CHAPTER 1-27: CITY OF PRESCOTT PROCUREMENT CODE

SECTIONS:

1-27-1:    GENERAL PROVISIONS:

1-27-2:    APPLICABILITY:

1-27-3:    PROCUREMENT ORGANIZATION:

1-27-4:    REQUIREMENTS OF GOOD FAITH:

1-27-5:    FRAUD AND COLLUSION:

1-27-6:    CONFLICT OF INTEREST:

1-27-7:    GIFTS AND GRATUITIES:

1-27-8:    SPECIFICATIONS:

1-27-9:    PROCUREMENT METHODS:

1-27-10:    SOLE SOURCE PROCUREMENTS:

1-27-11:    EMERGENCY PROCUREMENTS:

1-27-12:    EXPENDITURES:

1-27-13:    COMPETITIVE BIDDING REQUIREMENTS – EXEMPTIONS:

1-27-14:    MULTI-STEP SEALED BIDS:

1-27-15:    REQUEST FOR PROPOSAL:

1-27-16:    SELECTION OF PROFESSIONAL SERVICES:

1-27-17:    PURCHASES OF MERCHANDISE FOR RESALE:

1-27-18:    AWARDS:

1-27-19:    CHANGE ORDERS:

1-27-20:    TYPES OF CONTRACTS:

1-27-21:    CONTRACT CLAUSES:

1-27-22:    INSURANCE AND BOND PROVISIONS:

1-27-23:    SALE, TRANSFER OR DISPOSITION OF PERSONAL PROPERTY:

1-27-24:    PENALTIES:

1-27-25:    SEVERABILITY:

1-27-1 GENERAL PROVISIONS:

The City hereby adopts the following policies governing the procurement of all supplies, materials, equipment and services for the offices, departments and agencies of the City. (Ord. 2023-1818, 1-10-2023)

1-27-2 APPLICABILITY:

(A) This code applies only to contracts or purchases solicited or entered into after the adoption of this code. Renewal of existing contracts shall also be subject to this code unless the specific contract terms provide otherwise.

(B) This code shall apply to every expenditure of public funds regardless of source, including state and federal assistance monies, by this City, except that nothing in this code shall prevent the City from complying with the terms and conditions of any grant, gift or bequest or cooperative agreement. This code shall also apply to the disposal of City property.

(C) It shall be unauthorized for any City employee or appointed or elected official to order the procurement of materials, supplies or services, or make contracts within the purview of this code, other than in accordance with this code and any regulations or directives promulgated pursuant to this code. Contracts or purchase orders made contrary to the provisions hereof may not be approved and the City may not be bound thereby. Unauthorized contracts or purchases may result in disciplinary action or personal liability to the person entering into said unauthorized contract or purchase.

(D) The authority granted to purchasing agents by the City Manager pursuant to this code shall be limited by available funds having been budgeted by the City of Prescott.

(E) Notwithstanding anything to the contrary contained herein, this code shall not apply to financial stipends, grants or allowances by the City to assist in the continued operations of existing entities providing a public service to residents of Prescott; provided, that said payment is first approved by the City Council. (Ord. 2023-1818, 1-10-2023)

1-27-3 PROCUREMENT ORGANIZATION:

(A) The City Manager is vested with the authority for procurement. The City Manager may designate in writing purchasing agents who may be vested with the authority for procurement by a fiduciary relationship between the purchasing agent and the City Manager, except as otherwise provided herein.

(B) Each designated purchasing agent shall establish guidelines for the management of all inventories of materials belonging to the City in their department.

(C) The sale, trade or other disposal of departmental City-owned personal property and surplus supplies shall be supervised by the purchasing agent.

(D) The City Manager is hereby empowered to adopt rules and regulations relating to purchases and the entering into of contracts, which rules and regulations are not otherwise inconsistent with the provisions of this code or the City Charter.

(E) The City Manager shall be the awarding authority, or delegate awarding authority to the purchasing manager for budgeted line items specifically identifying one (1) time operational or recurring products or services approved by the City Council in the review and adoption of the annual budget of the City and for which an award is within the allocated expenditure and/or included on the Approved Expenditure List (AEL). Awards that deviate from the identified description and/or scope shall require City Council approval. Awards that exceed the AEL amounts by twenty percent (20%) shall require City Council approval. (Ord. 2023-1818, 1-10-2023)

1-27-4 REQUIREMENTS OF GOOD FAITH:

(A) This code requires all parties involved in the negotiation, performance or administration of City contracts or purchases to act in good faith. Any effort to influence any public employee to breach the standards of ethical conduct is also a breach of ethical standards.

