Explanation
Background: Fuel prices have risen dramatically since the 2011 budget was formulated and adopted. The cost of all fuel types (unleaded and diesel) and contracts (bulk and retail) has risen from the budgeted blended rate of $2.60 per gallon in 2010 to a blended price of $3.51, as of the end of August. At times, diesel fuel prices have exceeded $4.00 per gallon and unleaded fuel prices have exceeded $3.75 per gallon. Accordingly, the costs to operate large equipment like Refuse, Fire, Transportation, Sewer, and Power and Water vehicles has greatly exceeded budgeted amounts.
This legislation authorizes the Finance and Management Director to issue purchase orders to purchase bulk fuels (diesel and bio diesel) and credit card fuel for the Fleet Management Division.
Formal competitive bids were taken by the Purchasing Office and universal term contracts are in place for bio-diesel fuel with the Central Ohio Farmers Co-op and for credit card fuel with Voyager Fleet System, Inc.
Fiscal Impact: The Fleet Management Division budgeted $9,734,751.00 for fuel in 2011, at an average blended rate of $2.80 per gallon. The city uses approximately 3.5 million gallons of diesel and unleaded fuel per year. An earlier ordinance (0040-2011 & 0998-2011) authorized the entire budget of $9,734,751.00 for fuel purchases this year.
At the present price of fuel, the Fleet Management Division will exhaust current appropriations for fuel purchases by the end of October 2011. Therefore, these purchase orders are contingent on Ordinance 1704-2011 which will transfer appropriation within the Fleet Management Fund 513. The Fleet Management Division spent $7.6 million (on 3.4 million gallons of fuel) in 2009 and $8.9 million (on 3.5 million gallons of fuel) in 2010.
Emergency action is requested to ensure an uninterrupted supply of fuel. Nearly 92 percent of overall fuel use is for basic services provided by the Police, Fire, Refuse, Transportation, Power a...
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