Report to Mayor and City Council
Tuesday, July 16, 2019
Consent
SUBJECT:
Title
CONSIDER APPROVING FUEL PURCHASES FROM CLEAN ENERGY FUELS CORP. FOR THE PERIOD JULY 1, 2019 THROUGH JUNE 30, 2020 (CITY COUNCIL)
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I. SUMMARY
The City of Carson operates the Carson Circuit, a fixed-route public transit system which services defined areas of the City (Exhibit No. 1). Compressed Natural Gas (CNG) fuel for the buses has been provided by Clean Energy Fuel Corp. (Clean Energy) since 2009. As the leading provider of CNG in Southern California with stations in Carson, Wilmington, and in Long Beach, the close proximity of Clean Energy stations provide a great benefit to the operations of the Carson Circuit. Bidding is not required for purchases of CNG as fuel purchases fall under the category of Other Purchases as defined by Section 2611 (i)(11) of the Carson Municipal Code. Tonight, the City Council is asked to approve fuel purchases from Clean Energy for the period July 1, 2019 through June 30, 2020 in the total amount of $275,000.
II. RECOMMENDATION
Recommendation
1. APPROVE fuel purchases from Clean Energy for the period July 1, 2019 through June 30, 2020 in the total amount of $275,000.
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III. ALTERNATIVES
TAKE another action the City Council deems appropriate.
IV. BACKGROUND
The City of Carson’s fixed-route bus system, the Carson Circuit, is comprised of eight (8) routes that run 40-minute loops, beginning at 5:20 a.m. and ending at 6:40 p.m., through designated areas of the City. In addition to providing local services to the Carson Community, the Carson Circuit acts as a feeder/connector to other regional providers such as the Metropolitan Transit Authority (Metro) for both bus and rail, Torrance Transit, GTrans (Gardena Transit), and Long Beach Transit. All routes begin and end at the South Bay Pavilion Mall.
Based in Newport, California, Clean Energy is a nation-wide provider of CNG fuel. Since 2009, the City has maintained purchase orders with Clean Energy to purchase CNG fuel for its buses due to the close proximity and accessibility of their stations in Carson, Wilmington, and in Long Beach. The only other CNG providers in the region are located in Downey, Huntington Beach, and Buena Park. Staff and Clean Energy have recently signed a new fuel price agreement which allows for a $.15 discount per Gasoline Gallon Equivalent (GGE) from the posted retail price (Exhibit No. 2). As Carson Circuit consumes upwards of 8,000 GGEs per month for its operations, the City meets the threshold requirement of 5,000 or more GGEs per month needed to receive the $.15 discount per GGE. The term of the discount is effective from April 11, 2019 through June 30, 2020.
Bidding is not required for purchases of CNG fuel as fuel purchases fall under the category of Other Purchases as defined by Section 2611 (i)(11) of the Carson Municipal Code (Exhibit No. 3). A written contract is not required for purchases of supplies and commodities, including fuel, with a waiver from the City’s Purchasing Manager (Exhibit No. 4).
V. FISCAL IMPACT
Should the City Council approve the recommendation, funds for fuel purchases are budgeted in accounts 218-90-940-180-7007 and 219-90-940-180-7007.
VI. EXHIBITS
1. Map of Carson Circuit (page 3).
2. Clean Energy Fuel Price Agreement (pages 4-11).
3. CMC Section 2611 (pages 12-17).
4. CMC Section 2605 - Waiver (page 18).
Prepared by: Jason J. Jo, Transportation Supervisor