(B) City employees and elected or appointed officials must discharge their duties impartially so as to ensure fair competitive access to City procurement by responsible suppliers of goods and services. Moreover, they should conduct themselves in such a manner as to foster public confidence in the integrity of the City procurement organization.

(C) Any City employee, appointed or elected official who knowingly violates any of the provisions of this code shall be subject to disciplinary action and/or termination depending upon the severity of the violation, in accordance with City Code personnel provisions, and any and all other applicable local, state and federal laws, rules, regulations and policies.

(D) An individual who is not an employee of the City who violates any provision of this code may be subject to debarment from having the opportunity to bid or be awarded any City contracts for a period of up to twenty-four (24) months, depending upon the severity of the violation, at the sole discretion of the City Manager. Any individual, organization or entity so debarred shall be advised in writing by the City of the debarment, the period thereof, and the reason therefor. Any appeal of the City Manager’s determination of debarment must be presented to the City Council, in writing, within ten (10) days of the notice of debarment.

(E) Criminal, civil and administrative remedies otherwise available against employees or nonemployees for a violation of this code are cumulative, and shall not be impaired by this code. (Ord. 2023-1818, 1-10-2023)

1-27-5 FRAUD AND COLLUSION:

(A) Where competitive solicitations are required pursuant to this code, no City employee or elected or appointed official shall assist a supplier of goods or services in securing a contract or purchase order by prejudicing the selection of that supplier or the price paid for goods or services sold to the City.

(B) Willful misleading or withholding of information by a prospective supplier or City representative regarding the character of the goods or services procured or sold by the supplier or the City representative shall be considered a breach of ethical standards, resulting in administrative and civil remedies pursuant to this code and any and all other applicable local, state and federal laws, rules, regulations and policies. It shall be a breach of ethical standards for any employee or former employee knowingly to use confidential information for actual or anticipated personal gain, or for the actual or anticipated personal gain of any other person. Prices offered by suppliers of goods and services procured by the City shall be independently developed without consultation or collusion with other suppliers or potential suppliers when responding to bids, quotes or requests for proposals. (Ord. 2023-1818, 1-10-2023)

1-27-6 CONFLICT OF INTEREST:

(A) This code specifically incorporates the provisions of A.R.S. Title 38, Chapter 3, Article 8, regarding conflict of interest and exceptions thereto.

(B) The value of anything transferred or received in breach of the purchasing ethics of this code by an employee or nonemployee shall be recoverable by the City. (Ord. 2023-1818, 1-10-2023)

1-27-7 GIFTS AND GRATUITIES:

(A) It is a breach of procurement ethics for any person to solicit, offer, give or accept money, credits, gifts, entertainment, discounts, favors or services in connection with recommendations or decisions pertaining to any procurement.

(B) It shall be conclusively presumed that the value of the gifts or gratuities was included in the price of the contract, subcontract or order and ultimately borne by the City and will be recoverable by the City from the recipient, from the vendor, or both.

(C) Exceptions to this section are unsolicited advertising or promotional materials such as pens, pencils, calendars and other items of nominal intrinsic value offered on infrequent occasions in the ordinary course of business. (Ord. 2023-1818, 1-10-2023)

1-27-8 SPECIFICATIONS:

(A) When drafting specifications for the purchase of supplies or equipment, the purchasing agent should take into account all important factors for the intended purchase, including price, quality, lifespan, warranties, repair and replacement cost, functionality, and performance history from previously purchased similar supplies and equipment.

(B) All specifications, including those prepared by architects, engineers, consultants and others for procurement by the City, shall not be unduly restrictive and shall encourage maximum practical competition among suppliers.

(C) Specifications for goods and services that exclude suppliers offering similar performance or functional characteristics shall not be used unless such specifications are technically justified or it is not practicable nor advantageous to use a less restrictive specification. (Ord. 2023-1818, 1-10-2023)

1-27-9 PROCUREMENT METHODS:

(A) It is understood that similar purchases may, for legitimate reasons, occur at different times during the fiscal year. In such cases, they may be considered separately under this policy. The total cost of an item (inclusive of any freight, tax, and term length), not the method of payment, determines the method of procurement. Artificial division, splitting or fragmentation of a transaction to circumvent source selection or to avoid requirements for bidding or authorization of procurements is prohibited.

