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Consent Agenda Item 5. A.
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| Regular BOS Meeting |
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| Information |
| Request/Subject |
| Amendment No. 2 to Contract No. 050619-Bulk Fuel and Lubricants |
| Background Information |
On June 23, 2019, the Board of Supervisors awarded a contract to Fuelco Energy, LLC in response to Invitation for Bids (IFB) No. 050619-Bulk Fuel and Lubricants for the period of July 23, 2019 through July 22, 2020.
On July 7, 2020, the Board of Supervisors awarded Amendment No. 1 to Contract No. 050619 extending the term of the contract for one additional year, from July 23, 2020 through July 22, 2021; and to increase the contract amount by $193,000.
Gila County has entered into contracts with specific suppliers in order to purchase petroleum products under stringent cost parameters. Built into the bid includes using a fuel depot with the Rack Price which is the same as O.P.I.S. (Oil Price Information Service) system pulled from the Monday at 8:00 A.M. All of the fuel delivered Monday through Sunday of the same week will reflect the O.P.I.S. price plus the amount the contractor bid to cover the delivery. The contractor will send Gila County Fuel Management a Weekly Pricing report on Monday of each week that has the OPIS Phoenix Rack average plus “add-on” for delivery of Unleaded CBG, Unleaded Conventional & Ultra Low Sulfur Diesel for each Gila County site. The company’s contract price will include a separate margin price added to commodities in cents, to a required four decimal place. This contract price per gallon will include all costs for delivering the commodity. With all of these items separated on the invoice, Gila County General Services personnel can monitor the costs and compare them to the contract and the O.P.I.S. price. |
| Evaluation |
Contract No. 051619 expires on July 22, 2021. The contract allows for two additional one-year renewal periods for a total of five years at an annual cost of $900,000; therefore, staff recommends that the contract be renewed for one additional year, from June 20, 2020, to July 22, 2021.
The delivery of fuel to the remote location of Young and the smaller fuel capacity of this depot, the Tonto Basin depot, and Buckhead Mesa depot make the bid more of a challenge to suppliers. Travel on the Young road is best by bobtail tankers and some suppliers don’t have them. Fuel delivery to the Young depot can be critical at times during less than perfect driving conditions.
After evaluating and checking the references, Gila County General Services personnel chose Fuelco Energy LLC to contract with the County for bulk fuel and lubricant products at the bid in 2019. This choice stems from price and knowing they are a full-service company delivering both fuel and lubricants. The physical inventories on Gila County fuel tanks will be monitored with Fuelco Energy LLC equipment that General Services can also monitor on cell phones and computers.
In addition to the routes specified in the original bid, Gila County asked that service be brought to the Buckhead Landfill in 2021. This did not increase supply, but rather take diesel fuel from the Payson – Star Valley yard that used to be transferred by Service Truck to the Buckhead Mesa Landfill equipment. With a diesel tank installed at Buckhead Mesa, the equipment there and any road equipment in the vicinity can fuel without the Service Truck being brought in from the maintenance yard. The 2,200-gallon tank was in Public Works surplus storage. Fuelco Energy LLC has provided the average OPIS price per gallon plus their overhead of $0.250 which includes delivery and taxes. |
| Conclusion |
| The Public Works Director feels it is in the best interest of Gila County to renew this contract for another 12 months. General Services insists on the best service from any vendor. It is important Gila County receive the products prior to or as soon as requested. With each annual renewal of the contract, an evaluation will be done to ensure the highest quality of products and that Gila County is receiving the best service. Fuelco Energy LLC has provided outstanding service and products during this second year. |
| Recommendation |
| The Public Works Director recommends that the Board of Supervisors approve Amendment No. 2 to Contract No. 050619 to renew the contract for Fuelco Energy LLC for the purchase and delivery of bulk fuel and lubricants as specified in contract number 050619 at a not to exceed amount of $900,000; and to allow an additional delivery route for Buckhead Mesa Landfill under the same price structure as the rest of the contract. This contract has the possibility of annual renewals for a period of two more years. |
| Suggested Motion |
| Approval of Amendment No. 2 to Contract No. 050619 to extend the contract term with Fuelco Energy, LLC from July 23, 2021 to July 22, 2022 for a not to exceed amount of $900,000 for the continued provision of bulk fuel and lubricants at various Gila County locations. |
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