San Juan County hears options and cautions on vehicle leasing, finance structures

Kevin Lyman, a local representative for Young Commercial Leasing, told the San Juan County Commission on Sept. 16 that the county can access state‑contract vehicle pricing but must carefully choose financing and lease structures to avoid being “upside down” at lease end. The commission invited Lyman to explain how leasing, purchase and local financing alternatives compare and to answer department‑specific questions.

Why it matters: the county is managing a rolling replacement of many public vehicles — sheriff, road crews and administrative fleets — and commissioners want to preserve budget capacity while avoiding large buyout liabilities when leases end.

Lede details and key points Kevin Lyman explained that government buyers should start with state contract dealers to secure guaranteed government pricing rather than buying through an unknown third party. He described typical government leases as three‑ to five‑year terms, often “open ended in the back end,” meaning the lessor does not always guarantee a residual value. That structure can leave the county with a big buyout if market values fall. Lyman said some leasing companies “capitalize costs up front,” increasing early payments and the chance the county could owe more than a vehicle is worth after a crash or market drop.

Risk and mileage management Commissioners and staff pressed Lyman on mileage and fleet management. Lyman said mileage allowances should be tailored to departments: for example, sheriff vehicles may be set at about 30,000 miles per year, while admin cars may be budgeted at 10,000–15,000 miles. He offered to help manage the county’s fleet at no fee, including monitoring mileage and advising when to swap vehicles between users to avoid high‑mileage penalties.

Financing options and local bank participation Lyman described new options from credit unions and banks (he identified America First and Zions and noted Bancorp and other lenders commonly work with local governments). He said one credit union program the vendor is using allows a lease/purchase for up to seven years with transparent payoff figures after each annual payment. Commissioners asked about supporting local institutions; Lyman said some banks won’t do much government business, but some credit unions and regional banks will participate. He also cautioned that third‑party brokers sometimes “sell the paper” to other lenders, which can add hidden costs.

Leasing versus outright purchase Lyman and commissioners discussed tradeoffs of buying vehicles outright. Buying avoids lease residual risk but creates a long‑term maintenance commitment and requires sufficient capital. Lyman said heavier vehicles and specialized apparatus (police packages, upfit cages, light bars) can depress resale value and should be budgeted or leased with those costs included. He also advised looking for grant funding (for example USDA) for some first responder vehicles where appropriate.

Commission response and next steps Commissioners asked to receive mileage and residual information each time a vehicle financing or buy/lease decision comes before them. County staff agreed to provide fleet usage and resale‑value analysis at decision points so the commission can evaluate whether to buy, lease, or apply for grants. Lyman offered to assist the county with ongoing fleet management and lease review.

Ending No formal action was taken. Commissioners asked staff to return with department‑level mileage and cost analyses for vehicles that are coming up for replacement so they can decide whether to buy or lease on a case‑by‑case basis.