(B) Procurements made for the City shall be documented by a written contract or purchase order that has been authorized and issued prior to receipt of the goods or services or prior to payment for goods and services, except as otherwise provided for in this code.

(C) Purchasing agents are encouraged to participate with the state of Arizona, or any other public entity, for the cooperative purchasing of goods and services that have been obtained in accordance with the State Procurement Code or in substantial compliance with the provisions of this code.

(D) Procurements in an amount of more than ten thousand dollars and one cent ($10,000.01) and under fifty thousand dollars ($50,000.00) may be solicited from suppliers without bidding or competition with the prior approval of the City Manager for used vehicles, used equipment and other used personal property, upon written substantiation that the item or items to be purchased are only sporadically or occasionally available for purchase, and due to the sporadic nature of availability, the purchase via bidding or other competition would not be advantageous. (Ord. 2023-1818, 1-10-2023)

1-27-10 SOLE SOURCE PROCUREMENTS:

(A) Generally, procurements become a sole source procurement because there is only one (1) known source that exists, or only one (1) single supplier that can fulfill the requirements, such as with brand name parts, equipment, system or product maintenance, or information technology. When only one (1) manufacturer or distributor sells/provides the name brand only material or service this is a sole source procurement. Sole source procurement should be avoided, unless there is only one (1) source for the required material or service and no other type of material or service will satisfy the requirements of the City.

(B) A contract may be awarded for a material or service without competition if the purchasing agent determines there is only one (1) source for the required material or service and the sole source procurement is approved by the City Manager.

(C) City departments seeking a sole source procurement will prepare the sole source procurement form, which is available on the City of Prescott intranet, documenting why there is only one (1) source for the required material or service including:

1. Why no other type of material or service will satisfy the needs of the City; and

2. Why a specific material or service must be purchased to the exclusion of others; and

3. What were the specific efforts made to determine the availability of any other source.

(D) The form shall be approved by the City department head, pursuant to the threshold levels set forth in Section 1-27-12, and the form submitted to the City Manager for approval of the request.

(E) When possible, City departments seeking a sole source procurement must submit a letter from the manufacturer/distributor of the material, or the provider of the service, indicating the identified vendor as the sole source of the material or service being purchased.

(F) The provisions of this section apply to all sole source procurements unless emergency conditions exist as defined in Section 1-27-11. (Ord. 2023-1818, 1-10-2023)

1-27-11 EMERGENCY PROCUREMENTS:

(A) A purchasing agent may make or authorize others to make emergency procurements if there exists a threat to the public health, welfare or safety or if a situation is determined to be necessary for the public interest.

(B) An emergency procurement shall be limited to the goods or services necessary to satisfy the emergency need with as much competition as is practicable under the circumstances.

(C) In emergency situations, expenditures and obligations to suppliers of goods and services that exceed fifty thousand dollars ($50,000.00) shall be submitted to the Council for authorization or ratification at the next scheduled Council meeting. (Ord. 2023-1818, 1-10-2023)

1-27-12 EXPENDITURES:

All expenditures of the City, including budgeted line items on the Approved Expenditure List (AEL) and approved by City Council during the annual budget adoption, shall adhere to the following requirements:

(A) Expenditures of Ten Thousand Dollars ($10,000.00) or Less.

1. Any procurement that results in an expenditure of ten thousand dollars ($10,000.00) or less shall be made by the purchasing agent with as much economy as practicable in the open marketplace at the prevailing price, without the requirement of public notice or City Council authorization.

(B) Expenditures of Ten Thousand Dollars and One Cent ($10,000.01) to Fifty Thousand Dollars ($50,000.00).

1. Any procurement resulting in an expenditure from ten thousand dollars and one cent ($10,000.01) to fifty thousand dollars ($25,000.00) may be made by a purchasing agent without the requirements of public notification by advertisement.

2. The purchasing agent shall obtain three (3) informal competitive quotations, in writing, from available suppliers.

3. The solicitation requirements provided for herein are to be considered minimum requirements.

(C) Expenditures of Fifty Thousand Dollars and One Cent ($50,000.01) to One Hundred Thousand Dollars ($100,000.00).

1. Any procurement resulting in an expenditure from fifty thousand dollars and one cent ($50,000.01) to one hundred thousand dollars ($100,000.00) may be made without the requirements of public notification by advertisement, with City Council authorization.

2. The purchasing agent shall obtain three (3) informal competitive quotations, in writing, from available suppliers and submit said quotations to the City Council for consideration and approval, unless already on the AEL.

