We always also have Ray Cruz and introduce yourself here.

Well, I'll go ahead, Chair, if you don't mind.

This is Lisa Jefferson.

She's our assistant director, and she's worked diligently in putting together not only our reorganization but our draft uh budget proposal.

Okay, Lisa Jefferson, we're happy to have you.

If you if you'd be more comfortable, if you want to at um the city attorney's spot, feel free to sit sit up there with them.

You'll have your own mic.

You're good, you're good right there.

Thank you so much.

Okay.

Well, we appreciate all the good work you do keeping our 13,000 plus vehicles and working order.

And um, so we'll let you with that go ahead.

Floor is yours.

All right.

Well, good morning again.

Uh together, our group here will be presenting the department's proposed operating budget for fiscal year 2027.

Next slide, please.

Today's presentation will provide information on the department's alignment with city strategic priorities.

We'll give an overview of our cost-cutting initiatives, and we'll lay out our planned expenses and revenues for each of our department programs.

Next slide, please.

Relative to the city's four strategic priorities, fleet management is primarily aligned with the city's infrastructure strategy.

We provide for the fleet assets and the motor fuel used by all city departments.

We do, however, touch on each of the other priorities for the government that works strategy.

We strive to be as efficient as possible for public safety.

We service all emergency response and public health vehicles and for quality of life.

We support the solid waste health and parks departments as well as the Houston Forensic Science Center and Houston First.

Next slide, please.

Plans to eliminate the gap.

So for fiscal year 27, we're eliminating 26 positions and cutting supply expenses for a savings of 2.4 million dollars.

Almost all these positions are vacant.

Twenty-two reside within our fleet operations program, while the balance, including two executive level positions are within our support group.

Most of the vacancies to be cut are advanced level mechanics.

We just can't fill them, and it doesn't make sense to fund positions we can't fill.

If we're lucky enough to fill these 10 vacancies, we'll create additional positions and fund them within the existing budget using dollars earmarked for contracted services.

Additional cost-cutting initiatives include holding overtime expenses flat despite the scheduled wage increase.

We've completed our department reorganization with 62 personnel actions that included the elimination of 18 administrative and supervisory positions.

These cuts are in addition to those that are shown on the slide.

With regard to contracting, we've got a ratio of 80 vehicles per mechanic if we're able to fill every mechanic position when compared to industry standards of 37 sedans per mechanic or 20 police cars per mechanic.

And then we get down to five to 10 fire trucks, uh trash trucks per mechanic.

It's obviously that we're desperately short of people and uh and that we need to be strategic in how we contract our uh our work.

Our fully burdened internal rate will be approximately 110 dollars an hour.

Our contract service agreements have hourly rates that range from 45 dollars an hour for mower repair to 700 an hour for specialized crane repair.

We're gonna focus our in-house labor on work that is more costly to outsource, and we'll send work out that can be performed by contractors at a lower cost.

We're also looking to reduce our general fund expenses by contracting more enterprise department work.

We plan on contracting total operation of all airport garages and several of the public works garages.

This will allow us to reallocate mechanics from enterprise garages to general fund garages, reducing the need to outsource high cost general fund work.

Another cost-cutting initiative is training.

We lost a great deal of experience this past year through retirements.

Our goal is to expedite the development of our entry and junior level mechanics.

And finally, we plan to transition to paperless garages by issuing tablet PCs to our mechanics.

The tablets will be used to process work orders.

They'll provide mechanics with instant access to repair and diagnostic information, and they'll be capable of translating information for our non-English speaking employees.

Next slide.

Moving to expenditures, all our operating expenses are funded by the Fleet Management Revolving Fund.

In the totals role of the table, you'll see a fiscal year 27 budget request of 113.7 million dollars, which is 2.8% more than current year.

This budget is expected to provide for all labor, supplies, services, and fuel necessary to operate and maintain the city fleet.

Next slide, please.

This table provides a budget history and proposed spending plan for our department programs.

Worth noting is that we've reduced the number of programs from eight to two.

This change in program count was prompted by our department reorganization and discussions with EY.

We just no longer have the staff to keep a programs.

And I'll talk more about the uh programs and their expenses later in the presentation.

Next slide, please.

