Several Washington-area jurisdictions and Metro have banded together in a fuel-oil purchasing cooperative expected to save its members approximately $750,000.

The co-op, put together under the aegis of the Metropolitan Washington Council of Governments, will buy nearly 30 million gallons of fuel oil -- nearly half the total volume of heating oil bought by public entities each year in the Washington area. By buying in such bulk, the cooperative can command a price significantly lower than what individual buyers would pay.

According to Karl Kalish, contracts manager for COG, co-op members will save from 2 to 17 cents a gallon on heating oil costs, depending on the size of the jurisdiction. The cooperative also hopes to reap substantial savings later on gasoline and diesel fuel purchases.

"It's a damned good idea," said Kalish, who said that increased supply of fuel oil, diminishing demand and removal of government allocations allowed more innovation in purchasing.

Kalish said he believes the co-op's purchase is the largest cooperative purchase in the nation. In Massachussets and a few other areas, jurisdictions have banded together seeking lower oil prices.

Participating in the cooperative arrangement are Arlington, Fairfax, Prince George's and Prince William counties; Bowie, Fairfax City, College Park and Gaithersburg, the Maryland National Park and Planning Commission and Metro.

The successful bidders for the huge contract were Steuart Petroleum, a Washington-area dealer, which will supply 20 million gallons for $1.0297 a gallon, and Amerada Hess Corp. of Landover, which will supply 10 million gallons at $.9423. In the case of one of the jurisdictions, Arlington, the contract replaces various contracts with companies including Steuart and a subsidiary that were at prices 3 to 14 cents higher.

Other jurisdictions had been supplied by Gulf, which was not among the 12 companies that bid on the cooperative contract.

The District of Columbia would require enabling legislation by the city council to allow it to participate in cooperative purchasing agreements. One factor that might complicate any attempt by the District to participate is the city's minority set-aside program that reserves a percentage of contracts.

Kalish said that Montgomery County had chosen not to participate in the fuel-oil plan because it has equipment that allows it to pick up its fuel oil in Baltimore rather than having it delivered. Because of that, the county decided it could do as well on its own, he said.

Montgomery County, however, is the lead county in putting together the cooperative gasoline deal. That means that Montgomery County officials will draw up the specifications and issue the invitation to bid. Fairfax County was the lead jurisdiction on the fuel oil purchase, and Metro will serve in that role in the diesel purchase.

The fuel purchases through the cooperative are for use by the jurisdictions themselves, not for residential or commercial consumers. Area Units Form Co-Op To Buy Oil By Martha M. Hamilton Washington Post Staff Writer

Several Washington-area jurisdictions and Metro have banded together in a fuel-oil purchasing cooperative expected to save its members approximately $750,000.

The co-op, put together under the aegis of the Metropolitan Washington Council of Governments, will buy nearly 30 million gallons of fuel oil--nearly half the total volume of heating oil bought by public entities each year in the Washington area. By buying in such bulk, the cooperative can command a price significantly lower than what individual buyers would pay.

According to Karl Kalish, contracts manager for COG, co-op members will save from 2 to 17 cents a gallon on heating oil costs, depending on the size of the jurisdiction. The cooperative also hopes to reap substantial savings later on gasoline and diesel fuel purchases.

"It's a damned good idea," said Kalish, who said that increased supply of fuel oil, diminishing demand and removal of government allocations allowed more innovation in purchasing.

Kalish said he believes the co-op's purchase is the largest cooperative purchase in the nation. In Massachussets and a few other areas, jurisdictions have banded together seeking lower oil prices.

Participating in the cooperative arrangement are Arlington, Fairfax, Prince George's and Prince William counties; Bowie, Fairfax City, College Park and Gaithersburg, the Maryland National Park and Planning Commission and Metro.

The successful bidders for the huge contract were Steuart Petroleum, a Washington-area dealer, which will supply 20 million gallons for $1.0297 a gallon, and Amerada Hess Corp. of Landover, which will supply 10 million gallons at $.9423. In the case of one of the jurisdictions, Arlington, the contract replaces various contracts with companies including Steuart and a subsidiary that were at prices 3 to 14 cents higher.

Other jurisdictions had been supplied by Gulf, which was not among the 12 companies that bid on the cooperative contract.

The District of Columbia would require enabling legislation by the city council to allow it to participate in cooperative purchasing agreements. One factor that might complicate any attempt by the District to participate is the city's minority set-aside program that reserves a percentage of contracts.

Kalish said that Montgomery County had chosen not to participate in the fuel-oil plan because it has equipment that allows it to pick up its fuel oil in Baltimore rather than having it delivered. Because of that, the county decided it could do as well on its own, he said.

Montgomery County, however, is the lead county in putting together the cooperative gasoline deal. That means that Montgomery County officials will draw up the specifications and issue the invitation to bid. Fairfax County was the lead jurisdiction on the fuel oil purchase, and Metro will serve in that role in the diesel purchase.

The fuel purchases through the cooperative are for use by the jurisdictions themselves, not for residential or commercial consumers.