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Home My WebLink About1991-02-12 - AGENDA REPORTS - FUEL PRICE ADJUSTMENT (2)NEW BUSINESS DATE: SUBJECT: DEPARTMENT: Background AGENDA REPORT City Manager Approval' Item to be presented by: John E. Medina, Director February 12, 1991 Fuel Price Adjustment to Local and Commuter Transit Contracts Public Works The current agreements for local and commuter transit services in the Santa Clarita Valley are between the County and the bus operators, Antelope Valley for local service and Mark IV for commuter services. In turn, the City has an agreement with the County to provide approximately 90% of these contract administration services for the portion of transit which operates within City limits. This existing agreement was approved by the City Council at their June 13, 1990 regular meeting. With the invasion of Kuwait by Iraq, the effect on worldwide oil prices have resulted in unforeseen fluctuations in fuel prices, which have significantly impacted operating expenses for the City's transit contractors who have "not to exceed" contracts with the County. With the price per gallon for diesel fuel nearly doubling since the August.2, 1990, the transits contractors' ability to provide a cost-effective service is being hindered. Therefore, in order that the contractors are fairly compensated for their fuel expenses, and that the County and City are able to maintain control over the contract operating costs in the wake of fuel price fluctuations, City staff concurs with the County's recommendation that the current agreement with Antelope Valley Bus, Inc, and Mark IV Charter Lines, Inc., be amended to add provisions for fuel price adjustments. The County's proposed fuel price adjustment will be determined monthly using a base diesel fuel price of $0.70 per gallon, which was the price paid by the contractors before the crisis began and the price on which the current contract rates are based. When the price per gallon paid by the contractors exceed the base rate,.the City will reimburse the contractor this difference for each gallon of fuel used to operate their respective service. If the price per gallon falls below the base rate the difference shall be deducted from any amounts due the contractor from the City. The actual fuel price adjustment will be based on the contractors' monthly fuel purchase receipts and consumption reports. The County estimates the maximum cost of the fuel price adjustment through June 30, 1991, to the City is estimated to be $23,500 for the local and $7,400 for the commuter and the City Proposition A fund balance can provide the extra funding level. It is noted that the recent direction of fuel prices is heading down and the estimated extra cost involved may not be as high as originally estimated. Agenda Item: • 9 Fiscal Impact Estimated $30,900 from the Proposition A Reserve Recommendation Approve the attached fuel price adjustment amendments to modify County Cash Contracts Numbers 2529 and 1611 for local and commuter transit services. Attachments Proposed Amendment to Local Transit Agreement Proposed Amendment to Commuter Transit Agreement DEL: 81 A M E N D M E N T 12 A GRE E M E N T THIS FOURTH AMENDMENT TO AGREEMENT is between the COUNTy OF LOS ANGELES (COUNTY) and ANTELOPE VALLEY SUS,.INC., (CONTRACTOR). W I T N E S S E T H WHEREAS, COUNTY and CONTRACTOR have heretofore executed Cash Contract 2529, dated August 30, 1988, including Amendments dated June 27, 1989, December 12, 1989 and July 9, 1990, hereinafter referred to as "AGREEMENT", regarding the program to provide a public transportation.system in the Santa Clarita valley; and WHEREAS, COUNTY and CONTRACTOR desire to .revise the terms of the AGREEMENT to provide for a fuel price adjustment to be applied to monthly payments due to CONTRACTOR under this AGREEMENT, due to the recent fluctuations in oil prices, at an additional estimated cost of $24,100. NOW, THEREFORE, the AGREEMENT is amended as follows: A. Amend Subsection 8 of Section 4 on pages 5 and b by adding: "Fuel Price Ad ustment COUNTY and CONTRACTOR agree that the base cost of diesel fuel (including all taxes) paid by CONTRACTOR shall be $0.70 per gallon. Effective on the date this AGREEMENT is signed on behalf of COUNTY, when the price paid by the CONTRACTOR exceeds this base cost, COUNTY shall reimburse 170'd Sz9zZ£SZT86SZS08T6 01 I..Inm� -GST TaaT_PT_K,..r CONTRACTOR such difference for each gallon of fuel used in the performance of thfS AGREEMENT. When the price paid by CONTRACTOR is less than the base cost specified above, the difference shall be deducted from any amounts due CONTRACTOR from COUNTY. These fuel price adjustments shall be determined on a monthly basis, and shall be added to or deducted from the amount due CONTRACTOR each month as described above. Each month, CONTRACTOR shall report to COUNTY the actual amount of fuel consumed in the performance of this AGREEMENT and the price per gallon paid