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Page 1 of 3 <br />Item #11 <br /> CITY COUNCIL AGENDA REPORT <br /> <br />March 18, 2025 <br />Public Works - Operations Division <br /> <br />TITLE: APPROVE AN AMENDMENT TO THE PURCHASE ORDER WITH ENTERPRISE <br />FLEET MANAGEMENT TRUST FOR $75,000, INCREASING THE TOTAL NOT- <br />TO-EXCEED PURCHASE ORDER AMOUNT TO $375,000 FOR FY 2024/25 FOR <br />FLEET LEASING, VEHICLE REPLACEMENT, AND COMPLIANCE WITH <br />CALIFORNIA'S ZEV REQUIREMENTS, AND APPROVE A BUDGET <br />ADJUSTMENT OF $14,000 FROM FUND 510 <br /> <br />SUMMARY <br />Over the past five years, vehicle leasing costs have increased due to rising market demand, <br />inflation, and strict emission regulations, impacting the City’s ability to sustain a compliant and <br />operational fleet. The requested amendment to the purchase order is necessitated by <br />increased costs of leasing new and replacement vehicles, particularly as some vehicle leases <br />have expired and the new lease agreements cost more than the previously budgeted amount <br />per vehicle. Staff recommends the City Council approve an amendment to the purchase order <br />with Enterprise Fleet Management Trust for $75,000, increasing the total not-to-exceed <br />purchase order amount to $375,000 for FY 2024/25. <br /> <br />RECOMMENDATION <br />1. Approve an amendment to the purchase order with Enterprise Fleet Management for <br />$75,000 for Fiscal Year 2024/25, increasing the total purchase order amount to <br />$375,000 as needed for fleet leasing, vehicle replacement, and compliance with <br />California's ZEV requirements. <br />2. Approve a budget adjustment of $14,000 in Fund 510, bringing the total FY2024/25 <br />Budget to $375,000 for leased vehicle purchase. <br /> <br /> <br />BACKGROUND <br />The City maintains a fleet of approximately 430 vehicles and equipment to support the <br />operational needs of the organization to support the delivery of programs and services to the <br />community. To balance fiscal responsibility and operational efficiency, the City utilizes a <br />leasing model through Enterprise Fleet Management (FM) Trust for a portion of its fleet. <br />Currently, 46 of the vehicles are under the lease-purchase order. <br /> <br />The California Air Resources Board (CARB) Advanced Clean Fleets (ACF) Regulation <br />mandates that 50 percent of all new municipal fleet purchases as of January 1, 2024, must be <br />zero-emission vehicles (ZEVs), increasing to 100 percent by January 1, 2027; this mandate is <br />applied when developing the City’s vehicle replacement strategies and budgeting. To comply <br />with California’s ZEV mandate and address increasing leasing costs, the City continues <br />transitioning its municipal fleet toward cleaner, more efficient vehicles. Leasing through <br />Enterprise FM Trust is a cost-effective option that avoids substantial upfront expenses <br />associated with direct vehicle purchases. Continuation of the vehicle lease is critical to <br />Page 192 of 348