3. The solicitation requirements provided herein are to be considered minimum requirements.

(D) Expenditures Exceeding One Hundred Thousand Dollars ($100,000.00).

1. Any procurement resulting in an expenditure of more than one hundred thousand dollars ($100,000.00) shall have been made only after formal competitive sealed bidding, solicited by public notification, and awarded by the City Council, unless already on the AEL.

2. A formal invitation to bid shall be issued by the City Clerk, or designee, and shall include the dates of public notice, the time and place for bid receipt and opening and a description of the goods or services.

3. Public notification shall be considered adequate when a formal invitation to bid is advertised and published at least once in a newspaper of general circulation within the City not less than five (5) days before the bid opening.

4. Amendments to invitations to bid shall be issued in writing by the purchasing agent, with a copy to the City Clerk, within a reasonable time before the bid opening to all suppliers to whom the purchasing agent has distributed invitations to bid and to all suppliers who have requested bid documents or specifications and shall require acknowledgement of receipt by the bidder before the bid opening or within the bid.

5. Sealed bids shall be considered properly received only when delivered in a sealed envelope marked in accordance with the request for bid, or as set forth in the bid specifications by the City Clerk or designee, by or before the specified time and designated place as advertised in the public notice. Bids shall be time-stamped and stored unopened in a secure place until the public bid opening.

(a) Late bids shall be rejected if received after the designated time in the location for receipt thereof, with the exception of bids that are received by City personnel before the bid opening that would have been timely received if not for the action or inaction of City personnel directly serving the procurement function. These bids may be received and considered.

(b) Minor informalities may be waived by the City Manager in consultation with the purchasing agent and City Attorney if the waiver is deemed to be in the best interest of the City.

6. A modification, or withdrawal, of a bid must be received before the time and date set for bid opening in the location designated for receipt of bids. The modification or withdrawal shall be time-stamped and recorded.

7. Bids shall be opened publicly by the City Clerk or designee in the presence of one (1) or more witnesses at the time, date and location designated in the invitation to bid. The name of each bidder, and other information deemed appropriate, shall be read aloud and recorded.

8. Mistakes in the bid discovered after the bid opening based on an error in judgment may not be corrected or withdrawn except as set forth herein.

(a) After bid opening, the City Manager, in consultation with a purchasing agent and the City Attorney, may waive minor informalities in a bid.

(b) After bid opening, the bid may not be withdrawn and shall be corrected to the intended bid only if a bid mistake and the intended bid are evident on the face of the bid, as determined solely by the City.

(c) After bid opening, the City Manager, in consultation with a purchasing agent and City Attorney, may permit a bidder to withdraw a bid when:

(1) A nonjudgmental mistake is evident on the face of the bid and the intended bid is not clear; or

(2) The bidder establishes by clear and convincing evidence in the sole opinion of the City that a nonjudgmental mistake was made; or

(3) The bid is so low as to create a likelihood that the contract cannot be completed and to enforce compliance with the bid would be unconscionable.

9. An invitation for bids, request for proposals, or other solicitation may be canceled, or any and all bids or proposals may be rejected in whole or in part by the purchasing agent, the City Manager or the City Council, if it is deemed to be in the best interest of the City. Determinations to reject a bid or proposal in whole or in part lie solely in the City’s discretion.

10. The solicitation requirements provided herein are to be considered minimum requirements. Purchasing agents are expected to also publicize and inform the public and potential bidders of the availability of a bid opportunity by any other practical means. (Ord. 2023-1818, 1-10-2023)

1-27-13 COMPETITIVE BIDDING REQUIREMENTS – EXEMPTIONS:

Exemptions from competitive bidding requirements include, but are not necessarily limited to:

(A) Professional or specialized services;

(B) Insurance and bonds;

(C) Procurements funded by grants, donations, or gifts when the special conditions attached to the grants, donations or gifts require the procurement of particular goods and/or services;

(D) Works of art, entertainment or performance;

(E) Intergovernmental payments, purchases and agreements;

(F) Membership dues, conventions, training, and travel arrangements;

(G) Advertisements in magazines, newspapers, or other media;

(H) Goods procured for resale to the public;

(I) Public utility purchases of water, power, and related services;

(J) Development agreements, as defined in A.R.S. § 9-500.05;

(K) The purchase of real property and ancillary services related thereto, such as title insurance, appraisals or environmental assessments to the extent that they are negotiated as a part of the contract for purchase of real property.

