sr-061411-3eeCity Council Meeting: June 14, 2011
Agenda Item: J?-' ~ ~
To: Mayor and City Council
From: Carol Swindell, Director of Finance
Subject: Reject Bid #3047 to Supply and Deliver Biodiesel Fuel
Recommended Action
Staff recommends that the City Council:
1. Reject all bids received for Bid #3047 for the supply and delivery of biodiesel fuel.
2. Authorize an increase to the bid award amount of Bid #2984 made to General
Petroleum Corporation , a California-based company, in an amount not to exceed
$850,000, for the period July 1 through September 30, 2011 or until a formal bid
is awarded for a total amount $2,650,131.
Executive Summary
Staff recommends that City Council reject all bid responses to Bid #3047 to supply and
deliver biodiesel fuel as the bid responses received were noncompliant with the bid
notice and specifications. Staff also recommends extending the current agreement
with General Petroleum Corporation for three months for an amount not to exceed
$850,000 which would allow for the purchase of biodiesel fuel until new bids are
obtained and the City Council awards the biodiesel fuel contract. This increase will
bring the total expenditure to $3,500,131 for the 15-month term.
Background
On January 19. 2010, City Council awarded Bid #2984 to General Petroleum
Corporation for the purchase of biodiesel fuel through June 30,2010. On June 8, 2010,
City Council authorized staff to exercise a renewal option offered by General Petroleum
Corporation to supply and deliver biodiesel fuel blends to the Big Blue Bus and Public
Works Fleet Management Division, for the period July 1, 2010 through June 30, 2011 in
an amount of $2,050,131, and on Mav 10, 2011, City Council authorized an increase of
$600,000 to the existing purchase orders for a new total of $2,650,131.
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Discussion
In April 2011, the City published Notices Inviting Bids to supply and deliver biodiesel fuel
as required in accordance with City specifications. Although vendors were not
individually contacted by City staff, the bid was posted on the City's on-line bidding site.
Vendors who expressed interest in bidding on this in the past were encouraged to
register online so that they would receive an email notification when the bid was posted.
Notices were also advertised in the Santa Monica Dailv Press in accordance with City
Charter and Municipal Code provisions. Eight bids were received and publicly opened
on April 27, 2011. The bid notice and specifications requested that bid prices include
sales tax, fees/surcharges and if applicable, state excise tax. However, all of the bid
responses failed to include one or more of the items in their bid and staff -could not
discern what was included. Consequently, bids submitted could not be compared as
they were not an accurate representation of actual prices requested. Based upon the
bid responses received, staff recommends rejecting all bids due to noncompliance with
bid notice and specifications and issuing a revised Notice Inviting Bids.
Financial Impacts & Budget Actions
Funds for the purchase of biodiesel fuel are included in the proposed FY 2011-13
budget submitted to Council for review and approval in the following line items.
• Fleet: $145,000 in account 54554.522910, "Vehicles-Fuels/Lubrication."
• BBB: $690,000 in account 41654.522911, "Fuel-Revenue Vehicles."
• BBB: $15,000 in account 41654.522840, 60W, "Fuel & Oil Taxes."
Prepared by: Kimberlie Nimori, Acting Purchasing Agent
Approved: Forwarded to Council:
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Carol Swindell Rod Gould
Director of Finance City Manager
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