Fleet Management Consulting Services-1VILLAGE OF OAK BROOK
PROFESSIONAL SERVICES AGREEMENT
This AGREEMENT is dated as of the 15 day of 2016("Agreement"), and is by and between the VILLAGE OF
OAK BROOK, an Illinois municipal corporation ("Vil age"), and MERCURY ASSOCIATES, INC., 7361 CALHOUN PLACE,
SUITE 680, ROCKVILLE, MD 20855 ("Consultant').
IN CONSIDERATION OF the recitals and the mutual covenants and agreements set forth in the Agreement, and pursuant to the
Village's statutory powers, the parties agree as follows:
SECTION 1. SCOPE OF SERVICES. The Village
retains the Consultant to perform, and the Consultant agrees to
perform, all necessary services to perform the work in
connection with the project identified below ("Services"),
which Services the Consultant shall provide pursuant to the
terms and conditions of this Agreement:
Fleet Management Consulting Services as more fully
described in the attached proposal dated May, 25, 2016.
SECTION 2. TIME OF PERFORMANCE. The
Consultant shall perform the Services as indicated in the
attached proposal dated May, 25, 2016 ("Time of
Performance"),
SECTION 3. COMPENSATION.
A. Agreement Amount. The total amount
billed by the Consultant for the Services under this Agreement
shall not exceed $52,750.00, including reimbursable expenses,
without the prior express written authorization of the Village
Manager. Payment shall be made upon completion of the
services and final acceptance by the Village.
B. Taxes, Benefits, and Royalties. Each
payment by the Village to the Consultant includes all
applicable federal, state, and Village taxes of every kind and
nature applicable to the Services as well as all taxes,
contributions, and premiums for unemployment insurance, old
age or retirement benefits, pensions, annuities, or similar
benefits and all costs, royalties, and fees arising from the use
of, or the incorporation into, the Services, of patented or
copyrighted equipment, materials, supplies, tools, appliances,
devices, processes, or inventions. All claim or right to claim
additional compensation by reason of the payment of any such
tax, contribution, premium, costs, royalties, or fees is hereby
waived and released by Consultant.
SECTION 4. REPRESENTATIONS OF
CONSULTANT. The Consultant represents and certifies that
the Services shall be performed in accordance with the
standards of professional practice, care, and diligence
practiced by recognized consultants in performing services of
a similar nature in existence at the Time of Performance. The
representations and certifications expressed shall be in
addition to any other representations and certifications
expressed in this Agreement, or expressed or implied by law,
which are hereby reserved unto the Village.
The Consultant further represents that it is financially solvent,
has the necessary financial resources, and is sufficiently
experienced and competent to perform and complete the
Services in a manner consistent with the standards of
professional practice by recognized consultants providing
services of a similar nature. Paul T. Lauria, President, shall
be primarily responsible for carrying out the Services on
behalf of the Consultant ("Key Project Personnel'). The Key
Project Personnel shall not be changed without the Village's
prior written approval. The Consultant shall provide all
personnel necessary to complete the Services. The Consultant
shall provide all personnel necessary to complete the Services.
SECTION 5. INDEMNIFICATION; INSURANCE;
LIABILITY.
A. Indemnification. The Consultant proposes
and agrees that the Consultant shall indemnify and save
harmless the Village, its officers, officials, employees and
volunteers, against all damages, liability, claims, losses, and
expenses (including attorneys' fee) that may arise, or be
alleged to have arisen, as a result of the Consultant's
negligence or misconduct in the Consultant's performance of,
or failure to perform, the Services or any part thereof, or any
failure to meet the representations and certifications set forth
in Section 4 of this Agreement.
B. Insurance. The Consultant acknowledges
and agrees that the Consultant shall, and has a duty to,
maintain adequate insurance, in an amount, and in a form and
from companies, acceptable to the Village. The Consultant's
maintenance of adequate insurance shall not be construed in
any way as a limitation on the Consultant's liability for losses
or damages under this Agreement.
C. No Personal Liability. No elected or
appointed official, or employee of the Village shall be
personally liable, in law or in contract, to the Consultant as the
result of the execution of this Agreement.
SECTION 6. GENERAL PROVISIONS.
A. Relationship of the Parties. The
Consultant shall act as an independent contractor in providing
and performing the Services. Nothing in, nor clone pursuant
to, this Agreement shall be construed to: (1) create the
relationship of principal and agent, employer and employee,
partners, or joint venturers between the Village and
Consultant; or (2) to create any relationship between the
Village and any subcontractor of the Contractor.
B. Conflicts of Lrterest. The Consultant
represents and certifies that, to the best of its knowledge: (1)
no Village employee or agent is interested in the business of
the Consultant or this Agreement; (2) as of the date of this
Agreement, neither the Consultant nor any person employed
or associated with the Consultant has any interest that would
conflict in any manner or degree with the performance of the
obligations under this Agreement; and (3) neither the
Consultant nor any person employed by or associated with the
Consultant shall at any time during the term of this Agreement
obtain or acquire any interest that would conflict in any
manner or degree with the performance of the obligations
under this Agreement.
C. No Collusion. The Consultant represents
and certifies that the Consultant is not bared from contracting
with a unit of state or local govermnent as a result of (1) a
delinquency in the payment of any tax administered by the
Illinois Department of Revenue unless the Consultant is
contesting, in accordance with the procedures established by
the appropriate revenue act, its liability for the tax or the
amount of the tax, as set f
orth in Section I1-42.1-1 of seq. of the Illinois
Municipal Code, 65 ILCS 5/11-42.1-1 et seq.; or (2) a
violation of either Section 33E-3 or Section 33E-4 of Article
33E of the Criminal Code of 1961, 720 ILCS 5/33E-1 et seq.
If at any time it shall be found that the Consultant has, in
procuring this Agreement, colluded with any other person,
firm, or corporation, then the Consultant shall be liable to the
Village for all loss or damage that the Village may suffer, and
this Agreement shall, at the Village's option, be null and void.
D. Termination. Notwithstanding any other
provision hereof, the Village may terminate this Agreement at
any time upon 15 days prior written notice to the Consultant.
In the event that this Agreement is so terminated, the
Consultant shall be paid for Services actually performed and
reimbursable expenses actually incurred, if any, prior to
termination, not exceeding the value of the Services
completed.
