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A New Way of Conducting State Business

Governor’s Column

By Governor Matt Blunt

A New Way of Conducting State Business

When I ran for governor I promised we would identify savings for taxpayers across state government. One of many examples of these savings is the measurable improvement in how the state manages employees’ business-related vehicle travel. My directive to focus on the least expensive way to travel has saved taxpayers close to $15 million in mileage reimbursement costs since I took office.

Missouri workers historically travel about 190 million miles each year on official business. The more miles traveled in state owned and rental vehicles, the lower the overall cost. It costs $.475 for each mile reimbursed to state employees driving their own vehicle, $.35 for each mile traveled in a rental vehicle and $.28 for each mile traveled in a state owned sedan. Following my directives, the state’s new focus on less costly alternatives to mileage reimbursement is paying off.

Despite increasing mileage reimbursement rates, expenditures for personally owned vehicle reimbursement in Missouri dropped for the third straight year.

Missouri had never fully recognized the value of using rental cars for specific business travel situations. When the travel policy was implemented, the rental contract became a key component of the overall plan to reduce employee mileage reimbursement and increase savings.

At my urging, the Office of Administration worked to encourage the lowest cost option for travel and inform employees of the state’s new travel policy. This directive was an ongoing priority that contributed to the significant drop in reimbursement costs. In addition I issued an executive order calling for the Commissioner of Administration to explore ways to eliminate increased costs associated with state employees using their own vehicles for state business and state agencies renting vehicles for state employee use. The order gave the commissioner authority to replace vehicles in the state vehicle fleet if it would reduce costs for the taxpayers and called for no less than 70 percent of replacement vehicles to be flex fuel vehicles that can operate on fuel blended with 85 percent ethanol.

The Smart Lease Vehicle Program was unveiled in 2005. The Smart Lease program has saved over 43 percent in travel costs by replacing business miles paid through mileage reimbursement with state vehicles. The program provides a mechanism to lease purchase state vehicles at low rates and as a result transfer employee business miles from mileage reimbursement to lower cost state vehicles.

Missouri’s vehicle and fleet management is setting a standard across government and private industries. National vehicle fleet management companies have sought Missouri’s direction and input as a model of a program that has successfully reduced mileage reimbursement.