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Yucaipa approves five‑year vehicle lease program to replace aging fleet
Summary
Council approved a five‑year lease program to replace 23 city vehicles over a staggered schedule; staff said the lease (with 6% financing and a $1 residual) offers operational and maintenance benefits despite a slightly higher five‑year cost than purchasing outright.
The Yucaipa City Council approved a five‑year vehicle lease program to replace 23 city vehicles, citing improved reliability, safety features and operational efficiencies. Staff recommended a staggered replacement (10 vehicles in year one, 7 in year two, 1 in year three, 2 in year four and 3 in year five) and said the lease includes provisions that simplify future additions of public safety vehicles.
Financials and structure: Staff presented a comparison showing the five‑year lease cost for 23 vehicles is roughly $989,000 versus about $978,000 to purchase those vehicles outright, with a 6% financing assumption for the lease. The lease was structured with a $1 residual per vehicle at the end of the five‑year term to avoid residual valuation disputes; any positive residual will generate an accounting gain or credit against subsequent lease/purchase activity. The adopted FY‑26 budget includes funding in Public Works for non‑public safety vehicles; approval required an $18,170 budget adjustment in the Public Safety Fund to cover the lease costs of public‑safety vehicles.
Operational benefits: Staff and councilmembers emphasized reduced downtime, lower maintenance costs and improved fuel efficiency from newer vehicles. Staff also noted the city recently implemented a fleet maintenance tracking database that has already reduced repair costs. Under the agreement, leases can be terminated (with customary financial reconciliation) and the contract includes limited non‑appropriation protection that would allow termination in a fiscal emergency.
Council action: After questions about warranty coverage and mileage/condition risk, staff confirmed standard manufacturer warranties apply and that the lease provider will handle vehicle recycling and administrative replacement processes. Council approved the contract and directed staff to execute replacement tranches per the schedule.
What’s next: Public Works and Finance will finalize lease documents and begin year‑one vehicle procurement and scheduling. Staff will return with implementation details and report expected savings from maintenance and fuel efficiency.
