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SR-6-D (131) . 60 .; J , ~ " r PURCH:PW.DH:br:f:\finance\purch\stfrpts\srbd2540 - . Council Meeting: August 8, 1995 Santa Monica, CA AUG 0 8 1995 TO: Mayor and City Councll FROM City Staff SUBJECT: Recommendation to Award Bid to Furnish and Dellver Unleaded Fuel; Reject All Blds for Diesel Fuel, Bid #2540; and Adopt a Resolutlon Authorizing City Manager to Negotlate and Execute a Contract for the Purchase of Diesel Fuel Introduction This report concerns the award of bid to furnlsh and deliver unleaded fuel for various Clty departments at specified unit prices plus all applicable taxes, wlth one (1) one-year renewal option; the rejection of all bids for diesel fuel; and the adoptlon of a resolution authorizing the City Manager to negotiate and execute a contract for the purchase of diesel fuel in the open market, pendlng the possible ldentification of other acceptable dlesel fuel provlders. Backqround In response to publlshed Notlces Invlting Bids (published May 23 and 24, 1995) to furnish and deliver vehicle fuels in accordance wlth City specifications, blds were recelved and publlcly opened and read on June 6, 1995. Proposal forms were malled to eighteen vendors, and notlces were advertised in accordance wlth Clty Charter and Municlpal Code prOV1Slons. Eight proposals were recelved as shown In Attachments A and B. 60 I - 1 - AUGOaE Vehicle fuels for all locations were bid per Attachments A and B. In accordance with past practlce of the City's fuel suppllers, bld fuel prices are based on the weekly publlcatlon referred to as the "Oil Price Information Services II (OPIS) because of prlce volatillty ThlS means that bids for the 87 octane unleaded gasoline and 10% aromatlc CARB diesel are based on a "Fixed Adder or Discount" against thlS referenced price exclUSlve of all taxes. The "0PIS" price published on Monday of each week will be the basis for pr1ces of products dellvered during the seven-day per10d commenclng on Monday and runnlng through the followlng Sunday. It 1S necessary to establish a reference p01nt by using the 1I0PISI1 publicatlon in a volatlle market. The blds were evaluated at the IITruck and Traller" gallon levels as this reflects the highest volume of usage throughout the various locations. . The VarlOUS fuels are required to meet or exceed all requirements as set forth by CARB (Callfornia Alr Resources Board) and SCAQMD (South Coast Air Qual1ty Management D1strict) in effect at the tlme of delivery. Staff has evaluated the low b1d for 87 octane unleaded gasollne and finds that lt meets City spec1ficatlons. Staff has evaluated all blds submltted for dlesel fuel and flnds that none meet Clty specificatlons whlch called for 10% aromatics. The sixth lowest bid from Unocal has the lowest percent of aro- - 2 - matics of all bidders. However, on July 11, 1995, Council directed staff to evaluate the impact on the City of adopting a policy of proh~bi t ing procurements involv~ng companies wh~ch do business ~n or with Burma. Staff has begun to research this matter and will return to Council in September 1995 with appropr1ate recommendations The preliminary information now ava1lable 1nd1cates that all suppliers of the diesel fuel are compan1es d01ng bus~ness in or with Burma. In l~ght of these factors and 1n order to ma1ntain C1ty veh1cle/bus operations without increas1ng a~r pollution, to poss1bly ident1fy other acceptable fuel sources and to complete staff's analysis of the Burma polley matter, staff requests temporary author1zation to purchase d1esel fuel from Unocal, the City's current provider, or any other provider who may be dOlng buslness in or with Burma, but w1th an option to cancel at any time. Budqet!Financ1al Impact Fiscal Year 1995-96 appropriation authority for th1S purchase is in the malntenance accounts of various departments As the fuel is used, it w1ll be expended against available FY 1995/96 approprlation authority. For the perlod July 1, 1995 through June 30, 1996, appropriation authority will be as set forth ln the FY 1995/96 budget. - 3 - Recommendation It is recommended that the award of Bid #2540 be made to Kristen Schaffner Petroleum for 87 octane unleaded gasollne at speclfied unit prlces plus all appllcable taxes as the lowest and most responsive bldder with one (1) one-year renewal option. It is further recommended that all bids for diesel fuel be rejected, and that the attached resolutlon be adopted authorizlng the Clty Manager to negotiate and execute a contract for the purchase of diesel fuel in the open market pending the possible location of alternate fuel provlders whose fuel meets City speciflcatlons and pending completion of staff's analysis of the Burma policy matter. Prepared By: Pam Wortham, Purchasing Agent Diane Howell, Buyer August 2, 1995 - 4 - LLJ LLJ LL Cl <( 0 0 0 0 0 0 0 0 0 ...J 10 10 0 0 I- ...... M M (0 ...J * * * -<h' ll. UJ (I) (I) (I) (/) ~"'C C +oJ C +oJ C+oJ C+-' ~""O ~""O -l- +-' (D ~ ~ ~ ~ ~ ~ ~ ~ +-' (D +oJ (D W....J CtI_ CtI_ CtI_ 0....:::1 E ro 0= 0-= 0= 0= E ro E "iij c: 0- C Co c: 0- c: 0- >-(/) ou. .::,t. E ..::.::: E .xE .::,t. E ou. 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Ql Ol ~ 0- W ...J ~ U (f) +-' 1 .... 0 +-' a.l Z 0 U 0 . 0 C ~ m 1J g woo Z I- 55 Q) 0.0 -g ~ (9 U ~ :::J ~ C Q) ~ C 5 * ...J m:::J C ...-NM ~ , PW DH:br:f:\purch\stfrpts\res2540 City Counc1l Meet1ng: 8/8/95 Santa Monica, Cal1.forn1a RESOLUTION NO 8927 (CCS) (C1.ty Council Series) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA TO AUTHORIZE THE CITY MANAGER TO NEGOTIATE AND EXECUTE A CONTRACT FOR THE PURCHASE OF DIESEL FUEL WHEREAS, the City sent out Notlces Inviting Blds to furnlsh ana deliver vehicle fuels for purchase by various C1ty departments; WHEREAS, e1.ght responses were rece2ved and all but one were non-responsive result1ng 1n the lack of competitive bids to conslder, WHEREAS, staff has determined that the formal bidd1ng procedures are not conducive to meeting the City's goals on social responsib1l1ty and as well as the City's speclflcatlons regarding clean burning fuel; WHEREAS, an open market purchase will permlt the purchase of diesel fuel at an acceptable cost and perm1t the City to obtain diesel fuel which meets C1ty specif1.cat1.0nSi and WHEREAS, the C1ty Council has been requested to reJect the b1ds for diesel fuel;