Agenda 02/24/2009 Item #16D 9
Agenda Ilem I'h 1609
February 24,2009
Page 1 of 11
EXECUTIVE SUMMARY
Recommendation that the Board of County Commissioners approve past
expenses for non-ethanol gasoline for County Parks & Marinas.
OBJECTIVE: To obtain Board approval for past expenses associated with the
operation of the sale of non-ethanol gasoline at County marinas.
CONSIDERATION: The Parks & Recreation Department has the responsibility to
operate an increasing number of County owned marinas, and gasoline is sold to boaters
on an as needed basis. Recently, the federal government required the use of ethanol
products in gasoline. Staff sold products that contained ethanol however; the ethanol
product creates engine problems in boats. Parks and Recreation staff attempted to use
the County-wide contract for gasoline and diesel fuel to obtain non-ethanol gasoline
products, however, until recently that agreement only covered 87 octane gasoline with
ethanol and number 2 diesel fuels.
Subsequently, the Purchasing Staff added the required 89 octane non-ethanol gasoline
to the County bid as prescribed in the bidding document. However, there are
outstanding invoices totaling $62,826.60 that need to be paid for product prior to the
addition of non-ethanol.
Therefore, staff requests approval to pay the invoices so that the County Marinas may
continue to offer a quality gasoline product at the dock.
FISCAL IMPACT: Funds are budgeted within the Parks and Recreation cost centers to
pay for outstanding invoices.
GROWTH MANAGEMENT IMPACT: There is no impact on the Growth Management
Plan.
LEGAL CONSIDERATIONS: Parks and Recreation received and sold the fuel in
question. Failure to pay the amount owed may subject the County to a claim by the
supplier. This item is non-quasi judicial and as such ex parte disclosure is not required.
This item requires majority vote only. This item is legally sufficient for Board action. -
CMG
RECOMMENDATION: That the Board of County Commissioners approves payment of
the invoices associated with the 89 octane non-ethanol gasoline for County marinas in
the amount of $62,826.60 to Evans Oil Company.
PREPARED BY: Murdo Smith, Regional Manager
~.
Page I of I
A.~enda Item No. 16D9
February 24,2009
Page 2 of 11
COLLIER COUNTY
BOARD OF COUNTY COMMISSIONERS
Item Number:
Item Summary:
16D9
Recommendation that the Board of County Commissioners approve past expenses for non-
ethanol gasoline for County Parks and Marinas.
Meeting Date:
2/24/200990000 AM
Approved By
Scott Johnson Purchasing Agent Date
Administrative Services Purchasing 2/5/20098;32 AM
Approved By
Barry Williams Director Date
Public Services Parks and Recreation 2/5/2009 1 ;42 PM
Approved By
Steve Carnell PurchasinglGeneral Svcs Director Date
Administrative Services Purchasing 2/9/20099;35 AM
A pproved By
Jeff Klatzkow Assistant County Attorney Date
County Attorney County Attorney Office 2/11120098;52 AM
Approved By
Colleen Greene Assistant County Attorner Date
County Attorney County Attorney Office 2/11/20099;12 AM
Approved By
Marla Ramsey Public Services Administrator Date
Public Services Public Services Admin. 2/1112009 10;45 AM
Appro\'ed By
OMS Coordinator OMS Coordinator Date
County Manager's Office Office of Management & Budget 2/11/20092;45 PM
Approved By
Sherry Pryor Management & Budget Analyst Date
County Manager's Office Office of Management & Budget 2/13/20098;17 AM
Approved By
James V. Mudd County Manager Date
Board of County County Manager's Office 2/17/20098;52 AM
Commissioners
Iile://C:\AQ'endaTest\Exnort\ I 24-Fehruarv%2024. %202009\ I ti.%20CONSENT%20AGFND... 2/1 R/2009
Agenda Item No. "1509
February 24,2009
Page 3 of 11
February 9,2009
N.M.M.1.
Non- Ethanol Fuel Issue
Mr. Murdo Smith
Collier County Parks and Recreation
Murdo,
To address the Collier County Finance Departments
concerns as to the use of ethanol fuel in boats I will supply
you a brief summary of the issues as the Marine Industries
of Florida and marina mangers have been dealing with the
problem.