Here's a breakdown of our expenses by category.

The pie graph on the left shows that 31% of our budget will cover labor costs, while 69% will be spent on services and supplies.

The pie graph on the right is a breakout of our non-personnel expenses.

We're allocating 28.6 million dollars to fuel, 22 million dollars for parts and tires, and 14 million for outside repair services.

The balance of the non-personnel budget will cover office supplies, software, employee uniforms, and our restricted accounts, which are detailed at the bottom of the slide.

Next slide, please.

Moving to revenue, our revenues come from client departments and are always equal to our expenses.

From this table, you'll see that only our fleet operations program generates revenue.

Expenses of the business support program are billed to client departments as overhead through fleet operations.

So our overhead is included in our hourly rate that I mentioned earlier.

Next slide, please.

Here's a bar graph detailing our revenue sources.

General fund departments provide 76% of our revenue, while 22% comes from enterprise funds, primarily the public works and solid waste departments.

The remaining 2% comes from grants and special revenue funds.

Now, these percentages are obviously going to change as solid waste transitions over to public works.

The new numbers we're looking at once that change is complete will be 48% from enterprise departments and 50% from general fund, and of course, we'll maintain that 2% from grants and special funds.

Next slide, please.

Moving to program descriptions, the fleet operations program is a composite of all our operating functions, included our 24 garages, our fuel and parts management groups, and our outside services and fleet share functions.

Our fuel management group is responsible for the inventory and distribution of automotive fuels.

The group also maintains the refueling infrastructure of our 67 fuel stations.

Our parts management staff handles the purchase, inventory, and distribution of spare parts.

Outside services oversees the processing of contracted vehicle and equipment repair work, and the fleet share group manages city motor pool and vehicle GPS systems.

Labor, fuel, spare parts, and contracted services are the primary expenses for the fleet operations program.

The program's proposed budget is 3.4% more than current year, and this increase is primarily the result of inflationary pressure on the costs of spare parts, fuel, and tires, as well as a $2 million increase in the cost of contracted services.

We're seeing cost increases for replacement parts that have been attributed by suppliers to the recent changes in tariffs, and of course, everyone is aware of the recent spike in fuel prices.

Our direct labor costs will be less than last year because of position eliminations, but we do have an almost $1 million increase in the cost of fringe benefits.

The additional $2 million in contracted services comes from more contracted work and higher contracted prices.

Our contractors are seeing the same issues we are, same challenges in finding skilled mechanics.

We recently uh surveyed several of our heavy equipment heavy truck contractors and found that they are now paying their technicians anywhere from 45 to 55 dollars an hour.

And in some cases, they're also earning uh profit sharing.

And so uh as we mentioned, it's becoming more and more difficult to find technicians, and we're seeing that from our contractors in rising rates for contracted services.

Uh talking a little bit about the KPIs.

Uh our KPIs are a work in progress.

We're working with the administration and EY.

This is what we've presented to them uh as a draft, and we're going to work through that under the turning the curve process.

And I'll run through this uh quickly, if if uh if you will.

Uh vehicle availability.

This is a pretty typical KPI for all fleet operations.

And what we're looking at there, if we are able to keep 93% of our critical vehicles available, then our support departments will have plenty of vehicles to run their operation plus some spares left over for any type of emergencies, that sort of thing.

We've been uh pretty good in meeting this KPI.

We did experience some issues earlier in the fiscal year when the service level changed almost overnight at solid waste, and uh, but we've managed to catch up since then, especially with the arrival of the new trucks, and regularly now we're seeing 20 to 30 of the residential trash trucks left over in the yards uh after the pull out.

When it comes to uh preventive maintenance, also a standard uh fleet KPI, uh we're looking to uh for an on-time performance of 90 percent.

Uh, we dropped a little bit this past year, and and there's some some good reasons for that.

One is that uh, if you'll recall at last budget year's presentation, we said we were going to outsource a lot of our light duty PM work to the Valvaleen oil chain stations throughout the city.

We kicked that off, and of course, there were some growing pains as we uh uh educated the client departments on the process of having their employees drive to these locations and uh and having their vehicle serviced.

We seem to have the process down now.

We've uh uh doing much better.