E. Compliance with Laws and Grants.
Consultant shall give all notices, pay all fees, and take all
other action that may be necessary to ensure that the Services
are provided, performed, and completed in accordance with all
required governmental permits, licenses, or other approvals
and authorizations that may be required in connection with
providing, performing, and completing the Services, and with
all applicable statutes, ordinances, rules, and regulations,
including without limitation the Fair Labor Standards Act; any
statutes regarding qualification to do business; any statutes
prohibiting discrimination because of, or requiring affirmative
action based on, race, creed, color, national origin, age, sex, or
other prohibited classification, including, without limitation,
the Americans with Disabilities Act of 1990, 42 U.S.C. §§
12101 et seq., and the Illinois Human Rights Act, 775 ILCS
5/1-101 et seg. Consultant shall also comply with all
conditions of any federal, state, or local grant received by the
Village or Consultant with respect to this Contract or the
Services. Consultant shall be solely liable for any fines or
civil penalties that are imposed by any governmental or quasi -
governmental agency or body that may arise, or be alleged to
have arisen, out of or in connection with Consultant's, or its
subcontractors, performance of, or failure to perform, the
Services or any part thereof. Every provision of law required
by law to be inserted into this Contract shall be deemed to be
inserted herein.
F. Default. If it should appear at any time that
the Consultant Inas failed or refused to prosecute, or has
delayed in the prosecution of, the Services with diligence at a
rate that assures completion of the Services in full compliance
with the requirements of this Agreement, or has otherwise
failed, refused, or delayed to perform or satisfy the Services or
any other requirement of this Agreement (`Event of
Default"), and fails to cure any such Event of Default within
ten business days after the Consultant's receipt of written
notice of such Event of Default from the Village, then the
Village shall have the right, without prejudice to any other
remedies provided by law or equity, to (1) terminate this
Agreement without liability for further payment; or (2)
withhold from any payment or recover from the Consultant,
any and all costs, including attorneys' fees and administrative
expenses, incurred by the Village as the result of any Event of
Default by the Consultant or as a result of actions taken by the
Village in response to any Event of Default by the Consultant.
G. Assignment. This Agreement may not be
assigned by the Village or by the Consultant without the prior
written consent of the other party.
H. Notice. All notices required or permitted to
be given under this Agreement shall be in writing and shall be
delivered: (1) personally; (2) by a reputable overnight courier;
or by (3) by certified mail, return receipt requested, and
deposited in the U.S. Mail, postage prepaid. Unless otherwise
expressly provided in this Agreement, notices shall be deemed
received upon the earlier of: (a) actual receipt; (b) one
business day alter deposil with an oveinight gonia AS
evidenced by a receipt of deposit; e' (c) dn'oc business days
following dcposh in the U.S. mail, ns evidenced by n relmn
receipl. Notices and connnunicmimrs to the Village strait be
addressed to, and deliveml ill, (he following adthcss:
Village of Oak Brook
1200 OR, Qrnok Road
Oak Brook, Illinois 60523
Altenlion: Doig I'a(chin, Public Works
Director
Notices and conunmtications to the Cmtstlllma shall be
addressed to, and delivered N. the fiillowiog address:
Mercury Associates, Inc.
7361 Calhoun Place, Suite 680
Rnakville, NID 20855
Attention: Pod T. Lauria, President
i, Waiver. Neither lite Village nor lite
Consultant shall be trader any obligation In exercise any orthe
rights granted to them in this Agreement except as it shall
dckrminr to he in ill hest inrilresl from tittle it) time. The
I'aihue of the Village or the Cousullnnl to exercise w any lime
any suer rights 911,111 not he deemed illconslrued its a waiver
of that right, nor wait the failure void oraffcel the Village's or
the Rmasulion's right to enroree such rights or any other
I ights-
ATTEST,. _..�
ny.:
A"1101, one Pruss, Village Clerk
ATTEST;
.1. 'third party Ilencricinrv, No claim as a third ptoiy
benelieiauy under (his Agreement by lily person, firm. or
copondion shall he made or he valid against dw Villoge.
K, Covernina Law^ Yenue, This Agreement shalt be
governed by, consh'oed and enforced in accordanco rvi(h file
internal laws, half no( tire conflicts of laws rales, orthe Stale of
Illinois• Venae for any action arising call of this Apeemed
shaft be in the Circuit Court for DnPnge County, Illinois,
L. Exhibli9 and Other AyreeillQld9, If illy conflicl exists
between this Agreement and any exhibit attached hereto or
any olltcr Agreement between the parties relating to this
u'ansaetlon, the terms or(Ilis Agreement shall prevail.
6I. No Dlselosm•e of Colindcnlial Information by the
Cmtsullani.--'the Consultant acknowledges tical it shell, in
performing lite Services for the Village under this Agreement,
Illicit accoss, or be directly or indirectly exposed, la
Contidentinl Information The Consullmll strait hold
confidenlinl nil Conlidendlil InlLrmnlimt and shall not disclose
or use. such Coll fidelithill Information without the express prior
writlen consent of the Village. The Consultant shall use
reasonable nwasm'es at least as strict as those the Cnusullanl
uses to protect its own confidential information. Such
urcasures shall iachuie, wllhou( limitation, requiring
employees and subronh'aelors of the Co lsulimu to exacale a
non -disclosure agreement befixe obtaining access In
Con rident nal Infbrmalion.
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Proposal to Provide
Fleet Management
Consulting, Services
to the
May 2016
MERCURY ASSOCIATES, INC.
May 25, 2016
Mr. Doug Patchin
Public Works Director
Village of Oak Brook
3003 Jorie Boulevard
Oak Brook, IL 60523
Dear Mr. Patchin:
Pursuant to our recent discussions, Mercury Associates, Inc. is pleased to submit this
proposal to provide fleet management consulting services to the Village of Oak Brook
Public Works Department (PWD). The goal of these services is to assist PWD in
preparing itself and the Village to meet the growing challenges of managing its vehicle
and equipment fleet. These challenges stem from a number of forces that are bearing
down on both large and small, public -sector and private -sector fleet owners: the loss of
institutional knowledge resulting from the retirement of experienced maintenance
technicians, supervisors, and fleet managers; the growing technological complexity of
fleet assets due to the adoption of electric, plug-in hybrid electric, and alternative fuel
vehicles and increasing regulation of vehicle fuel economy and emissions; and the
impacts of the "Big Data" phenomenon, ranging from the growing use of telematics for
real-time vehicle tracking and event monitoring to the rising expectations of senior
decision makers and elected officials with respect to the use of data -driven fleet
management processes.
Many small municipalities are struggling to deal with these challenges because they
have limited in-house personnel resources to devote to fleet management. As a result,
more and more jurisdictions are relying on third parties to assist them in performing
critical fleet management functions, including vehicle dealerships and independent
repair shops; contractors who specialize in fleet maintenance and/or parts
management; and other government jurisdictions. PWD has already explored and/or
begun to employ all of these strategies, albeit in a largely reactive and piecemeal
fashion. It is looking to this study to assist it in developing a clear understanding of what
strategy or combination of prioritized strategies will best serve the Village, based on an
independent and objective assessment of the strengths and weaknesses of its current
fleet management resources and business practices.
Countless small local government jurisdictions across the US and Canada have turned
to Mercury for guidance in improving their fleet management practices. Mercury's
current and recent clients of this type range from Yellowknife, Northwest Territories and
Guelph, Ontario to Gresham, OR; Encinitas, CA; Mount Prospect, IL; Brownsville, TX;
and Sarasota, FL. We are excited about the possibility of adding Oak Brook to this list of
satisfied clients.