. Florida Statue # 526.203 exempts all water craft from
using ethanol blended fuel
. The long term effects of ethanol blended fuel in boats
has been documented for several years as harmful to
marine engines and in some cases fuel tanks and
systems
. The ethanol blended fuel breaks down with any
moisture in the tanks causes a slug of inert fluid that
will not burn or combust in the engine, it just stops
the engine till cleaned out
. This can cause a very unsafe condition if stranded
. The ethanol is a solvent and it attacks the fuel
components of the engines and if the vessel has a
fiberglass tank it attacks and dissolves the resin of
which the tank was constructed, which is extremely
dangerous
· Numerous litigations issues have sprung up from end
users looking to the fuel dock supplier to repair their
boat and engines
1
Agenda item tJo. 1609
February 24,2009
Page 4 of 11
. When the ethanol first became available the suppliers
such as Evans Oil had no choice but to purchase the
ethanol blended fuel and sell it to all of there marina
fuel dock customers.
. As time went on storage tank facilities were found
with the capacity to store non- ethanol blended fuel to
sell to the exempt end users.
. This non ethanol blended fuel was hard to find,
supplies limited, and for the most part limited to mid
rang products such as 89 octane, thus driving the cost
per gallon up slightly
. Using mid rang fuel as opposed to regular in marine
engines is a very wise choice as more and more
engine manufactures are requiring mid rang or better
to get the manufactures designed performance out of
there engine.
In conclusion switching to non- ethanol blended fuel in the
midrange octane was a very wise choice and will eliminate
long- term problems as to ethanol issues in the boats fuel.
All of our facilities have switched back to non- ethanol fuel
as soon as it became available to each facility
Thank You
Frank Donohue
Director of Operations
For Naples Marine Management Inc
Managers For:
Naples Boat Club
Naples Bay Yacht Stowage
The Carrabelle Boat Club
Maximo Moorings Marina
Cocoa Village Marina
Ocean Club @ Port Canaveral
Marine Industries of Florida
Marine Industries Association of Collier County
Collier County Parks and Recreation Advisory Board
2
Agencia item No.1 SD9
February 24, 2009
Page 5 of 11
3
Statutes & Constitution :View Statutes :->2008->Ch0526->Section 203#0526.203: OnIin... Page 1 of2
.4genda Item No. 16D9
February 24, 2009
Page 6 of 11
Select Year: 12~og~:If.
The 2008 Florida Statutes
Title XXXIII
REGULATION OF TRADE, COMMERCE,
INVESTMENTS, AND SOLICITATIONS
ChapteL526
SALE OF LIQUID FUELS;
BRAKE FLUID
View Entire
Chapter
526.203 Renewable fuel standard.--
(1) DEFINITIONS.~.As used in this act:
(a) "Blender," "importer," "terminal supplier," and "whotesaler" are defined as provided in s. 20Q.01.
(b) "Blended gasoline" means a mixture of 90 to 91 percent gasoline and 9 to 10 percent fuel ethanol,
by volume, that meets the specifications as adopted by the department. The fuel ethanol portion may
be derived from any agricultural source.
(c) "Fuel ethanol" means an anhydrous denatured alcohol produced by the conversion of carbohydrates
that meets the specifications as adopted by the department.
(d) "Unblended gasoline" means gasoline that has not been blended with fuel ethanol and that meets
the specifications as adopted by the department.
(2) FUEL STANDARD.--Beginning December 31, 2010, all gasoline sold or offered for sale in Florida by a
terminat supplier, importer, blender, or wholesaler shall be blended gasoline.
(3) EXEMPTIONS.~.The requirements of this act do not apply to the following:
(a) Fuel used in aircraft.
(b) Fuel sold for use in boats and similar watercraft.
(c) Fuet sold to a blender.
(d) Fuel sold for use in collector vehicles or vehicles eligible to be licensed as cotlector vehicles, off-
road vehicles, motorcycles, or small engines.
(e) Fuel unable to comply due to requirements of the United States Environmental Protection Agency.
(f) Fuel transferred between terminals.
http://www.leg.state.fl.uslStatuteslindex.cfm? App _ mode=Display _ Statute&Search _String... 2/10/2009
Statutes & Constitution :View Statutes :->2008->Ch0526->Section 203#0526.203: Onlin... Page 2 of2
t.,oenc!a !tem 1\]0. 16D9
. February 24. 2009
Page 7 of 11
(g) Fuel exported from the state in accordance with s. 206.052.
(h) Fuel qualifying for any exemption in accordance with chapter 206.
(i) Fuel for a railroad locomotive.
(j) Fuel for equipment, including vehicle or vessel, covered by a warranty that would be voided, if
explicitly stated in writing by the vehicle or vesset manufacturer, if the equipment were to be operated
using fuel meeting the requirements of subsection (2).
