250-02
PURCHASING, BIDDING AND CONTRACTING REQUIREMENTS

POLICY & PROCEDURE

Subject:

PURCHASING, BIDDING AND CONTRACTING REQUIREMENTS

Index: Administration

Number: 250-02

Effective Date

3/5/2015

Supersedes

4/1/2010

Page

1 of 20

Staff Contact

Iwen Wang

Approved By:

Denis Law

1.0 PURPOSE:

To establish a uniform and efficient review, approval and execution policy and procedure for selection, bidding, leasing, and contracting requirements for goods, services and public works projects throughout the City.

2.0 ORGANIZATIONS AFFECTED:

All departments/divisions.

3.0 REFERENCES:

RCW 35.22.620; RCW 35A.40.200 & 210; RCW 39.04.010 & 155 & 350; RCW 39.10.420 & 430; RCW 39.35A.020; RCW 39.80.

City of Renton Resolution No. 4029.

City Policy 400-12

4.0 POLICY:

It is the policy of the City of Renton to utilize uniform, efficient, and competitive bidding, purchasing, quoting, Requests for Proposals (RFPs), cooperative purchasing, and Statements of Qualifications (SOQs) consistent with State law, and to ensure that all public purchases and contracts for services, equipment, materials, supplies and public works are executed and managed at the highest professional and ethical standard and to achieve the greatest attainable levels of quality and value permitted by law.

The City encourages funds expended by the City, to the extent possible and practical, be reinvested in the local economy.

5.0 DEFINITIONS:

5.1    ALTERNATIVE PUBLIC WORK CONTRACTING PROCESSES: As it relates to this policy, Alternative to the Competitive Sealed Bid process includes: 1) Small Works Roster (RCW 39.04.155); 2) Limited Public Works Projects Process (RCW 39.04.155(3)); 3) Performance-Based Contracts for Energy Equipment; and 4) Job Order Contracting (RCW 39.10.420).

5.2    CHANGE ORDER: A written amendment or modification of a contract. Including, but not limited to, contracts for construction of a Public Work using alternative public works processes authorized by RCW 39.10.

5.3    CONTRACT: An agreement between the City and one or more entities.

5.4    CONTRACT CHECKLIST: A form required to be completed and submitted to the City Clerk Division with appropriate attachments for any contract, agreement, addendum, lease, or change order.

5.5    CRAFT: A “sub-unit” of a construction group such as carpenters, electricians and masons.

5.6    ELECTRONIC WRITTEN QUOTES: A process whereby price quotations are obtained by fax, email, or other paper or electronic format for the purpose of producing and comparing a written record of vendor quotes.

5.7    EMERGENCY: Unforeseen circumstances beyond the control of the municipality that either a) present a real, immediate threat to the proper performance of essential functions; or b) will likely result in material loss or damage to property, bodily injury, or loss of life if immediate action is not taken.

5.8    ENERGY CONSERVATION EQUIPMENT AND SERVICES: Equipment and services that are expected, upon installation, to reduce the energy use or energy cost of an existing building or facility. The services associated with the equipment, materials, or supplies include, but are not limited to, design, engineering, financing, installation, project management, guarantees, operations, and maintenance.

Reduction in energy use or energy cost may also include reductions in the use or cost of water, wastewater, or solid waste. RCW 39.35A.020(1)

5.9    GOODS AND MATERIALS: Supplies and equipment not used in connection with a Public Work;, including but not limited to, office supplies, maintenance supplies (e.g. beauty bark, top soil, etc), automobiles, equipment (e.g. specialty lighting, cameras, and furniture).

5.10    INTERLOCAL COOPERATIVE PURCHASES: Cooperative or joint purchases by different governmental entities established through interlocal agreements.

5.11    JOB ORDER CONTRACT: A contract the City has entered into pursuant to RCW 39.10.430 with a registered or licensed contractor for an indefinite quantity of work, over a fixed period of time, for the use of future negotiated, definitive work orders for public works projects.

5.12    PERFORMANCE BASED CONTRACT: A contract that provides for payment only if there are cost savings. RCW 39.35A.020(4)

5.13    PROFESSIONAL SERVICES: Activities rendered by any person, other than an employee of a public or government agency, involving the presentation or delivery of professional opinion, assessment, design, or other information to the City having a primarily intellectual final product.