Nothing in this section shall preclude the solicitation of competitive bids or proposals, when possible. (Ord. 2023-1818, 1-10-2023)

1-27-14 MULTI-STEP SEALED BIDS:

When it is considered impractical to initially prepare a procurement description to support an award based on the price of the goods or services, an invitation to bid may be issued requesting the submission of unpriced offers.

The initial invitation to bid will be followed by a subsequent invitation to bid limited to those bidders whose offers have been determined technically acceptable under the criteria set forth in the first solicitation. (Ord. 2023-1818, 1-10-2023)

1-27-15 REQUEST FOR PROPOSAL:

Request for proposal may be utilized whenever:

(A) The purchasing agent determines that the City wishes to utilize competitive negotiation, or if the City is unable to provide bid specifications for an entire project and shall request the prospective bidders to specify a method or manner at the bidder’s choosing of performing a contract.

(B) If the estimated dollar amount of the ultimate contract to be awarded exceeds that amount set forth in Section 1-27-12(D), the procedure for seeking requests for proposals shall be in accordance with Section 1-27-12(D).

(C) All proposals shall be opened publicly at the time and place designated in the request for proposals. The name of the proposer and other relevant information, as may be designated by the purchasing agent, shall be publicly read. All other information contained in the proposals shall be confidential as to avoid disclosure of contents prejudicial to competing proposers during the process of negotiation. All proposals may be open for public inspection after a recommendation is made to the City Council for, but no later than, the contract award by the City Council. To the extent as designated by the proposer and the purchasing agent concurs, trade secrets or other proprietary data contained in the bid documents shall remain confidential, unless the City is required by law to disclose this information.

(D) Competitive negotiation may be used at the discretion of the purchasing agent. Discussions shall not disclose any information derived from proposals submitted by other proposers.

(E) Negotiation following the opening of sealed proposals is not required if one (1) or more of the initial offers is fully satisfactory. Award may be made on the basis of the proposal as first submitted, without any discussion with the proposer or changes to the content of the proposal.

(F) Criteria for evaluation of proposals may include, but shall not be limited to, managerial or technical capabilities, comparative feasibilities of the approach or other elements where price may not be the sole determining factor for selection of a supplier.

(G) Authorized awards shall be made in writing to the responsible proposer whose proposal is determined to be the most advantageous to the City, taking into consideration, but not limited to, price, and the evaluation factors set forth in the solicitation and in Section 1-27-18.

(H) Once a formal recommendation is made to the City Council regarding which proposal, as subsequently amended by negotiations, should be accepted, no further negotiations or modifications to proposals may be made. However, this does not prohibit the City Council from either rejecting all proposals, or directing City staff to pursue further negotiations with one (1) or more of the proposers. (Ord. 2023-1818, 1-10-2023)

1-27-16 SELECTION OF PROFESSIONAL SERVICES:

(A) Personal services provided by members of professions that require specialized knowledge and expertise acquired by advanced training and/or experience (predominately involving mental or intellectual rather than physical or manual skills) may be procured or retained on an as-needed basis or for a particular project by the purchasing agent without the formal bidding requirements set forth in Section 1-27-12. These services may be procured annually, or on an as-needed basis.

(B) The purchasing agent may award a contract to a provider of professional services in the event that the contract for said services is not estimated to exceed the amount set forth in Section 1-27-12(B). Any contract for professional services which is expected to exceed that amount set forth in Section 1-27-12(B) must be approved by the City Council, unless on the Approved Expenditure List (AEL).

(C) Notwithstanding the foregoing provisions, purchasing agents are expected to also publicize and inform qualified professionals in the Prescott area of the availability of a contract award pursuant to this section by any other practical means.

(D) In the event that there is justification to do so due to the particular expertise or knowledge of a particular professional consultant, contracts for professional services for expert witnesses in litigation matters may be exempted from the provisions of Sections 1-27-8, 1-27-9, 1-27-12, 1-27-14, 1-27-15, 1-27-18 and 1-27-19, at the discretion of the purchasing agent. However, any contract for professional services which is expected to exceed that amount set forth in Section 1-27-12(B) must be approved by the City Council. (Ord. 2023-1818, 1-10-2023)

1-27-17 PURCHASES OF MERCHANDISE FOR RESALE:

