Article

Sold: A Word Alabama's DOT Uses to Save Big Bucks

Favorable legislation, an efficient operation, and on-site and online auctions by an outside company have allowed the Alabama Department of Transportation to get 40 percent of its equipment procurement costs back in resale.

March 2012, Government Fleet - Feature

by Ron Pruitt

All types of vehicles and equipment are sold during ALDOT's semi-annual auctions, which feature both live and online bidding.
All types of vehicles and equipment are sold during ALDOT's semi-annual auctions, which feature both live and online bidding.


In the current economy, spending money on passenger fleets and heavy construction equipment can make a big dent in a transportation department's budget. So, how can that process be turned around and become an asset with money saved and efficiency increased? Just ask the Alabama Department of Transportation (ALDOT), which has been garnering a lot of attention on how its equipment program is saving big dollars.

Legislation Helped with Funding

In 1980, state legislation was passed allowing ALDOT to establish a revolving fund within the State Road and Bridge Fund to collect a monthly depreciation and replacement rate along with a rental rate (operating cost) from the end user. This allowed ALDOT to have good equipment ready to respond to the needs of the state's infrastructure without directly impacting budgetary funds.

 Additional legislation was passed in 1995 to allow ALDOT to sell and auction its equipment by using an outside auction company. Since that time, ALDOT began turning in most of its passenger fleet at 55,000 miles or five years (whichever occurs first), the optimum time for replacement before operating costs begin to climb. It also allows ALDOT to determine the best time to replace all other equipment and to get the most return on investment.  

The process also generates extra dollars into the State's economy through direct sales to counties and municipalities that receive high-quality equipment with a lower acquisition cost, the collections of sales tax revenue from auction sales, and monies spent by out-of-town bidders who stay at local hotels and eat at local restaurants.  The October 2011 auction, projected to take in approximately $3 million, generated just under $4 million and collected $49,000 in sales tax.

Providing Top-Notch Vehicles for High Yield at Auction

ALDOT auctions are held twice annually. Auction bidders participate on site and online from all over the globe as far away as the United Kingdom, Australia, and the United Arab Emirates. In fact, online bidding continues to increase at each auction. During ALDOT's October 2011 auction, 48 items sold over the internet for $777,500.

The ALDOT ensures all equipment are refurbished and inspected before auction to make sure they are ready to be used.
The ALDOT ensures all equipment are refurbished and inspected before auction to make sure they are ready to be used.

To ensure buyers receive top-notch vehicles, ALDOT has the auction equipment refurbished and inspected to ensure it is ready to roll and be put to work. By using local vendors to renovate and detail equipment for auction, jobs were maintained or created, and $1.8 million was put back into the local economy in fiscal year 2011.  

Annually, ALDOT spends about $25 million on equipment purchases and receives around $10 million in revenue from the sale of surplus equipment at auction, a significant savings in fleet operations.

In 2011 alone, ALDOT will save, through the efficiency of the fleet, $6.6 million that can be used on routine maintenance and construction projects. Additionally, ALDOT will save another $600,000 on parts and repairs by negotiating with vendors for better discounts. ALDOT has also reduced its light- and medium-duty truck diesel fleet, which represents a savings in procurement costs and, in combination with a retrofit program installing diesel oxidation catalyst filters on older trucks and equipment, producing a significant reduction in the fleet's carbon footprint.

Therefore, from the pounding of the auctioneer's gavel to the last satisfied buyer, significant savings are created and at the same time, ALDOT has funding for new equipment. ALDOT officials are "sold" on their equipment renewal process and believe it helps make ALDOT's fleet one of the most efficient in the country.

 

About the Author
Ron Pruitt is the equipment management coordinator at the Alabama Department of Transportation.

COMMENTS

  1. 1. Johnny Majors [ May 07, 2012 @ 02:05PM ]

    We do business with ALDOT and Ron and his crew do an exceptional job of keeping the equipment in top notch shape, Their preperation is second to none and is done with complete honesty concerning auction machines. Glad they are getting regonized for a job well done with our tax monies.

 

Comment On This Story

Name:  
Email:  
Comment: (Maximum 10000 characters)  
Leave this field empty:
* Please note that every comment is moderated.

FleetFAQ

Fleet Management And Leasing

Jack Firriolo from Merchants will answer your questions and challenges

View All

 

Public Fleet Tracking And Telematics

Amin Amini from Verizon will answer your questions and challenges

View All

 

Fuel Management

Bernie Kanavagh from WEX will answer your questions and challenges

View All

 

Recent Topics

Hi all, we are in the process of reviewing our replacement policy for Fire apparatus. Can anyone offer information on their replacement...

View Topic

Hello! We opened up submissions for the Leading Fleets award this month and are encouraging everyone to apply. It's a great opportunity...

View Topic

Fleet Documents

1106 Fleet Documents (and counting) to Download!

Sponsored by

N. Bud Grossman, co-founder of General Leasing Company (later named Gelco) and past president of the American Automotive Leasing Association (AALA)

Read more

Blog

FleetSpeak

Thi Dao
What Your Vehicles Say About Your Fleet

By Thi Dao
Your vehicles may paint a certain picture of the fleet and even the public agency. Is the picture a positive or a negative one?

Are Your Drivers Safe?

By Thi Dao

Managing a Police Fleet

How Chevrolet's Tahoe PPV Differs From its Retail Relative

By Michaela Kwoka-Coleman
For the Chevrolet Tahoe PPV, tires are added to the vehicles that are capable of handling speeds of up to 134 mph and the brakes are adjusted to handle frequent stopping at high speeds.

Police Vehicles Pushed to the Limit in California

By Paul Clinton

Next-Gen Fleet

Facundo Tassara
Streets of the Future Could Take Automatic Tire Readings

By Facundo Tassara
WheelRight allows vehicles to drive through a specialized lane and captures tire pressure readings on all four tires while also providing tire tread depth within a few seconds and printed receipt.

Improved Communication (There's an App for That)

By Facundo Tassara

Driving Notes

Chris Brown
Hyundai Ioniq Plug-in Hybrid

By Chris Brown
The Hyundai Ioniq Plug-in Hybrid is the least expensive model on the market to offer electric-only range, while offering spirited driving performance and plenty of standard features.

2018 Range Rover Velar First Edition

By Mike Antich

Nobody Asked Me, But...

Sherb Brown
Keep Realistic Fleet Expectations

By Sherb Brown
If you don’t stay on top of the latest developments in mobility, battery technology, autonomous vehicles, and telematics, you are subjecting yourself to the whims of senior management who may be making decisions based on the latest trendy news.

Fleet Management 2.0

By Sherb Brown

STORE