Public Works Department
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1 Public Works Department SUBJECT: Consideration of a Resolution authorizing a contract extension from July 6, 2018 through July 5, 2019 with Gas Depot Oil Company of Morton Grove, IL, to supply fuel for the Village s fleet in the amount of $469, plus a five percent (5%) contingency for a total of $493, AGENDA ITEM: 9.b.iii MEETING DATE: July 2, 2018 VILLAGE BOARD REPORT TO: Village President and Board of Trustees FROM: Jerry Burke, Director of Public Works (847) THROUGH: Matthew J. Formica, Village Manager PURPOSE AND ACTION REQUESTED: Staff requests consideration of a Resolution authorizing a contract extension from July 6, 2018 through July 5, 2019 with Gas Depot Oil Company of Morton Grove, IL, to supply fuel for the Village s fleet in the amount of $469, plus a five percent (5%) contingency for a total of $493, BACKGROUND/DISCUSSION: The Village s procurement policy requires that all purchases for goods or services in excess of $20,000 must be competitively bid. The policy also provides that the Village may participate in cooperative purchasing initiatives when it is determined to be in the best interest of the Village. The Village first contracted for fuel supply and delivery via the Northwest Municipal Conference s ( NWMC ) Suburban Purchasing Cooperative in The contract offers competitively-priced fuel procured via a competitive bid process that leverages several municipalities demand. The contract also benefits its participants as they no longer need to spend staff time working on solicitations for fuel procurement. The NWMC rebid its fuel contract two years ago and awarded to Gas Depot Oil Company ( Gas Depot ), who was determined to be the lowest responsible, responsive bidder. The NWMC recently approved a second one-year extension with Gas Depot. NWMC communities and Glenview staff have been satisfied with Gas Depots delivery consistency and the products provided. Via the NWMC contract, the Village may purchase fuel from Gas Depot at a per-gallon price that includes two components: the cost of the fuel itself, which is based on the Oil Pricing Information Service low rack Chicago area price for the day of delivery (plus applicable taxes), and a markup for Gas Depot s profit/overhead that remains fixed throughout the term of the contract. The fixed markup is shown in the table below. (Please note that, except in emergency 1
2 situations, staff only orders quantities of fuel that are greater than 6,000 gallons so that the Village may take advantage of the lower markup rates. Please also note that the markup includes freight charges and the NWMC s 0.5 percent (0.05%) per gallon administrative fee.) Grade Order size (Gallons) Markup (Per gallon) Unleaded (87 Octane) >6,000 $ Unleaded (87 Octane) <6,000 $ >6,000 $ <6,000 $ BUDGET: The United States Department of Energy - Energy Information Administration s June 2018 Short-term Energy Outlook suggests fuel will be priced as follows in 2018 and USDOE - EIA, June 2018 ($/gal) ($/gal) Year Percent Change Staff s projections for the gallons of fuel the Village will need to purchase during the contract extension are included in the table shown below. Because the amount of fuel consumed each year is heavily influenced by snow removal activities, fuel consumption projections are based on a five-year average. Period Gallons Cost per gallon* FY2018, July through December FY2019, January Through June FY2018, July through December FY2019, January through June FY 2018 Projected cost FY 2019 Projected cost Contract Total 55,000 $2.81 $154, N/A $154, ,000 $2.78 N/A $133, $133, ,000 $3.16 $97, N/A $97, ,000 $3.10 N/A $83, $83, Subtotal 166,000 N/A $252, $214, $469, Contingency Request (5%) N/A N/A $12, $10, $23, Total Expenditure Request N/A N/A $265, $227, $493, *Cost per gallon is the sum of the USDOE outlook for the year plus $0.04/gallon for unleaded and $0.05/gallon for diesel for the NWMC fixed mark-up. Note: All expenditures are budgeted out of the MERF Fuel Account:
3 The projected cost with contingency for fuel for the remainder of FY2018, July December, is $261,818.00, which falls within the remaining FY2018 fuel budget. RECOMMENDATION: Staff recommends approval of the attached Resolution authorizing a contract extension from July 6, 2018 through July 5, 2019 with Gas Depot Oil Company of Morton Grove, IL, to supply fuel for the Village s fleet in the amount of $469, plus a five percent (5%) contingency for a total of $493, Attachment: 1. Resolution 3
4 Attachment 1: Resolution 4
5 RESOLUTION NO. WHEREAS, the Village of Glenview (the Village ) is a home-rule municipality located in Cook County, Illinois; WHEREAS, the corporate authorities have discussed and considered procuring fuel from the Northwest Municipal Conference s Suburban Purchasing Cooperative s fuel supplier, Gas Depot Oil Company of Morton Grove, IL ( Gas Depot ); and WHEREAS, the corporate authorities have determined that it is in the public interest to procure fuel from Gas Depot. NOW, THEREFORE, BE IT RESOLVED, by the President and Board of Trustees of the Village of Glenview, as follows: The Village President (or his designee) is authorized to enter into a contract extension from July 6, 2018 through July 5, 2019 with Gas Depot Oil Company of Morton Grove, IL, to supply fuel for the Village s fleet in the amount of $469, plus a five percent (5%) contingency for a total of $493, PASSED this day of, 2018 AYES: NAYS: ABSENT: APPROVED by me this day of, 2018 ATTESTED and FILED in my office this day of, 2018 James R. Patterson Jr., Village President of the Village of Glenview, Cook County, Illinois Matthew J. Formica, Village Clerk of the Village of Glenview, Cook County, Illinois 5
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