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CONSIDERATION AND AWARDING OF BID NO. 1213-37 FOR (1) UNLEADED GASOLINE, (2) #2 DIESEL FUEL, AND (3) BIODIESEL (B5) FUEL FOR THE FLEET MANAGEMENT DIVISION.
ACTION NEEDED: Motion to accept or reject all bids meeting specifications; and, if accepted, award the bid to Red Rock Distributing Company as the lowest and best bidder meeting specifications for all sections.
ACTION TAKEN: ______________________________
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BACKGROUND: On September 20, 2012, bids were opened on Bid #1213-37 for the delivery of Unleaded, Diesel, and Biodiesel (B5) fuels for the City of Norman.
DISCUSSION: The City of Norman owns and operates a fleet of 463 on-road vehicles and an inventory of over 200 items of off-road fueled equipment. Approximately 600,000 gallons of unleaded, diesel and bio-diesel fuels are used annually by the City at an annual cost of $1.6 million (3-year average). In an effort to reduce the annual cost of fuel, the City utilizes a competitive bidding process.
The bid package was sent to ten (10) vendors, two of whom responded: Petroleum Traders Corp. of Fort Wayne, Indiana and Red Rock Distributing Company of Oklahoma City, Oklahoma.
The City shall have the option to renew this contract annually, for a period of four (4) years, provided that the services and process continue to be acceptable to both parties. Pricing shall be reviewed at the beginning of each renewal period at which time the City will determine whether to renew or rebid. Bids were last taken for fuel September 23, 2008. The contract was awarded to Red Rock Distributing Company and it has been renewed every year since that time.
The contract confirms the vendor’s ability to supply the fuel within twenty-four (24) hours notice to any City owned location, the amount of profit margin the vendor will charge over the actual low rack price cost of the fuel, freight, freight surcharge, and the mandatory Underground Storage Tank (UST) fund fees.
A low rack price is determined by usin...
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