BOARD OF SUPERVISORS BUSINESS MEETING ACTION ITEM

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1 Date of Meeting: April 19, 2018 # 9i BOARD OF SUPERVISORS BUSINESS MEETING ACTION ITEM SUBJECT: ELECTION DISTRICT: FINANCE/GOVERNMENT OPERATIONS AND ECONOMIC DEVELOPMENT COMMITTEE REPORT: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Countywide CRITICAL ACTION DATE: At the pleasure of the Board STAFF CONTACTS: Ernest Brown, General Services Andy Bollinger, General Services Cheryl L. Middleton, Finance and Procurement John Sandy, County Administration PURPOSE: The purpose of this item is to present the study results and recommendations pertaining to transitioning the current maintenance and repair services operations for Loudoun County Government s (County, or LCG) light duty vehicle fleet to an outsourced vendor. These services are currently provided by the Loudoun County Public Schools (School Division, or LCPS) at the County-owned Central Vehicle Maintenance (CVM) facility located at Loudoun Center Place off of Sycolin Road. RECOMMENDATIONS: Finance/Government Operations and Economic Development Committee (FGOEDC): At the FGOEDC meeting on April 10, 2018, the FGOEDC recommended (3-0-2: Buffington and Saines absent) that the Board of Supervisors (Board) direct staff to move forward with the first phase of a plan to contract out for the maintenance and repair services for the LCG light duty fleet with its current outside vendor who handles LCG heavy duty vehicle fleet maintenance and repair services, and that these services be delivered at this vendor s current location. The FGOEDC also recommends that the Board direct staff to pursue a long-term implementation plan, or second phase, for its future consideration and approval for co-locating such outsourced services at a site designated for such work at Miller Drive, or another County-owned facility, subject to any future Town of Leesburg land use and future County budget and Capital Improvement Program (CIP) approvals. BACKGROUND: The County s Department of General Services, Division of Fleet Management (DGS) is responsible for the procurement, maintenance, and repair of all vehicles necessary to

2 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 2 support County services including public safety vehicles, fire response vehicles, public works, and a wide variety of other types of vehicles used by County government employees. This responsibility includes ensuring that all preventative and reactive maintenance activities are performed in a timely, cost effective and service efficient manner. Given the public safety and first responder responsibilities of the County, the overarching goal of the maintenance and repair program is to ensure that every vehicle, including emergency response vehicles, is maintained in a manner that meets or exceeds industry and safety standards for vehicle maintenance. Since 1988, LCG has partnered with LCPS for fleet maintenance and repair for light duty vehicles. The County s light duty fleet maintenance is performed by LCPS staff directly or indirectly through its vendors under a fee for service Memorandum of Agreement (MOA) (Attachment 1). Oversight of this agreement and the general management of the CVM operations is provided by a joint Steering Committee consisting of the following individuals from both organizations: LCG General Services Director, LCG General Services Fleet Manager, LCPS Director of Transportation, and LCPS Fleet Manager. This agreement covers all reactive and preventative maintenance activities on a County-owned fleet of more than 1,050 light duty vehicles and other types of equipment. Approximately 600, or 57%, of these vehicles are public safety vehicles. The types of vehicles maintained range from standard passenger sedans to specially equipped police interceptor vehicles for the Sheriff s Office. In addition to the maintenance and repairs currently performed by LCPS staff in-house at the CVM facility, approximately 25-50% of current work is now being outsourced to third party providers due to space and time limitations at the CVM. Maintenance and repair activities performed inhouse are provided within the same facility as the maintenance provided for the LCPS school bus fleet. In 2015, this joint Steering Committee recognized inefficiencies within CVM operations, resulting in part from the continued growth of both the County and LCPS vehicle fleets. Specifically, the size of both fleets have outgrown the existing facility and staffing. The CVM facility bay space capacity to handle the growing fleet is limited, as are the number of service technicians and supporting staff that are required to operate the program. As a result, the Steering Committee evaluated costs for services elements of the operations including labor and parts and other outsourced services required due to the lack of bay capacity and/or the specialized nature of certain tasks. This evaluation s goals included improving efficiency, decreasing down time of vehicles due to service and repairs, and improving readiness of all fleets served by the LCPS managed maintenance operations. Over the course of several months, the Steering Committee identified opportunities to revise the MOA and discover new methods to change operations internally in an effort toward improving readiness. The results and recommendations in each case identified the need to increase the capacity at the current facility, reduce inefficiency, and improve readiness. Though headway was made by the Steering Committee s work in 2015, it became apparent to County staff that further analysis of the service delivery model and alternatives would be

3 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 3 necessary. As a result, a study was commissioned to consider alternative delivery methods for the County light duty fleet to enable conditions in which the desired improvements could be achieved. As mutually agreed upon by the Steering Committee membership, County staff contracted with the firm School Bus Consultants (SBC) to fully evaluate the CVM and light duty vehicle maintenance operations. SBC produced its findings in a report entitled Lightweight Fleet Maintenance and Repair Services Outsourcing Analysis (Attachment 2). DISCUSSION: The SBC Report found that efficiencies may be improved by contracting out the County light duty fleet maintenance and repair services to an outside vendor or multiple vendors. According to SBC, additional efficiencies and savings may be realized by consolidating the maintenance and repair of public safety vehicles with the upfitting operations (e.g., radio, mobile data computer installations) for these same vehicles into one operation served predominantly through a competitively bid outsourced vendor. The SBC Report provides three scenarios for the Board s consideration, which are summarized below: Scenario 1: Outsource using a combination of vendors throughout the region This scenario provides a degree of savings and supports the local economy. However, it is highly likely that additional staffing within the DGS Fleet Management Division would be required to manage the transport of vehicles to a large number of contracted facilities. It is worthy to note that the current process outsources a varying degree of maintenance to outside vendors based on the workload and availability of shop space to perform the required work. This scenario would also significantly increase the contract management effort for DGS staff. Additionally, it requires that public safety, specifically law enforcement vehicles, be maintained commercially without the guarantee of necessary required controls to ensure the secure handling of Security Sensitive equipment. Estimated 10-year costs savings: $390,000 Page 25 of the SBC Report Scenario 2: Outsource primarily using a single vendor at County facilities (Preferred Approach) This scenario provides a degree of savings and supports the local economy. However, it is dependent upon very conservative assumptions and national averages. Staff used this scenario methodology as the baseline for a more in depth assessment using the existing Heavy Fleet Maintenance contractor, First Vehicle. This is the preferred paradigm for the County. The cost savings below are from the SBC Report, using their conservative assumptions. The more indepth assessment is provided later in the report, using actual costs with savings predicted as part of the First Vehicle negotiated maintenance program, which has a 10 year estimated minimum savings of $2,700,000 (see discussion below).