All records of sale of unblended gasoline shail include the ioilowing statement: "Unblended gasoline may
be sold only for the purposes authorized under s. 526.203(3), F.S."
(4) REPORT.--Pursuant to s. 206.43, each terminal supplier, importer, blender, and wholesaler shall
include in its report to the Department of Revenue the number of gallons of blended and un blended
gasoline sold. The Department of Revenue shall provide a monthly summary report to the department.
History.--s. 103, ch. 2008-227.
Copyright @ 1995.2009 The Florida Legislature. Privacy Statement. Contact Us
http://www.1eg.state.fl.usIStatuteslindex.cfrn? App _ mode=Disp]aL Statute&Search _String... 2/1 0/2009
Agenda Item No. 16D9
February 24, 2009
Page 8 of 11
Administrative Services Division
Purchasing Department
~ COLLmR COUNTY GOVERNMENT
Purchasing Building G
3301 E. Tamiami Trail
Naples, Florida 34112
Telephone: 239/252-8995
FAX: 239/732-0844
Email: ScottJolm....ui\A~ollierl!ov.net
January 20, 2009
Evans Oil Company
Attn: Randy Long
3170 Horseshoe Drive South
Naples, FL 34104
Re: Addition of items to 07-4180 "Gasoline & Diesel Fuel"
Dear Mr. Long:
We are pleased to add 89 octane non-ethanol gasoline to your agreement with
Collier County as provided on page 9 of the bidding document. Evans Oil will be
required to provide written prices at the time of order. If you have any questions,
please contact me.
Chevron
III
Agenda Item No. : 609
February 24.2009
Page 9 of 11
"
Global Marketing
!ii!
0..-.,.._
Don Welke,
DIstrict Sales Menager
The Amerle.. Region
Chevron Products Company
2300 Windy Ridge Parkway
Suite 575 S
Atlanta, GA 30339
Tel 770 984 4111
Fa. 770 984 3102
dmwalkerOchevron.com
June 24, 2008
Mr. Randy Long
Evans Oil Company LLC
3170 S. Horseshoe Dr.
Naples, FL 34 ]04-6137
Retail Outlet Product Tank Transition to EIO Blending
Terminals:
Chevron Port Everglades, Ft Lauderdale, FL
Marathon Spangler, Ft. Lauderdale, FL
Ethanol-Blended Product Offered: Conventional EIO (10% Etbanol) 8.8# RVP Gasoline
Transition Date: July 9, 2008
Dear Randy:
All grades of conventional ethanol-free motor gasoline will not be available to Chevron and Texaco
marketers from the Chevron Pt, Everglades and Marathon Spangler Tenninals in Ft. Lauderdale, FL after
July 8, 2008. Beginning July 9, 2008, only gasoline containing 10 vol% ethanol (E I 0) will be available
to Chevron and Texaco marketers, Thus, conversion to ethanol-blended gasoline is mandatory for
undisrupted supply from these terminals,
Because of the urgent need to transition, we want to provide you with the following background
information on the current regulations, your responsibilities, and some transition options you may wish to
consider:
Regulalxlry Background:
The addition of ethanol to conventional gasoline causes the RVP to increase and depresses tbe T50
distillation point and vapor lock characteristic temperature, T(VJL-20),
In this regard, the State of Florida has specific regulations concerning gasoline blended with ethanol.
Altbough the State allows a I psi vapor pressure increase for blends containing' I to 10 vol% ethanol from
September 16 through May 31, the State defers to US-EPA regulations on RVP from June 1 through
September 15. For blends containing 9 to 10 vol% ethanol only, the State allows a relaxed T50
distillation point of 1500F minimum and T[V1L-20) of I ]30F minimum for Vapor Lock Protection Class 3
and I070F minimum for Class 4, (A State proposal is pending. that would extend the relaxed T50 and
J . !(etail Outlet Product Tank Transition to EIO Blending
Evans Oil Company LLC
June 24, 2008
Page 2
Agenda Item No. 16D9
February 24,2009
Page 10 of 11
T(IIIL.2D)T limits to blends containing 1 to 10 vol% ethanol during transition only. but it has not been
adopted as of the date of this letter.)