Mercury Associates, Inc. • www.mercury-assoc.com
7361 Calhoun Place, Suite 680 • Rockville, MD 20855 • 301 519 0535
Mr. Doug Patchin: Proposal to Provide Fleet Management Consulting Services
May 25, 2016
Page 2
I will serve as the point of contact for all matters relating to this proposal, and am
authorized to legally bind our company to the commitments made in it. I can be reached
in our Rockville, MD office at 310 519 0535, ext. 1021 or at plauria@mercury-
assoc.com.
We appreciate being given the opportunity to offer our services to the Village and look
forward to hearing from you.
Very truly yours,
PAA4 C*M-,bt.�
Paul T. Lauria
President
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Proposal to Provide
Fleet Management Consulting Services
TABLE OF CONTENTS
Our Understanding of the Situation...............................................................................................1
2
Proposed Work Plan..........................................................................................................
1. Review Fleet Maintenance and Repair Practices....................................................2
Task 1.1: Initiate and Manage the Project................................................................
3
Task 1.2: Collect and Review Information................................................................4
Task 1.3: Analyze Data and Benchmark Conditions and Performance_ ..................
5
Task 1.4: Evaluate Business Practices....................................................................
5
Task 1.5: Present Findings and Recommendations.................................................7
2. Review Other Fleet Management Practices (optional).............................................8
3. Review Fleet Replacement Practices (optional)...... .........................................
Task 3.1: Develop Baseline Fleet Replacement Plan..............................................9
Task 3.2: Fine -Tune Replacement Plan.................................................................11
Task 3.3: Evaluate Alternative Capital Financing Methods....................................12
Task 3.4: Present Findings and Recommendations...............................................15
Project Schedule ..................................................
..........15
16
Qualifications and Experience .............................. ................................... ....................................
.........................................:..........................................
Overview ............... ...................16
RelevantExperience..................................................................................................17
............................................
Project Team ................................ ..........................18
... 20
Cost Proposal..................................................................................................
. .......................
Appendix
Detailed Cost Proposal
Project Timeline and Milestones
F1 .
Proposal to Provide
K� Fleet Management Consulting Services
OUR UNDERSTANDING OF THE SITUATION
The Village of Oak Brook operates a fleet of 83 vehicles, including passenger sedans,
pickup trucks, police patrol vehicles, ambulances, fire trucks, plow trucks, and
miscellaneous pieces of construction equipment. The fleet is managed by the Public
Works Department, including a Vehicle Fleet Division, which operates a small shop on
Jorie Boulevard staffed by two maintenance technicians and a half-time mechanic
helper; one of the two mechanics recently retired and has yet to be replaced. The
capital and operating costs of the fleet are financed using a cost charge -back system
and accounted for in two separate internal service funds, the Garage Fund and the
Equipment Replacement Fund. Budgeted expenditures for these funds for FY 2016 are
$805,000 and $746,000 respectively.
The Department outsources police patrol vehicle maintenance and repair to the Village
of Woodridge and fire apparatus maintenance and repair to a commercial repair shop
that employs certified emergency vehicle technicians. PWD has explored the possibility
of hiring a contractor to provide on-site fleet maintenance and repair services, but
concluded that such a contract is probably not cost effective based on the fee estimates
or proposals it received.
As in many small jurisdictions, some fleet management activities are performed by
employees who have responsibilities that extend well beyond the realm of fleet
management. For example, the Public Works Director oversees maintenance and repair
parts purchases and the generation of charges to fleet user agencies. The Public Works
Superintendent oversees maintenance and repair operations.
The recent retirement of the garage mechanic, the potential retirement of the Public
Works Director next year, the relative lack of experience managing the Village's fleet of
the Public Works Superintendent, and the combination of industry trends, alluded to
above, that are confronting all fleet owners makes this an opportune time for the Village
to take a fresh look at the way it manages its fleet. In order to do this, Mercury proposes
to perform what we call a best management practices review, essentially a top -to -
bottom assessment of current fleet management practices aimed at identifying both
business process improvement and cost savings opportunities.
The main component of our proposed scope of services is an assessment of PWD's
fleet maintenance and repair practices. Two optional tasks included in this proposal are
1) the enlargement of the best practices review to encompass all other fleet
management activities, ranging from vehicle allocation, acquisition, utilization
management, and fueling to fleet cost management; and 2) an evaluation of fleet
replacement planning and financing practices, including the use of alternative capital
financing methods such as leasing and lease -purchasing and the determination of
replacement rates to be used to replenish the Equipment Replacement Fund. Our
proposed approach to conducting each of these scope elements is detailed in the
following sections of our proposal.
AM&WOMY 1
Proposal to Provide
Y" Fleet Management Consulting Services
PROPOSED WORK PLAN
1. REVIEW FLEET MAINTENANCE AND REPAIR PRACTICES
The goal of this project component is to identify how the Public Works Department
should organize and conduct fleet maintenance and repair activities in light of both
conditions and challenges that are specific to the Village of Oak Brook and general
industry trends and fleet maintenance best practices. In order to formulate and prioritize
recommendations for improvement, we first need to determine the state of current fleet
maintenance resources and practices.
To make this determination, we will utilize information collection and analysis
techniques that fall into two categories: quantitative performance measurement and
benchmarking, and business process mapping and gap analysis. Having conducted
consulting projects for more than 600 organizations, our consultants understand both
the importance of, and the best techniques for, collecting information efficiently and with
minimal disruption to day-to-day work activities. The primary techniques we use in a
best management practices assessment like this one to collect information on, and
evaluate strengths and weaknesses in, current business practices are the following.
Written Information Request. We begin by providing detailed requests specifying
the types of documentary material (e.g., organization charts, position descriptions,
policy and procedure statements, etc.) and quantitative data (e.g., work order and
fuel transaction data, meter readings, etc.) we would like to review. These requests
will serve not only as a guide for PWD to follow in assembling information for our
review, enabling our staff to "hit the ground running" once we come on site, but
actually constitute the start of the evaluation process itself. This is because the
availability or lack thereof of key information on the fleet and fleet management
business processes provides us with initial insights into the soundness of those
processes. For instance, the existence of formally documented standard operating
procedures indicates that an organization has been proactive in defining how key
fleet management activities are to be performed, while the lack of such SOPS may
indicate a lack of sufficient structure, clarity, and accountability in some areas of fleet
management — with a corresponding impact on fleet management effectiveness and
fleet performance and costs.
Interviews and Focus Group Sessions. Face-to-face interviews and focus group
discussions are staples of this type of assessment. We typically interview a selection
of officials and employees involved in both the management and the
operation/utilization of the fleet in order to gain insights into current perceptions of
and levels of satisfaction with both the provision and consumption of fleet resources
and services. We also sometimes need to interview officials in organizational units
whose activities affect fleet management practices only indirectly, such as those
involved in budgeting and financial management, procurement, and information
technology administration and support.