4 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 4 Estimated 10-year costs savings: $437,700 (Factoring out the cost of renovations, improves to a savings of approximately $735,000) Page 26 of the SBC Report Scenario 3: Utilize a combination of LCPS and outsourced services Like the other two scenarios, this scenario provides a degree of savings and supports the local economy. As with Scenario 1, it is likely that additional staffing within the DGS would be required to manage the transport of vehicles to and from the various contracted facilities. This would significantly increase the contract management effort for DGS staff. Additionally, this scenario would require that public safety, specifically law enforcement vehicles, be maintained commercially without the guarantee of necessary required controls to ensure the secure handling of Security Sensitive equipment. It is important to note that the current process outsources a varying degree of maintenance to outside vendors based on the workload and availability of shop space to perform the required work. This scenario outsources the basic oil lube and filter services to quick lube operators in the County. The SBC used the Jiffy Lube price of $34.99 as the cost basis. This excludes the other elements provided by First Vehicle quick service. Finally, since some of the fleet would be maintained under LCPS, DGS would be unable to achieve all of the savings predicted as part of the First Vehicle negotiated maintenance program, which has a 10 year estimated minimum savings of $$2,700,000 (see discussion below). Estimated 10-year costs savings: $1,747,955 Page 27 of the SBC Report For these three scenarios, the SBC report illustrates the potential maintenance and repair cost savings for the County light duty fleet from the status quo. These savings are mostly achieved due to the expected lower contractual rates charged in a fee-for-service structure and less price markups on parts through the third party private vendor, as compared to the current LCPS fleet maintenance operations for light duty vehicles. DGS staff used rates and terms quoted by the current LCG heavy duty fleet maintenance provider as a proxy to confirm the SBC findings. LCG and LCPS staff have discussed the potential consideration of LCPS outsourcing in the future based on a more detailed analysis of their specific light fleet and observing the successes of LCG s efforts. To that end, LCG will ensure that the First Vehicle amended contract can accommodate LCPS light duty fleet in the future. Although SBC firmly believes that there are real opportunities for cost savings for each of the three scenarios, they cautioned that the actual results will vary considerably if the rates received during a Request for Proposal (RFP) process are substantially different from those used in their analysis. Specifically, SBC recommended that in the event Scenario 2 is considered the preferred option by the Board, a more comprehensive review of both the facility and the equipment needed to convert the current warehouse space into a fleet maintenance facility would be required. Staff would perform this analysis, if the Board agrees to direct staff to move toward the second phase of this transition for light duty vehicle maintenance and repair.

5 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 5 As discussed, all light duty vehicle maintenance is currently performed by LCPS personnel located at the CVM facility, or serviced by warranty vendors coordinated through the CVM enterprise. CVM operates under an enterprise agreement between LCPS and the County. All CVM personnel are employed by LCPS. CVM also controls contracts with outside vendors performing repair work that the CVM shop is not equipped to handle. Body work is also sent to outside vendors under contract with LCPS. The CVM also operates fueling locations for both LCG and LCPS with monthly invoicing for all users. Additional considerations relative to Scenario 2 offer supplemental benefits by consolidating the various County light duty fleet operations in a single point of service. Specifically, the County Space Strategy contemplates collocating and consolidating several of the existing fleet services into County-owned facilities from leased facilities. DGS staff believes that savings will be realized by performing emergency vehicle upfitting in-house versus transporting to outside vendors or operating out of leased space. This in-house work would also include the emergency equipment and lighting repairs. The light duty fleet maintenance contractor would also be able to perform warranty work on all vehicles, thus reducing time and expense of outsourcing this work. Warranty work is not currently provided by LCPS. Further, the contractor would be able to provide a set price quick service plan for all vehicles with fewer than 30,000 miles. In addition to the quantified cost savings, the above factors will provide significant efficiencies and cost avoidance to the operation. Phased Approach Staff has developed a phased approach to achieve the desired outcome of space availability for vehicle maintenance operations, cost savings, cost avoidance, and staffing efficiencies. Phase 1. The SBC study conservatively evaluated the light duty fleet maintenance services and utilized national averages and assumptions for management fee costs within the contract. DGS staff worked directly with its existing vendor that performs heavy duty fleet maintenance to develop a more realistic set of price points for the maintenance services. As discussed in an item presented at the March 13, 2018 FGOEDC meeting 1, the County currently contracts with First Vehicle Services Inc. (First Vehicle) for fire apparatus, ambulance and heavy duty vehicle maintenance and repair. This contract can be amended to support light and medium duty vehicle maintenance. The current contract period ends December 31, 2018 with up to four (4) additional one (1) year renewal periods remaining. In Phase 1, subject to the Board s approval, the County will continue to operate under the current MOA for light duty fleet maintenance; however, the vehicles not currently being maintained by the CVM and being outsourced to various vehicle maintenance garages ( overflow vehicles) will be handled by the County s contractor, First Vehicle, at its facility near Arcola. 1 March 13, 2018 FGOEDC Item 10: Award Authority Increase/Fire Apparatus, Ambulance and Heavy Duty Vehicle Maintenance and Repair

