty Patrols 001.000000.205.267.521.22.535099.0000.00 2 1 80,000 Trackable Tools&Equipment 001.000000.205.267.342.10.300620.0000.00 2 1 40,000 On Duty Patrols 001.000000.205.267.521.22.535099.0000.00 2 1 40,000 Trackable Tools&Equipment 001.000000.320.000.508.80.500000.0000.00 1 D 120,267 5,065,690 Ending Fund Balance 001.000000.050.000.525.10.535021.0000.00 1 1 23,124 SHSP Equipment 001.000000.146.000.576.80.547020.0000.00 1 1 12,634 Water Service 001.000000.205.270.523.60.548010.0000.00 1 1 46,658 Re airs&Maintenance 001.000000.205.270.594.60.564010.0000.00 1 1 32,851 Trackable Tools&Equipment 001.000000.300.000.511.30.541010.0000.00 1 1 5,000 Codification 117.000000.000.000.508.10.500000.0000.00 1 D " 51,125 52,281 Ending Fund Balance 117.000000.000.000.565.40.541000.0000.00 1 I 51,125 Housing Authority Contract 150.000000.200.000.331.06.383800.0000.00 2 1 67,200 Unbud eted Revenue 150.000000.200.000.562.20.531020.0000.00 2 1 5,700 Su lies for Opiod Program 150.000000.200.000.562.20.532010.0000.00 2 1 T 2,000 Fuel for Opiod Program 150.000000.200.000.562.20.541010.0000.00 2_ 1 25,000 Professional Services for Opiod 150.000000.200.000.562.20.541020.0000.00 2 1 17,000 Advertisingfor Opiod 150.000000.200.000.562.20.543010.0000.00 2 1 2,500 Travel for Opiod 150.000000.200.000.562.20.549020.0000.00 2 1 9,000 Printing for Opiod Program 150.000000.200.000.562.20.549040.0000.00 2 1 6,000 Registrations for Opiod 192.000000.000.000.337.00.300000.0000.00 2 1 410,000 Mason Conservation District 192.000000.000.000.554.90.541091.0000.00 2 1 410,000 Professional Services 402.000000.000.000.334.70.300000.0000.00 2 1 270,000 Garbage/SW Fees 402.000000.000.000.334.03.310005.0000.00 2 1 42,500 LSWFA IMP DOE Grant 402.000000.000.000.537.80.547040.0000.00 2 1 225,000 Lon aul Solid Waste Disposal 402.000000.000.000.537.80.545020.0000.00 2 1 45,000 Rentals&Leases-Roll Off 402.000000.000.000.537.80.547030.0000.00 2 1 8,000 Misc.Disposal Leachate,Tires,etc.) 402.000000.000.000.537.81.541010.0000.00 2 1 12,000 HHW Disposal 402.000000.000.000.537.80.531030.0000.00 2 1 3,500 Operating Supplies 402.000000.000.000.537.80.532010.0000.00 2 1 4,000 Fuel 402.000000.000.000.537.10.541513.0000.00 2 I 15,000 State Excise Tax General Fund Total: 206,483 326,750 120,267 Other Funds Total: 789,700 840,825 51,125 All Funds Grand Total:'9w _ -' 996,183 ,167,575 171,392 Page 1 of 1 MASON COUNTY PUBLIC WORKS—COMMISSIONER BRIEFING NOVEMBER 12,2019 Briefing Items Discussion Items • ER&R Fleet Management Options Commissioner Follow-Up Items Upcoming Calendar/Action Items Attendees: Commissioners: Public Works: Other Dept. Staff.: Public: _Randy Neatherlin _Diane Sheesley _Kevin Shutty _Loretta Swanson Sharon Trask _Others:(List below) MASON COUNTY BRIEFING ITEM SUMMARY FORM TO: BOARD OF MASON COUNTY COMMISSIONERS FROM: Loretta Swanson, Director Diane Sheesley, PE, County Engineer C ndi Ticknor Road 0 s/ER&R Manager Merrilee Kenyon, Finance Manager DEPARTMENT: Public Works EXT: 450 BRIEFING DATE: November 12, 2019 PREVIOUS BRIEFING DATES: INTERNAL REVIEW (please check all that apply): -/ Budget/Finance ❑ Human Resources ❑ Legal ❑ Other ITEM: General Fund Fleet Management Options EXECUTIVE SUMMARY: The Board of County Commissioners is seeking ways to update and manage the Sheriff's Office pursuit vehicles and General Fund vehicles within a limited budget. A Request for Proposals from private vendors was issued, seeking an alternative to ER&R fleet management. This briefing is to present Public Works' comparison of the two fleet management options, and to share options for achieving Commissioner and departmental objectives within the ER&R program. BACKGROUND For many years Mason County has looked for ways to reduce the cost of fleet services, particularly for the General Fund departments. The most recent major actions were to eliminate the collection of replacement funds and budget new purchases on an annual basis, and the lease/purchase of Sheriff Department vehicles outside ER&R. Over the past two years a review of ER&R fleet management practices was undertaken to see if additional cost savings could be realized. As part of that review four options were identified for managing the General