5.14    PUBLIC WORK: All work, construction, alteration, repair, demolition, or improvement, other than ordinary maintenance, that is executed by contract, purchase order, or any other legal agreement and that is executed at the cost of the City, or which is by law a lien or charge on any property of the City (RCW 39.04.010 (4)). The sources of the funding shall not determine the applicability of the statute, and may include, but is not limited to, such sources as those payments made through contract with insurance companies on behalf of the City.

5.15    ORDINARY MAINTENANCE: In the context of Public Works contracts and prevailing wages, is defined as work that is not performed by contract1 and that is performed on a regularly scheduled basis not less frequently than once per year to service, check, or replace items that are not broken; or work not performed by contract that is not regularly scheduled but is required to maintain the asset so that repair does not become necessary and is performed by City workers.

5.16    PUBLIC WORK (COMPETITIVE) BID PROCESS: Formal process of securing competitive price quotes for public work projects based on a specific set of specifications by publishing a call for bid in the City's official newspaper, or a paper of general circulation most likely to bring responsive bids, at least 13 days prior to the bid opening date. The advertisement designates a specific time and place for sealed bids to be publicly opened and read by the City Clerk. The City Council awards the contract to the contractor submitting the lowest responsible bid.

5.17    PUBLIC WORKS PROJECT TOTAL: The costs of a separate public work project shall be the costs of all labor, materials, supplies, equipment, incidentals, and applicable sales taxes required to complete all work included in the project proposal.

5.18    REQUEST FOR PROPOSALS (RFP): Solicitation of proposals for professional services, or equipment, materials or supplies not associated with a public work. RFP’s are project specific and distinctly describe the services needed and qualifications required.

5.19    REQUEST FOR STATEMENT OF QUALIFICATIONS (SOQ): Solicitation of statements of qualifications for certain project types. SOQ's are a list of general qualifications and are typically used for routine and/or smaller projects.

5.20    SEALED BID: A document containing all required State and City documents as well as the bidder’s proposal of project cost that is delivered to the City in a sealed envelope and is only to be opened at the scheduled bid opening time.

5.21    SMALL WORKS ROSTER: A list of public work contractors who have requested placement on the roster and who are properly licensed or registered to perform work in this state.

5.22    SOLE SOURCE SUPPLY: A desired product clearly limited to a single source or supply.

5.23    TAXES: All amounts and thresholds contained herein shall be inclusive of applicable sales and use taxes at the time of soliciting for bids/proposals.

5.24    WORK ORDER: An alternate method of procuring services for public works projects, through the City’s job order contractor for a specific public works project under $350,000. Aggregate work orders under the same Job order contract is limited to $4 million per year.

6.0 VENDOR SELECTION PROCEDURES:

6.1    DETERMINING COST, SELECTION PROCESS, AUTHORIZATION AND SIGNING AUTHORITY:Total estimated cost includes all applicable materials, supplies, equipment, labor, and applicable sales and use tax for the entire scope of the purchase. The entire scope should include all of the City’s anticipated needs at the time of solicitation. Intentionally limiting job scope to avoid the competitive contractor selection process and proper authorization is prohibited.

Based on the purchase type and the total estimated cost the Purchasing Matrix in Exhibit B shall be used to identify the appropriate selection process, and required levels of authorization and signing authority.

6.1.1    Public Works Projects done by City Employees: For public works projects, excluding ordinary maintenance, that exceed $40,000 for single craft and $65,000 for multiple craft, the project must not be done by City work crews and must be competitively bid.

6.2    SOLICITING QUOTES, RFP’S, AND SOQ’S THROUGH SHARED VENDOR LISTS (SMALL WORKS ROSTER): The City is a participant of the eCityGov Alliance, which allows access to a wide variety of vendor lists through its Shared Procurement Portal, including vendors for supplies, materials, equipment, Architecture and Engineering, professional services, and public works. The eCityGov Alliance is responsible for fulfilling the advertising requirements prescribed by RCW 39.04.155 for small works rosters. This forum should be used to identify vendors and solicit quotes when applicable. The eCityGov Alliance website can be found at www.sharedprocurementportal.com. Usernames and passwords for individual users can be obtained through the Finance Department.

When required, the City shall solicit quotations from all appropriate vendors to assure that a competitive price is established. Invitations for quotes shall include an estimate of the scope and nature of the work to be performed as well as materials and equipment to be furnished. Detailed plans and specifications need not be included in the invitation.

At the time quotes are solicited, the City representative shall not inform a contractor of the terms or amount of any other contractor's quote for the same project.

