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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />OCTOBER 3, 2010 <br />TITLE: - <br />CONTRACT AMENDMENT AND <br />AWARD TO SC FUELS FOR DIESEL <br />FUEL <br />(SPEC. NO. 08 -004 and 11 -051) <br />CITY MANAGER <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />"TA-00061WR <br />❑ As Recommended <br />❑ As Amended <br />❑ Ordinance on Vt Reading <br />❑ Ordinance on 2nd Reading <br />❑ Implementing Resolution <br />❑ Set Public Hearing For_ <br />CONTINUED TO <br />FILE NUMBER <br />1. Amend the contract with SC Fuels for diesel fuel by $50,000 for a total amount not to <br />exceed $300,000. <br />2. Award a contract with SC Fuels for the purchase of diesel fuel, petroleum products and <br />biodiesel for a one -year period with provision for four one -year renewals in an annual <br />amount not to exceed $325,000. <br />DISCUSSION <br />The Fleet Management - Central Stores Division of the Finance and Management Services Agency <br />provides diesel fuel at the City's Corporate Yard for all City diesel- operated vehicles. In addition to <br />the underground fuel storage tanks at the Corporate Yard, tanks are located at the police facility, and <br />various Fire Stations. Soy biodiesel is being introduced as a new subdivision to our diesel fuel usage. <br />Santa Ana City Ordinance No. NS -2312 authorizes the City to purchase against contracts from any <br />public agency utilizing a competitive bid process. The SC Fuels' contract with The Cooperative <br />Purchasing Network (TCPN) for diesel fuel and products was awarded as a result of open, <br />competitive bidding, and meets the City's requirements. Pricing for the City's fuel purchases are <br />based upon daily benchmarks published by the Oil Price Information Service (OPIS), plus fixed fees <br />and applicable taxes. <br />The current contract is based on the prior year's consumption and pricing. To date, the rising cost of <br />fuel at 27 percent has exceeded the anticipated rate increase of 12 percent projected last September <br />2010. Amending the contract will allow for the payment of invoices and will provide uninterrupted fuel <br />service until the new contract term becomes effective. <br />22A -1 <br />