Monday, July 31, 2017

Osage Beach rescinds Lee C. Fine Memorial Airport (KAIZ) fuel truck contract, considers alternatives

And that decision could cost the city as much as $17,000 to the low bidder for breaking a contract aldermen approved June 29.

The city of Osage Beach staff was sent back to the drawing board last week after the board of aldermen voted to rescind the purchase of a new jet fuel truck for Lee C. Fine Airport.

And that decision could cost the city as much as $17,000 to the low bidder for breaking a contract aldermen approved June 29. Mayor John Olivarri broke a tie 3-3 vote in favor of awarding the contract at that meeting, with half of the board reluctant to spend $171,645 for a new truck and instead favoring a less expensive option.

A week later at the July 6 regular meeting, Alderman Phyllis Marose said she wanted to bring the issue back to the table for discussion because of the cost. Since the issue was not part of the regular agenda, City Attorney Ed Rucker said she would have to request the jet fuel discussion be placed on the July 20 regular agenda.

City Administrator Jeana Woods noted during the July 20 meeting that based on the board’s June 29 decision to award the contract to Garsite Aviation Refueling Equipment, the contract was signed June 30. Part of the contract required a 10 percent down payment.

She told the board that if the decision to buy was rescinded, Garsite probably expects its down payment check in the mail.

“Because of the board’s decision (June 29), we’re pretty much tied to buying the vehicle. According to the last email from Garsite they said they hope to work out an agreement of mutual benefit without having to ask for the 10 percent down,” she told the board.

The bid was for a new jet fuel truck, and Garsite edged out two other bidders for the contract, she reminded the board.

Other options

The consensus of the board was that spending $171,000 for a new truck is not in the best interests of taxpayers, and the board ultimately voted to ask staff to research other options. These include leasing a truck, rebuilding the current truck or buying a used vehicle that meets the city’s specifications.

Alderman Kevin Rucker noted that an informal decision made by the board during budget discussions last November authorized the Airport Department to pursue purchase of a new jet fuel truck. He said having quality, safe equipment is important -- especially when dealing with aviation fuel.

“We want to make sure the truck is operating safely and properly, and generally you have to have up-to-date equipment,” he said. “Reliability is extremely important. When you buy something used, you’re buying something used. I considered that in November when we gave staff direction, and now we’re saying to them, well, we don’t want to do that.”

But Alderman Jeff Bethurem took exception with Rucker’s comments, noting that the makeup of today’s board is different today than in November with two new members.

Saying he’s all for safety, Bethurem said he believes there are other options for getting a quality jet fuel truck for less than the cost of a new truck. He also opposes the city having to borrow funds to help purchase the truck, noting that interest alone would be about $12,000.

Alderman Richard Ross, who also opposed buying a new truck, said he wants airport officials to have jet fuel trucks at both Lee C. Fine and Grand Glaize airports.

“I think there are opportunities to have jet fuel trucks at both airports,” he said. “I think we should look at different options to keep the functionality and safety, but it makes more sense financially to look at other options.”

Airport Manager Ty Dinsdale stressed that the current jet fuel truck is in poor condition, noting employees keep a spare set of spark plugs on hand to swap out every other week just to get the engine started. Taking the truck to the shop isn’t practical, he said, because it takes it out of service leaving the airport without any way to pump jet fuel.

“The money we’re making is coming through that truck,” he said.
In researching options, Dinsdale said companies are not interested in taking the truck as a trade-in because of its condition. Finding a used truck that meets the city’s specs has been difficult.

“We bought this truck in 1980, and it was used then. This airport is not the same as it was then because I’m selling a lot more jet fuel today. Yes, we could get this rebuilt but how am I going to get another truck in the meantime?” he asked.

Assistant City Administrator Mike Welty said rescinding the Garsite contract opens the purchase of any replacement to additional challenges.

“If you vote this down today, we’ll have to go through the entire new bidding process for a used truck,” he said.

That requires publication notices, additional deadlines to open and consider the bids and other delays in getting a different truck in place.

The vote to rescind the purchase was approved 4-2, with Aldermen Ross, Bethurem, Phyllis Marose and Tom Walker voting to rescind. Aldermen Kevin Rucker and Greg Massey voted not to rescind.

Staff will research a variety of options for consideration by the board at a later date.

Public input

Two veteran flyers from Osage Beach, both of whom have served on the Missouri Pilots Association, offered a different perspective during the Public Comment portion of the agenda July 20.

Jim and Carolyn Morris addressed the economic benefit of both local airports, and the image they feel should be portrayed to customers.

“If a $20 million corporate aircraft, and that’s not unusual, taxis in to Lee C. Fine Airport to get fuel and service, what do they expect? First class, the very best because that’s part of the picture,” Morris said. “I ask that everybody think twice when they vote and see if we can hold our heads up high and be proud of airports and what they do for us.”

Carolyn Morris agreed, adding that the economic impact of general aviation to the lake community should be considered when deciding on the purchase.

“All of us know that whenever somebody comes in to the community that every dollar spent at the airport goes a lot farther,” she said. “A fuel truck is part of that image, it’s part of the expectations of pilots and passengers looking for an airport that’s first class.”

She note that Osage Beach airports will soon be facing increased competition as Camdenton and Lebanon expand and improve their airports.

“I encourage you to think about that when you vote on this issue,” she offered.

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