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HomeMy WebLinkAbout~Master - Fuel Purchase Contracts for CyRide RESOLUTION NO. 11-021 RESOLUTION AUTHORIZING FUEL PURCHASE CONTRACTS FOR CYRIDE AND ACCEPTING FIXED-RATE PLUS MARK-UP/DEDUCT FOR THE REMAINDER OF CYRIDE'S FUEL PURCHASES FOR THE CITY OF AMES,IOWA WHEREAS, CyRide purchases approximately 300,000 gallons of fuel each budget year, expending between$700,000 and$1,000,000/year; and, WHEREAS, in the past, CyRide entered into fuel contracts in an effort to stabilize fuel expenditures; and, WHEREAS, in light of the volatile fuel prices, CyRide staff explored options to control fuel expenses in the 2011/12 budget; and, WHEREAS,one tool to stabilize fuel costs is the use of fuel contracts,which is a contract obligating the buyer to purchase fuel at a predetermined future date and price; and, WHEREAS,under that type of contract,CyRide would be required to purchase 42,000 gallons of fuel under each fuel contract,which would provide fuel for a two-month period; and, WHEREAS,under the proposal reviewed and approved by the Ames TransitAgency's Board ofTrustees on December 7,2010,CyRide would bid up to five two-month contracts covering fuel purchases for ten months (April 2011 through March 2012); and, WHEREAS, CyRide staff and the Board of Trustees have established a guideline for fuel contracting that commits to no more than 70% of its total fuel usage under a contracting arrangement; and, WHEREAS,the remaining 30%of fuel would be purchased at a fixed price plus mark-up/deduct on the market rate,which is also bid at the time contract bids are received; and, WHEREAS, CyRide would work with the City's Purchasing Division to solicit bids on fuel contracts and would not accept contracts that exceed$525,000 maximum; and, WHEREAS,CyRide would also reserve the right to reject all bids if they are not determined to be in the best interest of CyRide at the time of bidding; and, WHEREAS,under this procurement,the"premium"paid on the fuel cost would determine which firm proposed the lowest price. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of Ames,Iowa,that awarding up to five two-month fuel contracts at a total price not to exceed$525,000 and accepting a fixed-rate plus mark- up/deduct for the remainder of CyRide's fuel purchases is hereby authorized. ADOPTED THIS 11''day of January, 2011. Diane R. Voss, City Clerk Ann H. Campbell,Mayor Introduced by: Davis Seconded by: Goodman Voting aye: Davis, Goodman, Larson, Orazem,Wacha Voting nay: None Absent: Mahayni Resolution declared adopted and signed by the Mayor this 11'day of January, 2011.