Meeting_Body
OPERATIONS, SAFETY, AND CUSTOMER EXPERIENCE COMMITTEE
JANUARY 21, 2021
Subject
SUBJECT: DIESEL FUEL
Action
ACTION: RATIFY EXPENDITURES AND APPROVE CONTRACT MODIFICATION
Heading
RECOMMENDATION
Title
AUTHORIZE the CEO to:
A. RATIFY expenditures in excess of the total contract award of $2,075,855 for diesel fuel from Southern Counties Oil Company (SC Fuels) for Metro's diesel fuel non-revenue vehicles, major and other miscellaneous equipment, increasing the Contract No. DR4348700 total contract value from $328,959 to $2,404,814.
B. EXECUTE Modification No. 3 to extend the contract period of performance to June 30, 2021 for $252,150 increasing the total contract value from $2,404,814 to $2,656,964.
Requires Two-Thirds Vote
Issue
ISSUE
The original contract was to provide up to approximately 168,000 gallons of diesel fuel for 24 months at prevailing Oil Price Information Service (OPIS) pricing with the application of state and federal taxes and fees associated with diesel fuel. The contract is an Indefinite Delivery Indefinite Quantity (IDIQ) for two-years inclusive of sales taxes for a not-to-exceed amount of $328,959.
Discussion
DISCUSSION
In November 2015, Metro Staff approved a contract award, for a 24-month Contract for diesel fuel to SC Fuels for $328,959. SC Fuels was required to provide diesel fuel for Metro's non-revenue vehicles that operate using diesel fuel. The ratification for unauthorized expenditure of Metro funds is due to a staff member not complying with and implementing Metro's standard contract administration practices; inadequate staff monitoring; the bid pricing was based on an annual quantity of 84,000 gallons, but the diesel fuel annual actual average usage was 125,000 gallons; unforeseen fluctuations and increases in fuel price variables over the past 4 years related to the federal and state fuel taxes and fees; Oil Price Information Service (OPIS) fee per gallon, and its fuel supplier. The unexpected p...
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