Serves the Commercial Small Fleet Market of 10 – 50 Vehicles

North Carolina Fleets Wasting Millions on Unused Miles

November 12, 2009

North Carolina Gov. Beverly Perdue said Tuesday that rules governing how state agencies lease vehicles need to be reworked to avoid wasteful spending, reports WRAL.com. Some agencies paid millions for miles they did not drive, and others had questionable record-keeping practices.

Agencies lease vehicles from the state Motor Fleet Management Division, which is funded solely by fees collected on the vehicles. By law, the division charges for a monthly minimum of 1,050 miles on each vehicle to cover maintenance, insurance and gas for more than 8,500 state-owned vehicles. If vehicles are driven more than 1,050 miles in a month, the agency must pay extra. If cars travel less than 1,050 miles, agencies must still pay the minimum rate.

The unused miles added up in the past year, when Perdue and former Gov. Mike Easley ordered agencies to cut travel spending because of a record budget shortfall.

From July 2008 to last June, records show the state Department of Correction spent $1.7 million on parked cars. More than half of the state Department of Health and Human Services vehicles drove under the minimum mileage, costing the agency more than $1 million, records show.

The University of North Carolina-Chapel Hill spent $600,000 on unused mileage the fiscal year that ended in June, while North Carolina State University spent $293,000, according to state records.

The expense for the unused cars came as agencies cut programs and state workers took a pay cut last spring to balance the budget. The budget reform panel already targeted fuel efficiency in the fleet, and mileage charges will now be scrutinized as well.

Perdue said agencies could end up returning several vehicles to Motor Fleet Management and having their employees sharing vehicles. She also said the law regarding usage of state-owned vehicles might need to be updated.

The motor fleet statute that covers mileage was adopted in 1981 and has never been changed, according to WRAL.com. By law, Motor Fleet Management is limited in its oversight. Once an agency rents a vehicle, the division can't take it away as long as the bills are being paid.

 

Twitter Facebook Google+

Comments

Please note that comments may be moderated. 
Leave this field empty:
 
 

Fleet Incentives

Determine the actual cost of owning and running a vehicle in your fleet. Compare vehicles by class and model.

FleetFAQ

Fuel Management

Bernie Kanavagh from WEX will answer your questions and challenges

View All

 

Fleet Tracking And Telematics

Todd Ewing from Verizon Connect will answer your questions and challenges

View All

 

Fleet Management And Leasing

Jack Firriolo from Merchants will answer your questions and challenges

View All

 

Sponsored by

For more than 50 years, Merchants Fleet Management has been providing customized, total fleet management and leasing solutions for businesses and government agencies.

Read more

Article News

Popular Stories

Up Next

More From The World's Largest Fleet Publisher