6.2.1    Minimum Solicited Quotes: The minimum number of quotes solicited shall be dictated by the selection process identified in the Purchasing Matrix (exhibit B). Quotations may be invited from all appropriate vendors who have indicated the capability of performing the kind of work being contracted in a manner that will equitably distribute the opportunity among all appropriate vendors on the Shared Procurement Portal roster. It is likely not all vendors will respond with quotes and there is no minimum requirement for the number of quotes that are actually received prior to selecting a vendor.

The City must ensure that it equitably distributes the opportunity to bid to all appropriate contractors (RCW 39.04.155 2(c)). Therefore, the same vendors may not be singled out repeatedly for solicitation when other vendors are excluded from solicitation.

If the estimated cost of the work is from one hundred and fifty thousand dollars ($150,000) to three hundred thousand dollars ($300,000), and the City has not solicited quotations from all appropriate vendors on Shared Procurement Portal roster, the City must notify the remaining vendors on the appropriate roster that quotations on the work are being sought. The City has the sole option of determining whether this notice to the remaining vendors is made by:

1.    Publishing notice on the City’s website, or if applicable, with a link posted on the eCityGov shared procurement portal;

2.    Sending a notice to these vendors by email based on an email address provided by these contractors to the City or eCityGov database.

6.2.2    Record Keeping: A written record shall be made by the City representative of each contractor's bid on the project and of any conditions imposed on the bid. Immediately after an award is made the bid quotations obtained shall be recorded, open to public inspection, and available by telephone inquiry.

6.3    SOLICITATION OF FORMAL SEALED BIDS: For a public work contract greater than $300,000 or where a “Formal Sealed Bid” is called for, a call for bids shall be published at least 13 days in advance of the bid submission deadline. The call for bid shall be e-mailed to the City Clerk and Deputy Clerk for advertisement at least two days prior to the first date of legal publication.

6.3.1    Advertisement Content: The legal advertisement for the call for bid should contain the following items:

1.    Title of project;

2.    Nature and scope of work to be performed and materials and equipment to be furnished;

3.    If applicable, statement of mandatory contractor criteria and notice of any supplemental criteria under RCW 39.04.350

4.    Location where contract documents (plans and specifications) may be obtained or reviewed including the URL of any electronic posting;

5.    Cost to obtain a set of contract documents, or instructions for downloading or printing electronic documents;

6.    Time after which bids will not be received and the location where bids are to be submitted;

7.    Place, date, and time set for opening of the sealed bids;

8.    Name and telephone number of staff contact;

9.    Requirements for an accompanying bid bond; and

10.    Statements that the City retains the right to reject any and all bids and to waive minor irregularities in the bidding process.

6.3.2    Bid Bond: For contracts of $300,000 or more, bid bonds are required to help ensure that a bid has been made in good faith and that the bidder will enter into a contract if his or her bid is accepted. RCW 35.23.352(1) provides that each bid must be accompanied by a bid proposal deposit in the form of a cashier's check, postal money order, or surety bond to the City for a sum of not less than five percent of the bid amount, including sales tax.

After bids are opened and the contract is awarded to the lowest responsive responsible bidder as required by RCW 35.23.352, the bid proposal deposits or bid bonds are returned to the unsuccessful bidders. The successful bidder's bid bond or deposit is retained until the bidder enters into a contract with the municipality and furnishes a performance bond in the full amount of the contract price. If the successful bidder fails to enter into a contract with the municipality and does not provide a performance bond within ten days of being notified of the bid's acceptance, the bidder generally is required to forfeit the bid bond or deposit.

6.3.3    Public Works Contracts over $1 million: RCW 39.30.060 specifies that in order for a bid to be considered responsive, every bidder for a public works contract of over $1 million must submit (either with their bid or within one hour of the bid submittal time) the names of all subcontractors that will be used for heating, ventilation and air conditioning, plumbing, and electrical work.

6.4    LOWEST RESPONSIBLE BIDDER: After all bids (through the formal sealed bid process) or quotes (from the small works roster process) have been submitted, the contract shall be awarded to the lowest responsible bidder as defined by RCW 39.04.350(1). Formal sealed bids must be opened in public at the place, date, and time set forth in the bid proposal. The City shall award the contract for the project to the lowest responsible bidder (RCW 39.04.350) provided that, whenever there is a reason to believe that the lowest acceptable bid is not the best price obtainable or other reasons (i.e., defect or any other reason), all bids may be rejected and the City may call for new bids.

