The Fleet Services Division of the Environmental and Neighborhood Services Department is responsible for the procurement of the City’s gasoline and diesel fuel. Since fiscal year (FY) 2010, fuel provider services for the City of Sugar Land have been procured through inter-local agreements. This type of agreement leverages the purchasing potential of governmental entities. All contracts are competitively bid, and contracts are awarded in compliance with state procurement laws and regulations.
Over the past 2 years, the City of Sugar Land has utilized a Cooperative Purchasing Agreement with Harris County for the purchase of gasoline and diesel fuel through Sun Coast Resources. The Harris County contract for this service will no longer be effective in FY 2019, and a new contract has not yet been issued. In order to ensure the City of Sugar Land does not experience a lapse in fuel service, the Fleet Services Division researched additional fuel options for the upcoming fiscal year.
By utilizing a national cooperative agreement with Choice Partners, the City of Sugar Land can directly contract with Sun Coast Resources for bulk gasoline, diesel and lubricants (Contract Number: 15/001MP-06).
According to this contract, the commodity fuel prices will be provided by the Oil Price Information Service (OPIS) which is an industry recognized petroleum product commodity price tracking service. The commodity price is dictated by many factors including the world market, supply and demand, natural disasters, etc.; all of which are tracked by OPIS. Based on the fuel order volume, there are also fixed delivery fees and nominal environmental fees in addition to the per gallon price. These fees are comparable to the fees paid in FY 2018. The pricing provided by Choice Partners under this contract has been researched and found to be a good value for the City. The City of Sugar Land has worked with Sun Coast Resources for approximately 2 1/2 years continuously, and during that time, the City has been pleased with their fuel service. We have not experienced any mechanical issues due to fuel quality. They were even able to provide fuel to the City during Hurricane Harvey when many areas of Houston were inaccessible.
The City’s fuel expenditures were approximately $671,340.41 for FY18. Though the total planned expenditures of this service are not to exceed $900,000, the City is under no obligation to spend the entire amount but would have the flexibility to purchase additional fuel in the event of an emergency.
The Environmental and Neighborhood Services Department recommends the City Council authorize expenditures in the maximum amount of $900,000 with Sun Coast Resources utilizing the cooperative agreement with Choice Partners for FY 2019 fuel supplier services. Budgeted funding for this expenditure is located within each department's FY 2019 operating budget.