Nearly a quarter of vehicles leased by Kentucky may be underutilized
(The Center Square) – A report issued by the Kentucky Legislative Research Commission last week called on the state’s Finance and Administration Cabinet to improve several policies in regards to vehicle fleet management. That includes tracking underutilized vehicles and determining if independent fleets managed by five state agencies are effectively using public funds.
The 34-page report was the focus of a Legislative Oversight and Investigations Committee meeting in Frankfort on Thursday. Among the findings was 24.4% of the 3,793 cars, trucks and sports-utility vehicles leased in fiscal year 2019 were driven 5,000 miles or less.
In addition, 110 of the 459 vehicles state agencies bought also were driven less than 5,000 miles.
It’s not just a one-year issue either as the cabinet averaged more than 917 leased vehicles per year that were driven less than 5,000 miles over a five-year period. In agency fleets, the average was more than 113 purchased cars per year.
“These vehicles may be underutilized, and the commonwealth may be buying more vehicles than necessary,” the report stated.
The report stated that the cabinet did not seek reports from five state agencies maintaining their own fleets nor does it have statements from them claiming they can operate their fleet at a cost less than or equal to the finance cabinet’s fleet management office.
The lack of justification spanned from fiscal years 2015 to 2019, which included the administrations of Democratic Gov. Steve Beshear and Republican Gov. Matt Bevin.
Six agencies operate their own fleets, according to the report. The Kentucky State Police, which is exempt from needing cost-justification operates by far the largest fleet of that group. Other agencies are the Energy and Environment Cabinet, Public Protection Cabinet, Department of Agriculture, Facilities and Support Services, and the Attorney General’s Office.
The report also found the state’s central fleet ran a deficit of $6.3 million over fiscal years 2019 and 2020. One reason for the deficit was an increase in personnel spending. In fiscal year 2020, the cabinet spent nearly $925,000 on employee fringe benefits even though salary and wages totaled just more than $836,000.
The cabinet also bought nearly $10 million in vehicles in fiscal year 2020, which ended last June. That was up from $6.2 million in 2019 and $3.4 million in 2018.
That LRC report gave 10 recommendations for better oversight of fleet management. That includes calling on the cabinet to send annual reports to the LRC as required by state law and for cabinet officials and lawmakers to review state statutes and clarify laws about fleet management.
Cabinet Secretary Holly Johnson, who was appointed under current Gov. Andy Beshear in December 2019, told the committee that improving fleet management is a priority.
Johnson added she requested an internal audit on the fleet management program last year that will be completed this summer
“The cabinet will use this committee report as well as our internal findings to identify additional process improvements that may be implemented to enhance fleet management operations going forward,” she said.
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