Due to the fact that the City of Prescott is involved in certain enterprises which consist, wholly or in part, of retail sales to the general public (e.g., the golf course pro shop), it is understood that the practicalities of operating a retail sales establishment should be dictated not necessarily by the lowest competitive price, but rather by various market factors (e.g., brand name, availability, etc.). Therefore, a purchasing agent who is responsible for purchasing merchandise for resale to the general public shall be exempt from the provisions of Sections 1-27-8, 1-27-9, 1‑27-12, 1-27-14, 1-27-15, 1-27-18, and 1-27-19 for said purchases; provided, however, that any purchases which exceed the dollar amount as set forth in Section 1-27-12(B) shall still require City Council approval. (Ord. 2023-1818, 1-10-2023)

1-27-18 AWARDS:

(A) Authorized awards shall be made to the lowest and most qualified supplier whose bid, quotation or offer conforms to the procurement requirements and criteria set forth in the City’s solicitation and is deemed to be in the best interest of the City.

(B) The evaluation methods to determine the conformity of the procurement requirements and criteria shall be uniform and equal for each responding supplier.

(C) Goods or services shall be evaluated as much as possible by tangible, measurable criteria that include, but are not limited to, transaction privilege or use tax to be paid to the City of Prescott, transportation costs, energy costs, standard practices or procedures, life cycle and effective ownership costs, whether the goods are made from recycled material, or other factors that satisfy the particular function at the lowest overall cost to the City. Additionally, the City may include in its evaluation managerial or technical capabilities, comparative feasibilities of the approach to be used (if applicable), prompt service, accessibility, delivery, travel, or any other factors which may reduce or offset the cost of goods or services solicited by the City.

(D) A bidder or offeror may be required to submit to the purchasing agent a certification of current cost or pricing data used to price the bid or offer prior to an award to determine if the price is fair, reasonable, and in the best interests of the City.

(E) The City Manager retains the authority to debar or suspend any potential supplier of goods or services from consideration of award if the potential supplier is in default of any obligation, taxes or fees due and owing the City, until such time as the breach or default is cured.

(F) Low bids, quotations or offers which are identical in all respects from two (2) or more responsible and responsive suppliers may be awarded by the drawing of lots in public, in the presence of two (2) or more witnesses, including the City Clerk or designee.

(G) Multiple awards may be made in whole or in part to two (2) or more suppliers of similar goods or services to facilitate delivery, service, product compatibility or obtain the best value in the best interest of the City.

(H) If only one (1) responsive bid, quotation or offer is received from a competitive solicitation:

1. An authorized award may be made to the single bidder if the price is determined to be fair and reasonable; or

2. The bid may be rejected; or

3. New competitive solicitation may be made; or

4. The need for the procurement continues if the acceptance of one (1) bid is not advantageous to the City. The procurement may be made under provision for sole source or emergency as defined in this code.

(I) If no response is received from competitive solicitation, the purchasing agent may resolicit, terminate further solicitation, or procure under the provisions for emergency or sole source, whichever is applicable.

(J) If all bids received exceed available monies as certified by the City Manager or his designee, including the lowest and most qualified bid, the purchasing agent may negotiate an adjustment of the bid price, including changes in the bid requirements and specifications, with the lowest responsive and responsible bidder, to bring the bid within the amount of available monies.

(K) In reviewing bids, and/or proposals, and/or estimates, and determining whether or not a proposed contractor or vendor is the most responsible and/or most qualified bidder, the City shall consider, among other factors:

1. Costs incurred by the City or other governmental entities in contested change orders by the contractor;

2. Litigation in which the contractor was involved with the City or other governmental entities relative to contract performance;

3. Failure of the contractor to have met bid specifications or time limits in previous contracts;

4. Abandonment of a contract or refusal to perform without legal cause after submission of a bid;

5. A record of bidding errors or omissions in two (2) or more bid submissions in a thirty-six (36) month period;

6. A record of failure to perform, or unsatisfactory performance, of two (2) or more contracts within a thirty-six (36) month period;

7. Inadequate equipment, lack of expertise or insufficient personnel to complete the proposed contract;

8. A record of safety violations in two (2) or more contracts within a thirty-six (36) month period;

9. Conviction of a criminal offense as an incident to obtaining or attempting to obtain a public or private contract or subcontract, or in the performance of such contract or subcontract within a ten (10) year period;

10. Conviction of a criminal offense within a ten (10) year period of embezzlement, theft, forgery, bribery, falsification or destruction of records, receiving stolen property, or any other offense indicating a lack of business integrity or business honesty which might affect responsibility as a municipal contractor;

11. Conviction of state or federal antitrust statutes within a ten (10) year period arising out of the submission of bids or proposals;

12. Any other cause that the City determines to be so serious and compelling as to affect responsibility as a municipal contractor, including debarment or similar proceedings by another governmental entity. (Ord. 2023-1818, 1-10-2023)

1-27-19 CHANGE ORDERS:

(A) The provisions regarding the approval of change orders, as set forth in this section, supersede any other provision to the contrary as contained elsewhere in this code.

