Audits target fleet policies
reimbursements from workers may net $1.2 million; cutting vehicles could save $3 million, reports say
A series of audit reports suggest that Austin could earn $1.2 million a year by pressing for reimbursement from city employees — a few of whom commute more than 100 miles a day in city vehicles — and could winnow its city fleet by as much as two-thirds, saving $3 million.
The reports, released in May to little fanfare, indicate gaps in oversight regarding which city vehicles are allowed to be taken home and in the reimbursement by city employees who commute in the vehicles; insufficient standards for deciding which vehicles are underused and should be eliminated from the fleet; and the unlikelihood of the city meeting its main environmental goal for the fleet.
Though the issues cut across city departments, many of them lie in the bailiwick of Fleet Services, a city department with eight service centers, 169 employees and a $39 million budget to oversee the life cycle of a 5,400-vehicle fleet ranging from riding lawn mowers to firetrucks and back hoes.
The audit examinations grew out of a 2009 city risk analysis on fuel costs, City Auditor Kenneth Mory said. They add to the burden of Fleet Services, which has had to face reports, first in the Austin Chronicle in December, about problems with its disposal of scrap tires. At least one Fleet Services officer was fired, police and environmental officials launched investigations, and the department
Continued from A1 tightened its protocol. The department is also expecting, in several weeks, the results of an outside report on its operations, Fleet Services officer Gerry Calk said.
“It’s a very big, complex operation,” he said. “There are going to be potholes in the road. That’s the nature of business.”
An audit on the city’s take-home vehicle policy, which allows city employees to drive home vehicles for strategic and practical reasons, offered a mixed message. The audit report noted a 42 percent decrease in take-home vehicles assigned by departments since 2008, from 538 to 313. The take-home vehicle policy, common in cities across the country, is meant to benefit the city by making vehicles available to employees who require them for rapid response or because it’s a cost-effective situation for the city, said Samantha Park, a city spokeswoman.
“Say you have a city inspector who lives up north and does work up north,” she said. “The city can gain an extra hour of employment from him if he does not have to drive (downtown) to pick up a vehicle.”
But it also found that some employees with the Austin Police Department who have take-home vehicles have commutes of 144, 118 and 110 miles a day. City rules prohibit police employees from taking a vehicle home if their residence is more than 25 miles outside the city limits. (Employees with other city departments must live in the “city service area” to qualify for take-home vehicles.)
Total commuting miles in city vehicles during 2009 and 2010 amounted to 10,600 miles per day in take-home vehicles, or 2.4 million miles per year, according to the audit. If employees were to reimburse the city for these miles at 50 cents per mile, roughly the amount prescribed by the IRS for reimbursement, the city would take in $1.2 million.
The issue has led to trouble with the federal government. An IRS audit in 2009 found that for 2006, the city provided a taxable fringe benefit to employees when it did not require them to reimburse the city for commuting miles. As a result, the city was assessed $20,000 in taxes for commuting mileage not reported.
The city manager’s office, in a response to the city audit, noted that it is implementing a new policy that will treat take-home vehicles as a fringe benefit to be taxed.
The auditor found no evidence the vehicles were actually being used for nonbusiness purposes, but did report that some city employees who live out- Fleet Services has 169 employees at its eight service centers in Austin, including Ernest Lopez, 40. At Service Center No. 6, Lopez is checking the fluids on one of Austin’s firetrucks. All fire rescue vehicles and EMS vehicles undergo a thorough check at least once a year. Austin’s fleet comprises 5,400 vehicles, ranging from riding lawn mowers to back hoes and police cars. side the city service area had been assigned take-home vehicles.
Fleet Services could also tighten the standards to determine which vehicles should remain in the fleet, according to another audit issued in May. The city is meant to eliminate or transfer underused or unnecessary vehicles, and fleet services is supposed to identify them.
“Selling the vehicles can yield salvage value, and redeploying them to departments with needs could reduce or eliminate the need for new vehicles,” the audit report says. “In addition, fewer vehicles in the fleet could reduce fuel and maintenance costs as well as total carbon emissions.”
Under city policy, vehicles must be driven fewer than 2,400 miles a year to qualify for elimination. The auditor’s office found that other city and state governments had much higher thresholds. The State of Texas and the University of Texas System, for example, require that a vehicle log 11,000 miles a year or face elimination.
At a minimum of 11,000 miles, 66.8 percent of Fleet Services’ light-duty vehicles would be considered underused, possibly saving the city about $3 million if they were eliminated. (In its written response to the audit, city management said Texas and the UT System represent larger geographic areas than Austin.)
Even those vehicles that are identified as underused are often not eliminated, however.
The audit found that in 2008, the last time Fleet Services did a comprehensive underutilization study of vehicles, it identified 219 underused vehicles. Ultimately, only 11 were removed from the city fleet.
A third audit report questioned whether the city could live up to its aim of having a carbon-neutral fleet by 2020.
In 2007, 8 percent of vehicles were capable of using alternative fuels that cut carbon emissions, which have been linked to global warming. In 2009, 52 percent of city vehicles were capable of using alternative fuel. But only 22 percent of the fuel used that year was alternative.
“The City will not achieve a zero carbon emission fleet,” the report noted.
Nevertheless, Austin has “one of most responsible environmental fleets,” said Calk, noting that it has more hybrids than any other fleet in the country.
He said alternative fuel use has vastly improved this year over last, when the audit was prepared. Last year Fleet Services used about 1,600 gallons a month of alternative fuels; this year that amount is more than 16,000 gallons a month.
He said that last year, city vehicles could not use as much as 20,000 gallons of delivered biodiesel because it was of bad quality, fouling the engines of dozens of vehicles.
The Fleet Services department has faced criticism from the city auditor before. In 2001, auditor Stephen Morgan found excessive turnover in the department’s ranks. He found the “management controls over the quality and cost of service delivery cannot ensure an available, reliable, economical, and environmentally responsible fleet of vehicles.”
A follow-up report in 2004 found improvement, especially with the speed with which Fleet Services addressed emissions problems in city vehicles. But the department continues to be “stretched a little thin,” Calk said.
Since 2001, the fleet has grown about 20 percent, from 4,300 units to 5,400 units. During that same time, the department has slimmed down from 222 positions to 189, a 15 percent loss. Twenty positions are unfilled.