Fund fleet: 1. ER&R Fleet Management 2. Current expense fleet managed by Current expense 3. ER&R management report to BoCC 4. Private vendor management of Current Expense fleet Options 2 and 3 were eliminated due to the need to utilize current expense cash reserves to pay for vehicle replacements and the addition of 1-3 new FTEs to perform duties currently carried out by ER&R personnel. Option 4 was further explored by issuing an RFP during October 2019 which received one response. This RFP allows a comparison to be made between the current ER&R fleet management model (option 1) and privatizing fleet management (option 4). Page 1 of 3 BOTTOM LINE UP FRONT A comparison of ER&R and Private Vendor management reveals that it is more cost-effective to utilize ER&R. Savings can be accounted for in two ways: Vehicle acquisition and fleet management. It should also be noted that privatizing would shift ER&R cost allocations and increase costs to Roads and Utilities. 1. Vehicle Acquisition There is a cost savings of approximately$545,000 to$660,000 using current ER&R purchase practices versus purchasing vehicles through the lease proposal received. It should be noted that it is $115,000 less to purchase vehicles on State contract than to lease for 4 years and return at the end of the term. 2. Fleet Management ER&R fleet management is also less expensive for current expense than privatizing. Utilizing outside credit and fleet management services come with an estimated price tag of $23,000—$47,000 per year (Attachment 1) or more than the current ER&R fleet management program. "Or more" for the following reasons: ■ The comparison assumes no change to the current ER&R fleet management program. If fleet modernization and other identified changes occur there will be greater savings realized. • ER&R fuel savings are not included. It appears ER&R fuel is $0.25/gallon cheaper. ■ The comparison does not include the cost of maintenance outside of the manufacturer's recommended services. Assuming the pursuit vehicles are replaced at 5 year intervals or 100,000 miles and the remaining fleet is not replaced for 10 years or between 75,000-100,000 miles, it is reasonable to expect that tires, brakes, windshields, etc. are not covered as maintenance in the proposal. It is likely ER&R costs are below any contracted prices with a leasing company due to contracts ER&R holds with the state and outside vendors. 3. ER&R Cost Allocation ER&R fleet management is less expensive for roads and utilities if no vehicles at Mason County are privatized. The benefits of a "pooled" fund expand with the number of users. Industry best practices are to ensure that all vehicles are owned and managed by one central organization, unless replacement by ER&R is not necessary and the number of units is relatively small. Roads, Utilities and General Fund have already experienced a financial impact due to a reduction in the pool -the purchase and leasing of Sheriff's vehicles outside ER&R. Privatizing and removing the remaining current expense fleet will shift costs to roads an additional —$236,400 per year, and utilities an additional —$34,300 per year (Attachment 2). Additional measures can be considered to reduce overall costs. (Attachment 3) Page 2 of 3 i THE HURDLE — ACQUIRING/MODERNIZING FLEET Privatizing provides a means to acquire new Sheriff Department pursuit vehicles through a lease program, modernize the current expense fleet, re-establish a paced replacement schedule, and provide useful reporting aimed at cost containment or reduction, but it will cost the county more. The private vendor offers a lease program that acquires 54 new vehicles for the Sheriff's office and General Fund departments at a cost of— $2,136,000. The estimated ER&R one-time cost to acquire 54 vehicles is — $1,500,000. How can the county accomplish fleet acquisition/modernization utilizing ER&R fleet management? Interfund loan, loan through County's lending institution, adding replacement back into ER&R, and a levy shift were identified as alternatives to leasing. The most viable appears to be a levy shift. Levy Shift Option Year 1 $500,000 ($200,000 one-time reconciliation + $300,000 levy shift) Year 2 $600,000 ($300,000 General Fund + $300,000 levy shift) Year 3 $400,000 ($300,000 General Fund + $100,000 levy shift) $1,500,000 The General Fund contribution is less than what would have been used for privatizing, which was slightly over$300,000 per year and either option requires up-fitting costs to be covered as pursuit vehicles are replaced. This option does not acquire all vehicles in Year 1, as leasing with a private vendor would. There will be another hurdle in out years unless replacement is collected. If a levy shift or loan option is selected, it is recommended to set aside an additional $250,000—$300,000 per year, depending on when initiated. RECOMMENDED OR REQUESTED ACTION: No action. Briefing is for informational purposes. ATTACHMENTS: 1. Cost Comparison between ER&R and Privatized Fleet Management 2. Privatized Fleet Management- Projected Cost Impacts to Roads and Utilities 3. Cost Reduction Menu Options Page 3 of 3 ER&R(incl. mechanics, parts etc. Outside Vendor labor) Estimated Overhead Annual OH Annual OH Current Expense annual charge $ 285,479 $136,000-$160,000 low-high depends on lease term-OH is for 54 new vehicles only,36 additional exist .5 FTE Facilities Maint VI 0 $50,000 Indirects included $25,000 Vehicle Count 90 54 includes all of CE vehicles Cost per vehicle(annual) $3,172 $3907-$4352 low-high depends on lease term-does not include any of the costs below this line Surplus or sale charges included $5,400 Upfit-labor* included $37,500 Upfit-parts* $61,500 $63,750 Downfit included $5,625 Parts none retail Parts Markup** included $29,000 Admin charges for making $125/scheduling total appointments included unknown Insurance self insured full coverage required insurance costs unknown Additional Insurance 0 unknown Reporting*** included 1 $11,000 Maintenance**** 0 1 $1,230.00 Annual savings with ER&R Total $ 346,979 1 $352,500-$376,000 $5,021-$29,021 *assumed split of total upfit of$27,000($10,000 labor each and$17,000 parts each)for 15 vehicles and spreading costs over 4 years based on vendor information **assumed 25%parts markup is standard,parts labor is included in ER&R charge-utilized 2018 data to have 1 complete year ***assumed basic industry standard software setup-initial purchase not included ****Outside Vendor Maintenance Agreement would likely only covers manufacturer recommended services U&W ER&R with Current Expense 54% 9% 9% 7% 20% 100% Solid Waste Ops NBCI Sewer Ops Rustlewood-Sewer Rustlewood-Water Beards Cove Belfair Sewer July 2019 Rate 104,760 63,121 10,540 10,540 8,455 23,164 115,820 Prelim Budget Updated Fixed Cost with reduced Indirect due to change in Expenditures 8/1/2019 Slightly Revised 102,198 61,089 10,198 10,198 8,208 22,458 112,151 U&W ER&R Rate without Current Expense Solid Waste Ops NBCI Sewer Ops Rustlewood-Sewer Rustlewood-Water Beards Cove Belfair Sewer New Rate 116,546 72,000 12,019 12,019 9,674 26,470 132,182 The difference-which will be the additonal rate to each fund: Solid Waste Ops NBCI Sewer Ops Rustlewood-Sewer Rustlewood-Water Beards Cove Belfair Sewer Total 14,348 10,911 1,821 1,821 1,466 4,011 20,031 34,379 Monthly Monthly 2020 Without CE Rate 2020 With CE Rate Roads !!ds 887,619 Fixed 1,285 Fixed 397,846 Direct Cost 397,846 Direct Cost -7,198 Surplus+/-(DC less Sales proceeds) 7,198 Surplus+/-(DC less Sales proceeds) 965,000 Replacement 965,000 Replacement Washdown+/- Washdown+/- -165,078 Fixed Cost&Capital Reconciliation 2015-2018 -165,078 Fixed Cost&Capital Reconciliation 2015-2018 2,078,189 Annual Rate 173,182 1,841,855 Annual Rate 153,488 ER&R ER&R Material and Roads Vehicles Material and Roads Vehicles 0 Replacement? 0 0 Replacement? 