Broken Arrow City Council
Meeting of: 09-17-2024
Title:
title
Award the most advantageous bid for gasoline and diesel to Offen Petroleum LLC, with the exception of the optional items; The optional items, including portable diesel and unleaded fuel tanks with fuel award the most advantageous bid to Fleet Fuels LLC
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Background:
The City of Broken Arrow purchases approximately 255,000 gallons of gasoline and 268,000 gallons of diesel annually for its fuel supply. The cost of fuel in FY 2024 was $1,750,400, and for FY 2025, it is estimated to be approximately $1,900,000. Fuel is typically purchased weekly and delivered by tanker to the City’s fuel sites. Additionally, diesel fuel is ordered as needed for generators throughout Broken Arrow. The Purchasing Division monitors fuel levels and reorders when supplies reach a certain threshold.
Area fuel prices are tracked using OPIS (Oil Price Information Service), which is the most widely accepted benchmark for fuel pricing. Since the City cannot control fuel prices, the primary cost variables are the delivery charges and suppliers' markups. To mitigate the impact of local demand on prices, the Purchasing Division sought annual bids based on the unit cost per gallon above or below the OPIS rack average. This allows the City to reduce fuel costs by stabilizing pricing through fixed markups and delivery charges, while also simplifying the purchasing process.
Bids were advertised and opened on August 7, 2024, with six bids received. City staff recommends awarding the fuel supply bid to Offen Petroleum as the most advantageous bidder, excluding the optional portable tanks, for which they did not submit a bid. For the optional portable diesel and unleaded fuel tanks, City staff recommends awarding this portion to Fleet Fuels LLC, which submitted the most advantageous bid. The portable tanks will be strategically placed in various locations to better serve City departments and provide additional resources during emergency situations.
Funds for fuel are budgeted by each department.
The City of Broken Arrow would like to award the option of portable diesel and unleaded fuel tanks to Fleet Fuels LLC. The City of Broken Arrow would like to have the option of placing additional fuel tanks in strategic locations to better serve the City departments. This will also be beneficial in emergency situations.
Funds for fuel are budgeted by each Department.
Cost: Cost of fuel
Funding Source: Various department operational funds
Requested By: Ryan Baze, Maintenance Services Director
Approved By: City Manager Office
Attachments: 25.100 Gasoline Diesel Bid Tab, Offen Petroleum LLC Bid.
Recommendation:
recommend
Award most advantageous bid for gasoline and diesel to Offen Petroleum LLC, with the exception of the optional items. The optional items, including portable diesel and unleaded fuel tanks with fuel award the most advantageous bid to Fleet Fuels LLC.
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