____________________________________________________________________________________
FOR CITY CLERK ONLY
SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Public Works
Prepared by: April Miller
Director, Public Works
Lorena Cordova
Senior Management Analyst
City Manager Approval: ______
TOPIC: FUEL SERVICES CONTRACT
SUBJECT: RESOLUTION AUTHORIZING THE CITY MANAGER TO PROCURE FUEL SERVICES
THROUGH A COOPERATIVE PURCHASING PROGRAM WITH PACIFIC COAST PETROLEUM, INC. FOR UP TO THREE YEARS IN AN AMOUNT NOT TO EXCEED $522,000 PER FISCAL YEAR, FOR A TOTAL AMOUNT NOT TO EXCEED $1,566,000,
WITH THE AUTHORITY TO EXTEND THE AGREEMENT FOR TWO ADDITIONAL FISCAL YEARS IN AN AMOUNT NOT TO EXCEED $522,000 PER FISCAL YEAR,
SUBJECT TO SUBSEQUENT APPROPRIATIONS
RECOMMENDATION:
Staff recommends that the City Council adopt a resolution authorizing the City Manager to procure fuel services through a cooperative purchasing program with Pacific Coast Petroleum, Inc. for up to three years in an amount not to exceed $522,000 per fiscal year, for a total amount not to exceed $1,566,000, with the authority to extend the agreement for two additional years in an amount not to exceed $522,000 per fiscal year, subject to subsequent appropriations.
BACKGROUND:
Historically, the City has received fuel services for its vehicle fleet on an as-needed basis from an existing vendor. No formal agreement is or has ever been in place for the City’s fuel services. However, the existing vendor has provided reliable, routine, and satisfactory provision of services to date. Until recently, the City’s Department of Public Works (DPW) staff decided to explore the opportunity to procure fuel services with a formal agreement, with all the standards and protections that come with a contractual obligation. DPW staff began to inquire informally with different vendors, including the existing vendor, as to what procuring those services under a formal agreement might entail. Based on that initial research and analysis, the opportunity presented itself to procure fuel services via a cooperative purchasing program with Pacific Coast Petroleum.
ANALYSIS:
Fuel Needs
As noted, the City currently receives fuel services from an existing vendor through an unofficial arrangement. The City receives fuel services for eleven (11) tanks across the City, including maintenance yards and fire stations, each with different needs. Below is the list of City fuel locations, fuel type, and tank capacity:
Agenda Item No: 2.p
Meeting Date: July 20, 2026
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
Fueling Sites/Tanks Fuel Type Tank Capacity
1. PW Corp Yard/ Tank No. 1 Regular Unleaded E87 5,200 Gallons
2. PW Corp Yard/ Tank No. 2 Renewable Diesel R99 2,000 Gallons
3. PD/FD Station 51 Renewable Diesel R99 2,000 Gallons
4. FD Station 52/ Tank No. 1 Regular Unleaded E87 765 Gallons
5. FD Station 52/ Tank No. 2 Renewable Diesel R99 745 Gallons
6. FD Station 54 Renewable Diesel R99 500 Gallons
7. FD Station 55/ Tank No. 1 Renewable Diesel R99 526 Gallons
8. FD Station 55/ Tank No. 2 Renewable Diesel R99 250 Gallons
9. FD Station 56 Renewable Diesel R99 500 Gallons
10. FD Station 57/ Tank No. 1 Regular Unleaded E87 250 Gallons
11. FD Station 57/ Tank No. 2 Renewable Diesel R99 750 Gallons Cooperative Purchase Program
Services, supplies, materials, and equipment furnished to or used by any department of the City are subject to San Rafael Municipal Code Chapter 2.55 ("Purchasing Policy"). Pursuant to Section 2.55110 (A), contracts for such services, supplies, materials, and/or equipment awarded in the amount of $75,000 or more are required to comply with competitive and formal bidding procedures. Additionally, the City Council is established as the award authority for such contracts. Under the City’s Municipal Code Section
2.55.100 (C), exceptions to competitive bidding may be granted for cooperative purchasing programs which are defined as follows:
Purchases of supplies, material, equipment or services and sales of surplus property made under a cooperative purchasing program, such as by utilizing purchasing agreements maintained by the United States government or any agency or division thereof, the State of California, County of Marin, or other public agencies, are exempt from the competitive bidding requirements of this chapter. To the extent possible, cooperative purchases joined will be competitively awarded, and documentation as to the advantage of the cooperative purchase will be retained.
