43rd Annual Western States Highway Equipment Managers Association

Conference

Washington State Department of Transportation Presentation

August 29, 2011

Greg HansenFleet Administrator

Equipment Plays a Critical Role in Operating and Maintaining The Highway System

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4,800 Vehicles & Construction Equipment

10,000 Pieces of Supporting Equipment

TEF Equipment

4,500 - Wireless Radio System Components 1,350 - Equipment Attachments (primarily snow and ice) 410 - Fuel System Components and Generators 40 - Reproduction and Photogrammetry Pieces

500 - Field Engineering Survey Equipment 1,700 - Materials Lab Testing Equipment 1,110 - Message Signs and Impact Attenuators 390 - Equipment and Lab Trailers

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Fuel33%

Outside Services2%

Capital34%

Fees to Other Agencies

1%Labor21%

Repair Parts7%

Other2%

Expenditures Planned For The 11-13 Biennium$145.8 Million To Deliver Essential Program Services

(All dollar amounts are in thousands)

Labor $30.3 209.3 FTEOutside Services $3.1Includes glass replacement, body work, radio installation, fuel site service and repairs, man lift inspections and repairs and power generation maintenance.Other $3.3Supplies and materials; motor oil and other petroleum products; propane; safety items to include clothing and footwear; laundry; fleet management software and l icenses; fuel management software and l icenses; towing; tool replacements; travel and per diem.Fees to other Agencies $0.6GA disposal, Attorney General, Risk Management, Department of Licensing

Capital $49.4Fuel $48.5Repair parts $10.7

$145.8

Supported Customers • Highway Maintenance (M) 73.4%

• Preservation (P) 17.5%

• Improvements (I) 1.5%

• Facilities (D) 1.3%

• Traffic (Q) 3.3%

• Ferries (W & X) 1.4%

• All Other Programs (B, C, F, H, S, T, V, Y, Z)

1.7%

100.0%

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Work Force

209.3 FTE Authorized

a 16 Accounting and Administrative Staff

a 13 Repair Parts Specialists

a 145 Mechanics

a 15 Radio Technicians

Work Force

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Doing More … With Less

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Expenditures Planned For The 11-13 Biennium$145.8 Million To Deliver Essential Program Services

Fuel $48.5 M 33.3%

Outside Services $3.1 M 2.1%

Capital $49.4 M 33.9%

Fees to Other Agencies $0.6 M 0.4%

Labor $30.3 M 20.8%

Repair Parts $10.7 M 7.3%

Other $3.3 M 2.3%

Total Planned Expenditures $145.8 M 100.0%

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Fuel Usage and Cost

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Where we’ve been Because of budget constraints across all department programs over the past several biennia, the department limited the total amount of revenues that TEF was authorized to collect from rental charges to department programs. As a result, TEF has not been able to increase equipment rental rates to fully match the significant increases in equipment costs, fuel, labor, and other operating costs that occurred.

In order to make up the funding shortfall, equipment lifecycles were extended and equipment purchases were deferred. While that worked in the short term to plug the gap, it did not solve the problem long-term, as there is now a significant backlog of equipment that needs to be replaced.

Equity In The Fleet Has Been Depleted

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Pressures on TEF Program 99-01 01-03 03-05 05-07 07-09 09-11 11-13 Comments

Legislature transfers funds -$3,500,000 -$5,000,000 Transferred to MVFUnfunded fuel costs -$6,000,000 -$2,000,000 Fuel costs were not fully funded

Unplanned increase in fuel usage -$1,300,000 Increases occurred due to the Construction Programs tempo

Unfunded COLA increases -$1,400,000 OFM oversiteInventory adjustment -$1,000,000 Non cash working capital adj.Unfunded inflationary equipment costs -$1,000,000 -$1,500,000 -$300,000 Inadequate funding available to purchase all "Meets Criteria" equipment -$14,000,000 -$12,000,000 -$17,000,000 Leadership Team decision

Subtotal -$13,000,000 -$6,200,000 -$14,300,000 -$12,000,000 -$17,000,000

Actions TakenDeferred "Meets Criteria" equipment $4,000,000 $2,000,000 $3,300,000 $12,000,000 $17,000,000 Aged beyond its economic lifeExtended equipment life cycles $9,000,000 $4,200,000 $11,000,000 Defers replacement to out years

Subtotal $13,000,000 $6,200,000 $14,300,000 $12,000,000 $17,000,000 Variance $0 $0 $0 $0 $0 $0 $0

Time and Effort Repairing Equipment has Dramatically Increased Repair Hours and Dollars – The life cycle of the existing fleet have been substantially extended. Equipment breakdowns are now common.