6 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 6 If the Board directs staff to move forward regarding implementation of Scenario 2, the first phase would include amending the current heavy duty maintenance contract with First Vehicle to include light duty maintenance for the current overflow not currently being performed by LCPS. This overflow is outsourced to numerous vendors and various locations, contributing to the service inefficiencies previously mentioned. By amending the First Vehicle contract, this would provide consistent quality of service by one vendor, in one location, with set pricing. While there will be cost savings, the primary benefit achieved during Phase 1 will be the County consolidating vehicle transport to one facility for overflow work versus the current model of using multiple outside vendors with different pricing structures, quality of work and locations. Further, the contract amendment with First Vehicle will reduce the hourly rate for preventative maintenance on 154 trailers and medium duty vehicles less than 19,500 gross vehicle weight (GVW) from $99 to the new contracted rate of $72 per hour. This is estimated to save approximately $40,000 annually. As mentioned, all overflow service that cannot be accommodated at the CVM in a timely manner is currently outsourced by LCPS to multiple local vendors. The Phase 1 proposal consolidates all overflow work under the current contract with First Vehicle providing consistent quality of service by one vendor with set pricing. It should be noted that the March 13, 2018 FGOEDC item approved an award authority increase for heavy duty vehicle maintenance, which was required due to several changes over the last year necessitating direct billing to the County from First Vehicle. Specifically, in late spring 2017, LCPS transitioned the fleet management information system, known as FASTER, to a cloud-based solution. This transition created a number of invoice and contract management challenges for the existing heavy equipment maintenance activities. For several years, the County contract for heavy equipment, fire apparatus, trailers, and vehicles over 19,500 GVW was coordinated through the CVM utilizing FASTER. As a result of the FASTER transition, all of these services are now directbilled to the County and are not managed by LCPS staff or programs. LCG has made accommodations to make this work and there are currently no concerns with this process. Direct billing for First Vehicle already exists, so Phase 1 will not create additional administrative burden on the County. Eventually, the goal is to contract out all light duty vehicle services to this same vendor and have the work performed on-site at a County-owned facility (Phase 2). Phase 2. County staff believes that the SBC study was a conservative evaluation of services and employed national averages and assumptions of management fee costs within the contract. Staff worked directly with First Vehicle to develop a more detailed price point using the framework of existing fleet maintenance contracts and to validate the study s findings. Outsourcing provides for this service at a substantially lower cost than currently provided by LCPS at its hourly rates. The First Vehicle contract amendment will also provide a set price for Quick Service and standard preventative maintenance for all vehicles with fewer than 30,000 miles. The detailed comparison is provided in Attachment 3.

7 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 7 The following provides a likely summary of cost savings to the County: The current LCPS rate is $92 per hour compared to the First Vehicle contract rate of $72 per hour, which is equal to a $20 per hour savings once Phase 2 of the Plan is implemented. o This factor alone equates to an estimated $131,100 in annual savings based on an estimated 6,555 hours of LCPS labor used in the SBC Report. (SBC Report used the national average rate for service of $76.90.) Additionally, $101,000 in savings would be achieved by a decrease in vehicle parts markup from 25% by LCPS to 10% by the vendor. The First Vehicle contract does not have management fees. The SBC Report included management fees in their assumption, which is common in many service contracts. As noted in Phase 1, the contract amendment with First Vehicle will reduce the hourly rate for preventative maintenance on 154 trailers and medium duty vehicles less than 19,500 GVW from $99 to the new contracted rate of $72 per hour. As mentioned previously, the above new contracted rate will continue to save approximately $40,000 annually for these 154 vehicles. In summary, these savings combined equate to $272,000 per year excluding any escalators. This equates to a minimum of $2,700,000 in savings over 10 years, excluding any capital renovation and outfitting costs. This is notably different from SBC s estimated savings of approximately $735,000 due to the current negotiated pricing with First Vehicle discussed above. DGS staff believes that Phase 2 will also yield additional efficiencies in that the contractor will be able to perform warranty work on all vehicles, thereby reducing the time and expense for outsourcing to other vendors. Warranty work is not currently provided by CVM at this time. Further, DGS staff ultimately recommends that the light duty vehicle maintenance operations and contractual services be relocated to either 751 Miller Drive or 1002 Sycolin Road in Leesburg. Currently, these properties are owned by the LCG. DGS fleet staff and operations would also be collocated for improved daily management of light duty fleet and especially Public Safety vehicle maintenance, outfitting and purchasing operations. It should be noted that the Miller Drive location is not currently zoned for these types of fleet maintenance operations by the Town of Leesburg. Therefore, any change in use to these current facilities will require a zoning text amendment and a rezoning from the Town of Leesburg. In the interim period, with the FGOEDC and Board s endorsement, LCG would continue to implement Phase 1 of the Outsourcing Plan by operating out of the CVM facility and transporting vehicles that the CVM cannot handle on a daily basis, or the overflow, to the vendor s facility near Arcola. Additionally, County vehicles assigned to operations proximal to the Arcola facility could be taken directly to the First Vehicle facility, providing a time savings to those departments.

8 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 8 As mentioned during the Board endorsed LCG Space Strategy discussion, there are plans to move the public safety fleet support operations from Red Rum Drive in Ashburn to County-owned facilities located in Leesburg when the Red Rum leases expire in FY 2019 or FY Loudoun County Fire and Rescue s Red Rum Drive Radio Shop and Fleet Operations Center are planned to be relocated, resulting in an estimated lease savings of $11,562 per month, or $138,744 per year. The LCSO Special Operations Shop, located in leased space in Ashburn, will also be consolidated resulting in another $18,869 per month lease savings, or $226,428 per year. Consolidating each of these operations into one centralized County-owned facility will streamline daily operations, improve overall service for all departments, and provide approximately $365,172 in estimated annual lease savings. It is important to note that this does not include the cost of capital facility buildout and equipment for this consolidated facility. The preliminary analysis for Phase 2 full implementation as summarized above is provided in Attachment 4. SUMMARY: The recommended completion date for the overall consolidation project is flexible, as is the relocation to the Miller Drive or the Sycolin Road facilities. As mentioned, the Miller Drive and Sycolin Road facilities will require zoning actions taken by the Town of Leesburg and will be subject to future appropriation approvals by the Board with respect to the CIP and DGS operating budgets. Furthermore, if the Sycolin Road site is ultimately selected for this Phase 2 consolidation and not the Miller Drive site, the current LCPS Warehouse will need to be relocated. If the existing CVM facility at Loudoun Center Place is selected, no zoning action will be required by the Town of Leesburg. However under both scenarios, LCPS forfeited space will likely need to be resolved, which may result in a proposed CIP request for the LCPS in the future. As a result, staff does not recommend using the existing CVM facility but rather continue to explore the Sycolin Road and Miller Drive locations as the future site for these services. When the SBC Report was originally commissioned, the concept was to use warehouse space at 1002 Sycolin Road for the fleet maintenance shop. As previously mentioned and as part of the Board-endorsed County Space Strategy, the plan was to relocate the LCSO and Fire-Rescue fleet operations from Red Rum Drive to County-owned facilities when fiscally viable to do so. Upon further evaluation, it was identified that consolidating all of the County fleet-related operations, to include the LCSO and Fire-Rescue sites, at Sycolin Road would create greater efficiencies than the two moves independently. Ideally, either the 1002 Sycolin Road facility, as originally proposed, or the 751 Miller Drive facility would be suitable for the operations. Either of these locations may be renovated for this purpose for approximately $1.2 million. If the conservative annual savings of both the maintenance costs of $272,000 and facility lease savings of $365,172, which totals to an annual savings of $637,172, This amount could pay off the renovation investment within two years. The use of the 751 Miller Drive or the 1002 Sycolin Road facilities for this purpose will require zoning approvals from the Town of Leesburg prior to