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Proposal to Provide
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Performance Measurement and Benchmarking. Data availability permitting, we
employ quantitative performance measurement techniques in every business
practices assessment we conduct, interpreting the resulting performance statistics
using suitable internal and industry (if available and relevant) benchmarks. In
addition to serving as a valuable diagnostic tool that helps us home in on potential
problem areas and avoid devoting unnecessary time and attention to areas in which
current practices are strong, performance measurement adds objectivity and
consistency to our evaluation, and hence, credibility to our findings and conclusions.
Business Process Mapping and Gap Analysis. The other key method we use to
evaluate fleet management practices and identify opportunities to improve quality
and lower costs is process mapping and gap analysis. This involves ascertaining 1)
if and how specific management and operating processes are formally defined; 2)
the soundness of their design — e.g., their logic, thoroughness, compliance with
applicable regulations, responsibility and authority for execution, and so forth; 3)
their consistency with industry best practices; and 4) the nature of their actual
execution, which is a function of how they are communicated (e.g., through a policy
and procedure manual) and how employees are held accountable for following them.
We gain these insights primarily from the review of documentary material such as
policy and procedure statements and the conduct of the aforementioned interviews
and focus group sessions.
Our approach to conducting the assessment will be inclusive, interactive, and results
oriented. Our ultimate goal as management consultants is for our clients to improve
these practices by taking action on our recommendations. This requires that the
recommendations be practical and appropriate to the challenges and opportunities
facing a specific organization at a specific point in time. It also requires that
stakeholders not only understand the analytical methods, findings, and conclusions on
which such recommendations are based, but actually take ownership of proposed
organizational, business process, and other changes. This requires, in turn, that we
continuously interact with and secure the cooperation and confidence of an array of
stakeholders in both the fleet management and other organizational units.
Task 1.1: Initiate and Manage the Project
We will start the project with a formal kick-off meeting whose primary objectives will be
to introduce Mercury Associates' consultants to PWD officials and employees and to
confirm both parties' understanding of key study parameters including but not
necessarily limited to project goals and objectives, scope, timeline, critical success
factors, and deliverables.
A key ingredient of an effective project management approach is periodic written
progress reports. We want to ensure that the Village is afforded regular opportunities to
discuss the status of the project with us and to raise any questions or concerns relating
to our progress toward achieving its expected outcomes. To this end, we will submit a
brief progress report on a monthly basis, recapping the work accomplished to date. The
written progress reports will be integrated with our monthly invoices. We also can
ORMIMY 3
Proposal to Provide
Fleet Management Consulting Services
conduct periodic conference calls, if desired, with appropriate Village officials to discuss
such things as obstacles to study progress or desired outcomes encountered, and
preliminary findings and recommendations being considered.
Task 1.2: Collect and Review Information
Prior to kicking off the assessment, we will provide PWD with two written information
requests. The first of these will be an MS Word -based checklist which identifies the
documentary material that we would like to obtain to conduct the assessment. The
checklist will be organized by functional area of fleet management to be reviewed, as
outlined in Task 1.4 below. We will request that PWD return a completed checklist with
available documentary materials. This way, we will have a clear record of what types of
information were — or were not — available for our use in conducting the study.
Examples of the materials we will request include:
• Position descriptions;
• Policy and procedure statements;
• commonly used recordkeeping forms and management reports;
• Previously prepared consulting and/or audit reports; and
• Sample bid/proposal solicitation specifications, contracts and purchase order,
and vendor invoices.
Our second information request will be in the form of an MS Excel spreadsheet that
specifies certain pieces of information we would like to obtain for each asset in the
Village fleet for a recent 12 -month period. Examples of the quantitative data we will
request for each asset include year, make, model, serial number (VIN), Village ID
number, class code and description, user agency name, in-service date, original
purchase price/capitalized cost (for any leased assets), life -to -date maintenance and
repair cost, recent current meter reading and meter reading date, utilization during the
12 -month period, maintenance and repair costs during the same period (broken out by
in-house labor hours and costs, in-house parts costs, and outside vendor charges), and
gallons of fuel consumed during the same period.
Please note that our proposed level of effort for this task assumes that the Department
will be able to furnish these data to us in either Excel or flat files capable of being
imported to Excel in the format specified in the abovementioned data collection
template. It also assumes that these data will be substantially accurate and complete,
requiring minimal data cleansing or normalization by our project team. Our IT
consultants can assist PWD in writing queries, extracting data, and cleansing data prior
to analysis, if necessary, for an additional fee.
We will review all of the material and data provided in order to develop a preliminary
understanding of strengths and weaknesses in current fleet management practices,
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Proposal to Provide
Fleet Management Consulting Services
as well as in mapping and evaluating fleet management policies, procedures, and
practices in a later task.
Task 1.3: Analyze Data and Benchmark Conditions and Performance
We will use the quantitative data collected in the previous task to begin the process of
analyzing current lifecycle cost management practices in the Village. Analysis results
will help us flag specific fleet management activities in which opportunities for direct or
indirect cost reduction appear to exist, which we can then scrutinize during the process
mapping and evaluation task of this study component.
Subject to the availability of accurate and detailed data, we will calculate statistics for
current fleet maintenance and repair activities and the fleet for selected key
performance indicators — quantitative measures of efficiency and effectiveness. We will
interpret these statistics by comparing them against established industry standards,
benchmarks, and/or peer survey results, where available. We will incorporate the results
of our data analyses in the development of findings and recommendations in specific
areas of fleet management practice in the next task.
Task 1A: Evaluate Business Practices
We will review current business practices in those areas of fleet management that most
directly affect fleet lifecycle costs. The results of this evaluation will serve as the
foundation for recommending specific strategies and business process improvements
the Department should pursue in order to manage the Village's fleet efficiently and
effectively. As discussed above, we will evaluate current practices using standard
business process mapping and gap analysis techniques aimed at first defining and then
identifying strengths and weaknesses in specific functional areas.
We will determine how processes currently are performed through a combination of
documentation review, employee interviews, focus group meetings, and site visits. In
doing this, we fully understand that the way Village employees are supposed to perform
certain activities and the way they actually do so are not necessarily same. Thus, we
will assess the adequacy of both the definition, as expressed in regulations, rules,
policies, procedures, forms, etc. and the execution of fleet management processes in
accordance with these requirements and guidelines.
We will determine how well business processes are defined and executed by assessing:
Their intrinsic soundness (e.g., the clarity and logic with which they are
documented, the way they are communicated to employees, and the manner in
which they are enforced);
Their consistency with industry best practices which we have observed, and in
many cases defined, through our project team's combined decades of
professional fleet management, consulting, public speaking, writing, and training
ALUMMY
Proposal to Provide
Fleet Management Consulting Services
experience; and
3. Their results, as reflected in the quantitative measurement of costs and
performance levels in the previous task, and in the satisfaction levels of
management officials, fleet management employees, and fleet users.
