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SUBJECT:
FISCAL
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SUMMARY:
Placentia City Council
CITY COUNCIL
CITY ADMINISTRATOR
ACTING DIRECTOR OF PUBLIC WORKS
MAY 7, 2024
AGENDA REPORT
AGREEMENT FOR FUEL SALES BETWEEN THE PLACENTIA-YORBA LINDA
UNIFIED SCHOOL DISTRICT AND THE CITY OF PLACENTIA
AVAILABLE BUDGET:
$ 111,636 FY 2023-24 (103658-6345)
The City's unleaded fuel tank was taken out of service in December 2023 due to a leak. Staff explored options to allow for continued fueling of the unleaded fleet, such as a commercial fuel card program and fueling at the Placentia-Yorba Linda Unified School District (District) Education Center. Fueling at the District allows the City to benefit from bulk fuel pricing. The City will incur a 10 -cent admin fee per gallon to account for District staff time in administering the program for the City. Staff recommends the City Council approve the fuel sales agreement between the City and the District to allow the City to fuel its fleet at the District's fuel station. Separately, Staff is evaluating various options with respect to a long-term solution for fueling the City's fleet which could entail reconstructing the City's fuel island or continuing to fuel the City's fleet at the School District's facility or other retail fueling stations.
RECOMMENDATION:
It is recommended that the City Council take the following actions:
1. Approve the agreement between the Placentia-Yorba Linda Unified School District and the City of Placentia for fuel sales; and
2. Authorize the City Administrator and/or his designee to execute all necessary documents, in a form approved by the City Attorney; and
3. Authorize the City Administrator to approve future contract term extensions as may be needed.
STRATEGIC PLAN STATEMENT:
There is no specific Strategic Planning Goal or Objective associated with this agenda item.
1.e.
May 7, 2024
City Council Agenda
May 7, 2024
DISCUSSION:
The City's unleaded fuel tank was taken out of service in December 2023 due to a leak. Staff explored options to continue unleaded fueling of its fleet and one of those options is fueling at the Placentia-Yorba Linda Unified School District (District) yard. The District has offered to allow the City to fuel its fleet at the District's yard and benefit from the District's bulk fuel pricing. The City will incur a 10 -cent admin surcharge per gallon, to cover costs associated with fuel management, programming codes, card systems and invoicing. Based upon the most recent month of fuel purchases, the City has been paying an average of $4.59 per gallon for fuel. According to the District's FY 2023-24 fuel purchases to date, the average cost per gallon is $4.11 per gallon.
Based on these figures and including the 10 -cent admin surcharge, the average cost to the City would be $4.21 per gallon, which is an average savings of .38 cents per gallon.
The City utilizes an average of 5,500 gallons per month of unleaded fuel. Purchasing fuel from the District would save the City approximately $25,000 per year versus purchasing through retail fuel stations. The City currently has an account with SC Fuels to fuel the City's fleet at SC Fuels stations and other retail fuel stations, and there are no card fees, transaction fees or reporting fees. There is no time commitment and the City has the option to close the fuel card account at any time without penalty. Staff recommends the City Council enter into an agreement with the District to allow the City to purchase fuel from the District while additional analysis is conducted to determine a long-term solution which could include reconstructing the City's fuel island or continuing to fuel the City's fleet at the District's yard or other retail fueling stations.
FISCAL IMPACT:
A total of $415,000 was budgeted for fleet fuel in the FY 2023-24 Operating Budget. As such, sufficient funds exist for the recommended actions.
Prepared by:
Samantha Byfield
Public Works Manager
Reviewed and approved:
Christopher Tanio
Acting Director of Public Works
Reviewed and approved:
Jennifer'L.ampman
Director of Finance
Reviewed and approved:
Damien R. Arrula
City Administrator
City Council Agenda
May 7, 2024
Attachment:
Agreement for Fuel Sales Between the Placentia-Yorba Linda Unified School District and the City of Placentia