Delivery of Liquid Propane Gas - Statewide

The Michigan Department of Technology, Management and Budget (DTMB) Procurement Division issued Request for Proposal (RFP) No. 210000002160 on June 16, 2021, soliciting proposals for the supply and delivery of liquefied petroleum gas (LPG) to state agencies and extended purchasing participants throughout Michigan. The procurement encompasses delivery to approximately 569 locations containing approximately 853 tanks with estimated annual consumption of 621,150 gallons, primarily serving the Departments of Corrections, Natural Resources, Transportation, and Health and Human Services across all 83 Michigan counties organized into ten prosperity regions. Bidders must submit pricing using a mark-up model based on the Mount Belvieu, Texas weekly rack price, with separate mark-up rates for customer-owned and vendor-owned tanks; all ancillary costs including tank rental, transportation, handling, overhead, dye for off-road fuel, inspection fees, and profit must be incorporated into the mark-up price per gallon. Mandatory requirements include compliance with federal, state, and local business and transport regulations; demonstrated reliable fuel sources with terminal and storage capacity documentation; adherence to National Fire Protection Association standards #54 and #58; delivery within three business days of order receipt; both regular and emergency delivery capabilities; and maintenance of adequate terminal inventory and delivery fleet capacity. Technical evaluation is weighted across general requirements (30 points), service requirements (20 points), other requirements (10 points), delivery capabilities (25 points), and background and experience (15 points), with a minimum of 80 points required for pricing evaluation. Bidder questions were due by 3:00 p.m. Eastern on June 24, 2021, with answers posted by June 29, 2021; proposals were due by 3:00 p.m. Eastern on July 16, 2021. The anticipated contract effective date is September 1, 2021, with a five-year term through September 30, 2026, and provision for three additional one-year renewal periods at the State's discretion.

The RFP does not specify set-aside designations for disadvantaged enterprises or other restricted categories of respondents, indicating that all qualified vendors meeting the mandatory requirements are eligible to bid. Contractors must maintain commercial general liability insurance of $2,000,000 general aggregate, automobile liability of $1,000,000 per accident, workers' compensation, and environmental/pollution liability of $2,000,000 annual aggregate, and must pay an administrative fee of 1% on all contract payments. Award will be made by region based on overall lowest mark-up cost per gallon and coverage capability, with the State reserving the right to award multiple contracts across different regions. The contract extends to MiDEAL members, including local governments, school districts, universities, and nonprofit hospitals, providing extended purchasing opportunities beyond state agencies. No incumbent vendor or current contractor information is specified in the solicitation documents. While no specific budget range or award value is disclosed, the estimated annual propane consumption of 621,150 gallons provides a baseline for calculating potential contract values based on regional mark-up pricing and associated delivery costs over the five-year initial term.