9 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 9 execution. Staff is currently exploring options with the Town of Leesburg to determine the feasibility. Costs associated with the rezoning could be funded through the existing Consolidated Shops and Warehouses CIP. LCG staff ultimately recommends combining the outsourcing (Phase 1) and the aligning of complimentary fleet operations into one facility (Phase 2). This will create significant estimated cost savings and efficiencies to the Loudoun County Fleet operations, as well as mutual benefits to both the County and LCPS. Some of the benefits are outlined as follows: LCG benefits This will provide the County with streamlined billing of outsourced maintenance. This move will give both LCG and LCPS the opportunity to better manage their repairs and will provide a reduction in downtime with a decreased work load, along with a uniform fleet of vehicles to maintain. The need for software geared to County budget and Fleet Management will be more manageable. Currently, pulling information from two different systems to establish one report results in increased time spent by both LCPS and LCG. Due to the security sensitivity of law enforcement vehicles and complexity of equipment, outsourced work completed on these vehicles will be performed by highly qualified and certified contract staff with County-approved security and background checks. Outsourcing maintenance services will ensure that all personnel, training, and equipment are current with industry standards and technologies, and without additional expense for the County. Having Red Rum operations and LCG garage under one roof will decrease downtime and make repairs a one stop shop. Having a contractor that is certified to perform warranty work will significantly reduce downtime by eliminating transport time and dealer delays. Having a contractor performing the upfitting of vehicles in one facility will significantly reduce staff time associated with transport. Issues that arise during the process would be resolved quickly. Parts cost and markup will be lower due to the volume the contractor purchases as part of its national service operations.

10 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 10 The County will have direct Point of Service control of shop operations. LCG light duty fleet and Public Safety vehicles will be exclusively serviced at the facility with LCG overseeing daily operations. Outsourcing will allow both LCPS and LCG to set priorities based on their own fleet. The fueling operation will remain with LCPS, including fuel cards and billing to the County. Cost savings associated with contracting is estimated to be approximately $272,000 per year. Lease cost savings for consolidation of LCG fleet services will be approximately $365,000 per year. LCPS benefits This will allow LCPS to direct 100% of their resources to the operation and maintenance of their fleet, especially their school bus fleet and operations. With the complexity of the newer County fleet, specifically the Public Safety vehicles, LCPS will not be required to obtain and maintain certification and training requirements for this equipment. LCPS will be able to adjust work hours to fit their requirements and not LCG s after hours and emergency operation support. LCPS will no longer need to support the County by staffing the Central Garage during times of inclement weather closures for chaining of public safety vehicles and run-ins. The fueling operation will remain with LCPS, including fuel cards and billing to the County. LCPS will gain much needed parking, office and shop space at the County-owned CVM facility. LCPS will no longer be required to manage the outsourcing and associated billing for passthrough services for County vehicles. FISCAL IMPACT: Phase 1 of this initiative will contract out the overflow of LCG light duty vehicles to First Vehicle, who currently handles the LCG heavy duty vehicle maintenance. This will provide some savings in transportation costs since it will occur with only one vendor. Further, the contract amendment with First Vehicle will reduce the hourly rate for preventative maintenance on 154 trailers and medium duty vehicles less than 19,500 GVW from $99 to the new contracted rate of $72 per hour. This is estimated to save approximately $40,000 annually.

11 Item 9i, FGOEDC Report: Outsourcing County Government Light Duty Vehicle Fleet Maintenance and Repair Board of Supervisors Business Meeting April 19, 2018 Page 11 Scenario 2, depicted and recommended within the SBC Report, is the basis for Phase 2 of this initiative, and may yield an estimated annualized direct savings to the County of more than $272,000 per year. Over a 10-year period, this would result in a net savings to the County of approximately $2.7 million, excluding capital improvement costs. The consolidation of compatible fleet services is estimated to result in lease savings of approximately $365,000 per year. Over a 10-year period, this would result in a net cost avoidance to the County of approximately $3.65 million. Combined, the 10-year savings and cost avoidance equals more than $6.35 million. These combined projects under Phase 2 would necessitate a future expenditure of approximately $1.2 million in today s dollars within the CIP to build out the combined facility for a net 10-year benefit of more than $5 million. Additional non-monetized efficiencies will be accrued to the County as a result of these efforts. DRAFT MOTIONS: OR 1. I move the recommendation of the Finance/Government Operations and Economic Development Committee that the Board of Supervisors direct staff to proceed with Phase 1 of the light duty vehicle fleet outsourcing initiative by amending the existing contract with First Vehicle Services, Inc. to handle all overflow light duty vehicles not currently being maintained in-house by the Loudoun County Public Schools operated Central Vehicle Maintenance Facility and authorize the Purchasing Agent to increase the award authority of the existing contract by $250,000 to accommodate for the contract amendment. I further move the recommendation of the Finance/Government Operations and Economic Development Committee that the Board of Supervisors direct staff to pursue Phase 2 as outlined in the April 19, 2018, Board of Supervisors Business Meeting Action Item, for this initiative based upon Scenario 2 of the SBC Report, which would lead to outsourcing the entire County light duty vehicle fleet using the existing County contract with First Vehicle Services, Inc. at a county-owned facility as envisioned by the Board of Supervisors endorsed County Space Strategy and subject to any and all future Board of Supervisors Capital Improvement Program and appropriation approvals and the Town of Leesburg s land use approval process. 2. I move an alternate motion. ATTACHMENTS: LCPS-LCG Memorandum of Agreement with 2007 Amendment 2. Lightweight Fleet Maintenance and Repair Services Outsourcing Analysis, Prepared by SBC, Inc. March 20, Comparison of First Vehicle services and LCPS services 4. DGS Preliminary Analysis for Phase 2

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16 LIGHTWEIGHT FLEET MAINTENANCE AND REPAIR SERVICES OUTSOURCING ANALYSIS Loudoun County Virginia March 20, 2017 Attachment 2