In evaluating the strengths and weaknesses of current fleet maintenance practices, our
ultimate objective will be to advise the Department as to how these practices can be
improved. Consequently, our evaluation approach will not seek to merely differentiate
good practices from bad, but to identify the factors unique to the Village of Oak Brook —
whether political, organizational, managerial, operational, administrative, fiscal,
technological, educational, or other — that explain why some practices are strong and
others weak. This will allow us to develop recommendations for improvement that are
not generic or academic in nature, but of direct applicability to the needs, objectives,
conditions, and capabilities of the Village and the Department.
The business practices we will evaluate in this task are the following:
In -House Asset Maintenance and Repair
1. Pre -/post -trip inspection and defect reporting
2. Preventive maintenance program design and execution
3. Work planning, scheduling, assignment, and execution
4. Technician supervision and performance management
5. Warranty management
In -House Maintenance and Repair Parts Management
6. Supplier selection, contract establishment, and performance management
7. Inventory and ad hoc parts procurement
8. Parts requisitioning and disbursement
9. Inventory management and control
Outsourced Maintenance and Repair Management
10.Insourcing versus outsourcing determination
11. Service provider (e.g., vendor) selection, contract establishment, and
performance management
12.Service requisition and authorization and transaction administration
Fleet Maintenance Resources Management
13.Organization structure and staffing levels
14. Employee training and professional development
Proposal to Provide
Fleet Management Consulting Services
15. Maintenance facility utilization management, housekeeping, and maintenance
Fleet Maintenance Information Management
16. Fleet management information system functionality, configuration, and use
17. Integration and use of third -party service provider information
18. Standard and ad hoc management analysis and reporting
Fleet Maintenance Cost Management
19. Cost charge -back rate development
20.Charge-back system and Garage Fund management
21. Cost and expenditure analysis and control
Fleet Maintenance Service Delivery Management
22.Transaction-based communication
23.Operator/customer satisfaction measurement
24. Customer relationship management
Task 1.5: Present Findings and Recommendations
We will document our findings and recommendations in a written report. This document
will recap how we conducted the management practices assessment, what we found in
terms of strengths and weaknesses of current fleet management conditions and
practices (this section will be organized by functional area based on the content of the
above checklist), and what we recommend the Village do to improve fleet maintenance
practices and position DPW to deal with impending retirements and other strategic
challenges. Recommended improvements are likely to include a combination of tactical
and strategic initiatives pertaining to both internal business processes, staff, and other
resources and the use of external service providers.
We will submit this report in draft form for review and comment and make revisions, as
necessary, based on written feedback received. We will provide PWD with a reasonable
number of bound copies of the final report (if desired), along with one camera-ready
copy in electronic form.
In addition to documenting study results in a written report, we will conduct one informal
presentation of our findings, conclusions, and recommendations to PWD, fleet user
organization, and/or other appropriate Village officials. We will develop an MS
PowerPoint presentation for this purpose.
At the Village's option, we also can conduct a formal presentation of this and other
project component results to the Village Board for a small additional fee.
Proposal to Provide
Fleet Management Consulting Services
2. REVIEW OTHER FLEET MANAGEMENT PRACTICES (OPTIONAL)
In this optional project component, we would expand the scope of the above best
management practices assessment to encompass all other fleet management practices,
using the same information gathering and analysis methods as those described above.
We would integrate our findings, conclusions, and recommendations in the report and
presentation prepared in Component 1.
The specific practices we would review are the following.
Asset Allocation and Utilization Management
1. Asset requirements definition
2. Acquisition alternatives analysis (e.g., rent v. own) and decision making
3. Asset utilization measurement and exception management
4. Personal use management
5. Personally owned vehicle use management
Asset Acquisition and Disposal
6. Purchase specifications development, bid solicitation, and asset/supplier
selection
7. Purchase/lease/rental contract establishment and management
8. Asset commissioning
9. Asset decommissioning and remarketing/disposal
Driver/Operator Management
10. Operator license management (MVR checks, substance abuse testing, etc.)
11. Operator training and discipline
12. Safety management
13. Accident management
Fleet Fueling
14. Supplier selection and contract establishment
15. Bulk fuel procurement
16. Bulk fuel inventory management and control
In this area, our review will include exploring the potential impacts on future fleet size of any general
trends that may exist in the Village toward greater outsourcing of services that depend heavily on the use
of fleet assets, such as street sweeping.
. rMY
Proposal to Provide
Fleet Management Consulting Services
17. Fueling facility operation and maintenance
18. Commercial fuel transaction/credit card program management
Fleet Replacement
19. Replacement cycle guidelines
20. Replacement planning
21. Equipment Replacement Fund rate development and managementz
22. Use of alternative capital financing methods
3. CONDUCT FLEET REPLACEMENT PRACTICES REVIEW (OPTIONAL)
One of the best ways for the Village of Oak Brook to mitigate many of the most serious
fleet repair challenges with which many small fleet owners struggle is to replace
vehicles before they require major repairs. Essentially, this involves trading higher fleet
capital costs for lower operating costs. Effectively managing capital costs, in turn,
requires a proactive replacement management program and the use of one or more
capital financing methods that ensure that funds are made available to acquire
replacement vehicles when intended — rather than when "cash flow' permits.
At present, the Village has a relatively young fleet, having slowly recovered from the
curtailment in fleet replacement spending that resulted from the 2009 financial crisis.
Also, to its credit, the Village employs a replacement reserve fund that allows it to
accumulate funds incrementally to defray the costs of replacing vehicles and equipment.
This is an industry best practice insofar as replacement rates are calculated properly
and the reserve fund balance is managed properly.
We note that a large amount of money is being transferred this year from the Equipment
Replacement Fund to the Village General Fund to shore up funds for employee pension
obligations. While there is nothing necessarily in appropriate about making such a
transfer, it does beg the question of whether the Village has accumulated more
replacement reserves than necessary to ensure the timely replacement of fleet assets in
the future. This is one of several questions we would answer in this optional study
component.
Task 3.1: Develop Baseline Fleet Replacement Plan
Our approach to evaluating replacement practices begins with the development of a
long-term fleet replacement plan that quantifies the future replacement costs of each
and every asset currently in the Village's fleet. We will develop this plan using a
proprietary software program called CARCAPTm (Capital Asset Replacement Cost
Analysis ProgramTM) designed specifically to conduct this type of analysis.
2 We would perform a limited review of Village practices in this area only to the extent that PWD elects to
not have us perform optional Component 3, which is a full review of fleet replacement practices.
