PREPARED BY: CHIARA HANNA DATE OF MEETING: 01/20/2026
SUBJECT:
TITLE
CONSIDER ADOPTING RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN PABLO AUTHORIZING THE CITY MANAGER TO EXECUTE A FIRST AMENDMENT TO THE AGREEMENT WITH PINNACLE PETROLEUM, INC. FOR THE PURCHASE OF FUEL FOR CITY OPERATIONS; INCREASING COMPENSATION BY UP TO $90,000 FOR FISCAL YEAR 2025/26; AUTHORIZING COMPENSATION NOT TO EXCEED $180,000 FOR FISCAL YEAR 2026/27 THROUGH MARCH 1, 2027; EXTENDING THE AGREEMENT TERM THROUGH MARCH 1, 2027; AND ESTABLISHING A TOTAL AGREEMENT AMOUNT NOT TO EXCEED $974,846
CEQA: This proposed action is not a project as defined by CEQA.
Label
CITY MANAGER RECOMMENDATION
Recommendation
Adopt Resolution
Body
Compliance statements
FY 2023-2025 Council Priority Workplan Compliance Statements:
The purchase fuel supply is not found within the City Council’s Priority Workplan but is necessary for ongoing operations of the City.
CEQA Compliance Statement
The purchase of fuel supply is not a project under Section 15378 of the Guidelines for the California Environmental Quality Act (CEQA) and if a project, would be exempt from environmental review pursuant to Sections 15061 (b)(2) and 15061 (b)(3) of the CEQA guidelines.
BACKGROUND
Several City of San Pablo departments rely on City-owned vehicles to carry out daily operations, including the Police Department, the Public Works Department (Maintenance Division), and the Community Services Department (Paratransit Division).
On March 2, 2023, the State of California (State) entered into a fuel services agreement with Pinnacle Petroleum, Inc. (State Contract No. 1-23-91-02B). In accordance with State law and Section 3.16.110(E) of the San Pablo Municipal Code, the City is allowed to procure goods and services through State competitively bid contracts.
Following a review of the State contract pricing and terms, City staff determined that utilizing the State agreement would result in both cost savings and administrative efficiencies. Accordingly, on June 5, 2023, the City Council adopted Resolution 2023-084, authorizing the City to enter into an agreement with Pinnacle Petroleum, Inc. for fuel purchases under the State of California contract.
The City subsequently executed an agreement with Pinnacle Petroleum, Inc., effective July 1, 2023, to purchase fuel at the pricing established under the State contract. The original agreement term was set to expire on March 1, 2026.
On May 1, 2025, the State of California extended its contract with Pinnacle Petroleum through March 1, 2027. To ensure uninterrupted fuel services and to continue benefiting from State contract pricing, staff recommends extending the City’s agreement to align with the State’s extended contract term. The proposed amendment reflects projected fuel costs for City operations during the extension period and does not modify the scope of services.
Staff recommends that the City Council adopt the attached resolution authorizing the City Manager to execute a First Amendment to the Agreement with Pinnacle Petroleum, Inc. to:
1. Extend the agreement expiration date to March 1, 2027;
2. Increase compensation by up to $90,000 for Fiscal Year 2025/26;
3. Authorize compensation not to exceed $180,000 for Fiscal Year 2026/27; and
4. Establish total compensation under the agreement in an amount not to exceed $974,846.
Proposed Agreement Total Compensation - Pinnacle Petroleum, Inc.
|
Fiscal Year |
|
|
FY2023/24 - Original Agreement |
$257,500 |
|
FY2024/25 - Original Agreement |
$265,225 |
|
FY2025/26 (7/1/25 - 3/1/26) - Original Agreement |
$182,121 |
|
FY2025/26 (3/2/26 - 6/30/26) - Amendment #1 |
$90,000 |
|
FY2026/27 (7/1/26 - 3/1/27) - Amendment #1 |
$180,000 |
|
TOTAL |
$974,846 |
FISCAL IMPACT
The First Amendment to the Agreement with Pinnacle Petroleum, Inc. will authorize an increase in compensation of up to $90,000 for FY2025/26 and compensation not to exceed $180,000 for FY2026/27, for a total contract increase of $270,000.
Funding for FY2025/26 is included in the adopted FY 2024-2026 Biennial Budget. Staff recommends that funding for FY2026/27 be included as part of the next adopted budget cycle.
The $270,000 increase authorized under Amendment #1 will be funded through the following accounts:
|
Description |
Account Code |
FY2025/26 (3/2/26 - 6/30/26) |
FY2026/27 (7/1/26 - 3/1/27) |
Total |
|
Citywide Fleet |
100-1430-43100 |
$77,400 |
$154,800 |
$232,200 |
|
Paratransit |
263-5410-43100 |
$4,500 |
$9,000 |
$13,500 |
|
Street Lighting & Landscape District |
237-3610-43100 |
$7,200 |
$14,400 |
$21,600 |
|
Street Maintenance |
200-3710-43100 |
$900 |
$1,800 |
$2,700 |
|
TOTAL |
$90,000 |
$180,000 |
$270,000 |
ATTACHMENTS:
Att A - Resolution
Att B - Pinnacle Petroleum Amendment #1