17 March 20, 2017 Mr. Andy Bollinger, Assistant Director Loudoun County Department of General Services 801 Sycolin Rd. Leesburg, VA Dear Mr. Bollinger: School Bus Consultants, LLC (SBC) is pleased to present the following analysis of the outsourcing assessment for the repair and maintenance of the lightweight fleet vehicles for Loudoun County. The results of this study were based on the information and data obtained from onsite interviews with staff members from both Loudoun County and the Loudoun County Public Schools. The success of an analysis of this type necessitates a high level of involvement from staff and is equally dependent on quality data and information. We would again like to take this opportunity to thank county and school division staff who were very willing to respond to our initial and multiple follow-up requests for data and information. SBC looks forward to your thorough review of this document and also looks forward to providing continued assistance as you further consider the recommendations and suggestions for improvement. Please do not hesitate to contact us with any questions, comments or concerns. Sincerely, Philip S. McConnell Project Manager

18 Contents Introduction... 4 Background... 4 Executive Summary... 5 Current Fleet Maintenance and Repair Activities... 5 Baseline Cost Analysis... 5 Marginal Cost Analysis - Outsourced Services... 6 Current Fleet Maintenance and Repair Activities Results Current Fleet Maintenance and Repair Activities Current situation Departmental staffing Conclusions and Implications Cost Model Current Operations Results Cost of service Implications and Conclusions Repair Cost, Rate, & Marginal Cost Analysis Repair Cost Analysis Implications and Conclusions Rate Analysis Implications and Conclusions Marginal Cost Analysis Scenario 1: Outsource using a combination of vendors throughout the region Scenario 2: Outsource primarily using a single vendor at LCV facilities Scenario 3: Utilize a combination of LCPSD and outsourced services Overall Conclusions and Recommendations Appendices Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 3

19 Introduction Located in northern Virginia and with a population of approximately 375,000, Loudoun County VA (LCV) is the third most populous county in the Commonwealth of Virginia. The County s General Services Division, Department of Fleet Management, is responsible for the procurement and maintenance of all vehicles necessary to support county services including public safety vehicles, fire response vehicles, public works, and a wide variety of other types of vehicles utilized by county employees. This responsibility includes ensuring that all preventive and reactive maintenance activities are performed in a cost effective and service efficient manner. Given the public safety and first responder responsibilities of LCV, the overarching goal of the maintenance program is ensuring that every vehicle and especially the emergency response vehicles are maintained in a manner that meets or exceeds industry and safety standards for vehicle maintenance. While the safety of both the vehicle operator and the general public is of paramount importance, as stewards of public funds, the Department of Fleet Management s senior administrators proactivity sought an assessment of the potential for savings from having maintenance and repair services performed under one or more alternative service delivery models. Background In partnership with the Loudoun County Public School Division (LCPSD), maintenance on the LVC lightweight fleet is performed by LCPSD staff under a fee for service agreement. This agreement covers all reactive and preventative maintenance activities on a fleet of over 1,050 vehicles and other types of equipment. The types of vehicles maintained ranges from standard passenger sedans to specially equipped police interceptor vehicles for the Sheriff s department. In addition to the maintenance and repairs performed by LCPSD staff, a sizable percentage of work is currently outsourced to third party providers. Maintenance and repair activities are performed within the same facility for the maintenance of school s yellow bus fleet. While this agreement has been successful in providing services to the County s lightweight fleet, in part due to recent changes in the cost of service, the analysis of the potential cost and service benefit of outsourced services was deemed to be prudent. This necessity is in part due to a recent increase from $65.00 per hour to the current rate of $92.00 per labor hour and concerns over the timeliness of repairs. To assist in this endeavor, the LCV contracted with School Bus Consultants, Inc. (SBC) to analyze potential outsourcing opportunities. The fundamentals of the SBC approach included obtaining a baseline understanding of how service are currently being provided to serve as a comparison against potential alternative models for fleet maintenance and repair services. The key activities of the project included: The development of a cost model based on current fleet maintenance and repairs activities: To fully understand the cost of any operation, all cost inputs were considered including payments for service to the LCPSD, the cost of services provided by local repair facilities, and the full salary and associated labor costs of all LCV Department of Fleet Management employees. Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 4

20 The analysis of the cost of out-sourced services: The process included an analysis of the current cost and repair data across the fleet. The process is based on the research and review of the cost of maintenance and repair of similar vehicles as performed by the private sector service providers. Executive Summary Current Fleet Maintenance and Repair Activities Key Observation: While the current service agreement with the LCPSD has a successful history of providing satisfactory service to the LCV for fleet maintenance and repair, recent changes in the hourly rate and concerns over training requirements have necessitated the investigation of alternative service delivery options. Fleet maintenance and repairs for the light fleet is currently being performed by the LCPSD within a facility co-located on the same site as the department s administrative offices. This proximity enables departmental staff to provide monitoring and oversight to the process including establishing the priority for repair and monitoring the timeliness of the service. Services are being provided at an hourly rate of $92.00 per hour compared to the 2015 rate of $65.00 or an increase of 42 percent. While no attempt was made to evaluate the LCPSD fleet maintenance program beyond obtaining a basic understanding of how services are managed and delivered, one key area of consideration is that although the LCPSD has developed an internal program to advance the skills of its technicians, a more formal and recognized program such as ASE certification is not currently supported. Key conclusions or recommendations: 1. The rate of increase necessitates the evaluation of alternative services delivery methodologies to ensure that services are being provided in the cost-effective manner as possible. 2. Given the complexity of some of the LCV vehicles (e.g., police pursuit vehicles), having a more formalized training program for the more complex repairs of certain types of vehicles should be considered a necessity in the event that the LCPSD remains the primary provider of service. Baseline Cost Analysis Key Observation: Overall cost of service appears reasonable and within the range normally seen within the public-school sector. That being said, the cost of service does appear to be higher than service that may be available in the private sector. On a per vehicle equivalent unit basis, the current cost of service is approximately $1,520 compared to a range of $1,350 to $1,750 as observed within the public-school sector. While the cost of service appears to be reasonable compared against costs typically seen in public school districts, it is above a metric observed within the rental car industry and the private sector. Based on conversations with rental car fleet managers Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 5