0 0 Total 0 Total Utilities Mngmt Utilities Mngmt 70,759 Fixed Fixed 21,308 Direct 21,308 Direct 0 Surplus+/-(DC less Sales proceeds) 0 Surplus+/-(DC less Sales proceeds) 48,000 Replacement 48,000 Replacement -7,884 Fixed Cost&Capital Reconciliation 2015-2018 -7,884 Fixed Cost&Capital Reconciliation 2015-2018 132,182 Annual Rate 11,015 112,151 Annual Rate 9,346 Landfill Landfill 48,261 Fixed Fixed 33,732 Direct 33,732 Direct 0 Surplus+/-(DC less Sales proceeds) 0 Surplus+/-(DC less Sales proceeds) 40,000 Replacement 40,000 Replacement -5,447 Fixed Cost&Capital Reconciliation 2015-2018 -5,447 Fixed Cost&Capital Reconciliation 2015-2018 116,546 Annual Rate 9,712 1 102,198 Annual Rate 8,517 Replacement Fixed/Direct U&W 248,728 88,000 160,728 PW 2,078,189 965,000 1,113,189 Total 2,326,917 1,053,000 1,273,917 Menu Options Explanation Savings Notes Bring currently leased Approx.savings per year for all light duty vehicles combined if leased Sheriffs vehicles rejoined ER&R(approx. Sheriffs vehicles back into 3 Edge lease terminate in June 2020 and approx 8 F150 ExtCab 4X4 $20/month for 128 vehicles).Breakeven point for County is about 9 years to pay for purchase of 11 vehicles(but they ER&R terminate in lune 2021 $30,700 need to be purchased or leased regardless when lease is up) Cost savings between upfit costs of 15 patrol vehicles over 1 year between Difference between outside vendor and ER&R times 1S new pursuit vehicles. Additional upfits would have additional outside pricing and internal pricing. Labor for installation with ER&R savings.More savings as additional sheriff vehicles replaced for comparison sake RFP asked for IS vehicles,Sheriff long Upfiit Costs accounted for within ER&R monthly rates $159,000 term plan is 40 Reference purchase comparison tab,using State Contract and/or Ex.Dodge Charger AWD complete with upfit$41,000 on Lewis County Contract is a savings of$132,606 cheaper than Other vehicle options piggybacking on other local agencies $551,600 state contract with MC ER&R upfit or$551,648 cheaper than purchase through enterprise with upfit Additional collection of fuel surcharge(change from 6%to 10%). Based on $278,027 in fuel charges through 9/19 projected 2020 fuel$370,702.4%additional increase to cover OH costs assures historical data from 2013 to 2019 10%is needed to cover testing and all users of the fuel station are paying for the OH associated and the needed funds for fuel station are not funded by Fuel Station maintenance costs for the fuel stations. $14,900 ER&R general fund,but through a separate line item. Increase in Interlocai Costs based on 2020 prelim budget numbers and ILA cost increase from$71/hr letters will be able to go to interlocals in November 2019 to start new Increase of$14/hour for work orders for ILA's.This revenue would be split among all participants in ER&R.Based on to$85/hr rates in 2020 $10,700 2019 proejcted 1020 hours(765 ILA work order hours through 9/19) Reduction in accounting includes not charging outside expenses through ER&R such as fuel not purchased through ER&R such as Chevron cards for Sheriffs office,Chipseal Oil that is utilized in the same year by Roads etc.Yearly Staff shift from ER&R to Road Shift 0.2 FTE finanacial analyst III to Road fund,reduce 0.05 FTE reconcilliation wouldbegin and process improvements would be reviewed annually with reconcilliation.Time to ER&R Fund Administrator to Roads $24,500.00 would be tracked and revised each year with budget vs.an estimated average per position Eliminate 0.5 FTE shop assistant,shift 0.2 FTE financial analyist III to Roads, Services offered internally are not offered through interlocal agreement so mechanic needs may remain the same by Staff shift from ER&R to Road shift 0.15 FTE Administrator to Roads,shift 0.15 FTE supervisor to Roads, providing better service to ILAs,but other areas could be reduced. Services not offered to ILA's include purchasing, Fund with leasing shift 0.15 FTE Manager to Roads $100,700.00 surplusing,wash rack,title,insurance,handling collision/insurance reimbursement etc. Hourly rates would be too cumbersome in accounting and reconcilliation. May lead to audit findings or one fund benefitting another. The rate for all internal funds needs to be set the same. Grays Harbor leases vehicles and also Lease vehicles and have All vehicles would need to pay the ER&R rate to be serviced at ER&R so services them and at the full ER&R rate the same as purchased vehicles,this would really be the only viable option we vehicles serviced at ER&R one fund is not benefiting another -$295,000.00 could think of. Total savings if recommended options 1,3,4,5,and 6 are selected $632,400 Upfit charges reduced under options 3 and 4 are also accounted for under annual cost differential