FY 2025/26 CIP Study Session Update
May 6, 2025
City of Placentia
1 Summary of April 1 Meeting
2 •Two options:
Remove and fuel offsite
•Cost $220,000 for removal
•Initial cost savings of $880,000
•Fueling flexibility
•Eliminates ongoing costs of owning/maintaining UST
•Higher ongoing fuel costs
•Lack of fuel at City facility during outage or emergency Remove and replace UST
•Cost $1,100,000
•Lower fuel costs (savings of $1/gallon or approx. $60,000/year) •Control of fuel management and access during outage or emergency •Higher initial cost for replacement
•Ongoing costs of owning/maintaining UST (testing, inspections, & repairs)
Commercial Fueling Program: Galaxy
•Existing agreement for City
property at 480 S. Placentia
Ave
Monthly rent of $2,083.33
Royalty fee based on number of
gallons sold per month
•Review period of February
2024 – February 2025
$116,331.09 royalties paid to
City
Gallons Sold per Month Royalty Percentage
0 – 145,000 50%
145,001 – 195,000 40%
195,001 – 245,000 30%
245,000 +0%
3 Cost Per Gallon Comparison
SC Fuels Galaxy
Average Cost per Gallon Unleaded $4.56 $4.97
Cash Discount $0.00 ($0.12)
Additional Discount $0.00 ($0.05)
Revised Cost per Gallon $4.56 $4.80
4 Cost and Revenue Comparison
Bulk Fuel
(City Yard)SC Fuels Galaxy
Average Cost per Gallon $3.56 $4.56 $4.80
City Average Gallons per
Month
x 5,000 x 5,000 x 5,000
Cost per Month $17,800 $22,800 $24,000
x 12 x 12 x 12
Annual Cost $213,600 $273,600 $288,000
Annual Royalty Revenue
from City Purchases
$0 $0 $144,000
Ongoing Costs*$8,000 $0 $0
Total Annual Cost $221,600 $273,600 $144,000
5 *Does not include insurance. Attempts to get costs for insurance from broker were unsuccessful
Additional Considerations
•Current agreement with Galaxy expires October 2026
Could impact royalty revenue
•Installation of generator by Galaxy
Would there be costs to City?
Timing of installation
•Availability of fuel during emergency
Unknown amount of fuel available
Access in conjunction with public
•Projects that could be funded if opting for commercial offsite fueling $880,000 to fund other priority projects
6 Other Priority Projects
7 Questions?
8