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Home My WebLink AboutItem 2f - Agreement withPropertyRoom.com Auction Evidence ItemsFdP coop "E"Im DATE: September 2, 2014 STAFF REPORT Police Department TO: Honorable Mayor and City Council FROM: Chief Robert Guthrie By: Colleen Flores, Lieutenant SUBJECT: SERVICE AGREEMENT WITH PROPERTYROOM.COM FOR ONLINE AUCTIONING OF ITEMS FROM POLICE EVIDENCE Recommendation: Approve SUMMARY It is recommended that the City Council authorize and direct the City Manager to approve a three year contract with PropertyRoom.com for the online auctioning of police evidence items, with an option to renew for three additional years on a yearly basis. PropertyRoom.com is a web -based auction site specializing in the auction of lost, stolen, or seized items for law enforcement agencies. Various companies that auction items from police evidence were researched and it was determined that the process could be streamlined under the National Joint Powers Alliance (NJPA) cooperative purchasing program, which identified PropertyRoom.com as one of the best companies to offer law enforcement a wide array of auction related products and services. There is no direct cost for using PropertyRoom.com; instead, they keep a portion of the revenues collected for auctioned items. BACKGROUND The Arcadia Police Department maintains a property room in which all physical evidence collected is stored for safeguarding. The property room staff also maintains any items that were recovered by police officers including items that were seized, lost, stolen, abandoned, or found. US Auctions is the current company used by the entire City for disposal of surplus items including items from police evidence. Under the current process, items from police evidence are listed individually with a case number provided by the Police Department's Evidence Technician to US Auctions, which are then sold at the company's physical auction locations in Pomona or Benicia. US Auctions typically combines similar items and sells them in bulk, which is listed on the summary of their sales report to the City. The sales report, for example, summarizes, "(1) Bag of misc. cameras... Lot Auction Services for Police Evidence Items — PropertyRoom.com September 2, 2014 Page 2 of 4 #M038...$15.00 ". In this case, the sales report and a check are mailed to the City. Under this scenario, it becomes difficult at a later date to verify precisely when individual items were sold. DISCUSSION In comparing auction processes and revenue sharing programs of various auction companies, it was determined that the City could be generating more revenue from auction services than the amount collected by US Auctions, primarily due to US Auctions' bulk selling practices. PropertyRoom.com is expected to increase the City's auction revenue through its efforts to inspect, clean, and repair items within reason. PropertyRoom.com will also test items, conduct research to better describe the items, and appraise items when necessary, which translates to better sales output. In addition, switching to PropertyRoom.com will increase the transparency of the Department's auction process and help better track items leaving the property room. PropertyRoom.com will provide bar code labels for each item, which allows for a complete audit trail. In addition, once the items are picked up from the Police Department by PropertyRoom.com, they are inspected, cleaned, repaired, sorted, and digitally photographed in preparation for the auction. Unlike US Auctions, most items are sold individually instead of by bulk. The items are auctioned on www.PropertyRoom.com then packaged and shipped from their warehouse directly to the purchaser. On a monthly basis, the City would receive a check directly from the company for all evidence sales during a one month period. The company's system called AgencyWeb is a secure and comprehensive online reporting, auditing, and reconciliation system, which provides accurate and up -to -date tracking of all evidence items. This proprietary inventory control system can be accessed with an agency specific username and password at any time, 365 days a year. Current and historic items can be searched by SKU or case number from the point of agency pick -up to the point of online sale. Over 500 law enforcement agencies in California are using PropertyRoom.com, including surrounding agencies such as Pasadena, Monrovia, and El Monte. Over 2,000 law enforcement agencies in the United States also use PropertyRoom.com, including the Los Angeles Police Department and the New York Police Department. Moreover, with multiple agencies using PropertyRoom.com there is a greater chance that a victim's stolen property may be recovered by another agency that may not be able to link the item back to the owner. With PropertyRoom.com, the Department can refer theft victims to the website in order to search for their lost or stolen items. If a victim can identify their item, they can begin the process of recovering their property through the "Steal it Back" Program offered by PropertyRoom.com. Auction Services for Police Evidence Items — PropertyRoom.com September 2, 2014 Page 3 of 4 Due to the overall transparency and efficiency of PropertyRoom.com, it is recommended that the City Council authorize and direct the City Manager to execute a three year contract with PropertyRoom.com for the online auctioning of police evidence items, with an option to renew for three additional years on a yearly basis. FISCAL IMPACT There is no direct cost to the City for using PropertyRoom.com as its auction service provider for police evidence items. The City will receive 50% of the first $1,000 of sales receipts for each item and 75% of all sales receipts exceeding $1,000 per item. The City's current company, US Auctions, charges a 15% buyers' premium to the person who purchases auctioned items and does not take money from the City's proceeds. While there is a significant difference in costs per item between the two companies, it is expected that the difference will be offset by the higher prices garnered by the PropertyRoom.com method of selling described above. More importantly, there will be greater accountability for each item and a better customer service model for citizens attempting to recover items. For services, PropertyRoom.com does not charge pick -up fees, hourly labor rates or mileage charges. However, if and when fuel prices rise above a level as shown in the schedule below, a fuel surcharge ( "Fuel Surcharge ") will be paid to PropertyRoom.com out of Arcadia's Net Proceeds for each pick up. PropertyRoom.com tracks benchmark average retail diesel prices as published online by the Energy Information Administration of the U.S. Department of Energy and resets the Fuel Surcharge quarterly based on average weekly pricing from the prior quarter. Fuel Surcharges, if any, are deducted from monthly Arcadia's Net Proceeds. If by chance Arcadia's Net Proceeds do not cover the Fuel Surcharge, it will roll over to the next pick up and if Arcadia cancels service with PropertyRoom.com, they will cover that cost. PropertyRoom.com will not send a bill to the City. Fuel Surcharge Schedule Retail Diesel (per gal) Fuel Surcharge* < $ 2.50 $0.00 $ 2.50 to $ 2.99 $12.40 $ 3.00 to $ 3.49 $24.80 $ 3.50 to $ 3.99 $37.20 $ 4.00 to $ 4.49 $ 49.60* * Table continues at same $12.40 increments per $0.50 per gal change in Retail Diesel. Auction Services for Police Evidence Items — PropertyRoom.com September 2, 2014 Page 4 of 4 RECOMMENDATION It is recommended that the City Council authorize and direct the City Manager to execute a three year service agreement with PropertyRoom.com for the online auctioning of police evidence items, with an option to renew for three additional years on a yearly basis. Approved: Dominic LazzareW City Manager