HomeMy WebLinkAbout2022-05-10; City Council; ; Authorization of Additional Appropriation for City Fleet Fuel ExpensesCA Review _RMC_
Meeting Date: May 10, 2022
To: Mayor and City Council
From: Scott Chadwick, City Manager
Staff Contact: Bradley Northup, Fleet Superintendent
bradley.northup@carlsbadca.gov, 442-339-5193
Subject: Authorization of Additional Appropriation for City Fleet Fuel Expenses
Districts: All
Recommended Action
Adopt a resolution authorizing an appropriation of $100,000 from the Fleet Maintenance Fund
to the fleet maintenance operations budget for projected city fleet fuel expenses.
Executive Summary
Fuel costs have increased sharply in the past several months due to geopolitical risk and
uncertainty. As a result, the current fleet maintenance operating budget will not cover
projected fuel costs through the end of the current fiscal year. Staff request an additional
appropriation of $100,000 to the fleet maintenance operations budget.
The City Council’s approval is required to appropriate funds in excess of the $891,947 initially
allocated for fuel and fuel-related expenses for the city’s fleet.
Discussion
The City Council approved the city’s fiscal year 2021-22 operating budget on June 8, 2021, with
Resolution No. 2021-132. The approved budget for operating the city’s fleet included $891,947
for fuel and fuel-related expenditures.
Though fuel prices remained fairly stable during the first half of the fiscal year, prices spiked in
February from $3.65 to $4.97 per gallon, a 36% increase. According to the U.S. Energy
Information Administration, fuel costs in the fourth quarter of this fiscal year are expected to
increase by 30% compared to the previous year’s actual fourth quarter expenditures. The city’s
expenditure projection is based on historical fuel usage for this quarter and assumes that fuel
costs will remain elevated for the remainder of this fiscal year.
May 10, 2022 Item #4 Page 1 of 5
Costs of fuel– FY 2021-22, Q1 through Q3
Average price per gallon, diesel and unleaded fuel
To cover projected fuel and fuel-related expenditures through June 30, 2022, staff request an
additional appropriation of $100,000 to the fleet maintenance operations budget.
$76,598 $77,464 $75,541 $75,046
$71,490
$75,337
$77,472
$82,311
$102,071
$70,000
$75,000
$80,000
$85,000
$90,000
$95,000
$100,000
$105,000
Jul-21 Aug-21 Sep-21 Oct-21 Nov-21 Dec-21 Jan-22 Feb-22 Mar-22COST OF FUEL$3.34
$3.47 $3.55 $3.62
$3.74 $3.85 $3.94 $4.04
$4.89
$3.17
$3.31 $3.31 $3.37
$3.54 $3.59 $3.54 $3.57
$3.81
$3.00
$3.20
$3.40
$3.60
$3.80
$4.00
$4.20
$4.40
$4.60
$4.80
$5.00
Jul-21 Aug-21 Sep-21 Oct-21 Nov-21 Dec-21 Jan-22 Feb-22 Mar-22PRICE PER GALLONDIESEL AVG UNLEADED AVG
May 10, 2022 Item #4 Page 2 of 5
T T T
T T T T T
Options
Staff provide the following options for the City Council’s consideration:
1. Adopt a resolution authorizing an appropriation of $100,000 from the Fleet
Maintenance Fund for city fleet fuel costs
Pros
• No disruptions to city fleet use or critical city services
Cons
• None
2. Do not adopt a resolution authorizing an appropriation of $100,000 from the Fleet
Maintenance Fund for city fleet fuel costs
Pros
• None
Cons
• Critical city services may be disrupted due to fuel shortages
Staff recommend Option 1 for the City Council’s approval
Fiscal Analysis
The Fleet Maintenance Fund balance is sufficient to support the requested $100,000
appropriation.
Next Steps
Funds will be transferred to the fleet maintenance operations budget.
Environmental Evaluation
This action does not constitute a project within the meaning of the California Environmental
Quality Act under Public Resources Code section 21065 in that it has no potential to cause
either a direct physical change in the environment or a reasonably foreseeable indirect physical
change in the environment and therefore does not require environmental review.
Public Notification
This item was noticed in accordance with the Ralph M. Brown Act and was available for public
viewing and review at least 72 hours prior to the scheduled meeting date.
Exhibit
1. City Council resolution
May 10, 2022 Item #4 Page 3 of 5
RESOLUTION NO. 2022-103
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, AUTHORIZING AN APPROPRIATION OF $100,000 FROM THE
FLEET MAINTENANCE FUND TO THE FLEET MAINTENANCE OPERATIONS
BUDGET FOR PROJECTED CITY FLEET FUEL EXPENSES
Exhibit 1
WHEREAS, the City Council of the City of Carlsbad, California has determined that fuel costs
have risen significantly over the past few months; and
WHEREAS, fuel costs for the fourth quarter of fiscal year 2021-22 are anticipated to be almost
30% higher than the previous year's actual fourth-quarter costs; and
WHEREAS, the fleet maintenance operating budget is not adequately funded to support
anticipated fuel purchases necessary to maintain critical city services through the end of the fiscal year;
and
WHEREAS, staff anticipate that an additional $100,000 will be needed in the fleet maintenance
operation budget to support necessary fuel purchases through the end of the fiscal year; and
WHEREAS, the Fleet Maintenance Fund balance is sufficient to support the requested $100,000
appropriation.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as
follows:
1. That the above recitations are true and correct.
2. That the Deputy City Manager, Administrative Services, is authorized to transfer
$100,000 from the available fund balance of the Fleet Maintenance Fund to the fleet
maintenance operations budget.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of
Carlsbad on the 10th day of May, 2022, by the following vote, to wit:
AYES:
NAYS:
ABSENT:
Hall, Blackburn, Bhat-Patel, Acosta, Norby.
None.
None.
MATT HALL, Mayor
~t"" FAVIOLA MEDINA, City Clerk Services Manager
(SEAL)