21 for the greater Washington D.C. area, the average monthly cost of maintenance and repair for a rental car fleet is approximately $60 to $90 per month per vehicle or $720 to $1,080 per year depending on the type of vehicle and its equipment. These costs are based on their use of multiple vendors throughout the region including local and regional repair facilities and quick oil change stations. Using this methodology, the average cost of service net of the cost of program management and oversight is approximately $125 per month or well above rental car industry costs. While this discussion is not meant to imply that an apples to apples comparison can be made between the fleet maintenance requirements between a rental car fleet and the LCV fleet of vehicles, it does provide value in illustrating the impact on costs that can be garnered from a competitive private sector marketplace. In addition to this discussion, research was performed to understand to the potential rates within the industry for outsourced services. Based on this process we estimated hourly wage rates for common services as follows: General Maintenance: $78.50 per hour to $99.00 for a median rate of $83 per hour. Non contract labor rate: $25.00 per hour to $42.40 for a median rate of $34.20 per hour. Tire and wheel work: $14.00 per hour to $45.00 for a median rate of $ Lube, oil, and filter: $27.00 per hour to $34.99 for a median rate of Lastly, conversations were held with regional fleet managers from First Vehicle Services, a major provider of outsourced fleet maintenance services to municipal fleet operations, and a current provider to the LCV for heavy-duty fleet maintenance requirements. Based on these conversations, First Vehicle provided a very preliminary estimate of $76.90 per labor hour for service performed within a LCV facility. Key conclusions or recommendations: 1. Based on the analysis of rates within the industry, the further examination of the cost of alternative service methodologies is prudent. 2. While the focus of the study was to examine the potential cost benefit of utilizing alternative service providers, SBC believes that it may also be in the best interest of LCV to reevaluate their current fee for service arrangement with the LCPSD to understand if a more favorable agreement can be reached that is mutually beneficial and is competitive with the private sector in terms of cost and timeliness of service. Marginal Cost Analysis - Outsourced Services Key Observation: Whether the LCV remains with the LCPSD or transitions to an alternative service delivery model, alternatives to improve cost performance appear to be feasible. To understand the cost potential of alternative service delivery models, SBC compared the current baseline against the expected costs of providing the identical services under several alternative scenarios. These costs Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 6

22 were extrapolated over a ten-year horizon in order to better understand the long-term impact of each of the alternatives. The analysis was also constructed to carefully consider three primary categories of cost: Avoidable Costs These are costs currently incurred by LCV for services provided by the LCPSD that would be displaceable to one or more private service providers. Unavoidable Costs Those direct costs currently incurred by LCV that would remain regardless of the service delivery model. Chief among these include the management oversight of the contractor(s), fleet assets procurement and management, and other ancillary duties of the LCV Department of Fleet Management. Conversion Costs Those one-time costs that would be incurred as a result of making the transition to contracted services including such items as legal and consulting fees plus unemployment, and facility improvement costs in the event that services are to be provided in a LCV owned fleet maintenance facility. The value of an outsourcing analyses of this type is dependent on the accuracy of the estimated rates for each of the alternative scenarios. It should be understood that given the uniqueness of LCV including the size of its operation and its location, an absolute direct comparison was not readily found. That being said, several methodologies were utilized to provide a reasonable extrapolation as to the cost of service under several different alternative models. As a result of this process, the following alternative scenarios were analyzed for consideration: Scenario 1: Outsource using a combination of vendors throughout the region Scenario description: In lieu of the current situation, all preventative and reactive maintenance would be managed by the LCV Department of Fleet Management and outsourced to local vendors which may include specialty shops and repair garages, dealerships, and quick oil change service stations. Potential cost benefit: Based on a ten-year marginal cost analysis, estimated savings of this model is just under $390,000 or a reduction of 1.7 percent. This financial model represents our most conservative estimate of the potential savings and is based on the following assumptions: a. No change would occur in the number of LCV departmental staff. b. No change in the costs of parts or the amount of services that are currently being outsourced. c. The additional cost for Year 1 includes $61,000 for professional fees to assist with the development of the initial Request for Proposals and legal fee for the development of contracts. Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 7

23 Scenario 2: Outsource primarily using a single vendor at LCV facilities Scenario description: This scenario would be the most similar to the current situation whereby the majority of services would be provided by a single vendor utilizing LCV facilities. Potential cost benefit: Including the estimated cost of renovations of $297,500, the estimated savings over a ten-year period is estimated at just under $437,700 or a 1.9 percent decrease. Savings in this model are derived from a combination of a more favorable rate and a reduction on the current mark-up on parts. Assumptions and considerations for this scenario include: a. No change would occur in the number of LCV departmental staff. b. The cost of parts was reduced by $101,000 due to a change from the current 25 percent mark-up to a 10 percent rate which is consistent with the current First Vehicle contract. c. The hourly rate charged to the LCV was set at the estimated rate of $76.90 d. The cost estimate includes Corporate Administration and Management Fees of $130,500. e. The additional cost for Year 1 includes $61,000 for professional fees to assist with the development of the initial Request for Proposals and legal fee for the development of contracts. The additional considerations for this model includes: a. While a using a marginal cost model has proven to produce accurate results and the underlying assumptions are reasonable, they are assumptions and will change as the result of the procurement process. As an example, in the event that estimated hourly rate is substantially inaccurate and would be in the $80 per hour range, the savings for this model would decrease to just under $205,000 or 0.9 percent. Scenario 3: Utilize a combination of LCPSD and outsourced services Scenario description: For this scenario, the majority of maintenance and repair work would remain with the LCPSD. The preventive maintenance requirements, i.e. basic oil change and fluid inspections would be outsourced to local vendors. Additionally, the current agreement that allows for a mark-up on parts of 25 would be negotiated to 10 percent. Potential cost benefit: It is estimated that the 10-year savings for this model would be approximately $1,747,955 or a reduction of 7.6 percent. Key assumptions include: a. No change would occur in the number of LCV departmental staff. b. The cost of parts was reduced by $101,000 due to a change from the current 25 percent mark-up to a 10 percent rate which is consistent with the current First Vehicle contract. c. The hourly rate charged by the LCPSD was not altered. d. No additional professional fees were included to either renegotiate the current agreement with the LCPSD not with private sector vendors. Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 8

24 The additional considerations for this model includes: a. The key advantage to this scenario is that with a potential renegotiation of the current service agreement with the LCPSD, costs may be able to be reduced without the need for investment on the part of the LCV for facility improvements and equipment. b. Current service processes and procedures would remain and may be potentially less disruptive to the stakeholders of the service c. While the cost of service may be able to reduced, without a change in the training requirements for LCPSD, staff may not have the same level of formal training as can be demanded from private sector providers. The following report sections are designed to present these results in a manner that will support the LCV in their assessment of the opportunities for alternative service delivery for fleet maintenance and repair activities. Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 9

