Finance Committee weighs time-limited EV lease offer for code-enforcement vehicle

City finance committee members on Feb. 1 discussed a time-limited $18,000 dealer credit on a four-wheel-drive Hyundai electric vehicle that staff said could serve as a replacement for a city code-enforcement vehicle and be charged at the new on-site EV chargers.

Staff said the dealer credit was available through Feb. 14 and showed a capitalized price of about $24,000 compared with a stated MSRP of about $41,000. Staff reported an estimated end-of-lease buyout previously described as about $2,500 but later discussed as nearer $2,000; the lease-term figure was also given as 72 months in early remarks and later corrected to 60 months during the same discussion. Staff emphasized those figures were estimates from the leasing offer and said details would be confirmed in written lease documents.

The proposal drew questions about budget authority and timing. A committee member reminded the group that, "Only the council can authorize fund balance. And an undesignated fund balance spend," noting that using undesignated reserves would require council authorization. Staff said there are capital funds and line-item savings that could cover the purchase but that the city manager does not have unilateral authority to spend undesignated fund balance outside the adopted budget process.

Staff described operational reasons for pursuing a replacement: the current vehicle being considered has over 150,000 miles and formerly served as a police vehicle, and code enforcement workload is expected to increase when a short-term rental registration program starts in late spring. Staff also projected annual fuel savings for an electric vehicle of roughly $1,200 to $1,500 compared with gasoline, and noted the city could realize additional savings by charging at the municipal EV chargers at market electricity rates.

Committee members asked for more formal, line-item comparisons before taking the matter to council. One member requested a cost-per-year table similar to a prior presentation by the leasing vendor, saying that a clearer comparison of annual costs, buyout options and residual value would help the committee and council assess long-term value. Staff said they would ask the leasing company for a short extension of the dealer credit and, if not possible, prepare the documentation for council consideration at a special meeting or the next scheduled council meeting.

Other details raised during the discussion: the proposed vehicle was not one of eight vehicles previously allocated in the current capital plan; the police department is using an older city vehicle that an AMHC (behavioral health) staff member now uses to respond to calls; and the city’s EV chargers are scheduled for spring installation and have grant funding that staff said is preapproved.

Next steps: staff will request additional written lease details and a cost-comparison table from the leasing company, seek a short hold on the dealer rebate while the city evaluates the proposal, and bring a formal recommendation and funding-source options to the city council. No formal motion or vote was taken by the Finance Committee during the discussion.