Adopt Ordinance Amending Fiscal Year 2016 Capital Appropriation Ordinance to Reduce the Appropriation in the Vehicle & Equipment Replacement Fund by $275,000.00 to Reflect the Transfer of Vehicles and Equipment from the Stormwater Utility Fund to the General Fund for the Transportation and Public Works Department and Adopt Ordinance Amending Fiscal Year 2016 Operating Appropriation Ordinance to Reflect Reallocation of Pay-As-You-Go Capital Dollars and Increase in Stormwater Utility Fund (ALL COUNCIL DISTRICTS)

It is recommended that the City Council:

1.  Adopt the attached ordinance amending the Fiscal Year 2016 capital appropriation ordinance (Ordinance No. 22004-12-2015) to reduce the appropriation in the Vehicle & Equipment Replacement Fund by $275,000.00, which consists of a reduction in the Transportation & Public Works Project to reflect that certain vehicles and equipment will be acquired within the City from the Stormwater Utility Fund instead of being purchased from outside sources; and

2.  Adopt the attached ordinance amending the Fiscal Year 2016 operating appropriation ordinance (Ordinance No. 21873-09-2015) to reallocate a total of $275,000.00 in Pay-As-You-Go capital dollars for an internal acquisition and to increase the revenues and contribution to fund balance in the Stormwater Utility Fund by the same amount.

The Fleet Division of the Property Management Department is facilitating a transfer of vehicles and equipment from the Stormwater Utility Fund to the General Fund for the Transportation and Public Works Department. This internal acquisition will serve as an alternative to expending budgeted funds on the purchase of new vehicles and equipment.  

The vehicles and equipment are no longer needed by the Stormwater Division and will replace older models that will be turned in for auction by the Streets Division. The FY2016 Capital Improvement Program (CIP) included funding in the Vehicle & Equipment Replacement Fund (VERF) for the Streets Division to replace vehicles and equipment.

The transfer of vehicles and equipment from the Stormwater Utility Fund will result in the cancellation of previously approved Equipment Purchase Requests (EPRs) related to these vehicles and equipment, and a portion of the funds budgeted for new vehicle and equipment purchases will be transferred to the Stormwater Utility Fund.

Adoption of the first ordinance will revise the capital appropriation ordinance that was adopted earlier this year to reduce project totals and lower the amount for external capital outlays. Adoption of the second ordinance will:  (i) reallocate the dollars within the General Fund for the Transportation and Public Works Department to reflect that funds for the internal acquisitions will be transferred to the Stormwater Utility Fund instead of being transferred to the Capital Fund for the external outlay for external vehicle and equipment purchases; and (ii) document the transfer in and increased contribution to the fund balance in the Stormwater Utility Fund. Once these funds have been reclassified for a budgeted transfer, the Chief Financial Officer will be able to effect the transfer of funds in accordance with the authority delegated to him in the FY2016 operating appropriation ordinance.

The amount that is being transferred to the Stormwater Utility Fund is based on the presumptive value of the vehicles and equipment. "Presumptive value" is used to determine value when vehicles and equipment are either too new or unique to use the City's average auction value. The Texas Standard Presumptive Value is a value generated by the State of Texas for tax purposes for vehicles that are not bought through a licensed vendor. Presumptive value is approximately 10 percent lower than Kelly Blue Book for private sale, very good condition. Both are based on year, model, and mileage.

Both divisions have agreed upon the presumptive value of the equipment as a fair value.

The presumptive value of the vehicles and equipment being transferred is:

EQUIPMENT NO.	YEAR	MAKE	MODEL	PRESUMPTIVE VALUE
2620176	2007	Freightliner	Dump Truck	$  30,000.00
2620183	2007	Freightliner	Dump Truck	$  30,000.00
2620184	2007	Freightliner	Dump Truck	$  35,000.00
2060090	2008	Ford	F350	$  20,000.00
2060098	2008	Ford	F550	$  20,000.00
7700052	2008	Caterpillar	Grader	$140,000.00