OA takes positive action implementing SAO recommendation

OA implemented our previous recommendation and issued a statewide vehicle policy in January 2002. OA's policy included minimum requirements needed for a vehicle management program. OA established a fleet management system to identify the number of state vehicles and requires agencies to provide fleet management data to OA. Audit efforts at the Departments of Insurance, Agriculture, and Economic Development disclosed those departments are following OA's fleet management policies.  (See page 4)

State spent $72 million over a 5-year period on employee mileage reimbursements

During fiscal years 2001 through 2005, the state reimbursed employees approximately $72 million for using personal vehicles for business purposes. Three agencies (Departments of Corrections, Health and Senior Services, and Social Services) accounted for $40 million (56 percent) of that amount.  (See page 8)

Requiring the use of OA's trip optimizer and reducing vehicle assignment criteria could reduce mileage reimbursement costs

OA established the trip optimizer to help employees determine the most cost-effective mode of transportation. However, OA has not required agencies to use it. Auditors found 240 employees drove over 15,000 miles and had been reimbursed $1.6 million during fiscal year 2005. If those employees had been provided access to state vehicles, the state could have saved $670,000, or $3.3 million over a 5-year period. Auditors also found reducing vehicle assignment mileage criteria could save the state as much as $3.3 million a year in mileage reimbursement costs. OA is considering establishing a centralized vehicle pool, and acquiring additional vehicles through a lease-purchase program, to help offset mileage reimbursement costs.  (See page 9)

Increasing replacement mileage criteria could reduce fleet costs

Auditors noted increasing the minimum replacement mileage criteria for fleet vehicles could reduce fleet costs. For example, if vehicles are replaced at 135,000 miles instead of 105,000 miles, the state could reduce fleet costs by about $2 million. Auditors also noted purchasing surplus vehicles can reduce fleet costs.  (See page 13)

OA policies have not required agencies to consider surplus vehicles or justify purchase of SUVs

OA has not established a policy requiring agencies to justify why an agency chose to buy new vehicles instead of buying from surplus property. In addition, OA's vehicle policy has not established criteria to be met or required additional justification, prior to the purchase of sports utility vehicles (SUVs). OA data for 2004 showed SUVs cost the state approximately $0.34 per mile compared to $0.199 per mile for mid-size sedans.  (See pages 14 and 16)

Conservation, Transportation, and state university fleet programs could be enhanced

Auditors found the Departments of Conservation and Transportation, and state university fleet programs could also be enhanced by establishing policies, or formal guidance, addressing employee use of the least costly mode of transportation, and the procurement of surplus vehicles and SUVs. In addition, policies and guidance have not always addressed vehicle replacement criteria, vehicle assignments and/or minimum mileage use requirements, and use of vehicle mileage logs and/or the method for tracking vehicle usage.  (See pages 22 and 31)