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Approve a Fuel Supply Agreement with World Fuel Services, Inc. for aviation fuel for the Nut Tree Airport through August 31, 2028; and Authorize the County Administrator or designee to execute the agreement and any subsequent amendments, with County Counsel concurrence, up to a fiscal year aggregate of $74,999
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Published Notice Required? Yes ____ No _X _
Public Hearing Required? Yes ____ No _X _
DEPARTMENTAL RECOMMENDATION:
The Department of General Services recommends that the Board of Supervisors:
1. Approve a Fuel Supply Agreement with World Fuel Services for aviation fuel for the Nut Tree Airport through August 31, 2028; and
2. Authorize the County Administrator or designee to execute the agreement and any subsequent amendments, with County Counsel concurrence, up to a fiscal year aggregate of $74,999.
SUMMARY/DISCUSSION:
The Fuel Services Agreement (FSA) is necessary to maintain uninterrupted supply of aviation fuel at the Nut Tree Airport (Airport) for both based tenants and the flying public. The agreement covers the supply of aviation fuel: aviation gasoline (Avgas) and jet fuel.
The County began operating fuel services at the Airport in September 2012, generating revenue to support the Airport’s Operating Budget. From 2012 to 2020, World Fuel Services (World Fuel) provided aviation fuel through a series of agreements and amendments,. In October 2020, following a competitive solicitation, the County awarded a five-year FSA to Epic Aviation, LLC. On October 1, 2024, World Fuel acquired Epic Aviation Fuel, LLC and assumed the Airport’s FSA through assignment. The assigned agreement is set to expire on August 31, 2025.
In addition to fuel supply, World Fuel leases two fuel trucks to the County to maintain quality control. The lease terms are currently under negotiation and will be funded from the Airport Enterprise Fund.
Staff recommends approval of a new three-year FSA with World Fuel (Attachment A) to ensure continued fuel service. With the SB 1193 requiring unleaded aviation fuel by 2031, the Airport will reevaluate suppliers at that time to ensure compliance. To avoid service disruption when the current agreement expires in August 2025, and in accordance with County’s Purchasing and Contracting Policy, service contracts beyond three years require specific approval by the Board.
FINANCIAL IMPACT:
Funding for the recommended FSA will be from the Airport Enterprise Fund and offset by the sale of fuel to aircraft owners and operators. During FY2024/25, the Airport purchased 113,272 gallons of fuel in the amount of $437,856, and generated fuel sales in the amount of $655,249. The approved Airport Budget (BU 9002) for the current FY 2025/26 includes $650,000 for fuel purchases. If the recommended agreement is approved by the Board, fuel will be purchased for the remainder of FY2025/26 within approved appropriations. The costs associated with preparing the agenda item are nominal and absorbed by the department’s FY2025/26 Working Budget.
ALTERNATIVES:
The Board may choose not to approve the FSA with World Fuel Services, Inc. as the fuel supplier. This is not recommended, as there are limited regional fuel suppliers, and not approving the agreement could disrupt fuel operations at the Airport or lead to more costly alternatives.
OTHER AGENCY INVOLVEMENT:
County Counsel was consulted and has approved the agreement as to form.
CAO RECOMMENDATION:
APPROVE DEPARTMENTAL RECOMMENDATION