MEMORANDUM State of Alaska
Department of Transportation & Public Facilities
Administrative Services Division
TO: Karen Rehfeld DATE: October 22, 2007
Office of Management and Budget
TELEPHONE NO: 465-3911
TEXT TELEPHONE: 465-3652
FAX NO: 465-3124
FROM: Nancy J. Slagle SUBJECT: FY2009 SEF Rates
Attached are the operating and replacement rate methodologies and a summary by department of
the FY2009 equipment rental rates for the State Equipment Fleet (SEF). The Department is
proposing individual vehicle and equipment operating rates for FY09. In previous years
departments’ operating rates were calculated on a regional basis and then averaged to produce
statewide department rates. DOT&PF rates were presented on a regional basis. This process
combined all costs for individual classes or vehicles into an average rate; high and low cost
equipment paid the same fees. The transition to individual operating rates provides departments
with indicators of actual vehicle and equipment costs, and thus provides needed information on
whether to keep or replace aging equipment. This change also addresses an issue brought up in
DMG Maximus’ Review of State of Alaska Fleet Operations, December 2000. That report stated
concern regarding the potential of newer vehicles used by federally funded programs subsidizing
older state vehicles. Without the averaging across class or department, this can no longer occur.
Replacement rates for all departments are prepared on an individual vehicle basis.
The operating rates are projected to decrease by $115,000 in FY2009 and replacement is
projected to be almost equal to FY2008.
With respect to the operating departments, Administration and Military and Veterans Affairs
are projected to have substantial percentage increases in costs. In each case the departments
have vehicles that should be considered for replacement due to their high maintenance costs,
but funding presents the greatest challenge.
No directly billed services such as credit card fuel, accident and damage repairs, support for
Maintenance and Operations, or maintenance on assets that do not have operating rates are
included in the spreadsheet or the above analysis.
During your review of these rates, please let me know if you need additional information.
We would appreciate your approval of the FY2009 rates.
cc: Frank Richards, Statewide Maintenance Engineer
Diana Rotkis, Manager, State Equipment Fleet
“Providing for the movement of people and goods and the delivery of state services.”