TO: Department Directors and Autonomous Agency Heads
FROM: Governor Jennifer M. Granholm
DATE: January 24, 2007
SUBJECT: Efficient Use of State Motor Vehicle Fleet and Reduction in Vehicle Travel Expenditures

The economic conditions currently facing the citizens and government of this state and the resulting fiscal difficulties for our state budget are detailed in Executive Directive 2007-1. Given the severity of the state budget constraints, I am issuing this Directive now, which has as its objective reduction in expenditures by departments and agencies within the Executive Branch of state government. While I recognize that resources are already scarce, and that greater efficiencies already have been achieved in the administrative operations of state departments and agencies, it is critical to implement additional efforts to reduce costs and curtail spending. Accordingly, I direct:

I. MORATORIUM ON ACQUISTION OF STATE-OWNED OR STATE-LEASED MOTOR VEHICLES

A. Except as provided in Section I.C., effective immediately and continuing until September 30, 2007, no department or autonomous agency within the executive branch of state government may place an order for, or enter into any agreement for, the purchase, lease, or other acquisition of any motor vehicle.

B. Except as provided in Section I.C., not later than February 9, 2007, each department director or autonomous agency head shall identify each motor vehicle ordered by or for the department or agency not yet delivered. If an order may be canceled without the imposition of a penalty or other cost to the state, the department or agency, or the Department of Management and Budget, as appropriate, shall cancel the order if the cancellation is in the best financial interests of the state, as determined by the Director of the Department of Management and Budget.

C. An exception to the moratorium under this section may be granted by the Director of the Department of Management and Budget if the Director of the determines that one or more of the following apply:

1. The acquisition is required by legal mandate or court order or for law enforcement purposes.

2. The acquisition is for an ambulance, fire fighting vehicle, emergency service vehicle, military, or road-clearing or road-maintenance vehicle necessary to assure the health, safety, defense, and well-being of Michigan residents and visitors.

3. The acquisition is necessary to produce budgetary savings or to increase state revenues, including protecting existing federal funds or securing additional federal funds.

4. The acquisition is necessary to comply with federal requirements.

5. The acquisition is financed entirely by federal or non-state funds.

II. INVENTORY OF STATE MOTOR VEHICLE FLEET

A. Not later than March 16, 2007, each department and autonomous agency shall conduct, prepare, and deliver to the Director of the Department of Management and Budget a thorough and comprehensive review of mileage reimbursement expenditures and each motor vehicle utilized by the department or agency, including any department or agency official or employee, and a report containing all of the following:

1. An inventory of each motor vehicle, including its make, model, year, and vehicle identification number.

2. A justification of the need for each motor vehicle.

3. An identification of each motor vehicle assigned by or to the department or agency, including the job title and classification of the person to whom the motor vehicle has been assigned, if any, and the reasons why a motor vehicle must be provided to the person holding a position with that job title and classification.

4. Proposed methods to redeploy vehicles, including, but not limited to, seasonal assignment or reassignment in place of a new vehicle.

5. Proposals by the department or agency to reduce the number of motor vehicles utilized.

6. A review of all fleet mileage and mileage reimbursement for full utilization of fleet vehicles and strict review of compliance with rules for mileage reimbursement.

7. Identification of further opportunities to reduce travel expenses, improve fleet utilization practices, enhance opportunities to share vehicles across departments and other agencies, and increase motor pools to facilitate sharing of vehicles.

8. Any other proposals by the department or agency to reduce the cost of acquiring, maintaining, and operating motor vehicles utilized by the department or agency or mileage reimbursement expenditures.

B. Each department and agency submitting a report under Section II.A shall review its submission, fleet utilization, travel reimbursement policies, and vehicle assignments and locations with the Department of Management and Budget for identification of additional cost-reduction and inter-agency sharing opportunities.

III. EFFECTIVE UTILIZATION OF THE STATE MOTOR VEHICLE FLEET

A. Not later than April 18, 2007, the Director of the Department of Management and Budget shall present the Governor with a plan to more effectively manage the state motor vehicle fleet and reduce total vehicle travel expenditures, including, but not limited to, expenditures for mileage reimbursement. The report shall include recommendations on measures to encourage local units of government, state institutions of higher education, and other political subdivisions of this state to share use of fleet vehicles or to cooperatively purchase or lease vehicles using the state's contract or a statewide contract. The report also shall include recommendations on other measures to reduce the cost of operating the state's motor vehicle fleet or amounts paid for mileage reimbursement. If the Department of Management and Budget determines that legislative changes would facilitate cost reductions or cooperation with other governmental entities, the Director's report shall include proposed legislation.

B. State-owned or state-leased vehicles should be provided to state officers or state employees only when necessary to perform job duties or for security reasons. State vehicles never should be provided on the basis of the public office held, job classification, job title, as a management perk, or as an employment benefit. The Director of the Department of Management and Budget shall proceed accordingly when preparing the plan required by Section III.A.

IV. ENFORCEMENT

A. The Director of the Department of Management and Budget shall take all actions necessary to enforce the requirements of this Directive, consistent with Michigan law. All departments and agencies shall assist the Department of Management and Budget, as necessary, in implementing this Directive.

B. In exercising general supervisory control over the functions and activities of all administrative departments, boards, commissioners, and officers of the state, and of all state institutions, as required under Section 3 of 1921 PA 2, MCL 17.3, the State Administrative Board shall monitor compliance with the requirements of this Directive.

C. Violations of the requirements of this Directive shall be reported to the Director of the Department of Management and Budget and to the Secretary of the State Administrative Board.

D. The State Administrative Board may take action to enforce the requirements of this Directive as authorized under 1921 PA 2, MCL 17.1 to 17.3.

V. MISCELLANEOUS

A. Expenditures related to state motor vehicles shall be conducted in the most cost-effective manner that is reasonable given time considerations and should take advantage of joint purchasing with other governmental entities whenever feasible.

B. This Directive is effective immediately and remains in effect through September 30, 2007.

I extend my sincere appreciation for your assistance and the continued hard work of state employees as we respond to the state's difficult fiscal condition.

______________________________
JENNIFER M. GRANHOLM
GOVERNOR