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File #: TMP-1887    Version: 1 Name:
Type: Resolution Status: Agenda Ready
File created: 4/11/2023 In control: City Council
On agenda: 5/9/2023 Final action:
Title: RESOLUTION NO. 2023-9133 - AMENDING BULK FUEL SERVICES CONTRACT WITH SOUTHERN COUNTIES LUBRICANTS, LLC AND AUTHORIZING THE CITY MANAGER TO FINALIZE AND EXECUTE THE CONTRACT AMENDMENT AND RELATED DOCUMENTS
Attachments: 1. Resolution

MEETING DATE:                                          

MAY 9, 2023

 

SUBJECT:                                            

Title

RESOLUTION NO. 2023-9133 - AMENDING BULK FUEL SERVICES CONTRACT WITH SOUTHERN COUNTIES LUBRICANTS, LLC AND AUTHORIZING THE CITY MANAGER TO FINALIZE AND EXECUTE THE CONTRACT AMENDMENT AND RELATED DOCUMENTS

Body

 

Recommendation
Recommendation

ADOPT a resolution amending the bulk fuel services contract with Southern Counties Lubricants, LLC and authorizing the City Manager or delegated designee to finalize and execute the contract amendment and all related documents.

 

Body

Board or Commission Action

Not applicable

 

Relevant Council Strategic Theme

Dynamic and Responsive Service Delivery

Good Governance

 

Relevant Department Goal

Not applicable

 

Executive Summary

The City spends approximately $1 million per year on fuel and lubricants.  Approximately 70% of the fuel procured by the City is passed through to San Diego County (the Sheriff’s Department) and San Marcos Unified School District.  Staff recommends amending the existing contract to ensure adequate contract capacity through the end of the contract term.

 

Discussion

On July 20, 2020, a request for proposals was publically solicited to provide bulk fuel and lubricant delivery services.  Three proposals were received.  After review of the proposals, Southern Counties Lubricants, LLC was rated the most qualified, responsive and responsible proposer.  On September 20, 2020, City Council awarded Contract No. 6452 to Southern Counties Lubricants, LLC which was executed in the amount of $3.25 million for a term of five years.

 

Fuel cost is based on the Oil Price Information Service (OPIS) daily low rack average plus a stated not to exceed amount, which establishes the cost per gallon of fuel.  The average cost per gallon of fuel at the time of contract award was $2.73.  The average cost per gallon is now $4.16.  This substantial increase has resulted in exhaustion of the majority of the contract funds much sooner than the contact expiration of November 1, 2025. Staff recommends amending the contract to add $3.25 million to the contract amount for a total contract value of $6.5 million, to ensure adequate contract funding through the end of the five-year term.

 

Fiscal Impact 

Fuel expenses are budgeted in the Public Works Fleet Operating budget. This includes City fuel, and other agency fuel for which the City is reimbursed.  The addition of funds to the contract does not commit the City to any future expense.  Future expenses related to the purchase and delivery of fuel and lubricants will continue to be reflected in the Public Works Fleet Operating budget.

 

 

Attachment(s)
Resolution 2023-9133

 

 

Prepared by:   Samantha Byfield, Special Projects Manager

Submitted by:  Samantha Byfield, Special Projects Manager

Reviewed by:  Darren Chamow, Public Works Director

Approved by:  Jack Griffin, City Manager