HomeMy WebLinkAboutCOD-065-08Leading the Woq
~ ~ ~ REPORT
CORPORATE SERVICES DEPARTMENT
Meeting: GENERAL PURPOSE AND ADMINISTRATION COMMITTEE
Date: October 20, 2008
Report #: COD-065-08 File
Resolution #: r ~1 ~ tJ-O~
By-law
Subject: CL2007-52, SUPPLY AND DELIVERY OF OILS AND LUBRICANTS
Recommendations:
It is respectfully recommended that the General Purpose and Administration Committee
recommend to Council the following:
1. THAT Report COD-065-08 be received;
2. THAT the Contract for the Supply and Delivery of Oils and Lubricants be re-
tendered.
Submitted by: Reviewed by:
Marie Marano, H.B.Sc., C.M.O.,
Dir of Corpora Serv~ s
ancy ayl r, B. , C.A.,
Director of inanc
MMWB1BH1km
Franklin Wu,
Chief Administrative Officer
CORPORATION OF THE MUNICIPALITY OF CLARINGTON
40 TEMPERANCE STREET, BOWMANVILLE, ONTARIO L1C 3A6 T (905)623-3379 F (905)623-3330
REPORT NO.: COD-065-08
PAGE 2
1. BACKGROUND AND COMMENT
1.1. The award of contract number CL2007-52 for the Supply and Delivery of Oils
and Lubricants was approved by Council under COD-009-08 in February 2008;
a copy of the report is attached as Schedule "A"
1.2. Contract number CL2007-52 for the Supply and Delivery of Oils and Lubricants
required that the pricing remain firm for year one of the contract.
1.3. The successful bidder, R.P. Oil Limited, Whitby, Ontario has advised that the
prices cannot be held firm for the one year term and has requested price
increases of approximately 35%.
2. ANALYSIS
2.1. As per the Contract, under Schedule "A" General Terms and Conditions, Section
4.0 Pricing, "unit prices bid shall be firm for the first year."
2.2. R.P. Oil Limited, Whitby, Ontario will not hold their prices until the end of the first
year which expires February 28, 2009.
2.3. The oil market has become very volatile in recent months. Although bidders are
expected to factor some degree of inflation into their pricing structure the recent
price swings were not anticipated by the current supplier.
2.4. Since the terms of the contract are clear no adjustment to pricing can be
considered prior to the anniversary date of March 1, 2009. To do otherwise
would be contrary to best practice and unfair to other bidders of the tender who
committed to hold prices firm.
2
REPORT NO.: COD-065-08
PAGE 3
3. FINANCIAL IMPLICATIONS
3.1. The required funds for this acquisition were estimated as $24,195.72 based on
the consumption data provided by the Operations Department.
3.2. The funds were allocated from the current operating fleet budget.
3.3. It is feasible that the costs for the supply and delivery of oils and lubricants will
increase by up to thirty-five per cent.
3.4. Given the current state of the market it is anticipated that volatility will continue.
Accordingly, the new contract will make provision for semi annual price review.
4. CONCLUSION
4.1. The current contract will be cancelled and a new tender for the supply and
delivery of oils and lubricants will be issued.
5. INPUT FROM OTHER SOURCES
5.1. This report has been reviewed for recommendation by the Purchasing Manager,
with the appropriate departments and circulated as follows:
Concurrence: Director of Operations
Attachments:
Attachment 1 -Schedule "A" Report COD-009-08
3
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REPORT
CORPORATE SERVICES DEPARTMENT
Meeting: GENERAL PURPOSE AND ADMINISTRATION COMMITTEE
Date: Monday, February 4, 2008
Report #: COD-009-08 File #
t~~~o1,~~;~~,~~PA-~ tia-ag
By-law #
Subject: TENDER CL2007-52 SUPPLY & DELIVERY OF OILS & LUBRICANTS
rceevmmenaat:lons:
It is respectfully recommended that the General Purpose and Administration Committee
recommend to Council the following:
THAT Report COD-009-OS be received;
2. THAT RP Oil Limited, Whitby, Ontario with a total approximate annual bid in the amount
of $24,195.72 (Plus G.S.T.), being the lowest responsible bidder meeting all terms,
conditions, and specifications of Tender CL2007-52, be awarded the contract to supply
and deliver oils and lubricants commencing March 1, 2008, as required by the
Municipality of Clarington, Operations Department; and
3. THAT the contract be extended for a second year and third year dependant upon
satisfactory service and pricing; and
4. THAT the
Submitted by:
MMIJDBIbh
be provided from the current operating fleet budget.
Reviewed by: ~~--~X ~~~
Franklin Wu,
Chief Administrative Officer
CORPORATION OF THE MUNICIPALITY OF CLARINGTON
40 TEMPERANCE STREET, BOWMANVILLE, ONTARIO LTC 3A6 T(905)623-3379 F (905)623-4169
Marie Marano, H. B.Sc., C.M.O.,
REPORT NO.; COD-008A8
BACKGROUND AND COMMENT
PAGE2
Tenders were publicly advertised and issued for the supply and delivery of oil and lubricants, as
required by the Operations Department. Subsequently, tenders were received and tabulated as
per Schedule "A" attached.
The prices submitted by RP Oil Limited are firm for one year and the tender makes provision for
two one year extensions pending satisfactory service and pricing. Due to the volatility of the
petroleum market pricing for years two and three will be subject to adjustment based the market
conditions in effect at the time of renewal. Because of the market conditions it is estimated that
the total value of the three year agreement will exceed $75,000.00 which is in excess of the
Purchasing Manager's authority as set out in the Purchasing By-law. It is recommended that
the contract be extended for a second and third-year pending satisfactory service and pricing.
The required funds will be provided from the Operations Department current operating fleet
budget.
The Director of Finance has reviewed the funding requirements and concurs with the
recommendation. Queries with respect to department needs, specifications, etc., should be
referred to the Director of Operations.
The subject firm has previously provided service for the Municipality of Clarington and the
Operations Department were satisfied with the service.
After further review and analysis of the bids by the Operations Department and Purchasing, it
was mutually agreed that RP Oil Limited, Whitby, Ontario, be recommended far the contract to
supply and deliver oil and lubricants to the Municipality of Clarington, as required by the
Operations Department.
Attachments:
Attachment 1 -Schedule "A" Bid Summary
Schedule "A"
Bid Summary
Tender CL2007-52
BIDDER TOTAL BID
Safety Kleen Canada Inc. Excludin GST)
Breslau, ON $18,073.55*
RP Oil Limited
Whitby, ON $24,195.72
Noco
Toronto, ON $26,818.55
BOSS Lubricants
Toronto, ON $28,051.17
Edward Fuels
Godevich, ON $30,590.01
Paul Lizotte Fuels Limited
Bowmanville, ON $31,363.39
Total Lubricants Canada Inc.
Pickering, ON $31,794.14
Mister Chemical
Vaughan, ON $32,539.92*
Frew Petroleum
Oshawa, ON $32,764.98
*not aI! products quoted, re-refined products quoted