AUBURN – Mayor John Jenkins said area financial institutions and banks are stepping forward, hoping to be involved in creating neighborhood heating oil purchasing groups.

“If the neighbors get together and buy their oil, that money has to go some place,” Jenkins said Tuesday. “It can’t just sit in someone’s house. It needs to go some place safe, where it can earn interest and be available to the oil dealers, too.”

Jenkins told city councilors meeting Monday that several local financial institutions have expressed interest in the program, but he wouldn’t name them.

It’s part of an effort he unveiled earlier this month to help people form neighborhood oil purchasing cooperatives.

“Every indication points to this being a tough winter, and we need to have a plan,” Jenkins said. “This is going to be part of it.”

Last month, councilors decided to let people join a city co-operative bid to purchase heating oil in bulk in an effort to reduce costs. The plan drew plenty of interest, and 597 residents registered with the city, saying they would purchase 545,764 gallons over the next year.

Oil dealers were cold to the plan, however. Only one of 16 oil dealers submitted a bid, and it was $4.71 per gallon, about 30 cents more than the market price at the time.

Jenkins hopes his plan will get residents a better price without discouraging the oil dealers.

“Every oil company can participate, big or small,” he said. “Plus, putting the money in an interest-bearing account provides some security for the dealer. They know that they’ll get paid, that the money is right there waiting for them, as soon as they deliver the oil.”

Meanwhile, the city has taken delivery of the last gallons of oil purchased under last year’s heating oil bid.

City Councilor Ron Potvin said tankers from Bath-based M.W. Sewall topped off the city’s heating oil storage tanks last week. According to the city’s contract with M.W. Sewall and Co., the city agreed to purchase up to 430,000 gallons for city and school offices at $1.96 per gallon.

But Potvin said the city didn’t use all of that oil reserved under the old price. Thanks to efficiencies and closing the Webster School, the city ended the contract with 68,000 gallons left on the contract. Officials learned about that on June 2, and tried to get the company to deliver that oil.

“We had the trucks ready to go,” said Potvin. “Unfortunately, we found out just a few days too late. According to the contract, we needed to have that oil delivered by May 31. We found out about it on June 2.”

Potvin said the company did agree to top off all of the city’s the tanks.

“That’s something, but it doesn’t really make a dent in what we’re going to use next year,” Potvin said.