By Art Cusano

Putnam Valley officials are working to create an oil co-op like the ones recently formed in Cortlandt and Yorktown.

The town is still in the early stages of putting the plan together, and hopes to have it running sometime this winter. The town board is preparing the initial mailings that will go to all 4,193 households in the town. Councilwoman Wendy Whetsel estimated the cost of printing and mailing to be $2,191.63.

Following the initial mailing, about 1,000 membership cards will be printed for the program.
In an oil co-op, a company signs an agreement with the town and guarantees to sell oil to residents at a lower price for the year. In return the company gets access to a large group of customers. After residents join the co-op, they deal with the oil company directly.
“Once we put the oil company and the [customer] together, we’re out of it,” said Supervisor Robert Tendy at a Nov. 12 work session. “We just keep records and we charge them five bucks a year to stay in the program.”

The Town of Cortlandt was the first town in the area to start such a program. For $5, a resident can join the program and buy oil at a rate of approximately 30 or 40 cents above wholesale price, which is 20 cents less than what non-members will pay. Yorktown started its own oil co-op Saturday.

Tendy and Councilwoman Wendy Whetsel have been in contact with Cortlandt and Yorktown officials and have been studying how those towns are running their programs.
Whetsel said the sale rate would adjust as the cost of oil fluctuated.

“Every day it would be posted on our Web site what the wholesale price for oil was that day, so if you are purchasing it that day you would be purchasing it at 30 cents over that day’s rate,” Whetsel said. “If they wait three days down the line and oil changes, the rate will be 30 cents over that day’s rate.”

Tendy said he wanted to be completely sure it was legal for the town to run such an operation before it was started. He also said he feared that companies might find ways to abuse the contracts, such as raising other costs to compensate for the loss of revenue.
“An oil company can agree to do this, but they might at the same time decide to sell service contracts at $500 instead of $200 so you won’t be saving any money,” Tendy said.