HomeMy WebLinkAboutOrdinance No. 2392-2009,. ~s ~~~-E ~ , Suggested by: Administration
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KENA~ SKA CITY OF KENAY
ORDINANCE NO. 8332-2009
AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AMENDING
KMC 21.05.085, AIRPORT FUEL FLOWAGE FEE.
WHEREAS, the City of Kenai Municipal Airport budget for FY 2009 includes a fuel
flowage fee of three cents ($0.03) for each gallon of aviation gasoline, motor vehicle
gasoline, diesel fuel, kerosene, aviation jet fuel or like substances; and,
WHEREAS, the quantity of fuel delivered to the Kenai Municipal Airport has exceeded
the estimates on which the FY08 budget was based; and,
WHEREAS, the fuel flowage fee can be reduced from three cents ($0.03) per gallon to
two cents ($0.02) per gallon and achieve the revenue required to support airport
maintenance, airport crash fire and rescue, and other required airport support
activities.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI,
ALASKA, that KMC 21.05.085(a) be amended as follows:
(a) Any person, firm or corporation who delivers aviation gasoline, motor vehicle
gasoline, diesel fuel, kerosene, aviation jet fuel or like substance (hereafter
referred to as fuel) to any person, firm or corporation at the Kenai Municipal
Airport shall pay a fuel flowage fee of [THREE CENTS 00.03)) two cents
0.02 for each gallon of fuel.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 18th day of March,
2009.
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PAT PORTER, MAYOR
ATTEST: ~/ ~/~'
Carol L. Freas,~City Clerk
Introduced: March 4, 2009
Adopted: March 18, 2009
Effective: May 1, 2009
New Text Underlined; [DELETED TEXT BRACKETED]
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KENIl1~ SK-1
°°Villa~e witti a Past, Gc~ wit~i a Future °°
210 Fidalgo Avenue, Kenai, Alaska 99611-7794 ~a~~
Telephone: 907-283-7535 /FAX: 907-283-3014 1~~~~1
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MEMO:
TO: City Council
FROM: Rick Koch
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DATE: February 26, 2009
SUBJECT: Kenai Municipal Airport Fuel Flowage Fees
The purpose of this memorandum is to provide infortnation and recommend Council
approval of an ordinance to lower the airport fuel flowage fee from there cents ($ 0.03)
per gallon to two cents ($ 0.02) per gallon.
As you may recall the airporC has operated at a deficit from FY 2002 through FY2008,
and had fees, leases and rents that were in most cases signif candy below industry
standards aasd what was charged at other similar Alaskan airports.
We increased and instituted many fees and charges in order to begin to bring our pricing
structure in-line with other Alaskan airports and the industry in order to reduce our
operational deficit.
One of the fees hlstituted was a fuel flowage fee. The fuel flowage fee was estimated to
produce approximately $ 75,000 of revenue based on an esthnated volume of 2,500,000
gallons of fuel. The fuel flowage fee is based on all fuel delivered to the airport including
but not limited to fuel that goes "into the wing" of aircraft, but also fuel that into "bulk
fuel tanks" for re-sale at other Locations.
Through the first seven months (July 08-January 09) of the fiscal year the City has
received $ 61,295.04 in revenue from fuel flowage fees based on 2,043,167.23 gallons of
fuel, or an average of $ 8,756.43 azld 291,881.03 gallons per month.
If we project the monthly average over the twelve months of the fiscal year, total
estimated fuel flowage revenues for FY 09 would be $ 105,077.16. Total estimated
volume of fuel would be 3,502,596.36 gallons.
A reduction in fuel flowage fees by one cent for the remansder of FY 09 would decrease
fuel flowage fees by an estimated $ 5,837.62 and for FY 10 would result in total
estimated revenues of ~ 70,051.93.
Administration recommends the reduction in fuel flowage fees as the services provided
by the airport remain essentially unchanged by the increase in volume.
Tf yott have any questions please contact me at your conveirience.