SR-6-D (131)
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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
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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-
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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.
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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
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, 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;