HomeMy WebLinkAbout07/19/2016 NWMC/SPC Fuel BidItem X. E.: MOTION TO ACCEPT NWMC/SPC FUEL BID IN AN AMOUNT NOT TO EXCEED $442,700.
Department: Public Works Department
Information:
Annually, the village has utilized the Northwest Municipal Conference (NWMC)/Suburban Purchasing Cooperative
(SPC) bid contract to purchase fuel for vehicles and equipment. Since June 19, 2012 the bid was awarded to
Palatine Oil Company, of Schaumburg, Illinois. This bid award had provisions which included three (3) additional one
(1) year contract extensions. Each year, following the initial award, the NWMC/SPC exercised all of the contract
extensions. In 2015 Palatine Oil was purchased by RelaDyne who fulfilled the remainder of the contract. The final
contract extension expired on July 5, 2016.
NWMC/SPC recently let bids for a new fuel contract. On June 23, 2016 staff was notified by the NWMC/SPD that a
new fuel contract was awarded to Gas Depot Oil Company, of Morton Grove, Illinois. Five (5) fuel supply firms
participated in the NWMC/SPC public bidding process.
The cost of fuel per gallon will vary according to market conditions, as reflected in the Oil Price Information Service
(OPIS) low rack published price.
Gas Depot Oil Company bid was for $0.0335 over (profit/overhead) the OPIS low rack cost of fuel for unleaded
gasoline and $0.0435 for #2 bio -diesel. The final contract extension that just expired with RelaDyne was for $0.0475
over the OPIS low rack cost of fuel for unleaded gasoline and $0.0575 for #2 bio -diesel.
Attached is a fuel bid work sheet that compares last year's Village contract pricing with the new SPC bid award
pricing. The current bid award also includes a provision to extend the contract three (3) additional one-year periods
under the same terms and conditions of the original contract.
The NWMC/SPC fuel bid award is in effect from July 6, 2016 to July 5, 2017.
Throughout the potential four-year term of this contract (initial award and three (3) one-year extensions), the OPIS low
rack price may rise and fall on a daily basis but the amount of money paid to Gas Depot Oil Company as
profit/overhead will not change. It will remain fixed at $0.0335 over the OPIS low rack price for unleaded gasoline
and $0.0435 for #2 bio -diesel.
Based on our five (5) year average consumption of 87,000 gallons of gasoline and 53,000 gallons of diesel fuel, we
would realize a savings of $1,960.00 compared to last year's contract pricing through RelaDyne. Gas Depot has
been in business for seventeen (17) years, has an experienced staff, and sales for their last fiscal year totaled
$140,000,000.
Alternatives:
1. Accept Northwest Municipal Conference (NWMC) / Suburban Purchasing Cooperative (SPC) joint purchasing
bid for fuel.
2. Discretion of the Village Board.
Budget Impact:
This proposed award will require the expenditure of approximately $442,700 from the General Fund in 2017.
Expenditures in subsequent years of the contract will be limited to amounts authorized in annual budgets.
Recommendation:
It is my recommendation that the Village Board accept the NWMC/SPC bid award and execute a new 2016/2017 fuel
contract with Gas Depot Oil Company, Inc., of Morton Grove, Illinois, to be in effect from July 19, 2016 to July 5,
2017.
I also recommend that the Village Board authorize staff to execute up to three (3) one (1) year extensions if approved
by the NWMC/SPC
SUPPORTS THE FOLLOWING STRATEGIC PLAN GOALS:
INFRASTRUCTURE: Well designed, well maintained public spaces and facilities, GOVERNANCE: Financially sound, providing
exceptional service.
ATTACHMENTS:
Description Tyne Unload Date File Name
2016 2017 FUEL
D CONTRACT Cover Memo 7/10/2016 FUELBIDTAB2016(1).xls
COMPARISON