For instance, 2009 required the equivalent of 10 additional mechanics to keep up with required repair work.

Why Do We Need To Invest In Equipment Replacment?

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Why do we need to fund now?We’ve reached the tipping point • Time and Effort Repairing Equipment has Dramatically Increased Repair Hours and Dollars

– The life cycle of the existing fleet have been substantially extended. Equipment breakdowns are now common. For instance, 2009 required the equivalent of 10 additional mechanics to keep up with repair work

45%

47%

49%

51%

53%

55%

2005 2006 2007 2008 2009

Percent of Time Performing Repairs

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Aging the Fleet

Worn Out Brake and Electrical Parts

Things You Don’t See

Vehicle Classification Description Lifecycle Ferguson Target Age

2004 2008 2009Passenger Carrying Vehicles Passenger Carrying Vehicles 12 years 6 3.1 5.3 8.5Light Work Trucks Cargo Vans and Trucks 1/4 ton thru 1/2 ton 12 years 6 4 5.2 8.8Medium Work Trucks Trucks 3/4 ton thru 2 ton 12 years 6 3.2 4.8 7.7Heavy Duty Vehicles Vehicles 19,500 GVW or greater. Includes

Medium and Heavy Duty Dump Trucks, Bucket Trucks, Sweepers, Flushers,Snowblower, ect

12 years 6 4.4 6.2 10.6

Off Road and Construction Equipment

Mower,Backhoe,Grader,Forklift,Roller, Compressor,ect

20 years 10 5.9 7.7 13.2

Fleet Average Age

12 Year Old Plow Truck

A Tale of Two Trucks

Plow Truck Comparison Avg. Yearly Repair Costs Average Labor Hrs Average DownTime 12 Year Old Plow Truck

(Data based on 19 trucks ) $13,616 172 26%14 Year Old Plow Truck

(Data based on 15 trucks ) $21,492 250 44%Data from Jan.-Dec. 09 ($7,876) (78) -17%

The Ferguson Report, conducted in 1984, found that TEF equipment was excessively aged and contributed to excessive downtime and inefficient operations.

The recommendation was to reduce the average age of the fleet to 50 percent of the established economic life.

Risks Associated with Aging the Fleet

Equipment availability will go down Longer response times Efficiency decline in day to day operations

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Unreliable equipment effects the ability of Maintenance and Construction delivering their programs

Potential to adversely affect the traveling public and freight mobility

Performance Measures

•In Service Time•Equipment Availability•Preventive Maintenance•Labor Pie Charts

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In Service Time

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Equipment Availability

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Data as of: #REF!

Quarter 1 July through September Calander Year is One less than the Fiscal YearQuarter 2 October through December Calander Year is One less than the Fiscal YearQuarter 3 January through March Calander Year is the same as the Fiscal YearQuarter 4 April through June Calander Year is the same as the Fiscal Year

PM Jobs for Class 01 thru 23 and 25 Data reflects the Last job for each Job code

66% 67%63%

67%73% 75% 75% 77% 77% 76%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Statewide PM Completed on Time

Percent Performance Benchmark = 90% of PM Services witin 30 days of due date

Statewide PM Completed on Time

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Mechanic Labor Hours

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•Energy conservation and air quality concerns continue to be significant issues for our agency. Over the years, policies have been developed and implemented to ensure that limited resources are utilized in the most cost-effective, efficient manner possible. •Therefore, results of third party analysis and testing of new products, devices and technology for fuel savings and emission reductions must be provided by the vendor(s) prior to implementing the use of a new products, devices and technology with regards to the agency’s fleet and equipment. Prior to using a new fuel additive or fuel and emission reduction device and technology, testing and product evaluation from the U.S. Environmental Protection Agency’s (EPA) “Gas Saving and Emission Reduction Devices Evaluation” program is required. WSDOT will review the evaluation and determine if the product merits field testing. •The link to the EPA’s “Gas Saving and Emission Reduction Devices Evaluation” program is http://www.epa.gov/otaq/consumer/reports.htm.

Fuel Additives

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Questions?

Contact: Greg Hansen

- Title: Fleet Administrator- Phone: 360-491-2453- Email: Hanseng@wsdot.wa.gov

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