Date: July 15, 2020
Author: David Zimmer
Location: West Milford, NJ
"WEST MILFORD — Drive for 25 minutes in any one direction across North Jersey and you could drive through dozens of towns, or you could never get out of one.
At more than 80 square miles, West Milford is the eighth-largest municipality in New Jersey and the largest town north of Trenton. The size, more than 15 miles from Route 23 to the New York border north of Upper Greenwood Lake, paired with its lumpy Highlands terrain, takes a toll on the municipal vehicle fleet, local officials said.
To reduce high maintenance costs, township officials plan to lower the average age of its light- and medium-duty vehicles from 7 to 2.5. A contract with Enterprise Fleet Management will facilitate the plan by taking purchasing, ownership and resale responsibilities out of Town Hall and into the Wayne-based business to preserve resale value, maintain fuel economy and avoid age-based repairs, records show.
Mayor Michele Dale said the agreement will allow the town to lease its cars, trucks and SUVs from the company and turn them in after four or five years, or as officials see fit. The town currently holds them for more than 10, records show.
“This was something that we’ve been looking to do, and we’ve been working on for quite some time,” Dale said. “The goal was to have an efficient and productive vehicle replacement program … and save some money.”
On average, the town spends $243 per month, per vehicle, on maintenance. Plans are to bring that under $76 per month by 2023. Fuel costs are likewise estimated to drop from $202 per vehicle per month to $142, records show.
More than 60% of the township’s 64-vehicle fleet is more than 4 years old, said David Guthaim of Enterprise Fleet Management in Wayne. More than 20% has been around for a decade, he added. The town, like many government agencies and companies, holds on to vehicles too long, Guthaim said.
“Generally speaking that means you have an added cost of maintenance, a lack of fuel economy and a reduction or complete reduction, if you will, in resale value,” Guthaim said. “The way you handle that is by utilizing the resale value when the vehicle is still worth something.”
The open-ended lease with Enterprise will allow the town to trade in vehicles when their value most favorably compares with the balance on the financing sheet. Guthaim said the town’s size and terrain will likely lead to leases ending after four years.
The expansive town’s police SUVs rack up more than 22,000 miles a year, records show. To replace them, the Township Council typically buys six new vehicles a year — the new Ford police SUVs go for about $32,700 without flashing lights and communication equipment — and rotates the old ones into the general fleet every five years or 100,000 miles.
Those are used by health inspectors and other officials who need to travel around a town that is larger than Wayne, Ringwood, Clifton and Paterson combined.Township officials placed an order last year for five Ford police SUVs and paid half the roughly $43,000 aftermarket upgrade cost. Instead of that purchase, however, Enterprise is set to step in, take title and lease the vehicles back to the town for a year-one cost of roughly $51,500, plus the other $21,500 in upgrades.
In 2021, 16 more vehicles are due to be added to the fleet at a total annual lease cost of $160,000, records show. After additions of 19 and 20 vehicles the two following years, the town is projected to have a 61-vehicle fleet of all-leased vehicles by 2023.
The total "first-year savings on the transition to the Enterprise-owned fleet has been estimated at more than $330,000, Dale said. Through year eight, the savings should surpass $740,000, records show. Guthaim said the reduction in expense is directly tied to a decreased average age, which should result in better fuel economy and lower maintenance costs.
The township will continue to execute maintenance on the vehicles in its fleet, though Enterprise has offered to take that work as well, officials said. Similar lease agreements are used by nearby municipalities, including Pompton Lakes, Clifton and Vernon.