Title
Consider and take action on a resolution authorizing a three-year agreement with Bay Oil Company for the purchase and delivery of fuel and petroleum products in an amount not to exceed $3,250,000 (Director of Public Works)
Background:
Approval of this item will authorize an agreement with Bay Oil Company for the purchase and delivery of unleaded and diesel fuels to four fueling locations within the City and the necessary lubricants for maintaining fleet units. This contract will be for a three-year period beginning December 1, 2025 through November 30, 2028, with two (2) one-year renewal options.
On August 13, 2025, the City released Request for Proposal (RFP) 25-029 City Wide Fuel and Petroleum Products for these items. Seven (7) responses were received on September 16, 2025 from: Bay Oil Company, Campbell Oil, Gresham Petroleum, Midtex Oil, Pinnacle Petroleum, Senergy Petroleum, and Sun Coast Resources. A four-member evaluation team comprised of City Staff (Director of Public Works, Fleet Administrator, and Shop Foreman) and one consultant (Yvonne Calderon, retired Fleet Manager) evaluated all proposals.
The qualified bidders were scored based on the following criteria:
• Pricing and Fees (lowest bid/other bid x 50 = Proposer’s Price Score): 50 points
• Emergency Response Plan: 15 points
• References: 20 points
• Experience: 15 points
To ensure consistency, evaluations of Pricing, Fees, and References were completed by Purchasing Staff. References were evaluated based on comparable government agencies in the Gulf Coast Region, as well as responses from the references. Price for bulk fuels was evaluated based on the price obtained from OPIS (Oil Price Information Service) as of 10:00 am on September 16, 2025: Unleaded $2.0509 per gallon and Diesel $2.2257 per gallon.
Accumulative totals of the four (4) committee members are as follows:
Bay Oil - 396.0
Sun Coast Resources - 344.3
Pinnacle Petroleum - 339.7
Senergy Petroleum - 322.3
Midtex Oil - 246.8
Gresham Oil - 155.0
Campbell Oil- 106.0
Of the seven (7) qualified proposals, Bay Oil Company resulted in the highest overall scoring. MidTex Oil proposed the lowest price for fuel and diesel at $641,666.50 compared to Bay Oil at $644,716.50, Bay Oil submitted the lowest price for lubricants at $28,727.70 compared to MidTex at $39,419.05. After thorough evaluation, staff recommends awarding Bay Oil Company the contract which offers overall savings for fuel and lubricants of $7,641.35. Bay Oil is the City’s current fuel provider and is located locally, and has historically provided exceptional service during many emergency events.
The three-year contract total is based on the three following components:
1. Fuel - pricing is determined on a daily basis by the Oil Price Information Service (OPIS). OPIS provides daily fuel pricing based on pertinent regional petroleum market influences. The average cost per gallon of $2.50 for unleaded and $3.00 for diesel is derived from the City’s historical data from the past three years. These prices are utilized to calculate the contract value.
2. Delivery - the cost for delivery service is represented as a price per gallon above the OPIS market rate. Bay Oil proposes a cost of $0.04 per gallon for delivery orders over 2,001 gallons and $0.14 per gallon for delivery orders under 2,000 gallons. Comparative fuel delivery costs from other bidders are as follows:
UNLEADED (Gallons) DIESEL (Gallons)
Vendor Over 2,001 Under 2,000 Over 2,001 Under 2,000
Bay Oil $.04 $.14 $.04 $.14
Campbell Oil $.34 $.76 $.35 $.77
Gresham Petroleum $.05 $.05 $.05 $.05
Midtex Oil $.03 $.15 $.03 $.23
Pinnacle Petroleum $.0364 $.1727 $.0636 $.2260
Senergy Petroleum $.05 $.11 $.11 $.12
Sun Coast Resources $.0395 $.5000 $.0450 $.5000
3. Lubricants - motor oil, gear lube, hydraulic fluid, transmission fluid, and antifreeze used to maintain the City’s fleet. Bay Oil submitted annual cost of $28,728 X 3 years = $86,184.
The amount of $66,039 was added to the projected three-year contract value to address potential fuel price volatility.
The following costs represent the estimated three-year contract total:
Petroleum (unleaded & diesel) $2,617,500
Delivery Fee $ 79,417
Lubricants $ 86,184
Remote Locations (Generators) $ 400,860
Three-Year Total $3,183,961
Potential Fuel Price Volatility $ 66,039
Not to Exceed Total $3,250,000
Attachments:
1. Proposed Resolution
2. Exhibit A - Agreement with Bay Oil Company
3. Recommendation Memorandum
4. Evaluation Scoring Matrix Summary
5. Bid Tabulation
6. Vendor Report Card
CONTRACT ORIGINATION: Agreement has been reviewed by the City Attorney’s Office.
FUNDING
{X} Funds in the amount $884,073 are available from the F2026 Motor Pool Fund. Funding in FY2026 totaling $884,073 include:
$574,051 to account 40103600-51455 Fuel Inventory Expense
$39,192 to account 40103600-51457 Fuel Inventory Expense - FS #3
$51,877 to account 40103600-51458 Fuel Inventory Expense - FS #4
$84,024 to account 40103600-51454 Fuel Inventory Expense - PWOC
$23,579 to account 40103600-52300 Vehicle Repairs
$50,585 to account 10207500-51450 Gas & Oil - Wastewater
$42,055 to account 10207300 51450 Gas & Oil - Water
$2,486 to account 4400000-51450 Gas & Oil - Sportsplex
$5,757 to account 3650000-51450 Gas & Oil - Facilities
$10,467 to account 3300000-51450 Gas & Oil - Street Stormwater
The remaining $2,365,927 will be split in FY2027, FY2028 and FY2029.
STRATEGIC PLANNING
{X} Addresses Strategic Planning Critical Success Factor #1 - Develop and Maintain City Infrastructure