TO: Board of Supervisors
FROM: Steven Lederer - Director of Public Works
REPORT BY: Michael Parker - Supervising Staff Services Analyst
SUBJECT: Approval of Amendment to Professional Services Agreements for Fuel Related Services
RECOMMENDATION
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Director of Public Works requests the following actions related to the provision of unleaded and diesel fuel services:
1. Approval of and authorization for the Chair to sign Amendment No. 3 to Agreement No. 180153B with Napa Valley Petroleum, Inc., increasing the maximum compensation by $150,000 for a new maximum of $575,000 and extending the term of the agreement from September 30, 2022, to June 30, 2023, with an automatic renewal for no more than two (2) additional years; and
2. Approval of and authorization for the Chair to sign Amendment No. 1 to Agreement No. 180152B with Hunt Allied Petroleum, LLC., increasing the maximum compensation by $150,000 for a new maximum of $450,000 and extending the term of the agreement from September 30, 2022, to June 30, 2023, with an automatic renewal for no more than two (2) additional years.
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EXECUTIVE SUMMARY
Approval of today’s requested action will allow the Chair to sign Amendment No. 3 to Agreement No. 180153B with Napa Valley Petroleum, Inc (NVP)., and Amendment No. 1 to Agreement No. 180152B with Hunt Allied Petroleum, LLC., increasing the maximum compensation of each agreement by $150,000. Additionally, today’s requested action will extend the term of both agreements from September 30, 2022, to June 30, 2023, which aligns with the end of the County’s fiscal year. Both agreements have the provision for an automatic renewal at the end of each fiscal year not to exceed two (2) additional years.
Both amendments are needed due to the record high pricing of retail gasoline and diesel. Amendments to the County’s current fuel agreements ensures Fleet Management will have sufficient contract authority to compensate Napa Valley Petroleum and Hunt Allied Petroleum for fuel consumed by County departments.
FISCAL & STRATEGIC PLAN IMPACT
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Is there a Fiscal Impact? |
Yes |
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Is it currently budgeted? |
Yes |
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Where is it budgeted? |
Fuel charges are budgeted within Fleet Management and allocated to departments based on actuals. |
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Is it Mandatory or Discretionary? |
Mandatory |
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Is the general fund affected? |
Yes |
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Future fiscal impact: |
Funding for the services under these agreements will be budgeted each fiscal year for the term of the agreements. Department divisions budget for fuel costs as part of the annual fuel allocation and are billed monthly based on actuals. |
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Consequences if not approved: |
Due to the current volatility of fuel prices, if the amendments are not approved, the County may not have sufficient contract authority to compensate these fuel service providers and would no longer continue receiving the benefits, including reduced fuel prices, onsite delivery, and access to emergency fuel delivery during natural disasters. |
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County Strategic Plan pillar addressed: |
Effective and Open Government |
ENVIRONMENTAL IMPACT
ENVIRONMENTAL DETERMINATION: The proposed action is not a project as defined by 14 California Code of Regulations 15378 (State CEQA Guidelines) and therefore CEQA is not applicable.
BACKGROUND AND DISCUSSION
Since approximately 1994, Napa County has received unleaded and diesel fuel services from Napa Valley Petroleum. Following a Request for Proposal (FRP) process, on October 12, 2017, the County entered into Agreement No. 180153B with Napa Valley Petroleum, Inc., and Agreement No. 180152B with Hunt Allied Petroleum, LLC.
Agreement No. 180153B with Napa Valley Petroleum, Inc. provides discounted rates at multiple retail stations in Napa County and provides bulk fuel delivery and technical services to the County’s fueling yards in Yountville, Spanish Flat, and at generator sites throughout the County. Subsequent to the approval of the agreement with Napa Valley Petroleum Inc., the State of California introduced Senate Bill 1 (SB 1), the Road Repair and Accountability Act of 2017, which increased fuel taxes for the benefit of the local and state roadway system. Due to the increase on fuel taxes and general gas price fluctuations, the Board approved Amendment No. 1 to Agreement No. 180153B on March 12, 2019, increasing the maximum compensation to $375,000 per fiscal year. A year later on March 24, 2020, the Board approved Amendment No. 2 to Agreement No. 180153B increasing the compensation amount by $50,000 to a maximum of $425,000 per fiscal year due to continued increased costs from general gas price fluctuations and due to the increased cost of fuel for generators during the Public Safety Power Shutoffs. Based on an analysis of fueling history and locations of Napa County offices, NVP fuel cards are used by most County fleet users. Additionally, services from NVP have been utilized during natural disasters and Public Safety Power Shutoffs for the refilling of generators due to their fuel delivery service and quick response times.
Agreement No. 180152B with Hunt Allied Petroleum, LLC. Provides discounted rates at the Devlin Chevron Station, most commonly utilized by the Napa County Sheriff’s Office and Airport. Using the Pacific Pride system through Hunt Allied Petroleum, LLC., the County benefits from having access to numerous retail stations. Although fueling at these stations are at retail prices, expanding the access and number of stations is important for fleet users whose job function takes them to remote places within the County and throughout California.
Both amendments are needed due to the record high pricing of retail gasoline and diesel. Approval of today’s requested actions will ensure Fleet Management has sufficient contract authority to compensate both Napa Valley Petroleum and Hunt Allied Petroleum for fuel consumed by County departments.
Napa Valley Petroleum is a local vendor. Hunt Allied Petroleum is a joint venture in which one of the parties has a local office.