ITEM 6-H

Council Meeting:  June 14, 1994

TO:       Mayor and City Council

FROM:     City Staff

SUBJECT:  Recommendation to Award Bid to Furnish and Deliver
          Vehicle Fuels, Bid #2453

Introduction

This report concerns award of bid to furnish and deliver vehicle
fuels at specified unit prices, plus all applicable taxes, with
renewal options as specified in attached tabulation.

Background

In response to published Notices Inviting Bids (published March
10, 1994) to furnish and deliver vehicle fuels in accordance with
City specifications, bids were received and publicly opened and
read on April 5, 1994.  Proposal forms were mailed to twenty-nine
(29) vendors and notices were advertised in accordance with City
Charter and Municipal code provisions.  Six (6) proposals were
received per the attached tabulation.

Vehicle fuels for all locations were bid per the attached
tabulation.  In accordance with past practice of the City's fuel
suppliers, bid fuel prices are based on the weekly publication
referred to as the "Oil Price Information Services" (OPIS)
because of price volatility.  This means that bids for the
premium unleaded 

gasoline, regular unleaded gasoline and 10% aromatic CARB diesel
are based on a "Fixed Adder or Discount" against this referenced
price exclusive of all taxes.  The "OPIS" price published on
Monday of each week will be the basis for prices of products
delivered during the seven-day period commencing on Monday and
running through the following Sunday.  It is necessary to
establish a reference point by using the "OPIS" publication in a
volatile market.

The bids were evaluated at the "Truck and Trailer" gallon levels
as this reflects the highest volume of usage throughout the
various locations.  See attached "Fuel Tabulation" sheet for
examples of pricing.

The various fuels are required to meet or exceed all regulations
as set forth by CARB (California Air Resources Board) and SCAQMD
(South Coast Air quality Management District) in effect at the
time of delivery.

Staff has evaluated the low bids and finds that they meet City
specifications.

Budget/Financial Impact

Fiscal year 1994/95 appropriation authority for this purchase is
in the maintenance accounts of various departments.  As the items
are used, they will be expended against available FY 1994/95
appropriation authority.  For the period July 1, 1994 through
June 30, 1995, appropriation authority will be as set forth in
the FY 1994/95 budget.

Recommendation

It is recommended that the award of Bid #2453 be split between
two vendors as follows:  (1) Premium unleaded gasoline be awarded
to Falcon Fuels at specified unit prices, plus all applicable
taxes with two one-year renewal options; (2) regular unleaded
gasoline and 10% aromatic CARB diesel be awarded to Unocal at
specified unit prices, plus all applicable taxes, as the best
bidders.

Prepared By:   Pam Wortham, Purchasing Agent
               Diane Howell, Buyer