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HomeMy WebLinkAbout~Master - Fuel contracts for CyRide fuel purchases RESOLUTION NO. 13-519 RESOLUTION APPROVING FUEL CONTRACTS FOR REMAINDER OF CYRIDE FUEL PURCHASES FOR THE CITY OF AMES,IOWA WHEREAS,for the past four years,CyRide has purchased a portion of its fuel under contract in an effort to stabilize and possibly gain financial benefits from this type of fuel purchasing method; and, WHEREAS, the decision to switch to this type of purchasing arrangement was a direct response to the volatile fuel market in 2007- 2008 when prices increased from $2.00 to $4.00 per gallon in a short span of time; and, WHEREAS, based on previous bidding, CyRide staff has identified the following months as best for contract purchasing of fuel: January-April and September-December, and this is based on the quantity of fuel purchased and the volatility of fuel during these months; and, WHEREAS, CyRide does not purchase enough fuel in the summer months to utilize contracting; and, WHEREAS, CyRide is currently purchasing fuel at market rates and is averaging$3.18 per gallon for the 2013/14 budget year,and one of the prime times to enter into fuel contracts to gain the best price is in November or December; and, WHEREAS, staff recommends entering into a long-term contract in light of the low market prices at this time; and, WHEREAS, approval is needed from the City Council for a total fuel contract price not to exceed $1,764,000 for twelve, two-month contracts, for up to 504,000 gallons of fuel over the remainder of the 2013/14 budget year, 2014/15 budget year, 2015/16 budget year, and part of the 2016/17 budget year; and, WHEREAS, the not-to-exceed dollar amount for the fuel contract is calculated based on $3.50 per gallon and represents approximately 52% of CyRide's fuel purchases for the 36-month period; and, WHEREAS, the reason for the proposed extended contract is that the fuel purchase prices for FY 2016/17 are currently running at approximately$2.78 per gallon,significantly below current market rates and would be a significant savings to CyRide; and, WHEREAS, staff will prepare a Request for Proposal (RFP) that will be disseminated on November 13 if approved by the City Council,and results of the proposal would be due to the City on November 20; and, WHEREAS,at its October 30,2013,meeting,the Transit Board of Trustees approved a not- to-exceed amount of$1,764,000 for up to 12 fuel contracts. NOW, THEREFORE, BE IT RESOLVED,by the City Council of the City of Ames, Iowa, that the fuel contracts, for CyRide fuel purchases of up to twelve, two-month contracts, at a total price not to exceed $1,764,000 is hereby approved, and fixed rate, plus mark-up/deduct for the remainder of CyRide's fuel purchases is hereby accepted. ADOPTED THIS 12th day of November, 2013. `� tom'• �4s+t,. Diane . Voss, City Clerk Ann H. Campbell, Mayor Introduced by: Davis Seconded by: Goodman Voting aye: Davis, Goodman, Larson, Orazem, Szopinski, Wacha Voting nay: None Absent: None Resolution declared adopted and signed by the Mayor this 12th day of November, 2013.