2010-10-22 Cost of Government Commission Minutes

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MS. O’HARA: Well, the question again, the overall chain of purchasing that based on saving cost for the county, when you do the IFBs for the automobiles, we purchase it as a county. We purchase the printers and we purchase the computers. Have we looked at the idea of doing a county-wide leasing program? MR. BENEVIDES: We have some leasing for printers and copiers and such, and the life cycle on that, going back to your question is about five years for a printer. But other than that no, we haven’t leased really vehicles. It’s been discussed but just recently we were discussing it. But we have not to date leased any vehicles. We have purchased heavy equipment based on a lease from a third party financer so we can spread out the payments over 16 months. But other than that we really haven’t leased per se. We either purchase or in the case of multi-function machines where there is a life cycle issue, we have leased, but very limitedly. On vehicles, not to date. MS. O’HARA: It might be something to look at, zero line inaudible. MS. NICHOLSON: Ken, you have a question? MR. ARMOUR: How is things like travel handled? Do you set up contracts with Aloha or go!, or hotels in Oahu so that everybody gets a good price or is each department just go out and when they travel, just go out and get an airline ticket? MR. BENEVIDES: They get quotes. The get multiple quotes each time they need a travel arrangement made. They call different hotels to see who has the best rate because that fluctuates so much in the marketplace that it really doesn’t make sense to tie yourself to a particular price in an effort to put together like a price term agreement for the year. So we handle it through our department. The departments call us, ask us for who is next in line for a travel agent. And we have a list of about 11 travel agents on the island who want to participate. So we call them. And another option is for the departments to get direct quotes from online with the various different online ticketing agencies that are now available. They check with us. They tell us what the minimum three quotes were and then we give them the approval to go ahead and go with the low quote. So right now that’s the basic process. MR. MASUDA: You folks understand what price term agreements are? MS. NICHOLSON: No we don’t know. MR. MASUDA: Basically a price term agreement is like the beginning of the year, say for airline tickets, we’ll set up this request saying we want a price term agreement with the various airlines to submit their quotes for travel to Honolulu, interisland travel, whatever. And then from there you pick the lowest quote. Say if it’s $59 with Hawaiian Air. Probably it ain’t going to happen in a million years from now, but that’s okay. $59 with Hawaiian Air. Every purchase you purchase for that term of that agreement, which is usually one year, you have to purchase from Hawaiian Air. Even if Hawaiian Air goes down to $38, you know sometimes they have the $38 special, you’re paying $59. go! goes for a two for one, or whatever, you’re locked into that contract, so you have to pay that amount. So things that fluctuate greatly is kind of spooky from a financial position 15