In November of 2025, Pacific Coast Petroleum entered into an agreement with the City and County of San Francisco (“San Francisco”) to provide fuel services (Attachment 2). Under this cooperative purchase agreement with San Francisco, the City can procure the same fuel services, subject to our standard terms and conditions.
Contractual Agreement
At this time, City Staff is seeking City Council authorization to enter into a contractual agreement (“Agreement”) with Pacific Coast Petroleum, which submitted a proposal to provide fuel services for the City’s vehicle fleet. Thus, staff is seeking authorization to contract with Pacific Coast Petroleum for up to three years in an amount not to exceed $1,566,000. As part of the Agreement, the City seeks to establish a baseline for procuring fuel services that sets a price point, a service schedule, the locations to be serviced, and terms for emergency deliveries, among others. Additionally, the City’s standard terms and conditions would be established through this Agreement. Below is a breakdown of some of the baseline items that are key to this Agreement for the City:
Category Specifications
Pricing Standard Establishes a gasoline reference index Fuel Specifications Establishes fuel types that are to be supplied at the different City sites Price List Establishes fuel type, delivery volume and pricing for each City site Price Adjustments Establishes Oil Price Information Service as the reference and firm standard for price adjustments
Deliveries Establishes hours, timelines, and expectations for deliveries SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
With the specifications listed above, the City will have a baseline for fuel services that currently do not exist. Among other terms of the Agreement, City Staff recommends that the Agreement be established for a minimum term of three (3) years to provide stability in an unstable fuel market. Lastly, City Staff recommends two one-year options to extend beyond the three years if the formal Agreement and the working relationship with the vendor prove to be a successful endeavor and in the best interest of the City. City staff recommends two one-year options in an amount not to exceed $522,000 per fiscal year.
A copy of the draft Agreement is provided as Attachment 3.
FISCAL IMPACT:
Annually, the budgeted amount for the City’s automotive fuel is typically $522,000, which includes DPW’s costs for the City’s vehicle fleet and the Fire Department's costs for operations and emergency services.
There are adequate appropriations in the Fiscal Year (FY) 2026-27 budget to accommodate this contract.
Appropriations beyond FY 2026-27 will be included in the regular budgeting process for each subsequent fiscal year.
OPTIONS:
The City Council has the following options to consider relating to this item:
1. Adopt the resolution as presented.
2. Adopt the resolution with amendments.
3. Do not adopt the resolution.
RECOMMENDED ACTION:
Staff recommends that the City Council adopt a resolution authorizing the City Manager to procure fuel services through a cooperative purchasing program with Pacific Coast Petroleum, Inc. for up to three years in an amount not to exceed $522,000 per fiscal year, for a total amount not to exceed $1,566,000, with the authority to extend the agreement for two additional years in an amount not to exceed $522,000 per fiscal year, subject to subsequent appropriations. Funding to support annual contract costs is provided in the FY 2026-27 approved budget within the Fleet Maintenance/Replacement Internal Service Fund (Fund 621). Funding to support future years’ costs will be provided through the annual budget process.
ATTACHMENTS:
1. Resolution
2. Cooperative Purchase Program with the City and County of San Francisco
3. Agreement with Pacific Coast Petroleum, Inc.
RESOLUTION NO.