25 Current Fleet Maintenance and Repair Activities To understand the overall financial performance of the lightweight fleet maintenance program for the LCV, it was first necessary to understand how services are currently being managed and the processes for the repair and maintenance of vehicles as provided by the LCPSD. This section begins with brief summary of the repair and maintenance activities as provided by the LCPSD followed by the results of the cost analysis. Results Current Fleet Maintenance and Repair Activities Current situation The LCV s Department of Fleet Management is responsible for the totality of fleet management, procurement, and the oversight of maintenance and repairs activities for a large and diverse fleet of vehicles. Based on diversity of the fleet, units are classified by vehicle complexity and rating. Currently, the repairs and maintenance for the heavy fleet i.e. fire apparatus, and heavy duty trucks and equipment is outsourced to First Vehicle Services with maintenance services for commuter buses outsourced to Veolia Transportation Services. Fleet maintenance and repairs for the light weight fleet is currently being performed by the LCPSD. Services are performed in a facility that is co-located on the same site as the department s administrative offices. This proximity enables departmental staff to provide monitoring and oversight to the process to help establish the priority for repair and to monitor the timeliness of the service. Services are being provided at an hourly rate of $92.00 per hour or an increase of $32.00 over the 2015 rate of $65.00 In addition to the concerns over rising costs, interviews with LCV staff indicate that the timeliness of service has increasingly become a concern as is the lack of more formalized training for the fleet maintenance staff. Currently maintenance services are being tracked and monitored by the LCPSD and LCV using the Fasters fleet maintenance information system. While the system has been useful in the management of the fleet maintenance activities and for data, it is an outdated version and is in the process of being updated. The newer version will be web-based and will provide the LCV with a daily dashboard to more effectively support the monitoring of maintenance services. Departmental staffing LCV staff: The LCV Department of Fleet Management is staffed by six full time employees (FTE) that are responsible for a wide variety of responsibilities to support the function. The responsibilities include the general oversight of the function to ensure that each of the departments have the number and type of vehicles necessary to support their unique function, the coordination of repair services being performed by the LCPS, the oversight of outfitting new cars with emergency equipment, the monitoring of warranty work, and the procurement of new vehicles in conjunction with the sale of obsoleted equipment. Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 10

26 LCPS staff: For the maintenance of the LCV light fleet, the function is staffed by six FTE with coverage from 5:30 AM to 10:00 PM. The function is supervised by a one FTE supervisor. Given the relativity low average age across the fleet of just over 6.5 years with an average mileage of just under 38,000, the majority of maintenance is preventive and the majority of repairs in the areas of brake replacements, and tire and wheel work. Skills training is provided primarily in-house and is supported by a one FTE training specialist. This training includes hands-on or on the floor training and classroom programs. While this process is commendable, more formal training and certifications such as those offered by the National Institute for Automotive Service Excellence (ASE) is not currently required. Interviews with staff indicates that the lack of reimbursement or considerations for additional pay for mechanics that hold ASE certifications may be impacting the mechanics willingness to obtain the additional certifications. Conclusions and Implications While no attempt was made to evaluate the LCPSD fleet maintenance program beyond obtaining a basic understanding of how services are managed and delivered, one key area of consideration is while the LCPSD has developed an internal program to advance the skills of its technicians, a more formal and recognized program such as ASE certification is not currently supported. Given the complexity of some of the LCV vehicles i.e. police pursuit vehicles, having a more formalized training program for the more complex repairs of the vehicles should be considered a necessity in the event that the LCPSD remains the primary provider of service. Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 11

27 Cost Model Current Operations Once an understanding of the current processes and procedures for service were obtained, a review and analysis of cost on the cost and salary data was performed. These analyses included the examination of all maintenance and fleet management expenditures including wages and associated employment costs of LCV staff, and current contracted repair costs. Results Cost of service Based on discussions with departmental staff, the total cost of maintenance for the fleet of 1,031 vehicles in the fleet (as of December 2016) was approximately $2,006,000. Beginning with the 2016 fiscal year, the hourly rate was increased to $92.00 per hour or a substantial increase over the previous rate of $65.00 per hour. This factor along with a mark-up on parts of as much as 25 percent has led the LCV Department of Fleet Management to begin the investigation of alternative service delivery models. To better understand the cost performance of the current maintenance and repair model, several additional analyses were performed. One of the key analyses was to understand the vehicle equivalency of the fleet. A methodology that has been developed to assist managers in determining the correct number of technicians in relation to the number of vehicles in the fleet when this fleet is not homogeneous and to compare the cost of service between different types of vehicles is to utilize vehicle equivalent units or VEUs. A VEU is a standard that allows all fleet work to be measured against a common comparison basis. A standard automobile is 1.0 VEU while heavy duty trucks and other larger vehicles range upwards from 1.0 to as much as 2.0 VEU. While this methodology is most useful in determining the number of technicians that are necessary to effectively support any given number of vehicles, it can also be very useful in determining and comparing the cost of service on a per VEU basis. Using this methodology, it is estimated the fleet has a VEU of approximately 1,320. The following Table 1 summarizes the VEU assigned to vehicle models or types of vehicles most represented. It should be noted that while vehicles such as Dodge Charger or a Crown Victoria would normally be assigned a VEU value of 1.0, given the additional equipment that is installed on the police interceptor models, a value of 1.5 was assigned. Vehicle Description Table 1: VEU Assignment Standard sedans (Impala, Honda Accord, Jeep Compass) 1.0 Pick-up Trucks and Vans 1.5 Police Interceptor Vehicles 1.5 VEU Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 12

28 Using this data and the provided cost data, the average cost per VEU across the fleet is approximately $1,520 per year including the cost of program management and oversight compared to a range of $1,350 to $1,750 as observed in typical fleet maintenance operations for school districts. While the cost of service appears to be reasonable compared against costs typically seen in public school districts, it is above a metric observed with the rental car industry. Based on conversations with rental car fleet managers for the greater Washington D.C. area, the average monthly cost of maintenance and repair for a rental car fleet is approximately $60 to $90 per month per vehicle or $720 to $1,080 per year depending on the type of vehicle or a range of 1.0 to 1.5 VEU per vehicle. Using the methodology, the average cost of service for LCV vehicles (net of the cost of program management and oversight) is approximately $125 per month or well above rental car industry costs. This factor will be discussed in greater detail in the following report sections. The cost of service is summarized in the following Table 2: Table 2: Current Cost of Service Cost Area 2016 Expenses Cost per VEU Average Cost per Month Departmental Salaries and Benefits $463,479 $351 Parts $576,938 $437 $47 Labor $603,024 $457 $49 Sublet $362,522 $274 $30 Total $2,005,964 $1,520 $125 Implications and Conclusions While it appears that compared against the costs of service as observed within the public sector that costs are reasonable, it also appears that there may be an opportunity to reduce costs through either a change in the way services are currently being provided or through the outsourcing of services. The remainder of the sections will further discuss the cost of service and will examine the potential cost benefit of alternative service delivery methodologies. Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 13

