HomeMy WebLinkAboutIR 9142 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9142
To the Mayor and Members of the City Council November 3, 2449
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Y SUBJECT: NATIONAL COOPERATIVE AGREEMENT FOR MOTOR FUELS
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The City of Fort Worth has long supported the use of cooperative purchasing contracts in order to
provide goods and services for City departments and residents in an efficient and effective
manner. Since 2443, the City has had annual purchase agreements in place for diesel and
unleaded fuels which many other north Texas public entities have utilized to save time and
money in their operations. The City of Fort Worth's fuel agreements have been recognized as
some of the best cooperative purchasing agreements available in this area for diesel and
unleaded fuel products.
In September 2448, the City's Purchasing Division was approached by the National
Intergovernmental Purchasing Alliance (National IPA) about the possibility of facilitating a
competitive proposal process to award a cooperative purchasing contract for aviation, diesel and
unleaded fuel products (including ethanol and biodiesel blends) that could be used by public
entities across the nation. As part of this arrangement, the City would receive a portion of any
administration fee received by National IPA from vendors as products were purchased by other
public agencies. Recognizing the potential savings and additional revenue such an arrangement
could bring to the City, the Purchasing Division, with support from the Equipment Services
%f Department, agreed to facilitate the project.
National IPA is a cooperative purchasing organization, established through a collaborative effort
of public agencies across the United States with the specific purpose of reducing procurement
costs by leveraging group volume. National IPA aggregates purchasing volume of participating
agencies in order to receive larger volume discounts from suppliers. National IPA offers an
expanding catalog of 15 contracts for public agencies cooperative use.
This Motor Fuel Agreement was bid as a national cooperative purchasing Request for Proposals
(RFP) to develop and encourage cooperative purchasing efforts to reduce the cost of motor fuel
to the City and other public agencies. The RFP was issued on April 16, 2449, and included
estimated annual purchase quantities from 63 public entities around Texas and the US with a
total estimated annual quantity of 114 million gallons. Seven proposals were received on May 28;
2449.
The RFP evaluation factors included responsiveness and clarity of proposal, ability to meet City
of Fort north specifications, the national supply program, vendor qualifications, and contract cost.
Representatives of the City's Equipment Services, Fire, Police, Transportation and Public forks
and Water Departments evaluated the proposals received and selected two suppliers as the best i
evaluated firms s for awards of the agreements of diesel and unleaded fuel products (including
ethanol and biodiesel blends): The recommended agreements are estimated to save the City
over $30,000 peryear compared ' the current supply agreements, N award, will be
recommended for aviation fuels as no viable pnc-,po'sal was received for provision of this pr duct-
ISSUED `�' THE CITY f-A ANA ER Ft. RT V IV TR, TEAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9142
To the Mayor and Members of the City Council November 3, 2009
* Page 2 of 2
SUBJECT: NATIC}NAL. COOPERATIVE AGREEMENT FOR MOTOR FUELS
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This national cooperative fuel supply program is one of the first in the nation. Because of this
unique opportunity, proposal evaluations and contract negotiations took several months to
complete.
Under a rebate to principal procurement agency agreement, the City of Fork Worth will receive
8.333% of a one-cent administration fee to be paid to National IPA by the petroleum vendors for
each gallon of motor fuel sold under this national cooperative contract. Based on the annual
quantity estimates listed in the RFP, this rebate could generate approximately $92,000 annually
in revenue to the City. The rebate revenue received will be deposited in the Equipment Services
Department's budget and will be used to further reduce the cost of fuel and services to user
departments.
The Purchasing Division intends to present an M&C to City Council on November 10, 2009 to
award two supply agreements for the City of Fort Worth, a dual award to both recommended
suppliers for the national supply program and request authorization for the City Manager to sign
the rebate agreement with National IPA. Under the cooperative contracts, the City will have no
liability or responsibility for purchases by other public agencies.
If you have any questions regarding this information, please contact Jack Dale, Purchasing
Manager, at (817) 392-8357 or Wayne Corum, Equipment Services Director, at (817) 392-5112.
Dale A. Fisseler, P.E.
City Manager
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