In fact, I think about roughly about 500 preventive maintenance inspections are occurring at Valveline on a monthly basis.

And uh we're happy to say that uh we're on pace to perform a thousand more preventive maintenance operations this year as compared to last year.

Our timing's a little off, but we feel that everything will fall in place this next budget year.

Um, technician villable hours.

Well, as I mentioned previously, we're short staffed, so we have to make sure that our people are as productive as possible.

So in this particular KPI, we're taking a 20 to 80 annual hour per employee.

We're reducing that by vacation, by holidays, and coming up with a uh number for available work hours, and what we're saying is we want 83% of total hours to be billed to a client department.

That way we know our folks are being productive, and we're getting uh every bang we can out of the uh out of the personnel that we've got.

Now, industry standard is 70 percent, but again, this is a new KPI, we're shooting high, and uh, and uh we're gonna see how we fall out, but we feel pretty comfortable that we'll meet the industry standard and uh and do a little better.

Um, fuel station availability, unscheduled interruptions.

Again, we take care of the fuel stations for the entire city, 67 of them.

Uh we want to make sure that our client departments have the fuel when they need it.

Uh, we've done pretty well with that.

Occasionally we'll get interruptions when we lose power to a station, and we do seem to have a continuous problem with people driving off with the hoses still uh attached to the car.

So those are some of the things we deal with.

Um parts management, uh, our inventory accuracy, of course.

We want to maintain good control of our spare parts inventory, and we do regular cycle counts to ensure that uh that we're doing just that and we're pursuing a uh accuracy level of 95%, and we've been pretty good uh through the years.

Fleet share reservation hours, we've got a target of 75,000 hours.

Um, and fleet share uh what we try to accomplish with that is uh we don't have enough capital dollars to go around for every department for vehicle replacements.

So those dollars typically get assigned to uh critical needs, which include uh police department, fire department, solid waste.

So very little, if any, is left over for admin vehicles for for uh um vehicles used in non-essential services.

So we try to gear the departments operating those types of vehicles over to fleet share because what we see in a lot of cases is an admin car will go in and it doesn't get the use that a critical vehicle gets.

6,000 miles is typical, and uh so we'll have a car that sits for 10, 15 years, it really never achieves the replacement threshold and uh and consequently gets a lot of weathering.

So with fleet share, we could be more efficient uh by allowing multiple departments to use the same vehicle.

Now we also use fleet share for emergency cases, and as an example, the fire department recently uh uh desperately needed additional vehicles for their fire inspectors, and so we pulled four vehicles out of fleet share and uh and handed those over to them for uh for their use.

So we'll do that as well because occasionally programs develop mid-year that were not planned for uh at the beginning, and we try to provide for those particular departments through Fleet Share where we can.

Next slide, please.

Our fleet business support program is a composite of our non-operating functions, including the department's executive office, and that's basically Lisa and I, and our asset uh management function.

The uh executive office provides the uh strategic planning, project development, and goal setting for the department.

The office also oversees employee administration, contract administration, training, and quality control for the department.

The asset management group handles vehicle onboarding and disposals as well as vehicle titling and registration.

The group also oversees the administration of our maintenance software system and provides for data collection analysis and performance reporting.

The program's eight and a half million dollar budget covers labor, software costs, and the 5.2 million dollars in interfund charges to fleet management by other city departments.

Expenses for fiscal year 27 are decreasing by 4.1 percent because of position eliminations.

Our non-operating personnel are now only 3.8% of our total workforce.

Um we'll be operating with a ratio of 28 operational employees to every one support employee.

Moving to KPIs, again, this is a work in progress, but uh we've added quite a few new KPIs here.

One of them is our client department satisfaction rating.

We communicate with our client departments daily and in some cases uh hourly, making sure that they have what they need to perform their jobs and they keep us advised of any changes, anything we need to accommodate.

But we want to make it a little more formal and actually provide their executive management with a survey.

Um our hope is that uh if we can really define their needs, then we can be a little more strategic in satisfying them and again uh try to get the best value out of every dollar that we're spending.

Our uh employee training, this is uh this is a big thing for us, as I mentioned.

We're having a very difficult time uh finding advanced level mechanics.

