California State Lottery Commission
September 28, 2017
Page 1
Date: / September 28, 2017To: / California State Lottery Commission
From:
Prepared by: / Hugo López, Director
Terry Murphy, Deputy Director
Operations Division
Subject: / Item 8(a) – Vehicle Purchase - Fiscal Year 2017-18
ISSUE
The California State Lottery (Lottery) has newly created Sales & Marketing Division positions that do not yet have assigned vehicles and has existing vehicles that have significant, recurring mechanical issues.
BACKGROUND
The Lottery currently owns 301 vehicles, which are utilized by the Sales & Marketing Division, Security/Law Enforcement Division (SLED), and headquarters staff in the everyday execution of their duties.
DISCUSSION
Lottery staff has determined that 12 vehicles are needed and has prioritized the procurement of vehicles. Nine minivans are needed for newly created sales positions; and three minivans are needed to replace vehicles that are scheduled to be surveyed due to recurring mechanical issues.
The cost to procure 12 sales cargo minivans is $26,000 each plus $7,443 per van upfitting expense for a total cost of $401,316. Upfitting is the installation of custom-built ticket storage cabinets, point of sale bins, console boxes for sensitive equipment storage, and sales supplies drawers. A contingency for any unforeseen expense is included per budget authority.
Any vehicles purchased will be capitalized over five years beginning on the date of delivery.
California State Lottery Commission
September 28, 2017
Page 1
RECOMMENDATION
Lottery staff recommends purchasing 12 vehicles for Sales & Marketing Division staff at a cost not to exceed $426,000.