6.5    DETERMINATION OF RESPONSIBLE BIDDER: For all public works contacts, a responsible bidder is defined by RCW 39.04.350 as 1) being a registered contractor, 2) having current state unified business identifier number, 3) having valid workers’ compensation insurance coverage as evidenced by a valid certificate of registration from the department of Labor and Industry for bidder employees, 4) valid Employment Security number for unemployment insurance, 5) an affidavit that bidder is not disqualified from bidding as provided by statutes governing unregistered and unlicensed contractors and/or failing to pay prevailing wages per RCW 39.12.065(3) or 39.06.010., and 6) holds a state excise tax registration number.

6.5.1    Supplemental Bidder Responsibility: In addition to the standard responsible bidder requirements, the City may develop additional criteria to determine whether the lowest bidder is responsible. Parameters for the supplemental criteria are set by RCW 39.04.350(2).

The purpose of Supplemental Bidder Responsibility is to identify whether the low bidder holds the relevant experience, training, and/or certification requirements or qualifications. Criteria may include experience and other qualifications of the bidder’s subcontractors, suppliers, or employees who will be performing specific work on the project. When developing supplemental criteria, project managers should ensure the supplemental criteria is deliberate, documented, defensible, and relevant to the project.

The supplemental bidding criteria must be advertised in the bid documents. In addition the City must state the basis for evaluation, deadline for submitting bidder responsibility documentation, and the deadline for the appeal of any “not responsible” determination that has been made.

The City shall evaluate the low bidder’s submitted documentation to determine whether they meet the supplemental criteria for a responsible bidder. If the low bidder fails to submit the required supplemental criteria documentation, that bidder may be found not responsible. Determination of responsibility must be made prior to award of contract.

Appendix A includes a list of Supplemental Bidder Responsibility Criteria examples. This appendix should be used as a tool only.

6.6    EVALUATION OF RFPS AND SOQS: If the City has solicited SOQs or RFPs for the procurement of Architecture and Engineering type services or other professional services, qualifications should be evaluated as follows: evaluation of the qualifications and performance data along with any information submitted regarding the proposed project. Following evaluation of the written proposals and other relevant information, the City may perform oral interviews with the firms rated the highest.

The City shall select the firm “most highly qualified” to provide the required services. The price or cost of the service may not be considered by the City when determining which firm is the most highly qualified. After selection, the City may negotiate a contract for the services at a price that it determines is fair and reasonable, considering the estimated value of the services to be rendered, as well as the scope and complexity of the project. If a satisfactory contract cannot be negotiated, the City shall formally terminate the negotiations with that firm and attempt to negotiate a contract with the next most qualified firm. The process continues until an agreement is reached or the search is terminated.

6.7    PURCHASES WITH FEDERAL FUNDS: On any purchase either partially or fully funded with federal funds, bidders must provide a non-collusion and debarment affidavit. The project manager must also verify that the bidder is not debarred or suspended from federally funded programs by: 1) verifying the contractor is not on the “Lists of parties Excluded from Federal procurement or Nonprocurement Programs”, 2) printing the verification and 3) maintaining the printed verification with original bid documents as proof of responsibility.

6.8    MAINTENANCE CONTRACTS: For the purpose of fulfilling all contractor selection, procurement, and contract requirements, maintenance contracts are treated the same as procurement for public work projects. While maintenance contracts are subject to prevailing wage requirements, they are not subject to the performance and payment bonds and retainage requirements that other public works contracts are subject.

All maintenance contracts that are procured by the City must have a written contract that clearly defines scope, time frame for job completion/contract period, and cost. To properly identify total cost the City’s needs for the entire year should be considered and combined, when appropriate.

The City’s preference is to create annual, or even multiyear, contracts for recurring and routine maintenance services if it can achieve significant cost savings with a longer contract period. Total contract cost is determined by the aggregate value of the contract including all periods the contract entails. All maintenance services contracted each year will be required to have a fully executed contract if the services will cost more than $10,000 a year.

6.9    ON-CALL CONTRACTS: City departments may solicit bids for on-call contracted services for small maintenance, public work projects, and professional service contracts. These services can include, but are not limited to: emergency tree removal, plumbing, electrical and housing repair. The benefit of using an on-call contract gives the City flexibility for getting repairs done quickly, and reducing administrative time spent on managing very small public works projects. Therefore, each on-call contract amount should not exceed $35,000.

