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Subcommittee review finds motor-pool accounting change could lower internal charges
Summary
A motor-pool audit presented to the subcommittee found reserves built up in prior years and recommended switching to charging only depreciation plus lease costs, which staff said could reduce the annual internal cost and correct prior overcharging.
Peter presented an audit of the city's motor pool and vehicle amortization schedules and told the committee the motor-pool enterprise fund had built reserves after earlier policies that underfunded depreciation. Staff and members said the city had been "double-charging" departments to rebuild the fund, and that returning to a model that charges depreciation plus lease costs should reduce internal rates.
Peter said the audit showed a significant reserve balance (described in discussion as roughly $7.8 million across funds) and estimated previous annual overcharges may have been "maybe a couple hundred thousand" a year. Staff recommended using reserves strategically for near-term vehicle purchases while moving toward normal depreciation funding. The committee requested that these motor-pool findings and amortization options be included in the June 2 materials for council consideration.
