Motor Vehicle Fleet Performance Audit

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Motor Vehicle Fleet Performance Audit

• Jeff A. McMahan, CFE
• Oklahoma State Auditor Inspector
• NSAA Annual Conference 2005
• Wrightsville Beach, NC

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Background

• 74 O.S. 213.2 B. of the Oklahoma State Statutes
  requires a written request from the Governor, an
  agency director, or a resolution from the
  Legislation to conduct a performance audit.
• Governor Brad Henry made an official request for
  a performance audit of the States motor vehicles
  in December 2003 to determine if the fleet was
  being used in an economical and efficient manner.
  
• The Department of Central Services-Fleet
  Management Division (FMD) is responsible for
  maintaining records of the States vehicles.

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Scope

• The scope was limited to include only passenger
  type vehicles (two and four door cars, SUVs, pick
  ups one ton or less, and vans) owned by the
  State.
• Colleges and universities were excluded.

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Objectives

• I. To determine if vehicle fleet records
  are adequately maintained so the State can
  accurately track the number of vehicles in its
  fleet, the usage of the vehicles in its fleet,
  and the costs associated with the fleet
• II. To determine if agencies utilize fleet
  management policies and procedures
• III. To determine if the vehicles in the
  States fleet are adequately utilized
• IV. To determine if vehicles are assigned to
  employees in only those instances where a true
  need exists
• V. To determine if state employees are
  driving their private vehicles and being
  reimbursed for mileage when it would be more
  economical to utilize the State motor pool

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Objective I Vehicle Records

• Inventory records maintained by FMD are not
  adequate.
• Duplicate and invalid VIN numbers
• 75 of a sample consisting of vehicle purchases
  were not included in the inventory.

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Objective I Vehicle Records

• Vehicle operating cost information is not
  maintained or analyzed.
• Mileage, fuel costs, and maintenance costs had
  not been entered into the FMD system since 1999.
• Analysis on operating cost data was non-existent.
• There were 428 purchase requests in 2003. None
  of the requests were denied.

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Objective II Policies and Procedures

• Agencies often lack comprehensive fleet policies
  and procedures.
• A survey sent to 73 agencies revealed
• 62 of respondents did not have a vehicle
  replacement policy.
• 28 of respondents did not have a vehicle
  maintenance policy.
• 56 of respondents did not have a policy related
  to the assignment of vehicles to individuals.

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Objective III Assigned Vehicles Driven Home

• Assigned vehicles driven to and from employees
  residences may be unjustified.
• 47 O.S. 156.1 A. and B. requires the following
  to commute in a State vehicle
• Approval of the Governor
• Regularly receives emergency phone calls at the
  employees residence when not on dutymust have
  documentation
• Specific law enforcement agencies are authorized
  to commute in State vehicles.

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Objective III Assigned Vehicles Driven Home

• A survey was sent to 73 state agencies to
  determine the number of employees driving a
  vehicle to and from their residences. We asked
• Make, model, VIN
• Distinction between Governors approval or an
  after hour responder
• Number of calls responded to in 2003
• Mileage at 1-1-03 and 12-31-04
• 680 vehicles identified through survey

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Objective III Assigned Vehicles Driven Home

• A sample of 133 vehicles were selected. From
  this, we noted
• Nine had the approval of the Governor. Only one
  of the nine had an approval letter for the time
  period.
• 70 reported they maintained no documentation to
  support whether or not they responded to after
  hour calls.
• 54 reported they did maintain documentation
  however, 28 of the 54 responded to 10 calls or
  less.
• 19 out of 30 employees did not have commuting
  fringe benefits reported on their W-2.
• A reduction of 25 in commuting vehicles could
  produce savings of 3,000,000.

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Objective III Assigned Vehicles Not Driven Home

• Mileage criteria indicates assigned vehicles not
  driven home are underutilized.
• 1,018 vehicles identified through survey as
  assigned but not driven home
• Selected a sample of 127 vehicles
• 29 of sample was driven less than 9,000 miles in
  2003 (GSA standard is 12,000) which projects to
  approximately 300 vehicles across population.
• Estimated 2,500,000 in savings from reduction in
  underutilized vehicles

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Objective III Agency Fleet Vehicles

• Mileage criteria indicates State agencies
  owned/leased fleet vehicles are underutilized.
• 3,137 vehicles identified through survey as
  agency fleet.
• Selected a sample of 131 vehicles
• 45 of sample was driven less than 9,000 miles in
  2003 (GSA standard is 12,000) which projects to
  approximately 1,400 vehicles across the
  population.
• Estimated 11,500,000 in savings from reduction
  in underutilized vehicles

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Objective III State Motor Pool

• Number of vehicles in State motor pools appears
  to be excessive.
• On average, 52 vehicles were available for lease
  each day.
• On average, 14 vehicles were used each day.
• No analysis on miles driven or days of use

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Objective VReimbursement vs. Use of State Car

• The State has no process for evaluating cost
  effectiveness for use of State owned vehicles
  versus use of private vehicles.
• Analysis of break-even point had never been
  performed.

• 1,048 employees were reimbursed for more than
  9,967 miles. Had the employees utilized a State
  vehicle, the State would have saved approximately
  1,200,000.

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Other Items Noted

• Additional justifications for sport utility
  vehicles is needed.
• The State owns 233 SUVs.
• Had the State purchased this number of sedans
  rather than SUVs, potential savings over the life
  of these vehicles would have been approximately
  1,800,000.

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Other Items Noted

• Unauthorized agencies are acquiring vehicles.
• 22 agencies in addition to the Department of
  Central Services have the authority to purchase
  their own vehicles.
• FMD purchased vehicles on behalf of agencies
  without specific authority to purchase and
  charged them a 20 per month administrative
  feeover 260,000 from 1986 to 2003.

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Other Items Noted

• Cost of certain car washes, details, and fuel
  appears excessive.
• 38 instances of car washes/details greater than
  50 with 13 of these 100 or more
• 142,941 in premium fuel purchases
• Approximately 10,000 in savings had unleaded
  fuel been purchased.

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A Funny Thing Happened on the Way to the
Department of Corrections
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A Funny Thing Happened on the Way to the
Department of Corrections
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Closing Comments

• Administration of fleet is inadequate.
• Lack of adequate policies
• Utilization
• Assignment
• Maintenance
• Decentralization
• FMD is not operating in a regulatory capacity
• 22 different agencies have the authority to
  purchase and own their vehicles.