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HomeMy WebLinkAbout2007-04-12 = co :;0 Present: Whitey Willauer, Brian Chadwick, E. Foley Vaughan, Dual Macintyre:'AI Peters<rQl 0'\ Bulk Fuel Committee Meeting Meeting Minutes April 12, 2007 ~ -\-, o~< ~~',~ Also Present: Libby Gibson and Janine Torres ;~-~ C.::J Mr. Willauer began the meeting suggesting the proper procedure to reestablish the Bulk Fu~ Committee is to elect officers, draft a mission statement and decide how to run the project moving forward. Mr. Vaughan interrupted announcing the possibility of the airport terminal project becoming a reality. He felt airport commitment on the committee might be challenging. He himself would no longer continue on the committee but knew that Mr. Macintyre was interested. The airport was still interested in renting the land for the project. Mr. Vaughan suggested a new committee with broad based community involvement. Mr. Willauer interjected the reason for the meeting is to decide where to go from here and how to run the project which doesn't mean the present committee would go into perpetuity. Mr. Willauer asked everyone to look over the mission statement he drafted: Mission Statement: Examine options to structure the organization/entity/agency(s) that could operate the off-shore pipeline, associated fuel tanks and other components of an out-o.f-town bulkfuel storage and distribution facility with recommendations (including pros and cons) to be brought back to the Board of Selectman within a timeline to be established by the committee and brought back to the Board by May 9, 2007 for approval by the Board on May 16, 2007. Brief discussion took place over the purpose of this committee. Mr. Vaughan asked if this "exploratory" committee would morph into the "leadership" committee. Mr. Willauer explained his interpretation of the procedure was this committee, once established, will determine who will be on the "leadership" committee. Mr. Vaughan nominated Whitey Willauer as Chairman of the Exploratory Committee. Second by Dual Macintyre followed by a unanimous vote of approval. Mr. Vaughan nominated Dual Macintyre as Vice Chairman. Second by Brian Chadwick followed by a unanimous vote of approval. Mr. Willauer called the meeting to order. Items to be discussed are: 1) Who to manage, the town, the airport or an outside entity. 2) Location: Airport property or 60 acres of town land east of airport land. Mr. Peterson pointed out technical feasibility has already been established and paid for. After brief discussion regarding security, firefighting and land title issues, it was decided the airport property would best suited for the tank farm location. Discussion moved to who would own the business, the town, the airport or a town controlled independent organization. Mr. Macintyre pointed out an outside entity will want a great deal of control. Mr. Vaughan pointed out that includes price of fuel. It was unanimous that we do not want another Waste Options situation. Mr. Vaughan suggested getting a knowledgeable financial consultant who knows the fuel business. Mr. Macintyre pointed out any outside organization is going to see this as a profit making organization and therefore the fuel prices may not be as low as they might be. Mr. Chadwick said there are three reasons why we are proposing this project. Environmental, safety and possible lower fuel costs. Determining which reason is the most important reason may help us in how to proceed. Mr. Macintyre pointed out the biggest reason the bulk fuel project was started was for safety reasons adding the environmental concerns of the harbor as a safety issue as well. Mr. Willauer added redundancy to the reasons and noted we need to know what the townspeople see as the most important reason. Lower fuel prices cannot be guaranteed because of hedging. Everyone agrees hedging is the most difficult piece but if the town has control of the project, can almost guarantee lower fuel costs due to the quantity and off season purchasing. Mr. Chadwick suggested a Public/Private where a private entity invests in the infrastructure with some form of municipal input to protect town's interest. Mr. Vaughan added this as a possibility if there was some way to establish a pricing module that stated the price could never be more than, as an example, 15% of the price on the Cape. Christine Silverstein from the audience suggested researching models of established public/private entities believing that there might be some at this size scale. She also suggested a partnership between the town and the airport. Mr. Willauer pointed out the FAA may have a problem with joint ownership. Mr. Vaughan reported already approaching Town Counsel in regards to the airport having control thinking it might be out of the realm of what the airport is authorized to do and may require a special law to grant the airport this authority. Mr. Peterson reported the FAA position is to examine the proj ect once the structure is organized and maintains preliminary support as long as it is revenue producing for the airport. Continued discussion took place over the financial aspects of town control should the town want to assume the risk. Does the town want to be in direct competition with Harbor Fuel and Sun Island Fuel and is it within the town function to do so. Mr. Macintyre said there are many examples of municipalities that also run utilities. Ms. Gibson asked if there were any examples showing how these are structurally set up? A visit to the Irving facility in New Brunswick would have included a meeting with the townspeople who lease Irving the land would have shed some light on the structure, but the trip was never finalized. Mr. Willauer asked if the committee would like to retain the existing consultant, hired through an RFP by the airport. After brief discussion it was m/s/p to retain Vanasse Hangen Brustlin, Inc. (VHB) with the logistics of procurement to be worked out between the town and the airport. The committee decided the next step would be to meet with Leo Roy from VHB and have him come prepared to answer the main questions/concerns to this point: 1. Provide models and recommend a structure on how to build and operate the facility. Examples should include public, private and public/private organizations. Perhaps provide a decision matrix. 2. Recommend which island entity should have oversight of the operation. 3. Ifpublic control, how do we manage hedging? Mr. Willauer pointed out the ability of any town to run a public enterprise with town leadership changing with every election. Mr. Vaughan highly suggests a leadership committee which can provide continuity if set up more like a board of director model with established by-laws. Bulk Fuel Committee Minutes 4/12/07 Page 2 of3 Mr. Peterson pointed out the permitting and engineering needs to be done prior to any outside company showing any interest in the project. This could be a 5-year, $5 million process. Discussion moved to how to entice island fuel retailers into buying from the fuel farm other than possible lower costs including possible town imposed fees on harbor deliveries. 4. Can, as a matter of law or special law, the town prohibit tankers from using the harbor as an access for fuel except on an emergency basis? Have to take into consideration the exceptions, propane, av-gas etc. 5. Can a municipality as well as the state grant Certificates of Public Convenience and Necessity? If yes, this could be the vehicle to control the issue. Next meeting dates were discussed with 3:00 p.m. on the April 19th or the 23rd selected. Mr. Vaughan agreed to sit in for Mr. Macintyre if the 23rd is chosen. It was mls/p to adjourn at 10:47 a.m. Bulk Fuel Committee Minutes 4/12/07 Page 3 of3