(B) A change order shall be defined as any change order, contract modification, or any adjustment to the amount of the original authorized award for work when extra work or materials are required due to bona fide unforeseen conditions.

(C) Any change order in an amount of fifty thousand dollars ($50,000.00) or less must be approved by the purchasing agent in writing.

(D) Any change order in an amount of more than fifty thousand dollars ($50,000.00) must be submitted to the City Council for approval. In the event that prior approval of the Council will unduly delay a project in progress, the City Manager shall have the authority to approve said change orders subject to subsequent ratification by the City Council.

(E) Cost or pricing data may be required to be submitted for change orders, contract modifications or adjustments to the original award when such adjustments increase the amount of the original award or decrease value of work. (Ord. 2023-1818, 1-10-2023)

1-27-20 TYPES OF CONTRACTS:

(A) Any type of contract, which will promote the best interest of the City, may be used.

(B) Fixed-price contracts shall be used only when the extent or type of goods or services can be specified and the cost can be reasonably estimated at the outset of the contract. Fixed-price contracts, with a price adjustment allowance, shall be used only if the solicitation and the contract specify the basis for the price adjustment and provide for adequate notice of such adjustments.

(C) Alternative forms of contracting (e.g., design-build, construction manager at-risk, etc.) allowed by A.R.S. Title 34, Chapter 6, can be used if it is in the best interest of the City.

(D) Time-and-material contracts may only be used when the purchasing agent determines that such a contract is less costly than any other type or that it is impractical to obtain the goods or services except under such a contract. The purchasing agent may set performance criteria in monitoring said work. Time-and-materials, or labor-hour contracts, shall provide for a maximum contractual amount.

(E) Lease agreements and lease-purchase contracts may be used if all conditions for renewal, including the cost determination for renewal, are set forth in the agreement and the lease is not used to circumvent the required procurement procedures of this code.

(F) Multi-term contracts may be used for any period of time deemed to be in the best interests of the City. Payment and performance obligations for succeeding fiscal years shall be subject to the availability and appropriations of funds therefor.

1. Before exercising any option for renewal or extension of a contract, the purchasing agent shall evaluate the performance during the original contract period and determine that a competitive procurement is not more advantageous to the City than exercise of the particular option.

2. A contract entered into by the City should not provide for automatic extensions or renewals thereof without first requiring some affirmative act on the part of the City to continue or extend said contract.

3. In the event that funds are not appropriated or made available to support the continuation of a contract in a subsequent fiscal year, the contract shall be canceled and the City shall have no further obligation under said contract. (Ord. 2023-1818, 1-10-2023)

1-27-21 CONTRACT CLAUSES:

The City Attorney may establish standard contract clauses for inclusion in City contracts. Such standard clauses may be modified upon review by the City Attorney on a case-by-case basis. (Ord. 2023-1818, 1-10-2023)

1-27-22 INSURANCE AND BOND PROVISIONS:

(A) The submission of bid security by the bidder, or offeror, may be required to guarantee a faithful bid and execution of all contracts if awarded the bid. Any requirements for a bid bond shall be set forth in the bid solicitation or bid specifications.

(B) When the solicitation requires bid security, noncompliance with such security requires that the bid or offer be rejected, unless it is determined that the bid fails to comply only in a nonsubstantial manner with the security requirements. In that event, and upon request of the City, the bidder must post the required bid security within twenty-four (24) hours of the bid opening.

(C) No action shall be taken against the bidder’s or offeror’s bid security if the bidder or offeror is permitted to withdraw its bid or offer prior to award as provided in Section 1-27-12(D).

(D) The submission of performance or payment bonds by the successful bidder or offeror may be required by the City in an amount of not less than one hundred percent (100%) of the total bid. Any requirement shall be set forth in the bid solicitation or bid specifications.

(E) All performance and payment bonds shall be submitted to the City prior to execution of the contract and prior to release of any bid bond.

