HomeMy WebLinkAboutFCS-16-112 - T16-024 Supply and Delivery of Gasoline and Diesel ProductsStaffReport
KI x R Finance and Corporate Services Department www1ftrfiener tp
REPORT TO: Jeff Willmer, Chief Administrative officer
DATE OF MEETING: 2016 -07 -27
SUBMITTED BY: Michelle Palmer, Director of Supply Services
619 -741 - 2200 ext. 7214
PREPARED BY: Adam Buchholtz, Buyer, 519 -741 -2200 ext. 7217
WARD(S) INVOLVED: NIA
DATE OF REPORT: 2016 -07 -04 AcA'�o,, C A O
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REPORT NO.: FCS -16 -112
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SUBJECTS T16 -024 Supply and Delivery of Gasoline an Di sel
Products
That Tender T16 -024 Supply and Delivery of Gasoline and Diesel Products, be
awarded to Hogg Fuel and Supply Limited, Kitchener, Ontario, at their tendered
price of $1,377,650.11, plus H.S.T. of $179,094.51, for a total of $1,556,744.62,
annually, for a five (6) year term, with an option to renew for one (1) additional five
(5) year term.
BACKGROUND,
This contract includes the supply and delivery of gasoline and diesel products as well as
a card lock dispensing system. Our current fleet is comprised of approximately 1400
vehicles and equipment. The card lock dispensing system is a two card system where
each vehicle is assigned a card and each employee has an individual card equipped
with a personal identification number (PIN) to dispense fuels, as required. Card lock
dispensing systems are installed at Kitchener Operations Facility, Doon Valley Golf
Course and Rockway Golf Course. Where fuel is held at these locations, ownership of
the product does not transfer to the City until dispensing. This contract also includes
multiple off site card lock dispensing systems throughout the city that are maintained by
the successful vendor and available for City use. This dispensing system provides a
secured access point for staff to refuel vehicles and equipment, eliminating issues
around theft or lost product. The dispensing system also tracks vehicle mileage data
which is used by the fleet department to assess vehicle fuel efficiency and to ensure
proper billing to each operating area.
* ** This information is available in accessible formats upon request. * **
Please call 519- 741 -2345 or TTY 1- 866 - 969 -9994 for assistance.
In addition to the card lock dispensing system locations, this contract also includes the
supply and delivery of gasoline and diesel products to six (6) non -card lock dispensing
locations, as well as the filling of twenty -seven (27) back -up generators located in City
facilities and sewer pumping stations.
The average annual spend over the past five (5) years was $1,668,448.12, before
taxes. The actual spend will depend on the level of activity and market fuel price
throughout the term of the contract.
In the Iast year of the previous contract the City used 748,800 litres of gasoline and
808,842 litres of diesel products.
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Tenders were advertised publicly on the City of Kitchener website and the Internet
through the Ontario Public Buyers Electronic Tendering Information System. Documents
were downloaded by twelve (12) interested parties, and by the closing date of Thursday
June 16, 2016, one (1) tender had been received.
The following tenders were received:
Bid Price
Hogg Fuel and Supply Limited Kitchener ON $1,556,744.62 *
The City is ensured good value because fuel pricing is adjusted every week based on
current market rates coupled with a small fixed mark -up. The weekly pricing is
established based on the Bloomberg Oil Buyers Guide (013G) rack prices on Friday of
each week and is adjusted up or down from the base to establish pricing for the
following week and takes effect every Monday at 12:00 a.m. The fixed mark -up covers
the costs associated with fuel deliveries, maintenance of the card lock and dispensing
systems, and emergency supply and delivery.
The fixed mark -up price has increased 2.7% from the final year of the 2011 -2016
contract.
The tender was reviewed by M. Born, Manager Fleet Planning and A. Buchholtz, Buyer,
who concur with the above recommendation.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
The recommendation of this report supports the achievement of the city's strategic
vision through the delivery of core service.
FINANCIAL IMPLICATIONS:
The net cost for this tender (A), is fair and reasonable for a purchase of this scope and
the upset limit is within the budget allowance (B) provided within the budget. Funding
for this tender is included within the approved operating budget. The estimated surplus
(D) will remain within the Fleet operating cost centre to fund increases in consumption
or pricing.
Tender T'I6 -024
MCI '11IMM
Estimated Cost for this Tender
Tender T16 -024 costs including HST
less: HST rebate on.tender
Net Cost Being Awarded
Projected Costs for Additionals
Total Estimated Cost for this Tender
Budget for this Tender
Fleet Fuel Operating Budget
Estimated Surplus for this Tender (B - C)
COMMUNITY ENGAGEMENT:
$1,656,744.62
$ (154,847.87)_
$1,401,896.75 A
$1,401.896.75_ C
$1,581,845.00 B
$ 179,948.25 D
INFORM — This report has been posted to the City's website with the agenda in
advance of the council / committee meeting.
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Not applicable
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO & City Treasurer, Finance and
Corporate Services