29 Repair Cost, Rate, & Marginal Cost Analysis The following describes the methodology utilized by SBC to determine the potential cost benefit of outsourcing of the repair and maintenance of the lightweight fleet. The process begins with the further analysis of the current maintenance program followed by an assessment of potential private sector costs and lastly, several options forecasting the potential over a ten-year planning horizon for cost improvements. Repair Cost Analysis To understand LCPS maintenance and fleet management expenditures SBC reviewed and analyzed current labor cost and repair data. The data that was used in this analysis was provided on 1/17/2017 and contains repairs dating from 7/10/2000 to 1/9/2017. The data was extracted from the fleet management information system, FASTER. The data provided repair and labor information on several vehicle groups and repair types. The vehicle groups included the Ford Crown Victoria, Dodge Charger, Chevy Impala, Chevy Tahoe, 2-wheel drive pickup trucks, and 4-wheel drive pickup trucks. The primary repair types included brake inspections and repairs, State inspections, preventive maintenance inspections and service, and speedometer calibrations. Specific information and data that was performed included vehicle type, date and time of the repair, repair type and parts replaced, and labor time and cost. To establish a comparative baseline of labor cost for the maintenance of the LCPS light fleet, SBC focused on the following three repair types by year to understand the number of repairs performed, total hours spent, average hours spent, total cost, and average cost. Vehicle types have been grouped by make including, Chevy (Impala, Tahoe, Silverado, Malibu, and a small number of others), Ford (Crown Vic, Escape, F Series, Interceptor, Taurus, and a small number of others), and Dodge (Charger, Caravan, Ram Series, and a small number of others). It should be noted that each of the following discussions, that the total between the figures and the tables will vary. The figures illustrate the repairs and service on the majority of vehicles types as grouped above while the cost tables are all inclusive for all repairs and service across the fleet. State Inspections State Inspections have a set price that does not vary based on time spent. The set price from 2000 to 2002 was $10.00, from 2003 to 2005 it was increased to $15.00, and since 2006 it has been $ Note that that Community Bus Service, Dump, and Ford E450 state inspections cost $ The fact that the number of State inspections and total cost is increasing every year matches the increasing fleet size. The following Figure 1 and Table 3 summarizes the number and cost of State Inspections from 2000 to Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 14

30 Figure 1: State Inspections Table 3 State Inspections Year Count Total Hours Avg Hours Total Cost Avg of Cost $ $ $ $ $1, $ $1, $ $2, $ $3, $ $5, $ $7, $ $9, $ $11, $ $12, $ $13, $ $16, $ $19, $ $21, $ $24, $ $25, $ $ $16.00 Grand Total $178, $16.11 Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 15

31 Brake repair Brake repair labor cost are based on an hourly rate. The rate from 2000 to 2001 was $42.00, from 2002 to 2007 it was $43.00, in 2008 it was $54.50, from 2009 to 2015 it was $65.00, and in 2016 it was raised to $ Shown in Figure 3 and Table 3 there was 231 less brake repairs in 2016 than 2015, but Dodge vehicles did see an increase in brake repairs. The average repair time shows an upward trend from 0.75 hours (45 minutes) to 1 hour. The total cost was steadily increasing with the number of brake repairs until In 2015 the total cost was around $5,000 less than 2014 with only 24 less brake repairs due to the average repair time decreasing. Fiscal year 2016 saw another decrease in total cost by around $4,000 due to the 231 less brake repairs. fiscal year 2016 did not see a more drastic decrease in total cost because the cost/hour increase from $65.00 to $ Figure 3 summarizes brake repairs from 2000 to 2017 while the cost of service is illustrated in Table 4: Figure 2: Brake Repairs by Vehicle Make Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 16

32 Table 4: Brake Repair Cost Brakes Year Count Total Hours Avg Hours Total Cost Avg of Cost Cost/Hour $21.00 $21.00 $ $ $33.22 $ $ $34.79 $ $1, $35.01 $ $1, $39.85 $ $1, $42.93 $ $4, $55.60 $ $3, $44.23 $ $8, $47.33 $ $11, $54.62 $ $15, $53.79 $ $21, $56.02 $ $23, $60.01 $ $37, $63.08 $ $44, $60.21 $ $39, $55.38 $ $35, $74.21 $ $ $90.85 $92.00 Grand Total $253, $ Preventative Maintenance Inspections Preventive Maintenance (PM) inspections labor costs are based on an hourly rate. The rate from 2000 to 2001 was $42.00, from 2002 to 2007 it was $43.00, in 2008 it was $54.50, from 2009 to 2015 it was $65.00, and in 2016 it was raised to $ Figure 4 shows that from 2015 to 2016 the number of PM inspections increased for Dodge, but decreased for both Chevy and Ford and overall by 111 less PM inspections. Although there was less PM inspections, the total cost rose by around $23,000 due to the rate going from $65.00 to $92.00 and an increase in average repair time. Figure 3 summarizes PM inspections from 2000 to 2017 with the cost of service illustrated in Table 5: Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 17

33 Figure 3: Number of PM Inspections by Year Table 5: Cost of PM Inspections by Year PM Inspections Year Count Total Hours Avg Hours Total Cost Avg of Cost Cost/Hour $1, $32.43 $ $2, $30.77 $ $3, $32.10 $ $3, $28.77 $ $5, $31.21 $ $9, $39.14 $ $14, $41.55 $ $21, $40.62 $ $32, $40.72 $ $48, $46.41 $ $39, $33.57 $ $53, $37.46 $ $73, $40.91 $ $77, $44.25 $ $86, $46.07 $ $99, $46.44 $ $122, $60.29 $ $2, $70.44 $92.00 Grand Total $698, $ Loudoun County Virginia Outsourcing Analysis for Lightweight Vehicle Maintenance 18