We lost quite a few this past year, and so it's uh it's important that we have a career path for entry-level individuals, junior level mechanics that will get them up to the advanced level as quickly as possible.

Um this is something that that uh that we really don't have any choice on, it's imperative so that we can sustain city operations.

Um contracts.

Contracts we need on time.

It sounds a little mundane uh when you first take a look at it.

Of course, we want 100% there, but uh as I mentioned, we're contracting out a lot more work, so it's imperative that these contracts remain current, and it's imperative that uh these contracts remain focused on the type of equipment that we have.

Um, some of the changes that we've made uh here recently, um, traditionally the city has used, and I'll give an example.

We operate Ford police cars.

So the city would have a contract with one Ford dealer and then send all the police cars to that one Ford dealer.

Well, that doesn't work anymore because we've we've we've got too much work, and that four dealer cannot keep up, and vehicles would uh consequently sit there too long uh waiting for service.

So we have multiple contracts for each type of service so that we can ensure the contractor is able to turn around those vehicles as quickly as possible so that we can get them back into service.

Uh here most recently we just awarded a light duty collision repair, and I think we used five different four different contractors, and one thing this is also doing is giving us an opportunity to uh send work out to small businesses, you know.

Traditionally we've gone after the big dealers, and uh and we think there's some opportunity to get small businesses involved in some of the work that we need to send out.

Um when it comes to capital projects.

This is another one that looks mundane on paper, but uh capital projects really impact our operation and our expenses.

So our goal is to ensure that all the rolling stock or fleet approved projects within the capital improvement plan are uh contracted within the budget year.

And I'll give you an example of of what that does for us.

So everybody's familiar with the uh with the recent arrival of the uh trash trucks, and uh we've taken a look at it and overnight our expenses maintenance expenses went down 250 to 300,000 dollars, right?

So uh when we're maintaining equipment that should have gone out of the fleet a long time ago.

There's an expense to that, and uh and capital dollars helps us to address those situations.

So that's why it's imperative that as soon as that money's awarded and is available, we start issuing POs for the delivery of these vehicles.

And then finally, uh safety.

This is something that we've been working with uh our uh colleagues in human resources and their safety division.

Um we have a safety officer assigned to our department.

She regularly visits our garages, makes assessments of how we're doing in terms of cleanliness, accident prevention, uh hazardous communication, how well we're responding up to uh safety issues, and she provides a grade for us.

So we're formalizing this and uh making it a priority for all of our shop managers.

We want to put uh safety first, make sure everybody's got safety in mind as they process through their work day.

Next slide.

And uh, Chair, if I might, before we open it up, I wanted to again uh uh offer a huge thanks to Ray and Lisa as well as the rest of our staff.

You know, we went through our reorganization and we put this uh budget together, a lot of research, a lot of analysis, and uh and a lot of really difficult decisions that had real impacts on employee lives, and uh uh I'm thankful for our team that stuck with us.

Um we've this budget that we've prepared is we think is extremely lean, but we feel confident that it'll allow us to take care of our uh obligations and and functions.

So, that I'll open it up to questions.

Well, I appreciate that, and I appreciate you, even though you're in desperate need, I'm eliminating some of those um those positions.

I hope you can find those 10.

And um just congratulations on doing a great job with this budget.

I'll go first to Councilmember Martinez.

Thank you, Chair.

Director, um, it seems like you're extremely lean because we don't have some of the resources that we need.

Um, so out of those twenty-six or I guess twenty-three vacant positions, how many are those are are they all mechanics?

I believe that's uh 20, 20 positions are mechanics.

Okay.

Um and what's average pay right now for a city of Houston mechanic?

So our top rate for what we consider our advanced level will be in the neighborhood of $35 an hour uh this this upcoming budget year.

Any and I know this kind of outside of uh your your realm a bit, but any conversations about a program that you know specializes in city of Houston mechanics with you know folks out in the community?

So so we've actually so so two years ago, right now we're just experiencing trouble hiring advanced level.

Okay.

Two years ago, we were experiencing trouble hiring every level.

So we worked with uh human resources and uh we started networking.

So uh we went out to uh HISD, Al Lean, A Leaf, uh Houston Community College, and some of the employment uh veterans uh employment centers and uh and started networking, letting them know hey, we're here, uh you can come in at at an entry level, and we will get you up to the the advanced level with the training program and through experience uh uh that we have.

