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6.C. - Page 2 of 15 <br />ANALYSIS <br />The bid process established that base fuel prices would be based on the "Oil Pricing Information Service" <br />(OPIS) for the San Jose area wholesale pricing. OPIS is the world's most recognized comprehensive <br />database of U.S. wholesale petroleum prices, as well as other key markets. All bidders were to bid a <br />guaranteed profit margin that will not change during the contract period over the base fuel price. The bid <br />results are below: <br />Table 1: Bid Tabulation I <br />Unleaded Diesel <br />Contractor Profit Margin/Gallon Profit Margin/Gallon <br />Valley Oil Company <br />$0.0280 <br />$0.0250 <br />Western States Oil <br />$0.0330 <br />$0.0540 <br />American Textile Systems <br />$0.1034 <br />$0.1034 <br />SC Fuels <br />$0.2200 <br />$0.2200 <br />Merrimac Energy Group <br />$0.3000 <br />$0.3000 <br />Staff recommends that the contract be awarded to Valley Oil Company because they were the lowest <br />responsive and responsible bidder. Staff believes that Valley Oil Company has the staffing and expertise <br />needed to perform the services and recommends awarding a one-year contract in an amount not to <br />exceed $750,000, with the option of up to three consecutive one-year extensions, for a total not to exceed <br />amount of $3,000,000. <br />Although staff is requesting $750,000 for each one-year term of the agreement to safeguard unforeseen <br />market conditions, the actual expenditure will be lower than projected based on City's historical usage. <br />PWS is closely following City's Climate Action Plan to reduce both fuel usage and cost over time by <br />introducing more fuel-efficient and electric vehicles into the City's fleet. <br />FISCAL IMPACT <br />Fuel costs are included in the Fleet Division's annual authorized budget. The expenditure will be recovered <br />subsequently from the operating budget of the user departments. <br />ENVIRONMENTAL REVIEW <br />This activity is not a project under California Environmental Quality Act (CEQA) as defined in CEQA <br />Guidelines, section 15378, because it has no potential for resulting in either a direct or reasonably <br />foreseeable indirect physical change in the environment. <br />City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.org <br />57 <br />