RESOLUTION AUTHORIZING THE CITY MANAGER TO PROCURE FUEL SERVICES THROUGH A COOPERATIVE PURCHASING PROGRAM WITH PACIFIC COAST PETROLEUM, INC. FOR UP TO THREE YEARS IN AN AMOUNT NOT TO EXCEED $522,000 PER FISCAL YEAR, FOR A TOTAL AMOUNT NOT TO EXCEED $1,566,000, WITH THE AUTHORITY TO EXTEND THE
AGREEMENT FOR TWO ADDITIONAL FISCAL YEARS IN AN AMOUNT NOT TO EXCEED $522,000 PER FISCAL YEAR, SUBJECT TO SUBSEQUENT APPROPRIATIONS WHEREAS, the City of San Rafael (“City”) maintains a vehicle fleet, including public works and emergency response vehicles, that requires a reliable supply of fuel to support City operations, including maintenance yards and fire stations; and
WHEREAS, the City currently receives fuel services for its vehicle fleet on an as-needed, informal basis from an existing vendor, and no formal agreement has ever been in place for the City’s fuel services, although the existing vendor has provided reliable, routine, and satisfactory service to date; and
WHEREAS, the City’s Department of Public Works (“DPW”) undertook to explore procuring fuel services under a formal agreement that would provide the standards and protections of a contractual obligation, and, in the course of informally inquiring with various vendors, identified the opportunity to procure fuel services through a cooperative purchasing program with Pacific Coast Petroleum, Inc. (“Pacific Coast Petroleum”); and
WHEREAS, San Rafael Municipal Code 2.55.100(C) authorizes purchases of supplies, material, equipment or services and sales of surplus property made under a cooperative purchasing program, such as by utilizing purchasing agreements maintained by the United States government or any agency or division thereof, the State of California, County of Marin, or other public agencies, without competitive bidding by the City; and
WHEREAS, in November 2025, Pacific Coast Petroleum entered into an agreement with the City and County of San Francisco (“San Francisco”) to provide fuel services, and, under the cooperative purchasing program established by that agreement, the City may procure the same fuel services, subject to the City’s standard terms and conditions; and WHEREAS, City staff seeks authorization to enter into a contractual agreement (“Agreement”) with Pacific Coast Petroleum establishing a pricing standard, fuel specifications, a price list, price adjustment methodology referencing the Oil Price Information Service, and delivery terms for the City’s fuel services; and
WHEREAS, City staff recommends that the Agreement be established for up to three (3) years to provide pricing and service stability in an unstable fuel market, in an amount not to exceed $522,000 per fiscal year, for a total amount not to exceed $1,566,000; and WHEREAS, City staff recommends that the City Council grant the authority for City staff to extend the Agreement for two additional years in an amount not to exceed $522,000 per fiscal year, if it is in the best interest of the City; and
WHEREAS, the City’s annual budgeted amount for automotive fuel is typically $522,000, which includes DPW’s costs for the City’s vehicle fleet and the Fire Department’s costs for operations and emergency services, and adequate appropriations exist in the Fiscal Year 2026-27 budget to accommodate this contract, with appropriations for subsequent fiscal years to be included in the annual budget process.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of San Rafael finds the foregoing recitals are true and correct, and hereby authorizes the City Manager to authorizing the City Manager to procure fuel services through a cooperative purchasing program with Pacific Coast Petroleum, Inc. for up to three years in an amount not to exceed $522,000 per fiscal year, for a total amount not to exceed $1,566,000, and grant the authority to extend for two one-year extensions in the amount not to exceed $522,000 per fiscal year, subject to subsequent appropriations for up to three years in an amount not to exceed $522,000 per fiscal year, for a total amount not to exceed $1,566,000, and grant the authority to extend for two one-year extensions in the amount not to exceed $522,000 per fiscal year, subject to subsequent appropriations.
I, LINDSAY LARA, Clerk of the City of San Rafael, hereby certify that the foregoing Resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of the City of San Rafael, held on Monday, the 20th day of July 2026, by the following vote, to wit:
AYES: Councilmembers:
NOES: Councilmembers:
ABSENT: Councilmembers:
Lindsay Lara, City Clerk