ADMINISTRATIVE REPORT
MEETING DATE: June 25, 2025 AGENDA CATEGORY: Consent - Miscellaneous TO: Honorable Mayor and City Council
FROM: Zachary Meyer, Public Works Director
DATE: May 30, 2025
SUBJECT: Appropriate $2, 500,000 Equipment Fund Balance to the Public Works Department’s operating budget
within the Equipment Management Fund
RECOMMENDATION:
Staff recommends approval of the appropriation.
BACKGROUND:
An appropriation of $2,500,000 is needed to cover increases in several expenditure line items incurred for the City’s Fleet expenses for the current Fiscal Year (FY). The budget shortfall can be contributed to several factors including increased costs for repair and maintenance, parts, and fuel. As Fleet continues to address the budget shortfall, these funds are necessary to maintain the quality and impact of our services. Despite our efforts to operate efficiently within our current budget, the need for additional resources has become essential to meet our objectives.
$2,000,000 – Repair & Maintenance and Outside Services: Staffing levels within the Fleet Division h ave recently improved, but vacancies continue to be high with high turnover. Fleet continues to rely on outsourced support to repair and maintain vehicles. Even though the majority of these contracted services were competitively bid, the cost for outsourced services reflect the industry’s high costs of doing business.
As the Fleet Division fills remaining mechanic vacancies, outsourced repair and maintenance may decrease slightly. Therefore, there are some offsetting costs between personnel and operations. An additional appropriation is needed to cover these additional expenses.
$500,000 Fuel and Equipment Parts: An unexpected increase in fuel costs have led to a shortfall for FY 2025-26 budget and additional funds are needed in the fuel line item to cover the gap. Fleet continues to see impacts on the cost of parts and materials due to supply chain issues and a very competitive industry.
An additional appropriation is needed to cover these additional expenses.
FISCAL IMPACT:
This appropriation is offset by internal rental revenue charged to various departments based on actual costs incurred to repair, maintain, and operate fleet equipment. The equipment fund balance has sufficient funding to cover this appropriation.
COUNCIL GOAL:
Innovative and Efficient City Government
ATTACHMENTS:
None