When establishing an on-call contract, special care should be given to ensure all procurement and contracting laws are followed. The Purchasing Matrix in Exhibit B should be used to identify the performance bond, prevailing wage, and retainage requirements applicable to the services provided by the on-call contract.

On-call contracts must only be made with contractors who meet the applicable minimum requirements established by RCW 39.04.350 and outlined in section 6.5 of this policy.

The following are considerations to make when establishing an on-call contract:

1.    Identify all of the potential small tasks that will need, or may need, completion throughout the duration of the contract. Do not include tasks that are so large that they should be procured individually through a stand-alone maintenance, service, or public works project.

2.    Parts and materials can be bid by the vendor as cost plus a defined markup.

3.    Vendors can also bid the hourly cost of their workers based on prevailing wage plus a defined markup.

4.    The total bid should be the sum of the unit prices items times the task quantity. The vendors who bid are not guaranteed any minimum contract amount; only the maximum contract amount.

5.    Consider including a contract clause that reserves the City’s right to ask for a price in advance for each project that is estimated to exceed $2,500.The City can select one on call vendor or several. Within the bid documents, the City can outline the expectations of how quickly the vendor will respond. Selecting several vendors to be on the list provides for availability of a number of firms and each City department can use the list to find a vendor to meet its timeframe and/or budget constraints.

6.    These contracts should be one year in duration, with a maximum of two separate one year extensions.

7.    Prevailing wage intents must be filed prior to the first payment under the contract and affidavits need to be filed with the Department of Labor and Industries at least annually.

6.10    EXCEPTIONS TO THE COMPETITIVE SELECTION PROCESS

6.10.1    Interlocal Purchasing Authorized: State contracts, and other interlocal cooperative purchasing agreements may be utilized for acquisition of non-public work goods, supplies, materials, equipment, and services without going through additional processes described in this policy.

6.10.2    Purchase at Auctions: RCW 39.30.045 allows for the purchase of any supplies or equipment at auctions rather than through competitive bidding, if the items can be obtained at a competitive price.

6.10.3    Emergencies: In the event an emergency situation arises which necessitates a deviation from bidding and contracting requirements, the Mayor or his/her designee shall award, on behalf of the City, those contracts necessary to address the emergency situation. In emergency situations, RCW 39.04.280 requires that a written finding of the existence of an emergency be made and entered into the public record no later than two weeks following the award of the contract.

RCW 39.04.280 defines an emergency as “unforeseen circumstances beyond the control of the municipality that either: a) present a real, immediate threat to the proper performance of essential functions; or b) will likely result in material loss or damage to property, bodily injury, or loss of life if immediate action is not taken.”

6.10.4    Sole Source: In the event a department finds it necessary to use a sole source for the acquisition of materials, supplies, equipment, or services, the department shall first submit, for approval, a rationale to the department head for contracts less than $35,000 or the Mayor for contracts in excess of $35,000. If approved, the sole source acquisition may be executed subject to the Contracting section (Section 7) and Approval and Execution section (Section 8) of this policy.

Sole source acquisition may only be used in instances where there is exclusive distributorship of product or service or if such service or product is clearly unique. A requirement for a particular proprietary item does not justify sole source procurement if there is more than one potential bidder or offeror for that item.

6.10.5    Performance-Based Contracts for Energy Conservation Equipment and Services: Cities may enter into performance-based contracts when contracting for certain water conservation services, solid waste reduction services, and energy conservation equipment and services.

To acquire such equipment, services or supplies, the City need not follow a competitive bid process. Instead, the City shall announce its requirements and seeks proposals to meet those requirements. Using evaluation criteria it has established in the Request for Proposals, the City then negotiates with the person or firm that has submitted the “best proposal” according to the criteria. If the City is unable to develop a satisfactory contract with that person or firm, it may select the next best person or firm and negotiate with it until a contract can be agreed to or the selection process is terminated.

6.10.6    Job Order Contract (JOC): Small public works projects, not exceeding $350,000, may be procured by creating a work order through the City’s job order contractor. The project manager shall be familiar with the terms of the contractor’s price book and must be comfortable negotiating prices. The City’s project manager must ensure that the contractor has identified the correct line items in the price book, and quantities, for the project.

Using the JOC only offers an alternative to the procurement method of a small public works project. Each work order procured through the job order contractor is still bound, but not limited, to the following requirements:

1.     Each work order is subject to approval per the City’s authorization thresholds identified in the Purchasing Matrix and section 6.1 of this policy and procedure.

