The Levelland Police Department (LPD) was approved to implement a new vehicle lease program for their fleet following a presentation to the City Council by Police Chief Erica O’Bryon on July 7.
The proposal contained information about the current fleet and included two options for leasing as well. Working alongside O’Bryon, Brady Elmore was in attendance as he represented the American National Leasing Company.
“This plan is not just about vehicles,” O’Bryon said. “It’s about supporting our officers and creating conditions that reinforce pride, high morale,and professionalism. I routinely ask our officers to give their best each day, and they continue to rise to that expectation.”
According to O’Bryon, patrol vehicles “typically reach the end of their useful life between five and six years of service” due to constant idling, high engine hours, emergency response driving and vehicle equipment. Every engine hour is equivalent to around 25-30 miles of wear.
The current fleet includes units that have exceeded their recommended usage by 10 or more years, some dating back as far as 2013. It also includes 19 units over five-years-old, and three 2021 models.
As examples of heavily used vehicles, O’Bryon mentioned Unit No. 7408 is a 2015 Chevy Tahoe which has 11,592 engine hours equating to about 347,760 miles worth of wear. Unit No. 6472 (ACO) is a 2014 Ford F150 with over 141,000 miles and is still in use daily. The K9 unit 3112 also has 56,741 miles with 11,410 engine hours and requires constant idling for K9 safety. Engine hour estimates were made using a 30 mile/engine hour multiplier.
“They [police officers in the LPD] operate with torn seats, rusted push bumpers, peeling paint and decals and recycled cages and radios,” O’Bryon said. “Even the most recent vehicles purchased were outfitted using recycled equipment that was taken out of older units.”
The LPD received five units this year which have been paid off totaling 25 units. However, there is an option for the department to include their newly acquired vehicles to avoid a lease payment in the first year if that is their desire.
The first option would be to move to a five year lease program to lease 20 vehicles. This route would include an annual lease payment of $308,099.84 for 20 vehicles with the first payment due 12 months after signing the contract. The fleet trade offer would total $189,700 which covers 62% of the first year’s lease payment. The projected payment in 2026 would be $118,399.84. From 2027-2030, the payment would total $308,099.84.
Option two would consist of 25 total vehicles including five recently purchased units which would be refinanced. If this route was chosen, the annual lease payment would be $378,980.79 for 25 vehicles with the first payment also due 12 months after contract signing. The initial capital recovery would total $502,200, according to O’Bryon.
The City would be reimbursed $312,500 for the five already purchased vehicles in refinancing. The company would also accept most of the current fleet for roughly $189,700 in trade-ins resulting in the City recovering in capital. The option fully covers 2026. In 2027, the total payment would be $255,761.58. From 20282030, the payment would be $378,980.79.
Option two drew some concern from the Council as the five units have been paid off already.
“In a highly competitive hiring environment, a modern, reliable fleet not only enhances officer safety and performance, but also makes Levelland more attractive to highly qualified candidates,” O’Bryan said. “One of the strongest elements of this proposal is the financial responsibility.”
Regardless of the five newly purchased vehicles, the overhaul of the fleet needed includes 15 patrol units, one Animal Control (ACO) unit, and four CID/Admin units. Both options include new equipment, full upfitting and documentation fees.
“Whatever equity is in those vehicles would be returned back to the city,” O’Bryon said. “Ultimately, we are not losing any equity by going to the leasing program. Ideally the equity that we receive from the units selling back after five years would be rolled into a new five year lease program with new vehicles, once again completely outfitted with new equipment.”
O’Bryon included information about costs for replacing only the minimum for a 10 year rotation.
Without the lease program, the current 10-year cycle cost would be $312,500 for five patrol units, $25,000 for equipment upgrades and $60,000 for an ACO vehicle. This would be a total of $397,500.
After the presentation, Michael Stueart asked whether the outfitting of new vehicles would be an additional expense for the City or if the company would take care of it.
“Those quotes include a complete outfit with new equipment,” O’Bryon said. “That includes the decaling and the window tint.”
It was added that the last oufits did not include those features, resulting in additional incurred costs equaling about $800 per vehicle.
O’Bryon noted that the estimates could vary because a majority of the current fleet is still being driven. An additional factor could be the differences in the price provided by whichever dealership that American Leasing chose as opposed to a local option.
Stueart also asked about if the complete outfit also applied to the cages and bed in the ACO truck. O’Bryon said that the current ACO bed is functional; therefore, it would be transferred to the new truck and not replaced.
Mayor Breann Buxkemper asked about the shopping local option and how that would work.
“We would let you [the City] go directly to them [local dealerships] and get pricing. If that’s who you choose to go through, then they would contact us,” Elmore said. “Essentially, we are just a finance company.”
Brady said that going out and getting the quotes from local dealerships is an added benefit of working with them.
“On these quotes, you have a bank qualified rate of 6.45%,” Buxkemper said. “That’s your leasing rate? How does that work because I can beat that?”
Elmore said that was the rate at the time of the presentation, but he could ask if it could go down further. He also said they offer one refinancing opportunity for no cost if rates were to drop after they sign the contract.
Looking at up-keep, O’Bryon explained that maintenance would fall onto the City, but there would be no mileage limit. Additionally, she explained that she has been a part of departments who have switched to leasing structures. She indicated that it depends on the department size and feels the LPD is more than big enough to see benefits from the change.
If a vehicle was totaled while in the leasing program, Elmore says the company would put together a lease deal for a new unit and the insurance would pay off the rest. If it did not pay all of it, then the City would be liable.
Buxkemper then asked City Manager James Fisher if there was anything creative they could do with funds to try to save money when it came to payments. He said they would commit the funds to those payments specifically.
Asked about vehicle options, O’Bryon explained that the quotes were for Dodge Durangos as they are cost effective and operate well. The LPD will also have the option to choose a different vehicle if they are unsatisfied with the Durangos.
Councilmember Bill Powel also asked what the time frame would look like if they did sign the lease agreement. O’Bryon said that the new units would be out in roughly five months.
Buxkemper asked about the possibility of opting out of the agreement to which Elmore said it can be done. The City would need to pay what was left on the note, but there would be no prepayment penalties.
Multiple council members agreed that the proposal was a good idea.
After an executive session, the council decided to approve the LPD leasing up to 20 cars without refinancing the five they already purchased. The company they will go through has not yet been established. Instead, they will open bids to companies and dealerships to apply to be considered for use.