,,r,MMI Y 9
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Proposal to Provide
Fleet Management Consulting Services
To develop them plan, we will begin by obtaining an inventory of vehicles and pieces of
equipment in the fleet. We will work with appropriate officials to ensure that all required
data elements are obtained, including asset ID number; VIN; user organization name;
asset model year, make, and model; asset class code and description; in-service date;
recent meter reading; etc. We request that this information be provided in a Microsoft
Excel file, and will furnish the Village with an Excel -based data template to facilitate this.
We will then develop a list of vehicle and equipment class codes for the fleet that will be
used as the basis for populating the Planning Parameter Table in CARCAP, and work
with PWD officials to identify (if, necessary to define) the parameters (i.e., assumptions)
needed for the program to develop a replacement plan and other associated cost and
capital financing analysis results. These parameters include, by asset class,
recommended replacement cycles in age (months) and usage (miles or engine hours),
purchase price in today's dollars, purchase price inflation rate, interest rates and terms
for alternative financing approaches, and disposition of vehicle remarketing proceeds.
We will discuss current replacement cycle guidelines or policies used by the Village and
recommend changes where appropriate based on our experience working with other
small municipal fleets in the US. (We can perform optimal replacement cycle analyses
for selected key types of assets in the fleet for an additional fee if this is of interest to the
Department or any of its customers, such as the Police or Fire departments.)
Next, we will use these two sets of inputs to develop a preliminary or baseline
replacement plan that projects the replacement date and cost of each unit in the fleet
each time it meets the recommended criteria for replacement over the next 20 years. A
baseline replacement plan for the 315 -unit fleet of a local government jurisdiction with
whom we worked recently is shown in the following exhibit.
W]Abc*0144 10
Proposal to Provide
Fleet Management Consulting Services
Sample Baseline Replacement Plan
(315 -Unit Local Government Fleet)
Task 3.2: Fine -Tune Replacement Plan
As the above exhibit suggests, we often find peaks and valleys in future spending
requirements when we develop a baseline fleet replacement plan for a client. Even in
the most homogeneous of fleets, the confluence of replacement dates of vehicles with
different rates of utilization and replacement costs rarely results in an equal number of
vehicles becoming eligible for replacement each year. Needless to say, in a mixed -
application municipal fleet comprised of everything from passenger cars to vactors to
fire trucks, such convergences typically result in significant fluctuations in annual
replacement costs. Moreover, large backlogs of replacement needs, signified by the
large projected fleet replacement cost in the first year of the plan shown above, are a
characteristic of virtually all fleet operations that traditionally have relied on direct cash
financing of fleet replacement purchases.
In this task, we will review the baseline plan we develop for the Village's fleet with
appropriate officials and make needed adjustments to the timing of the replacement of
individual vehicles or pieces of equipment to reduce to a manageable level the backlog
of replacement spending needs that we suspect currently exists. CARCAP has
functionality for doing this, including a replacement prioritization scoring system and a
replacement plan "smoothing feature that allows the user to systematically adjust
planned replacement dates for individual assets in the fleet to accommodate near and
long-term budget realities. A smoothed version of the baseline replacement plan shown
above can be seen in the following exhibit.
0
Proposal to Provide
Fleet Management Consulting Services
Sample Smoothed Replacement Plan
(315 -Unit Local Government Fleet)
Task 3.3: Evaluate Alternative Capital Financing Methods
Once we have finalized the replacement plan, we will use this smoothed replacement
plan as the foundation for evaluating alternative capital financing approaches. Our
replacement planning program CARCAP is designed to calculate funding requirements,
by vehicle and by year for each year of a 20 -year analysis period, under each of several
financing approaches: outright purchase using ad hoc appropriations of cash; a
replacement reserve fund and charge -back system (the Village's current approach);
debt financing; and leasing.
We will quantify and compare against one another the long-term funding requirements
under each financing approach that is of interest to the Village and identify the financing
approach that we believe would be most beneficial from both a budgetary (i.e,, cash
flow) perspective and an economic (i.e., present value cost) perspective.
The following exhibits illustrate the future fiscal impacts of the use of several alternative
capital financing methods to pay for the replacement costs shown in the smoothed
replacement illustrated in Task 3.2 above.
M N v 12
Proposal to Provide
Fleet Management Consulting Services
Net Fleet Replacement Funding Requirements, Cash Purchase Financing
Net Asset Purchase Costs
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Fiscal Year
Net Replacement Funding Requirements, Reserve Fund Financing
Reserve Fund Financing
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AWI v 13
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Net Replacement Funding Requirements, Debt Financing
Gross Replacement Costs, Net Debt Service Costs
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Side -by -Side Comparison of Net Replacement Funding Requirements
A tabular comparison of the fiscal impacts over the next 20 years of each of the three
capital financing approaches illustrated above is shown in the table below.
Ayr. p k v 14
Proposal to Provide
Fleet Management Consulting Services
Future Fleet Replacement Funding Requirements
Outright Purchase v. Debt v. Reserve Fund
(millions)
Cash Purchase
Debt (Lease Purchase)
Reserve Fund
$ 1.21
$ 0.10
$ 1.57
$ 1.21
$ 0.24
$ 1.14
$ 1.22
$ 0.45
$ 1.20
Fiscal
$ 1.19
$ 0.66
$ 1.24
t ear
$ 0.98
$ 0.81
$ 0.82
$ 0.94
$ 1.00
$ 0.92
$ 0.56
$ 1.13
$ 0.94
$ 1.00
$ 1.18
$ 0.97
$ 1.05
$ 1.09
$ 1.02
$ 1.23
$ 1.12
$ 1.05
$10.59
$ 7.79
$10.89
Fiscal
Year
Cash Purchase
Debt Lease Purchase
Reserve Fund
$1.12
$1.13
$0.64
$1.33
1.081
$1.15
$1.34
$1.091
$1.03
$1.27
$1.141
$1.45
$1.37
$1.201
$1.76
$1.30
$1.251
$1.60
$1.36
$1.741
$1.33
$1.48
$1.49
$0.94
$1.56
$1.26
$0.72
$1.59
$1.27
$11.75
$13.71
$12.59
Task 3.4: Present Findings and Recommendations
We will document our findings, conclusions, and recommendations in a written report.
This document will recap how we conducted the fleet replacement study, what we found
in terms of replacement cycle guideline, funding, and financing improvement
opportunities, and what we recommend the Village do to improve these practices.
As in the two previous project components, we will submit this report in draft form for
review and comment and make revisions, as necessary, based on written feedback
received. We will provide the Village with a reasonable number of bound copies of the
final report (if desired), along with one camera-ready copy in electronic form.
In addition to documenting study results in this report, we will conduct one informal
presentation of our findings, conclusions, and recommendations to PWD, fleet user
organization, and other appropriate Village, officials. We will develop a Microsoft
PowerPoint presentation(s) for this purpose. At the Village's option, we also can
conduct a formal presentation of this and other project component results to the Village
Board for a small additional fee.
Finally, we will provide all detailed analytical results from this project component to
PWD in an MS Excel workbook.
