HomeMy WebLinkAbout2016-07-12 - AGENDA REPORTS - CLEAN ENERGY CNG FUEILING (2)Agenda Item: 10
CITY OF SANTA CLARITA
Q) AGENDA REPORT
CONSENT CALENDAR
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CITY MANAGER APPROVAL: 1 j=�
DATE: July 12, 2016
SUBJECT: AWARD CONTRACT EXTENSION TO CLEAN ENERGY FOR THE
OPERATION AND MAINTENANCE OF THE CITY'S CNG FUELING
STATIONS
DEPARTMENT: Neighborhood Services
PRESENTER: Adrian Aguilar
RECOMMENDED ACTION
City Council:
Authorize the City Manager or designee to modify the terms and scope to include the
operation and maintenance of the Public and Transit CNG stations located at the TMF and
the maintenance of the fueling infrastructure supporting Public Works located at the City's
Corporate Yard facility, execute the remaining four, one-year options, and modify the award
in the event issues of impossibility arise, subject to City Attorney approval.
2. Authorize an increase in Transit's CNG station operating and maintenance budget
(expenditure account 12401-5161.030) by $50,000 annually.
BACKGROUND
In 2005, the City of Santa Clarita (City) entered into an agreement with Clean Energy for the
operation and maintenance of the City's Transit and Public compressed natural gas (CNG)
fueling stations. The original agreement was for ten years and included five, one-year City
options to renew. To date, the City has exercised one of the renewal options.
Over the past 11 years, the number of CNG buses in the City's transit fleet has increased from 14
local buses to 52 local, 5 commuter, and 13 Dial -a -Ride vehicles. As part of the Santa Clarita
2020 plan, this number will increase as the City continues to replace its diesel -powered
commuter buses with CNG -powered vehicles.
This expansion can also be seen within the City's fleet of pool and Public Works vehicles. Over
the past few years, the City has added a number of CNG -powered vehicles to its fleet including
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sedans, street sweepers, pumping vehicles, and dump trucks. As the size of the City's CNG fleet
grows, so does the importance of a well-maintained and functional fueling infrastructure.
In the past, the City would contract with service providers, on an as -needed bases, to maintain
the Public Works fueling equipment located at the Corporate Yard. Unfortunately, this resulted
in slow response times and a lack of interest by some of the larger service providers. By
expanding the scope of this agreement to include maintenance of the Public Works fueling
infrastructure, the City can leverage its existing relationship to improve response times, reduce
maintenance costs, and ensure it can sufficiently fuel its fleet of CNG vehicles.
Under the proposed contract terms, the City would see a 5% to 15% decrease in operation and
maintenance rates, depending on the total monthly fuel consumption. Additionally, the City
would be paid a royalty on all third -party sales at the Public CNG station. Based on current
volumes, the City would receive $0.20 per gasoline gallon equivalent sold.
In addition, the City has negotiated special fueling rates for all City -owned vehicles using the
Public CNG station. Under the proposed terms, the City would be billed at a rate equivalent to
the wholesale cost of the fuel, plus any associated regulatory fees and maintenance expenses.
Compared to the market rate paid by the general public, this can save the City as much as $1 per
gasoline gallon equivalent and provide a cost-effective alternative when other fueling outlets are
being repaired or not available.
ALTERNATIVE ACTION
1) Direct staff to issue a request for proposal.
2) Other action directed by Council.
FISCAL IMPACT
This request requires the City to increase its operating and maintenance budget by $50,000 per
year. The net increase is reflective of the City's growing CNG fleet. Additionally, all royalties
generated under the agreement would be used to offset the City's operating and maintenance
costs. The request would be funded using local transportation funds and does not require
General Fund monies.
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