Naples seeks heating fuel savings

By Dawn De Busk

Staff Writer

NAPLES – As it stands, the Town of Naples has had no problem getting heating fuel from its providers. After all, the town is a long-standing customer and pays its bills on time. Because the town-owned buildings are on the regular customer list there have been no worries about tanks running low.

However, as part of its budgetary housekeeping, the town will attempt to consolidate its fuel suppliers and see if it is possible to get a lower price.

Even at this late date in the winter, saving a few pennies to a dime on the per unit cost by agreeing to pay each fuel bill within 10 days will definitely make a difference, Naples Iterim Town Manager Mitch Berkowitz said.

It’s more likely that the town can get ahead of next winter’s heating fuel prices by lining up contracts in the early summer, Berkowitz said.

The Naples Board of Selectmen gave the Interim Town Manager the authority to contact fuel suppliers and see if a money-saving arrangement is doable this winter. “We are giving you the direction to get the best price for the town and consolidiating the buildings (heating-fuel suppliers) as well,” Chairman Jim Grattelo said prior to the board’s nod of approval.

The timing is spot on.

Today (Thursday) is the first meeting of the Naples Budget Committee, during which time it will review and prepare the 2018-19 budget. The budget committee meets today, starting at 5 p.m. at the Naples Town Hall. What better time than the present to plug in some numbers for the upcoming year’s heating-fuel costs. And, it is already being done.

Berkowitz brought up the current status of the town’s heating arrangements during a recent selectmen’s meeting.

The issue was that the town’s heating-fuel contracts have not been revised or re-negotatiated for years, he told the board. Another sitation that could be improved upon is that various companies service different town-owned buildings.

Berkowitz updated the board on what staff has been doing to improve its heating costs — now and in the future.

“We are contacting the different companies in Naples to determine who has the best price. Ten days payment is the same as cash,” Berkowitz said, adding the town was in a position “to make sure it is paid within 10 days so we get best possible price.”

Paying for the fuel within 10 days of delivery is treated the same as cash payments — an offer that will give the town some leverage to get a lower price.

“For this season, the town will continue working with some of the same vendors,” Berkowitz said during a phone interview this week.

“It is not the best time of year to make a change. We will do something for the balance of the year, June or July of this calendar year,” Berkowitz said.

Well before next winter, the town will also look into consolidating their suppliers — something selectmen said they would like done, he said.

The town will not officially put a heating-fuel contract out to bid, but take a “hybrid approach” to the bid process.

“We’ll identify the companies, send it out as a written package,” he said.

“We may very well find some of them saying, ‘We don’t have the time. We don’t have the resources.’ Some may say, ‘We could shave off a couple pennies as long as the bill is paid within 10 days,’” he said.

The Town of Naples maintains heat for several buildings including the Town Office, the old town hall, The Naples Museum, which includes the informational center, the Naples Fire Station, and the “public works garage” on Route 11.

Therefore, it uses a combination of fuel types: kerosene, No. 2 heating oil, and propane.

Generally, the bid letter would state “the demand of the town is: XX number of gallons of the following…,” Berkowitz said.

“By doing it in June or July, we are already knowing that is what is going to be used,” he said.

During the meeting on Jan. 8, Selectman Bob Caron II commented on a gap between prices from different companies. He asked about the prospects of locking into a better price.

Berkowitz provided his advice for the upcoming town budget.

“As your interim, I would put out (a solicitation for a better price) in written form. Whatever the price is delivered, 10 days payment same as cash, lock it in. The new town manager should plan to do this in August at the latest.”

Caron said, “We cannot lock in this late in the year.”

Yes, Berkowitz said, “We ‘ve missed it.”

Caron continued, “And, we are paying the piper.”

Berkowitz said he could ask companies if they are willing to lock in at a better price for the remainder of the winter.

“This has not been bid out for a while from what I understand,” he said.

Chairman Grattelo asked for someone to explain the reasoning behind using different suppliers for various town buildings. This was not explained, except that some time had lapsed since the agreements with fuel suppliers had been examined.

Since this summer and autumn, the Naples selectmen have been putting the contracts out to bid for several town services, including the town attorney and the assessor. As with the fuel prices, the motive that was stated is to see where savings can be found.

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