PROJECT SCHEDULE
We estimate that all three components of the project will take approximately 16 weeks
to complete if they are all performed in conjunction with one another. Please note that
our proposed timeline begins with the project kick-off meeting, which may or may not be
the same date as the execution of a contract or issuance of a formal notice to proceed.
Adherence to this timeline is contingent upon the activities not only of the Mercury
project team but of the Village as well, including the timely delivery of requested data
Proposal to Provide
Fleet Management Consulting Services
and documentary material; scheduling of site visits, interviews, and presentations;
completion of the Web -based survey of users of potentially underutilized fleet assets;
and receipt of written feedback on draft final reports.
A Gantt chart for the project can be found in the appendix to this proposal.
QUALIFICATIONS AND EXPERIENCE
OVERVIEW
Mercury Associates, Inc. is a Maryland corporation, incorporated in 2002, with offices
located in Rockville, MD (headquarters); Charlotte, NC; and Houston, TX. We are an
employee -owned fleet management consulting firm that assists organizations in
improving the management and operation of their vehicle and equipment fleets.
Collectively, the firm's three owners possess more than 75 years of professional fleet
management and fleet management consulting experience. Mercury's staff consists of
approximately 30 full and part-time employees (including the owners), many of whom
were professional fleet managers, full-time fleet management consultants, or both, prior
to joining the firm.
Mercury's consulting services touch on virtually every facet of fleet management and
operation, ranging from broad-based assessments of fleet management organizational
structures, staffing levels, facilities and equipment, and business practices, to tightly
focused analyses of a single issue or opportunity such as "Can we reduce the size of
our fleet?" "Should we replace our fleet management information system?" "How can
we reduce our maintenance and repair expenditures?" or "Should we lease or buy
vehicles?" We also provide many different types of implementation and management
support services to fleet owners such as information system requirements definition,
selection, and implementation; development of RFPs for vehicles and equipment,
maintenance and repair parts, fuel, and third -party services ranging from fuel
management to parts management to fleet maintenance and repair; business process
redesign; cost charge -back rate development; policy and procedure development;
management training; and executive recruiting.
Mercury's principals and employees have worked with a wide array of public and
private -sector organizations around the world — primarily in the United States and
Canada and primarily with governmental jurisdictions — with fleets ranging in size from
fewer than 10 to more than 200,000 vehicles and pieces of equipment. For the US
federal government, we have provided services to the Army, Navy, Air Force, and
Marine Corps; 10 of the 15 executive branch departments (Defense, Energy, Homeland
Security, Interior, Transportation, State, etc.); and the General Services Administration,
NASA, the US Postal Service, and the Smithsonian Institution. Our professionals have
worked with one or more agencies in 33 states in the US and four provinces and
territories in Canada, and with more than 40 colleges and universities.
MUNIM, 16
Proposal to Provide
Fleet Management Consulting Services
In the private sector, Mercury has provided consulting services to a diverse mix of large
and small companies. Recent corporate/commercial clients include 3M, Air Products,
Bell Canada, Brinks, British Columbia Hydro, Carolinas HealthCare System, Cox
Enterprises, Cudd Energy Services, EPCOR, Gulf Stream Marine, Honeywell, Horizon
Utilities, Intel, ITS, Inc., Joerns-Recover Care, Johnson & Johnson, Lancaster Foods,
Pfizer, Republic Industries, Quanta Services, and Schindler Elevator.
RELEVANT EXPERIENCE
Of particular relevance to Oak Brook is Mercury Associates' experience working with
both large and small local government jurisdictions. Our current and recent past (last
five years) large local government clients include one or more departments in the cities
of Austin, Baltimore, Boston, Chicago, Dallas, Edmonton (AB), Fort Worth, Houston,
Long Beach, New York, Oakland (CA), Orlando, Philadelphia, Phoenix, Richmond (VA),
Sacramento, Saint Louis, Salt Lake, San Antonio, San Francisco, Seattle, Tampa,
Toronto, Vancouver (BC), and Washington, DC; and the counties of Ada (Boise), ID;
Bexar (San Antonio), TX; Chesterfield (Richmond), VA; Gwinnett (Atlanta), GA; Harris
(Houston), TX; Hillsborough (Tampa), FL; Howard, MD; Jefferson (Birmingham), AL;
Jefferson (New Orleans), LA; Loudoun, VA; Mecklenburg (Charlotte), NC; Miami -Dade,
FL; Montgomery, MD; Orange, CA; Orange (Orlando), FL; Pinellas (St. Petersburg), FL;
Sacramento, CA; San Bernardino, CA; and Wake (Raleigh), NC.
Some of the smaller municipalities with whom we have worked around the US and
Canada in recent years include:
• Annapolis, MD
•
Longmeadow, MA
• Asheville, NC
•
Medicine Hat, AB
• Brownsville, TX
•
Montgomery, AL
• Corpus Christi, TX
•
Mount Prospect, IL
• Encinitas, CA
•
Mountain Brook, AL
• Exeter, NH
•
Olympia, WA
• Fayetteville, NC
•
Palo Alto, CA
• Guelph, ON
•
Port Moody, BC
• Greenville, SC
•
Pullman, WA
• Harrisonburg, VA
•
Provo, UT
• Hillsboro, OR
•
Saint John, NB
• Hamilton, NJ
•
Tacoma, WA
• Huntington Beach, CA
•
Waterford, CT
• Hyattsville, MD
0
Wilmington, DE
MAKWIft, 17
Proposal to Provide
Fleet Management Consulting Services
Our work with these and many other government jurisdictions both large and small has
given us a deep understanding of the challenges of managing and operating a fleet in a
local government jurisdiction like Oak Brook. This expertise is further enhanced by the
professional fleet management experience of our staff: no fewer than seven of our
employees, including two of Mercury's three owners, are former local government fleet
management professionals (in Charlotte, NC; Jefferson County, CO; Kansas City -
Wyandotte County, KS; Los Angeles County, CA; Montgomery County, MD; Pinellas
County, FL; Saint Petersburg, FL; Sandy, UT; Sarasota County, FL; and Vail, CO).
PROJECT TEAM
The project team that we propose for conducting this study is shown in the table below.
Brief biographical sketches of each team member follow, and detailed resumes can be
furnished upon request. As can be seen, our team is composed of individuals with
extensive experience as fleet managers, fleet management consultants, or both. The
expected level of effort by project team member is shown in our detailed cost proposal,
which has been provided under separate cover.
Paul Lauria is the president of Mercury Associates. During hisconsulting career of
more than 30 years, he has worked with a wide array of organizations in the public and
private sectors touching on virtually every facet of fleet management and operation. He
has conducted presentations and workshops on fleet management best practices
throughout the United States and in 18 other countries around the world; directed
research studies for entities such as the NAFA Foundation, the RAND Corporation, and
the Transportation Research Board; and served as an expert witness on more than half
a dozen class-action lawsuits and arbitrations in federal and state courts.