The US-EP A has specific vapor pressure requirements for gasoline during the summer VOC control
period of Junc ] through September 15 of each year. Thc EPA provides a I psi vapor pressure increase
but only for gasolinc containing 9 to 10 vol% ethanol. There is no allowance for RVP increase for
ethanol blends of less than 9 vo]% ethanol, which might result from delivering EIO gasoline into a half-
full retail storage tank. Ethanol-gasoline blends containing less than 9 voJ% ethanol must meet the same
specifications as ethanol-free gasoline. This requirement may create comp]cxity for transitioning from
ethanol-free gasoline to E]O gasoline, particularly at retail sites.
Marketer Responsibilities:
On July 9, Chevron will begin delivery of gasoline containing ]0 vol% ethanol at the Chevron Port
Everglades Terminal and the Marathon Spanglcr Terminal in Fort Lauderdale, FL, The blends will be in
full compliance with state and federal regulations for such blends.
State and federal regulations on fuel quality apply to retail sales and it is the responsibility of marketers to
ensure that gasoline dispensed from retail sites (service stations and marinas) meets regulatory
requirements at all times. Federal and state regulations provide waivers only for 9-10 vol% ethanol
blends, and marketers will need to convert all storage tanks from 0 vol% ethanol to a blend of9.10 vol%
ethanol instantaneously with the first delivery of EIO gasoline. (This requirement also applies to
facilities operated by wholesale purchaser-consumers. and it is incumbent on mar/reters to /reep these
parties informed of transition plans and their obligations.)
Managing: the Transition:
Chevron understands that this transition will present a challenge for marketers, and we suggest the
following options for managing the process:
Option I: For the first delivery of ethanol-blended gasoline, receive at least 13 times the volume
of gasoline remaining in thc retail undcrground storage tank (UST). (Example: If the retail
storage tank has a capacity of 10. 000 gallons and there are 600 gallons remaining in the tank,
the volume of the first delivery of E10 gasoline shauld be at least 7800 gallons.)
Option 2: pump out the remaining gasoline and receive a delivery ofEIO gasoline.
Here are some suggestions and other considerations to help you manage the transition:
. To confirm the tank contains 9-10 vol% ethanol, you may wish to have the tank contents tested for
ethanol content. The EPA-designated test method is ASTM D 5599-00. ASTM D 48]5-03 is an
acceptable alternative method provided the lab has correlated the method with ASTM D 5599-00.
This is not 8 requirement, but it would provide you with confirmation of ethanol content if you're
unsure.
. This is a requirement for each tank at the fCtail outlet.
. Ifthcre are multiple tanks of the same grade, the requirement applies to each tank individually. If the
tanks are connected by manifold, all tanks should be transitioned at the same time.
, .
'({ewl Outlet Product Tank Transition to EIO Blending
Evans Oil Company LLC
June 24, 2008
Page 3
Agenda Item No. 16D9
February 24, 2009
Page 11 of 11
. Ethanol decals should not be visible to customers until ethanol.blended gasoline is being dispensed,
If tanks are lransitioned at different times, this could pose a labeling problem, particularly for singl.,..
hose dispensers.
. As you are aware from previous communications, ethanol can dislodge scale and sludge and may
result in rapid dispenser filter plugging after initial transition to ElO. This effect can be avoided or
minimized with good housekeeping and appropriate preparations. However, filling a tank On top of a
low tank heel can stir up otherwise quiescent sediments and magnify the impact. It might be helpful
to let the storage tank settle for awhile before commencing sales following initial delivery. Our
experience has been that i5 minutes settling time was sufficient in most cases.
. Appropriately prepared storage tanks should be clean and dry. To minimize problems that residual
moisture due to condensation could cause, it is recommended that the first delivery ofE]O is large in
volume relative to the tank heel. The reason is that higher percentages of ethanol can potentially
better tolerate more moisture. Nevertheless, this suggestion is not meant to provide foolproof
assurance that water.re]ated problems will be avoided, nor is it an alternative to appropriate
preparations. It is still vilal to ensure that storage tanks are clean and dry.
Once a facility has completed the conversion to E]O, it is imperative to continue to maintain the ethanol
content at 9-10 vol%. If the ethanol content drops below 9 vol%, the dispensed gasoline may nO longer
comply with volatility regulations. Subsequent receipt of conventional ethanol-free gasoline would not be
acceptable,
To ensure E 10 product quality, ongoing monitoring and maintenance by the facility operator are more
important than ever. It is imperative to gauge the product tanks daily for water with the proper gauge
stick and water.finding paste (specifically made for E I 0 product) and to use and change the
recommended ethanol-tolerant filters in accordance with manufacturer's instructions,
If you have any questions, please contact your Retail Business Consultant.
Sincerely,
GJ ~ \:\\ ~~
Don Walker