And so that's actually worked out pretty well for us, and uh and people are seeing that now.

We don't have any problem anymore filling the entry and and junior level.

It's just the advanced level, and again, it really isn't focused just on the city.

This is a nationwide problem.

There was uh uh the president of Ford just recently made a statement saying that that nationwide they're short 5,000 mechanics, and these jobs pay 120 to 160,000 a year.

Wow, and so uh it it it isn't a matter of the city of Houston just falling behind, it's just a natural uh uh national situation, and we're working hard to to try to uh uh attract and build what we can.

Makes sense.

And then my last one, um, when we're looking at if we were to have an FTE, right, a mechanic that at the city of Houston compared to the contracting out, what uh where will we save more money?

Contracting out or we always save in in-house.

And one of the things that, and I had this discussion with the administration.

So we've cut positions, and no doubt, and we don't want to cut positions, but we did with the understanding that we're having a difficult time filling them, but we're gonna keep trying.

So let's say we fill these 10 vacancies that that we're carrying into the next budget year.

We're not gonna stop there.

We're gonna continue to recruit as we get if we can get more people in, we'll take dollars from the contracting side and bring them over to labor so that we can stay within our budget and actually reduce uh expenses.

Well, I guess on on our on our end, whatever we could do to help with you know that recruitment relationships that we have as well, uh, please lean in to us because you know as you mentioned, you know, the as we buy purchase new vehicles, we're still gonna have to maintain them, and so uh if not we'll find ourselves with 10 or 15-year-old vehicles in solid waste what we're not supposed to be doing, right?

So um thank you for the presentation.

And again, it's lean, but it's not because it's not by choice really, right?

There's a lack of resources or at least staff that y'all need, so right.

And again, and and I wanna say that that we feel confident that we can take care of our obligations with this budget.

It's just a different way of of doing it, and and if we can find additional people, we'll be able to lower our costs.

Councilmember Ramirez.

Thank you, madam chair.

Thank you, Director, for the presentation.

Just a couple topics I wanted to ask about.

One was you cited timely renewal of contracts to preclude interruption of service and supplies uh looking to make some improvements there, and that's a new KPI.

Um, does this involve the legal department getting contracts approved or is that uh uh something that is handled within your department?

So so we'll put the uh the the uh contract specifications together, we'll uh we'll solicit quotes, and uh, but we do work with the legal department to make sure that of course the uh the uh contract terms that we're using are above board with uh with respect to city standards, and then we'll also work through SPD to uh to formalize and and get the contracts to council for approval.

So does every contract have to be reviewed by legal?

I believe they are.

And do you do you guys track how long that takes for that approval to occur by legal?

So so we've got a a really good relationship with legal and uh and and Martin Buzak, and uh so we have not had any difficulties with that process.

In fact, as I mentioned, we're looking to contract the total operation of garages at the airport and and uh some at public works, and we've already met uh several times with legal just on the front end to uh to make sure that uh uh we're we're pursuing this as efficient as possible.

Great, glad glad to hear that.

Uh so director, let me ask you last November in this committee, we heard a presentation from the controller's office about an audit of the fuel card program for fiscal years twenty-two through twenty-four, and um they outlined uh 11 findings, three they rated as critical.

Can you address uh what progress has been made to address these their findings?

So I think it and and I'm I'm going off of memory here, uh, but I believe most of those findings were closed out before they they issued their report.

Um I will say with uh we have we recently reached an agreement with U.S.

Bank and our Samsara uh GPS systems that uh and legal and hits they were also involved as as well.

And so uh we're kicking off the ability to now locate a vehicle at the uh uh where it's being fueled.

So in other words, if somebody's using a fuel card uh at any given location, we'll be able to verify that vehicle through GPS, and uh that way if there's any any issues there, then uh then we can respond to them.

Okay, well, it looks like they had that capability during those fiscal years because they were able to report that sixty-five percent of the fuel card transactions occurred within three miles of a city-owned uh fuel island.

But let me ask you, can you can you tell us which findings, if any, remain outstanding?

Well, well, one thing, and just going back, the the their assessment of the three miles was based on the invoice.

