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<br />WS – Item 2 <br /> <br />WORK SESSION STAFF REPORT <br />Work Session Item 2 <br /> <br /> <br />Date: February 6, 2017 <br /> <br />To: City Council <br /> <br />From: Sarah Cotton, Finance Director & John Swenson, Public Safety Director <br /> <br />Re: Vehicle Replacement <br /> <br /> <br />Background <br /> <br />During the Council Work Session on December 5, 2016 and the December 12, 2016 <br />Council Meeting, staff presented a vehicle replacement policy for Council consideration. <br />Attached to this staff report is Mr. Karlson’s staff report from the December 5, 2016 <br />Work Session, Mrs. Cotton’s staff report from December 12, 2016 and the Police <br />Division vehicle replacement policy as presented on December 12, 2016. <br /> <br />Also during the December 5, 2016 Council Work Session, Council Member Rafferty had <br />learned that some cities are leasing vehicles for use in their police departments. Council <br />directed staff to research leasing programs utilized in other cities. Staff has met with <br />representatives from Enterprise Fleet Management, which is the leasing company <br />working with several agencies. <br /> <br />Staff has provided the representatives from Enterprise Fleet Management with the <br />complete list of all city vehicles, which could potentially be leased through Enterprise <br />Fleet Management. The representatives have reviewed the data and created the attached <br />proposal. Representatives from Enterprise will be at the Work Session to provided <br />further information and answer any questions. <br /> <br />As discussed with Council during the January 3, 2017 Work Session, the Enterprise Fleet <br />Management program is not a traditional vehicle lease program; as the City would retain <br />ownership of all vehicles. The current cost of financing vehicles under the Enterprise <br />Fleet Management program is 400 basis points plus the current 3-year Treasury rate of <br />1.48%, which is equivalent to an interest rate of 5.48%. This rate is fixed at the date of <br />vehicle delivery. <br /> <br />Also attached to this report is the Police Division Vehicle Replacement Policy that was <br />presented to Council at the December 5, 2016, December 12, 2016, and January 3, 2017. <br /> <br />Staff is seeking Council direction on how to proceed with 2017 vehicle replacement. <br /> <br /> <br />