(F) All bid, payment or performance bonds shall be a cash bond, C.D., or bond provided by an insurance company authorized to do business in the state of Arizona. This is to be evidenced by a certificate of authority as defined in A.R.S. § 20-217, a copy of which is to be attached to the applicable bond.

(G) All insurance required by a successful bidder or offeror shall be written by an insurance company authorized to do business in the state of Arizona. This shall be evidenced by a certificate of authority as defined in A.R.S. § 20-217, a copy of which is to be attached to the applicable insurance policy, binder or certificate of insurance.

(H) A bid, payment or performance bond shall not be required solely to exclude potential bidders.

(I) The nature of performance and the need for future protection of the City shall be considered when determining the amount and type of bond required for each solicitation.

(J) In addition to the requirements of subsections (F) and (G) of this section, depending upon the nature of the contract and amount thereof, the City may also require insurance companies and/or bonding companies to have an "A" rating or better with Moody’s or A.M. Best Company, and/or to be included on the current list of "Companies Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and as Acceptable Reinsuring Companies" as published in Circular 570 (as amended) by the audit staff, Bureau of Accounts, U.S. Treasury Department. (Ord. 2023-1818, 1-10-2023)

1-27-23 SALE, TRANSFER OR DISPOSITION OF PERSONAL PROPERTY:

(A) The method, form and manner of the sale or transfer or disposition of personal property of the City shall be uniform and consistent within the provisions of this code and in accordance with the requirements set forth in the City Charter.

(B) The purchasing agent shall be the custodian of all personal property that has been identified and declared by a City governmental unit to be neither needed nor likely to be needed within a reasonable future time.

1. No individual, City employee, elected or appointed official, City office or agency shall sell, transfer, trade in, condemn or otherwise dispose of any City personal property without written notification of such intent to the purchasing agent and authorization in accordance with the requirements set forth in the Charter.

2. The purchasing agent may identify City personal property, idle equipment, excess inventory, obsolete materials or expendable supplies that may be subject for disposition and recommend their disposition to the City Manager.

(C) It is assumed that all City personal property has a value which shall be determined by the fair and competitive market at the time of sale or transfer or disposition through consistent methods, form and manner as to be determined by the purchasing agent and subject to such conditions as the Council may from time to time prescribe.

1. The method, form and manner selected by the purchasing agent for the sale, disposition or transfer to other than City governmental units shall consider the value, terms of sale, timing of the activity and other economic factors relative to obtaining the maximum value in the best interests of the City.

2. The purchasing agent may employ whatever methods are most advantageous to the City to dispose of personal property valued at three thousand dollars ($3,000.00) or less.

(D) Prior to sale or disposition of City personal property, the purchasing agent shall endeavor to identify and recommend to the City Manager any City personal property that has potential for recycle, reutilization or transfer to other City governmental units. Personal property transferred to or from City governmental units shall be documented on forms acceptable to the Finance Department and at such times as the purchasing agent may prescribe with authorization by the department heads of the sending and receiving departments.

(E) The value received from the sale, transfer or disposition of City personal property shall be allocated in accordance to the proper accounting practices determined by the Director of Finance.

(F) The purchasing agent shall act on behalf of the City with the state, federal or other surplus property agencies regarding the procurement or disposition of surplus property.

(G) Notwithstanding anything to the contrary herein, the Police Chief is hereby authorized to trade or destroy weapons, in accordance with any policy as promulgated by the City Manager or otherwise required by applicable local, state and/or federal laws, rules and regulations.

(H) Notwithstanding anything to the contrary herein, the City Manager or his designee is hereby authorized to transfer and convey surplus personal property of value not to exceed three thousand dollars ($3,000.00) to other governmental entities. (Ord. 2023-1818, 1-10-2023)

1-27-24 PENALTIES:

In addition to or as an alternative to any penalty provided herein or by law, any person who violates the provisions of this code shall be punishable as a criminal misdemeanor violation or as a civil violation, or both, pursuant to Sections 1-3-1 and 1-3-2. (Ord. 2023-1818, 1-10-2023)

1-27-25 SEVERABILITY:

The provisions of this code are hereby declared to be severable; and if any section, sentence, clause or phrase of this code shall, for any reason, be held to be invalid or unconstitutional, such decisions shall not affect the validity of the remaining sections, sentences, clauses and phrases of this code, but they shall remain in effect, it being the legislative intent that the ordinance codified in this chapter/this code shall stand, notwithstanding the invalidity of any part thereof. (Ord. 2023-1818, 1-10-2023)