So they didn't actually put it put it together, it was just where the invoice uh came from.

But uh I think we may have to go back and look because I don't remember each finding in detail, but uh, but as I recall, most of them were closed out before uh before the report was issued.

So in cases uh there was one I know about training.

Uh I believe we've got online training now for fuel card uh uh coordinators, annual training, and so that's closed out.

Uh I'm sorry, I just can't remember each of the uh each of the findings in detail.

But uh, but I do know that uh we work diligently on addressing those.

All right.

Uh thank you.

I'll go back in the queue.

Councilmember Fleckinger.

Thank you.

And I I'll follow up on Julian's comments.

Uh one of the things I found very disconcerning about the fuel card program is that there were sharing of the fuel cards that multiple people would be using the same fuel card.

Is that practice still in place?

Yes, we took a hard look at that and uh and we contacted US bank and and surveyed how uh other customers including the state were operating.

And so um one of the things in particular, if we were to issue fuel cards to to each employee within the departments that uh that are using fuel cards currently, we would issue be issuing, I think it was 15,300 fuel carts.

Uh currently we have a thousand in the field, and so there would be an enormous amount of work associated with increasing that number, monthly reconciliations, and then just the uh just the mere turnover within those departments.

Uh when we looked, we those particular departments we were seeing uh 26 people leaving service on a weekly basis.

So all those changes would have to go in.

We would would constitute a uh uh a pretty uh significant workload.

So uh what we're doing now again is uh working with Sam Serra and uh US bank.

Um one of the things that uh U.S.

bank has told us that uh that they're developing and that may be uh available soon, is that uh our employees would be able to swipe their IDs at the uh fueling location.

So at that point, we would not only verify the vehicle at the particular location, but we would also have the employees ID swipe at the location as well.

So we'd have automated reporting of vehicle, automated reporting of employee, and uh, and we feel that would be uh significant to uh to address what was viewed as a uh uh a risk.

Now now I do also want to mention that uh uh when audit looked at that uh it was it was a two-year investigation, very detailed investigation, and uh and they did not find one incident of fraud.

How could you?

I mean, I've managed fuel card programs in the past, and the report I would get, you know, one card was assigned to one driver, and he had to put in the mileage every time he fueled up.

The bill used to actually already calculate the miles per gallon.

I mean, the way you're doing it now, I I'm sure they didn't find any fraud because you're not able to, you don't have enough information.

Well, we do calculate the miles uh per gallon.

Okay, but but you don't know it's it's not tied to a vehicle, it's not tied to a driver.

There's there's no way to go back and calculate who got the cards are tied to vehicles.

Okay, so that card it can only be used for that one vehicle because that was not a discussion we had when we talked about this before.

Okay.

Let me go back in the queue.

Councilmember Davis.

Thank you, madam chair.

Gary, uh, first of all, thank you for your presentation and uh and the work of your team.

You all have really seemed to have uh a great challenge, but you've figured out ways in order to do it.

I had a couple of uh things I wanted to address was that you're now if I understand it, 26 positions, 26 that need to be filled.

So so we cut 26 positions, most of which were vacancies.

Right.

Right, but we still have we still have existing vacancies that we're going to carry into the budget.

Okay, so could how long have those vacancies been needed over the years?

Is it been so some of them had been vacant almost uh two years?

Okay, I I thought I heard that about prior to right, okay.

And then also in the now if you had to fill those vacancies to bring you up where you would be comfortable with speaking of mechanics and that, what would you need?

Well, we could uh um we looked at at rosters for the last what was it, seven years?

So we went back to 2019, and what we saw is is that we've we've reduced our mechanics staff by sixty-three positions, okay.

And and again, that that wasn't done to simply cut budget, that was done because we just couldn't fill those positions.

That's that hurt, right?

Right, you couldn't fill them.

Right.

Now, and that's due to the competitive uh you know uh jobs offers, what we pay, uh, because I understand we you the cost of salary would be 35 dollars, 35 to 40 of what was the so our advance rate is is about $35 an hour going into next year, and and and I do want to tell the committee that that we did survey other public agencies throughout the state, and uh and what we found was uh only two agencies that paid more than we did, uh or we do, I should say.