during this AGREEMENT and the price per gallon paid during the month. In addition, CONTRACTOR shall submit to COUNTY. copies of invoices and receipts necessary to substantiate the actual price paid per gallon. This information will be used to determine the fuel price adjustment for the month." B. Amend Subsection D of Section 4 on page 7 to read: "Maximum Obligation Notwithstanding the above, the total cost to County and the City of Santa Clarita under this Agreement is not to exceed $2,000,000. If Director chooses to exercise his option Of extending the contract an additional six months, the total cost to the County and City of Santa Clarita under this Agreement, as amended, shall not exceed $2.524,000." cul 'rI CF9779'1Z7 T. Ar C7CRF T F. n I_lnvl I "". nT TaCT_PT_""r -3- C. . Except as expres$ly set forth herein, alb other terms and ^nditivaa vE tho PCni3mi=jrx utt-;t1 full r -JI H dIIU OTrACt. D. The effective date of this AMENDMENT to AGREEMENT is the date it is signed on behalf of COUNTY. 90'd SZ9Zz£SZS86SZS08i6 01 WOad WdSV:OS L66i-0L-Ndf �J -4- IN WITNESS WHEREOF, the parties hereto have caused this FOURTH AMENDMENT TO AGREEMENT to be executed by their respective officers, duly authorized, by the COUNTY OF LOS ANGELES on 1991 and by ANTELOPE VALLEY BUS, INC., -on ATTEST: LARRY J. MONTEILH COUNTY OF LOS ANGELES Executive Officer and Clerk of the Board of Supervisors By Deputy APPROVED AS TO FORM: DE WITT W. CLINTON County Counsel By County counsel adjust 1991. By Chairman, Board of supervisors ANTELOPE VALLEY BUS, INC. BY GU's 1. 1: LU !Ji_L].:_,1 !dr+ ^: L1t !LL: !. Lit NH1' 0 A M E -N D M E N T TO AGREEMENT THIS SECOND AMENDMENT TO AGREEMENT is between the COUNTY OF LOS ANGELES (COUNTY) and MARK IV CHARTER LINES, INC., (CONTRACTOR), W I T N E S S E T H WHEREAS, COUNTY and CONTRACTOR have heretofore executed Cash Contract 1611, dated June 23, 1989, including Amendment dated July 9, 1990, hereinafter referred to as "AGREEMENT", regarding the program to provide a public bus commuter service between Santa Clarita and Downtown Los Angeles; and WHEREAS, COUNTY and CONTRACTOR desire to revise the terms of the AGREEMENT to provide for a fuel price adjustment to be applied to monthly payments due to CONTRACTOR under this AGREEMENT, due to the recent fluctuations in oil prices, at an additional estimated cost of $8,200. NOW, THEREFORE, the AGREEMENT is amended as follows: A. Amend Subsection B of Section 4 on page 4 by adding: "Fuel Price Adjustment COUNTY and CONTRACTOR agree that the base cost of diesel fuel (including all taxes) paid by CONTRACTOR shall be $0.70 per gallon. Effective on the date this AGREEMENT is signed on behalf of COUNTY, when the price paid by the CONTRACTOR exceeds this base cost, COUNTY shall reimburse 60'd SZ9ZZESZT865Z508T6 01 w0aA WdGV :0T T66T-0T-Ndf 0 -2- CONTRACTOR such difference for each gallon of fuel used in the performance of this AGREEMENT, when the price paid by CONTRACTOR is less than the base cost specified above, the difference shall be deducted from any amounts due CONTRACTOR from COUNTY. These fuel price adjustments shall be determined on a monthly basis, and shall be added to or deducted from the amount due CONTRACTOR each month as described above. Each month, CONTRACTOR shall report to COUNTY the actual amount of fuel consumed in the performance of this AGREEMENT and the price per gallon paid during this AGREEMENT and the price per gallon paid during the month. in addition, CONTRACTOR shall submit to COUNTY copies of invoices.and receipts necessary to substantiate the actual price paid per gallon. This information will be used to determine the fuel price adjustment for the month." B. Amend Subsection D of Section 4 on page 4 to read: "Maximum obligation Notwithstanding the above, the total cost to County and the City of Santa Clarita.under this Agreement, as amended, shall not exceed $445,000. If Director chooses to exercise his.option of extending the contract an additional six months, the total cost to County and the City of Santa Clarita under this Agreement, as amended, shall not exceed $598,000." 60'd SZ9Zz£SZT86S2S08T6 01 W06d W097:OT T66T-OT-Ntf 0 0 -3- C. Except as expressly set forth herein, all other terms and conditions of the AGREEMENT are in full force and effect. D. The effective dateof this AMENDMENT to AGREEMENT is the date it is signed on behalf of COUNTY. 0S'd SZ9ZZ2SZL86SZS08S6 01 WOLid W09b:01 S66i-0T-Ndf IT 'd -10101 -Q- IN WITNESS WHEREOF, the parties hereto have caused this SECOND AMENDMENT TO AGREEMENT to be executed by their respective officers, duly authorized, by the COUNTY OF LOS ANGELES on 1991 and by MARK IV CHARTER LINES, INC., on , 1991. ATTEST: LARRY J. MONTEILH COUNTY OF LOS ANGELES Executive Officer and clerk of the Board .of Supervisors By Ey Deputy chairman, Board of Supervisors MARK IV CHARTER LINES, INC. APPROVED AS TO FORM: DE WITT W. CLINTON county Counsel By County Counsel fuel •r-� ni Lin 4 .1.1/ -MT TOUT-RT-NHf ',