Title
Consider and take action on a resolution authorizing a one-year renewal agreement with Bay Oil Company for the purchase and delivery of fuel and petroleum products in an amount not to exceed $1,230,000 (Director of Public Works)
Background:
Approval of this item will authorize a one-year renewal agreement with Bay Oil Company for the purchase and delivery of fuel and petroleum products from December 1, 2024 through November 30, 2025 in an amount not to exceed $1,230,000. This is the second and final renewal and this service will be rebid in FY2025.
Renewal agreement amount based on the following:
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 proposed one-year amount accounts for the most recent one-year usage history and a contingency amount for unforeseen conditions. At the time of this writing OPIS fuel pricing is $2.77 for unleaded and $3.11 for diesel.
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 orders over 2,000 gallons and $0.14 per gallon for deliveries under 2,000 gallons for unleaded and diesel fuel.
Estimated costs:
Petroleum (unleaded & diesel) - $1,068,790
Delivery Fee - $ 21,450
Lubricants - $ 20,881
Remote Locations (Generators) - $ 12,000
Potential Fuel Price Volatility - $ 106,879
Not to Exceed Total - $1,230,000
On September 12, 2023, Council approved: 1) a one-year renewal agreement with Bay Oil Company for the period December 1, 2023 through November 30, 2024 in a not to exceed amount of $1,225,000 and 2) an amendment to increase funding by $200,000 for the remaining term which ended November 30, 2023 in a total not to exceed amount of $2,700,000.
On November 10, 2020, Council approved a three-year agreement with Bay Oil Company RFP #20-FLEET-016 for ...
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