City and Colorado Springs Utilities agree to pursue negotiation to outsource City Fleet operations
Monday, June 03, 2013
In ongoing efforts of fiscal sustainability, initial conversations about outsourcing Fleet services began last summer following discussions between the City and Utilities aimed at finding opportunities for cost savings while continuing high quality maintenance of essential municipal, public safety, and utility vehicles and equipment. Outsourcing City functions that could potentially be serviced by the private sector has long been discussed by citizen stakeholder groups as the need for funding other critical services and infrastructure continued to grow. Mayor Steve Bach committed to explore any and all outsourcing options upon taking office two years ago, while Utilities has also been researching fleet cost-saving options for some time as a means to increase efficiency and customer value.
In November, 2012 a Request for Proposal was released that requested offers for Fleet maintenance services for all City and City-owned Enterprises (with the exception of Transit which had been previously outsourced in accordance with Federal guidelines). The proposals included five (5) options some with over 4,500 pieces of equipment/vehicles, and ~70 City staff.
A recommendation/selection team that included City/Utilities/City Auditor, and Citizens explored options to outsource jointly, outsource independently, or continue to insource all Fleet operations. The panel was largely comprised of City and Utilities staff involved in fleet maintenance functions, who worked through multiple concerns associated with outsourcing. Technical and finance evaluation teams agreed that cost savings were available with the optimum outsourcing alternative, and recommended a preferred firm with which to enter negotiations.
Three-year financial savings are estimated at ~$2M with ~60% contributed to the City and ~40% to Utilities.
It is anticipated that negotiations will take a minimum of 90 days; and if successful, a contract will be awarded with a start date of January 1, 2014. Initial conversations with the Firm have indicated that there is desire to hire the majority of the City’s Fleet staff.
It is important that our employees know this endeavor was not due to any dissatisfaction with the current level of service provided by this dedicated group of professionals nor was it a decision made lightly. However, our Citizen stakeholders have charged us with securing the greatest value for their tax payer and rate payer dollar while heightening services to our community. This service which can be provided by the private sector immediately lent itself to the exploration of other options for service delivery.
We are most appreciative of our staff’s professionalism and loyalty over the years and will do everything in our power to ensure transition negotiations are fair and representative of their years of service to our City.