That the City Council approve and authorize the City Manager to enter into an agreement to provide vehicle maintenance and repair services for the City of La Habra Heights.

The City of La Habra Heights has requested a new agreement from the City of La Habra for the provision of continued maintenance, repair, supervision, and inventory management for some of their fleet vehicles.  Public Works Department staff has negotiated an agreement that provides routine and non-routine maintenance on an hourly basis and includes an 18 percent administration charge. The City of La Habra's vehicle repair shop is properly equipped to maintain vehicles similar to those used by the City of La Habra Heights.  City of La Habra staff have the requisite experience and are properly certified to work on public utility and safety vehicles and equipment and can provide these services to the City of La Habra Heights without impacting the maintenance of the City's own vehicles.

The proposed term of the agreement is for three years, with the option to extend the term for two additional one-year terms.  Either party to the contract may cancel the agreement at any time with 60 days written notice.

Pursuant to the agreement, the City of La Habra will bill the City of La Habra Heights on a monthly basis for all parts and material used and will include a labor rate of $69.50 for each hour charged.  This rate includes vehicle maintenance employees' salaries and benefits.  An additional 18 percent administration charge will also be added to the total bill each month.