Locally it was metro, metro pays, I believe it's two dollars more an hour.

They still struggle with vacancies, yeah.

And uh the other agency was the city of Austin, and uh the city of Austin's paying about, if I if I remember correctly, about five dollars an hour more than what we're paying.

Do looking at our number high level of of things we have to cover in Durham's, uh, one last thing, and I'll be finished.

The loss during retirement, what what did you lose during the retirement window?

So we lost uh I believe it was 43 positions total.

And uh I want to say how many how many mechanics you recall?

Uh 27, I believe it was.

And uh, and and I do want to say a lot of these people were talking about retiring anyway.

A lot of these folks were 30, 40-year uh employees that were nearing the the uh the end of their term with the city, but the uh the retirement incentive did just that, you know.

Of course, it it incentivized them.

So uh so they but we knew they would they would be leaving soon uh regardless.

Yeah, and it's a tall task, it's a tall task when you're trying to stay within the budget and fulfill the places of necessities.

It's it's rough uh in doing that, looking for new recruits and and then at the same time having retirement, so it it's a task.

Great job.

Thank you.

I thank you for for what you do.

Thank you, Madam Chair.

I'm out.

Councilmember Maris.

Thank you, Madam Chair, and just to follow up on this uh audit director.

Um, the other two critical findings were 29% of city vehicles with active fuel cards were actually inactive or listed as sold in the city's asset registry, and then another troubling one 91% of the fuel card statements during the audit period, and we're talking three years, lacked evidence of proper review.

So just to address that last critical finding, what steps have been taken to make sure that these transactions are are undergoing proper review?

Well, no, let me see.

Uh we're we monitor, we got with all the fuel coordinators, their processing their and fuel coordinators.

I'm talking each department has their own fuel card coordinator.

They take the uh invoices, verify that uh their employees and their trucks or uh or vehicles were used for that.

Then they send them over and uh go on yeah, they send over a um they kind of do like the card reconciliation that we do for our city of Houston P cards, so they have to reconcile at the department level, review the invoices, the transaction dates, where they fueled all of that with the statement, send over a checklist to the fleet department saying, hey, we reviewed everything, everything looks good, they have a monthly check checklist just like we do for P cards, sign off on it, send that over to our fuel department coordinator so that we can then verify that they have submitted those monthly checklists each month, then obviously we follow up with them if they haven't done so and do some spot audits as well to ensure that they're doing that.

Is that a new process?

Yes, okay.

Yeah, so it would be helpful.

I think if if you all could report to council the the status of these 11 audit findings, because I think this is kind of a big deal.

Um the budget for that's proposed uh will will uh spend you know 28.6 million dollars on on fuel.

So this is a significant cost to the city, and we want to make sure uh to Councilmember Flickinger's point there's no fraud, and that uh we're using these resources wisely.

So if we could hear back from you guys on that, that'd be great.

Thank you.

Absolutely.

Councilmember Flickinger.

Thank you.

You said one of the biggest issues I've got at the stations is people driving off of the hoses.

Is there any disciplinary action taken with those employees?

We're not sure because that's typically handled by the individual departments, and so we'll report the situation, then it's up to the departments to respond uh with their uh individual employees.

Are you able to make a determination as to who the employee is that drove off with it?

Uh in some cases we have cameras at the uh at the stations, in others we don't.

Shouldn't the fuel card be able to tell you that?

No, because uh fuel cards are not used at our city stations.

Okay.

And so this is the city stations we have the issues with.

Yes, sir.

Okay, so uh how do we track the information on the vehicles at the city stations?

So uh anybody refueling the vehicle will pull the car up, you'll enter the uh car number, the employee ID, and a pin.

What's the last four?

They're social last four of the employees' social and uh and all that information will be uh oh, and the mileage as well, right?

All that will be recorded into the fuel system.

Okay, um you talked about having difficulty hiring mechanics.

I assume pay is the issue.

Uh it's really more availability, so there are not enough mechanics to go around to meet the needs.

Okay.

So this is just essentially a shortage mechanics throughout the market.

Exactly.

Okay.

Severe.

Thank you.

I think you mentioned in your presentation what the hourly rate contract is to contract out the work.

