4.7 SR 11-04-2024City of
Elk -
River
To
City Council
Meeting Date
November 4, 2024
Item Description
State Fuel Consortium
Request for Action
Item Number
4.7
Prepared By
Justin Femrite, Public Works Director/Chief Engineer
Reviewed by
Justin Femrite
Cal Portner
Tina Allard
Action Requested
Enter, by motion, into the State Fuel Consortium for bulk fuel purchasing and pricing.
Background/Discussion
Annually, the city has participated in the State of Minnesota Fuel Consortium to gain bulk fuel at state
contract pricing. While the pricing has yet to be set for the upcoming contract cycle (Feb. I, 2025, through Jan.
31, 2026), we are asked to commit our quantity order by Nov. 10, 2024. This buying opportunity has
historically yielded savings by purchasing fuel outright through the open market and staff is again
recommending entering this program.
Upon approval of this item, we will review our historical usage and make the appropriate estimations for our
anticipated 2025 fuel needs to complete our order and contractual obligations.
Financial Impact
Budget savings will be understood as fuel costs are set by the State.
Mission/Policy/Goal
Responsible for every dollar.
Attachments
Fuel Consortium Program
The Elk River Vision
A avelcoming community with revolutionary and spirited resourcefulness, exceptional service, and community p p W E R E U A Y
engagement that encourages and inspires prosperity
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Fuel Consortium Program - Overview
Attachment A
The current Contract with Beaudry Oil is set to expire January 31, 2025. Due to market conditions and the solicitation
process, the procurement team is exploring pricing options for a new solicitation or agreement term and program that
will begin February 1, 2025. In order to achieve this, participants must submit their quantities for the Fixed Price Fuel
Program no later than November 10, 2024.
Fixed Price Fuel Program —Agencies participating in the Fixed Price Fuel Program are required to take 100% of its
monthly quantity committed and the Contractor is required to provide 100% of the monthly quantities contracted. The
program will be for 12 months, from February 1, 2025 through January 31, 2026.
- If the original purchaser is unable to take all of the monthly committed gallons, the Contractor will be
responsible for contacting other location participating the Fixed Price Fuel Contract to determine if they are able
to take additional gallons.
- If the Contractor is able to ship the unused gallons from the original participating purchaser to another
participating agency, there will be no cost to the original participating agency. If the Spot Price is less than the
Fixed Price, participants are not required to take more than the monthly amount they committed to.
- If the Contractor is unable to ship the unused gallons from the original participating purchaser to another
participating agency, they may sell the unused gallons on the open market and either debit or credit the
difference in price back to the original participating purchaser based on the open market sell price.
- If the Contractor is unable to provide all of the monthly committed gallons to a participating member by the due
date and time, the participating member may purchase the product on the open market and charge the
Contractor for any actual additional costs incurred.
Spot Price Program — In addition to the Fixed Price Program, we will include a Spot Price Program for Participants to
handle extra fuel needs over and above the committed quantities in the Fixed Price Program. Only Participants in the
Fixed Price Program may use the Spot Prices offered by the Contractor.
If the Contractor is unable to provide the order quantity to a State agency or CPV member by the required due date and
time, the State agency or CPV member may purchase the product on the open market and charge the Contractor for any
actual additional costs incurred.
The signature below and/or submission of the Order Form (Attachment B) certify that your Entity agrees to all terms,
conditions, and prices of any Contract agreement entered into on its behalf by the State of Minnesota, which includes,
by is not limited to, taking 100% of the monthly fuel quantities submitted for the Fixed Price Program on the Fuel Order
Form (Attachment B). There is no requirement to take any product(s) using the Spot Price Program.
Agency Name: City of Elk River
Address: 13065 Orono Parkway, Elk Rlver MN 55330
Contact Person: Justin Femrite
Title: Public Works Director
Phone No.: 763-635-1000 Fax: Email: JFemrite@ElkRiverMN.gov
Authorized Signature:
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