Sharing the Load
As municipal fleet budgets tighten, regional equipment-sharing models are emerging as a practical strategy to improve utilization while reducing capital and operating costs.
Utilization management is one of the biggest challenges for government fleets. Across Canada, small and mid-size municipalities face a common problem in providing affordable specialized fleet services.
At a recent Canadian Association of Municipal Administrators (CAMA) meeting, I was asked for input on shared fleet services models. Attendees noted that fleet equipment, such as graders, aerial fire trucks, or heavy snow-clearing units are expensive to buy and sit idle most of the time.
Regional districts (British Columbia) or upper-tier counties (Ontario) may offer a framework for solving this problem by pooling fleet assets across member municipalities, rather than each community buying and maintaining their own.
As capital budgets tighten and vehicle costs climb, shared fleet models are drawing more attention as a practical way to stretch public dollars further.
"Sharing the purchase price of a $400,000 grader among three or four municipalities is far more manageable than one small town absorbing the full cost."
Making better use of expensive equipment
The appeal of shared fleets is lower cost. Sharing the purchase price of a $400,000 grader among three or four municipalities is far more manageable than one small town absorbing the full cost.
Shared ownership also improves utilization. Equipment that might sit unused 300 days a year in one municipality can be scheduled to be used by several communities, reducing the number of under-utilized assets.
Pooling also supports economies of scale in maintenance and purchasing, since regional partners may be able to negotiate better service contracts and bulk pricing on parts and fuel.
Finally, shared fleets make it more financially feasible to invest in newer, cleaner equipment, including electric or hybrid vehicles, since the higher upfront cost is distributed across multiple budgets.
Where shared models can break down
This is all very attractive to smaller municipalities, but are the risks worth it? Shared models are not without risk, as scheduling, decision making, accountability, and geography can present challenges.
Scheduling conflicts are the most common. If two municipalities need the same grader after a snowstorm, one of them must wait. If the need is for a non-priority road, that wait may be worth the savings.
Governance can also get complicated, since partner municipalities must agree on cost-sharing formulas, usage priority, and who is responsible for maintenance, repairs, and eventual replacement.
Political accountability is another hurdle as councils ultimately answer to their own taxpayers, which can make it harder to justify decisions made jointly with neighbouring communities.
Geographic distance also impacts this model. Equipment stationed in one municipality may take too long to reach another during time-sensitive emergencies, which limits which asset types make sense to share.
Fire apparatus and other emergency vehicles, for instance, are often excluded from formal fleet-pooling arrangements and are covered separately in mutual aid agreements.
A model worth considering
As more Canadian municipalities confront aging fleets, supply chain delays, and pressure to electrify, regional pooling arrangements offer a template worth considering. They will not work for every asset class in every location, but for the right equipment, sharing, rather than duplicating, may be an effective tool for local governments to control fleet costs.
Bio: Kate Vigneau, CAFM, is Vice-President MCG Consulting Solutions
