When the city of Elk Grove unveiled its new transit buses four years ago, it laid claim to the nation's only all-hybrid municipal commuter fleet.

Then came the bus fires.

Now the 21-bus gasoline-electric hybrid fleet costing $10 million is sidelined, and the city is suing the manufacturers and other transit-related contractors for breach of contract.

Among the complaints: at least four bus fires, some 30 catastrophic engine failures, noxious exhaust fumes inside buses and buses unable to achieve freeway speeds with full passenger loads.

Now it's clear that e-tran, the city's transit agency, is destined for change. Elk Grove City Council members say they need to raise fares and increase scrutiny of the city's transit contract.

In the next few months, they will consider cutting ties with transit operator MV Transportation Inc. of Fairfield when its contract ends June 30. MV is one of six defendants named in the city's May 20 lawsuit.

A range of alternatives will be considered, from bringing transit operations in-house to returning to the former service provider, Sacramento Regional Transit.