Prior to co-founding Mercury Associates, he was Vice President and Director of Fleet
Management Consulting Services for Maximus, Inc.; a Senior Manager in the National
Transportation Consulting Group of Ernst & Young; and an analyst with the North
1 1 18
.-
'. Responsibilities
Project director with overall responsibility for
7
contract negotiation and execution; project
planning and administration; direct involvement in
Paul Lauria
President
all three project components; participation in all
key meetings/presentations; and quality assurance
review of all deliverables.
Project manager with day-to-day responsibility for
Tony Yankovich
Senior Manager
managing and conducting all project components.
Steve Saltzgiver
Manager
Support analyst on project Components 1 and 2.
David Burtnick
Senior Consultant
Lead analyst on project Component 3.
Paul Lauria is the president of Mercury Associates. During hisconsulting career of
more than 30 years, he has worked with a wide array of organizations in the public and
private sectors touching on virtually every facet of fleet management and operation. He
has conducted presentations and workshops on fleet management best practices
throughout the United States and in 18 other countries around the world; directed
research studies for entities such as the NAFA Foundation, the RAND Corporation, and
the Transportation Research Board; and served as an expert witness on more than half
a dozen class-action lawsuits and arbitrations in federal and state courts.
Prior to co-founding Mercury Associates, he was Vice President and Director of Fleet
Management Consulting Services for Maximus, Inc.; a Senior Manager in the National
Transportation Consulting Group of Ernst & Young; and an analyst with the North
1 1 18
Proposal to Provide
Fleet Management Consulting Services
Carolina Department of Transportation and Durham (NC) Transit. Mr. Lauria's particular
areas of expertise include business process mapping, evaluation, and reengineering;
strategic business planning; fleet rightsizing and optimization; activity -based costing and
cost charge -back system design; vehicle life cycle cost determination and replacement
cycle optimization; and fleet replacement planning and evaluation of alternative capital
financing approaches.
Mr. Lauria has worked extensively with clients in California including the cities of Long
Beach, Los Angeles, Sacramento, San Diego, and San Francisco; the counties of Los
Angeles, Orange, Sacramento, and San Luis Obispo; and Pacific Gas & Electric
Company and Southern California Edison. He holds a Master Degree in Transportation
Planning from the University of North Carolina at Chapel Hill.
Tony Yankovich is a Senior Manager in Mercury Associates with more than 25 years
of experience as a management analyst and consultant in the fleet management and
public works areas. Mr. Yankovich specializes in serving state and local governments,
universities and private companies in the provision of fleet management consulting
services, management operations reviews, facilities space needs assessments, and
development of facilities master plans. Prior to joining Mercury Associates, he was
Senior Manager in the Fleet and Facilities Division of Eclipse, a division of Bucher,
Willis & Ratliff Corporation, and Senior Consultant with Maximus, Inc. Before beginning
his consulting career, he worked for the Unified Government of Wyandotte County and
Kansas County, KS where he held several management positions in the Public Works,
Operations Services, and County Clerk departments. Mr. Yankovich's particular areas
of expertise include program evaluation; productivity and competitiveness assessments;
fleet replacement planning and financing; maintenance facilities reviews and facilities
space needs assessments. He holds a Bachelor's Degree in Sociology from the
University of Kansas.
Steve Saltzgiver is a Manager with Mercury Associates, Inc. Over his extensive career,
he has a rather unique perspective having served at virtually every organizational level
holding various roles ranging from maintenance technician to vice president in public,
private and non-profit institutions while leading diverse fleets of over 40,000 assets, with
annual operating budgets exceeding $113 dollars; leading process improvement teams
and cost reduction initiatives; optimizing complex maintenance operations, and
executing comprehensive talent management programs. He has taught workshops and
best practice seminars on a wide array of topics throughout the US, Canada and
Europe. Mr. Saltzgiver is recognized as a change advocate who has supervised the
implementation of several Fleet and ERP data systems, and as an executive for two
Fortune 500 companies (i.e., Coca-Cola and Republic Services), two sizable state
government fleet operations (Utah and Georgia) and has been recognized for his
achievements in data analysis, benchmarking for continuous improvement, fleet cost
reduction, sustainable fleet technology, planning, telematics and deployment.
Mr. Saltzgiver has led myriad multi-year strategic fleet management planning initiatives
in both government and the private sector. He has also been active in several
MR&WOMY 19
Proposal to Provide
Fleet Management Consulting Services
professional fleet organizations serving in various leadership positions including: NAFA
Curriculum and Governmental Affairs Chair, RMFMA Board Chair, National Conference
of State Fleet Administrators (NCSFA) Executive Director and President and on various
industry supplier boards. He was twice nominated for Automotive Fleet Magazine's,
"Fleet Manager of the Year award and is the recipient of the 2000 Honda Environmental
Leadership (State Government) award, 2005 NCSFA Distinguished Service Award and
recipient of the 2015 Fleet Technology Expo Sustainable Fleet of the Year award.
David Burtnick is a Senior Consultant with Mercury Associates. He has 17 years of
experience in business management as well as 12 years of experience as an
operations research statistician and data scientist. His experience includes predictive
modeling, forecasting, business process improvement, lean Six Sigma methodology,
simulation, and survival analysis. His fleet management consulting experience includes
fleet replacement planning and alternative capital financing analysis, determination of
optimal vehicle replacement cycles; and operating cost charge -back rate model
development. Prior to joining Mercury Associates he worked as a research analyst at
the Nielsen Company. He holds a Bachelor's Degree in Business from the University of
Maryland at College Park.
COST PROPOSAL
Our proposed cost for each of the three components of the project is shown in the
detailed cost proposal in the appendix. The amount shown for each component is a not -
to -exceed price which includes all professional services and out-of-pocket expenses.
However, the proposed cost for Component 2 is based on the assumption that it would
be performed in conjunction with Component 1 (meaning either simultaneously or within
one to two months of the performance of Component 1). This is because efficiencies in
the conduct of Component 2, in terms of collecting and reviewing information,
conducting interviews and site visits, etc., have been assumed in estimating its level of
effort and cost. If the work of Component 2 were performed on a stand-alone basis, the
cost would be approximately 40 percent more than the amount shown.
Our proposed level of effort and fees are based on the thorough and detailed approach
and work plan presented in this proposal. We recognize that this is not an insignificant
amount of money for the Village to spend on a fleet management consulting project. We
are confident, however, that the study will uncover savings opportunities that far exceed
the cost of having Mercury conduct this project, and believe that many of our client
references will readily attest to the fact that this has been their experience in working
with our firm. That said, please be assured of our willingness to discuss modifications to
our proposed approach to the project if the Village wishes to explore ways to reduce its
overall cost or the cost of any particular components of the proposed work plan.
0yprQr0101 20
Proposal to Provide
Fleet Management Consulting Services
DE MLED COST PROPOSAL
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