So it's going to range uh at the low end, it's forty-seven dollars an hour for mowers, landscape uh equipment repair at the high end, seven hundred dollars an hour for specialty crane repair, and everything in between.

Right, yes.

And did you say you were going to be having more of the contract work go to the enterprise funds, and then you're gonna take in more uh more of their the personnel that you had servicing the enterprise fund cars to the to our general fund department?

Yes, ma'am.

So so right now we've got a garage at each of the three airports.

We also have, I believe it's seven public works garages on.

So our plan is, and we've been negotiating with with several vendors.

Our plan is to staff each of the three airport garages with contractors.

So we pull our entire staff out of those garages.

Okay, and the contractor will operate them.

We take that staff, and uh one of the big areas where we're short is fire, and uh uh of course police can also use some help so and parks.

So we'll take that staff, redeploy them uh into general fund garages, and uh hopefully displace some of the general fund work that's being sent out for rates that are higher than our interim and the and their airport will be able to absorb that additional cost.

Yes, I've had a conversation with the director.

Right, and public works still does their own fleet.

No, you're handling all the public works, and all the solid waste fleet, okay.

That that change was when.

Uh well before my touch.

That was uh 2011.

Oh, yes, all the way to 2014, okay.

Okay, okay.

Great.

All right.

Any other questions from my colleagues?

Councilmember Davis.

Thank you, madam chair.

Uh, back to that contract.

I'm glad the chair asked that question concerning it.

Did you understand understood you said that was a two million dollar increase of contracts?

Yes.

So a two billion dollar increase in the amount of uh contracted work that we're sending out.

Got it.

And also you talked about the dealers that were most of the cars of Ford or with HBD cars, and you try to stay with the four dealers, but the fact that the work was too they can't always keep up, they couldn't keep up with it.

So you had to go to other dealers in order to meet that requirement.

Yes, sir, which meant the increase of dollars, I'm sure by contractors, because everybody was not charging the same.

Well, actually, actually, we've seen we've seen just the opposite, it's been kind of interesting.

So, so in contracts where we have multiple vendors, yeah, uh, they start competing with each other, right?

So they all won't work if they can handle it, and we decide who gets who gets what work.

Right.

So if we have a particular job that needs to be done, we call each of the contractors, see what their scheduling looks like, and then uh receive estimates, and then we look for the of course the best estimate, and then uh get the vehicle to that location.

Okay, very good.

Okay, thank you.

So since the solid waste vehicles will now be in the enterprise fund, will that will you also contract out that work at those garages or will you keep um not just yet?

Uh one of the things that that we look at what makes the airport relatively easy is they don't have a complex fleet, and a lot of their vehicles are light duty vehicles, uh they do have their share of specialized equipment, but but not in great numbers.

When you get to public works, the range is almost infinite, you know.

So you guys will keep doing those for now.

And those the uh vehicles that cost $700 an hour to outsource belong to public works, okay.

Right.

So we have to be mindful of that.

I think a good mix of contract and internal to uh to and and being strategic about it will keep costs in check.

Okay, great, understood.

Um, we again did not have anyone sign up for uh public comment, but if anyone's in the audience that would like to speak and any other colleagues have questions, I think we are good to go.

Thank you very much for your presentation.

Oh, here we do have someone, a public speaker.

So if y'all could just step aside and let the speaker come up, just please state your name and you'll have three minutes.

Hello, my name is Azul McSwain.

Um, I think this is more so for fleet management, but it sounds like there may be a systems issue in set uh Houston specifically, um thank you.

Houston specifically has a bevy of developers that could fix that issue from the unified dashboards to actually overview of transactions and then also um it sounds like they may have a training problem.

So if you have uh a flow of entry level and no events, why not train up and then you know kind of push the flow of entry level comment over?

Yeah, they I think they did do talk about having that program where they went to U of H and got people trained up.

I think it's just a lack of of enough of them that are to try train to the level that they should be.

And would you please state your name again?

Uh Isaiah McSlane.

Isaiah McSwain?

Okay, great.

Well, thank you very much.

Appreciate it.

Anyone else?

Okay, fleet department, thank you very much for all you do for all of our thirteen thousand plus vehicles.

We appreciate it, and we will take a short break and we will conclude today's workshop with the General Services Department.