SR 11-27-2018 3H
City Council
Report
City Council Meeting: November 27, 2018
Agenda Item: 3.H
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To: Mayor and City Council
From: Susan Cline, Director, Public Works, Street & Fleet Services
Subject: Extension of Vehicle Rental Services by Enterprise Rent-A-Car
Recommended Action
Staff recommends that the City Council:
1. Authorize an extension of the renewal options to Bid # 4210 to Enterprise Rent-
A-Car, a Missouri-based company, for vehicle rental services for two additional
one-year renewal options to extend at a 3% increase per year plus Vehicle
License Recovery (VLF) fees, through January 11, 2021.
2. Authorize the Purchasing Services Manager to issue a purchase order for the
Police Department with Enterprise Rent-A-Car for vehicle rental service in an
amount not to exceed $229,827 for one year, including an additional $76,013
anticipated overage in the original three-year term, with one additional one-year
renewal option to extend at a 3% price increase plus Vehicle License Recovery
(VLF) fees, for a revised total not to exceed $754,426 over a five year period,
with future year funding contingent on Council budget approval.
3. Authorize the Purchasing Services Manager to issue a purchase order for Fleet
Management with Enterprise Rent-A-Car for vehicle rental service in an amount
not to exceed $133,859 for one year, which includes an anticipated unspent
balance of $54,499 in the original three-year term, with one additional one-year
renewal option to extend at a 3% price increase plus Vehicle License Recovery
(VLF) fees, for a revised total not to exceed $631,157 over a five-year period,
with future year funding contingent on Council budget approval.
Summary
The Police Department regularly utilizes rental vehicles for certain specialized anti-crime
operations. The Fleet Management division utilizes rental vehicles as temporary
replacements for City fleet vehicles that need to be taken out of service for extended
periods for maintenance, repair or replacement. Staff recommends authorizing two
additional one-year renewal options for Bid #4210 with Enterprise Rent-A-Car for
vehicle rental services, for a revised total amount not to exceed $1,385,583 over a five-
year period.
Discussion
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On January 12, 2016, Council awarded Bid #4210 to Enterprise Rent -A-Car to provide
vehicle rental services to Fleet Management and to the Police Department over a three-
year period (Attachment A). The bid will expire in January 2019. When this bid was
conducted, the limit on the number of extension years was set at two. Since then,
purchasing standards were revised to allow for four extension years. Staff is requesting
an extension of the renewal options by an additional two years with Enterprise Rent-A-
Car to continue providing rental car services. The vendor has consistently provided
reliable vehicles to the City. They are able to maintain a high level of customer service
by having several rental locations within the City. On the rare occasion that a requested
vehicle is not available at their primary contract location, they are able to locate one at a
nearby facility. The City has been very satisfied with their ability to provide rental
vehicles over the course of the initial three-year term. The vendor offered a 3% price
increase over the previous year, which is consistent with their pricing model over the
last three years. Their pricing also includes the addition of the Vehicle License
Recovery Fee, which seeks to recover the amount of any vehicle license fee and
vehicle registration fee paid by a rental company for the particular class of vehicle being
rented.
The Santa Monica Police Department has utilized the services of rental car companies
for specialized anti-crime operations during the past 17 years. The vehicles are used on
a daily basis as the primary mode of transportation by certain units and as-needed by
other units. The vehicles are a necessary element of the department’s regular
operations. The original amount of the purchase order for the Police Department was for
an amount not to exceed $366,223 over the course of three years. It is anticipated that
this amount will be exceeded by $76,013 by the end of the original three-year
agreement. This overage amount is being requested along with the additional two years
of funding needed for the term extension.
Fleet Management utilizes rental vehicles if a loaner vehicle is unavailable for staff
when their vehicle has been taken out of service due to long-term maintenance, repair
because of an accident, or if the procurement process for a replacement vehicle is
longer than expected. Fleet Management also uses rental vehicles when a vehicle’s
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compressed natural gas (CNG) fuel tank certification expires. CNG fuel tanks have a
specific and regulated useful life, at the end of which they can no longer be legally
operated and need to be removed from service. The original amount of the purchase
order for the Fleet Management was for an amount not to exceed $413,253 over the
course of three years. It is anticipated that this amount will be underspent by $54,499 by
the end of the original three-year agreement. It is anticipated that the requested amount
of $79,360 in year four will be sufficient when added to the left-over amount of $54,499
for the first year of the two-year term extension.
Estimated cost projections are based on the cost table below:
Current
Amount
Authorized
Projected
Three-Year
Amount
Projected
Over /
(Under)
Requested Year
Four Amount
Requested
Year Five
Amount
Total
Additional
Amount
Requested
Police
Dept $366,223 $442,236 $76,013 $229,827 $158,376 $388,203
Fleet
Mgmt $413,253 $358,754 ($54,499) $79,360 $138,544 $217,904
Based on the average cost per year, the estimated year four and year five amounts
include a 3% increase in each year, along with a 3.5% increase for the addition of the
Vehicle License Recovery Fees. A 5% contingency is also requested to cover the rental
of additional vehicles, if needed.
Past Council Actions
01/12/16 (Attachment A) Original bid and award of agreement with Enterprise
Rent-A-Car for vehicle rental services.
Financial Impacts and Budget Actions
Staff seeks authority to increase the purchase order amount with Enterprise Rent-A-Car
for vehicle rental services.
Purchase Order Modification Request
Agreement # Current Total Modified Request FY 2018-19 Budget Total Revised Purchase
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Authorized
Amount
Amount Dept/CIP Account # Order Amount
21901253 $366,223 $229,827 01180004.525020 $ 754,426
11901941 $413,253 $ 79,360 C7000010.689000 $ 631,157
TOTAL $1,385,583
Future year funding is contingent on Council budget approval.
Prepared By: Ryan Kraemer, Senior Administrative Analyst
Approved
Forwarded to Council
Attachments:
A. January 12, 2016 Staff Report
B. Enterprise Rent-A-Car Oaks Form