2.     The job order contractor shall pay prevailing wages, pursuant to RCW 39.12, and section 7.1 of this policy.

3.     The job order contractor shall be subject to all performance and payment bonds, pursuant to RCW 39.08, and section 7.2 of this policy.

4.     Retainage shall be withheld, pursuant to RCW 60.28, and section 7.3 of this policy.

5.     Each work order is still subject to compliance with sections 6.9, 7.4, and 7.5 of this policy.

6.10.7    Telecommunications and Data Processing Equipment and Software: For purchases of telecommunications and data processing equipment, the City may opt to use an RFP process for solicitation. Refer to section 6.6, Evaluation of RFPs and SOQs.

6.11    Purchases with Grant Funds: If the purchase is funded either fully or partially with grant money, the purchasing requirements stipulated in the grant award supersede the City of Renton’s purchasing procedures. Unless the City’s purchasing requirements are more restrictive, in which case the most restrictive requirements must be followed.

6.12    Local Business Preference: City departments shall make their best effort to purchase goods and services from local businesses when price, availability, quality/qualification and responsibility are comparable. This preference is not applicable when prohibited by law, agreement, funding source or when the purchase is made through competitive or cooperative/interlocal purchase agreement in accordance with procedures prescribed herein.

7.0 CONTRACTING REQUIREMENTS

Whenever the City enters into a service agreement (maintenance, professional service, or public work) there are several contracting requirements that must be considered. All contracts should include the total contracted amount, detailed description of work to be done, scope, and time frame requirements. In addition, the Purchasing Matrix in Exhibit B identifies three additional potential requirements: prevailing wage, payment and performance bond, and retainage.

7.1    PREVAILING WAGES: The City is required by RCW 39.12.040 to require contractors to pay prevailing wages on all public works contracts. A “Statement of Intent to Pay Prevailing Wages”, approved by L&I, must be received from a contractor before any payment is made, and an L&I certified “Affidavit of Wages Paid” must be received following final acceptance of the work. Final payment will be withheld on all contracts until the L&I certified Intent and Affidavit forms are received. If retainage is being withheld, final payment will be the retainage release; if no retainage is being withheld, final payment is the final pay estimate.

7.1.1    Alternate Process: RCW 39.12.040 allows for an alternate process to accept combined Intent and Affidavit short forms for contracts with a value under $2,500, when a small works roster is used to solicit quotes. This process allows the contractor to submit both the “Statement of Intent to Pay Prevailing Wages” and “Affidavit of Wages Paid” directly to the City without prior L&I approval or certification. Within 30 days of receiving the contractor’s Affidavit, the City must submit the Affidavit of Wages Paid to L&I for approval. If a small works roster is not used to solicit quotes, this alternate process cannot be used.

For multi-year maintenance contracts; Intents must be filed no less than once in the beginning of the contract period (prior to first payment) and approved affidavits must be filed at least once annually at the end of the year.

7.2    PERFORMANCE AND PAYMENT BONDS: Performance and payment bonds are a required contract component for all public works and maintenance service contracts. Depending on the total cost and the selection process used, the retainage requirements may vary.

Contracts Greater than $35,000: Performance and payment bonds are required for no less than 100% of the contract amount.

Contracts $10,000 - $35,000, using small works roster: Performance and payment bonds may be waived, provided the contract is procured through the small works roster, as described in section 6.2 of this policy.

Contracts $10,000 - $35,000, not using small works roster: If solicitation has not occurred through the small works roster process, Performance and payment bonds are required for no less than 100% of the contract amount. At the option of the contractor, the performance and payment bond may be waived in lieu of 50% retainage.

7.3    RETAINAGE AND CLAIMS AGAINST A CONTRACTOR: Retainage is a required contract component for all public works and maintenance service contracts, except for public improvement contracts involving the construction, alteration, repair, or improvement of any highway, road, or street funded in whole or in part by federal transportation grants. For these contracts, the City shall rely upon the contractor’s performance bond for project completion and fulfillment of claims and liens. For all other contracts, the retainage requirements vary depending on the total cost and selection process used.

    Contracts Greater than $35,000: Per RCW 60.28.11, a 5% retainage will be withheld from all contractor payments for the purpose of fulfillment of claims and liens. In lieu of having retainage withheld, the contractor may submit a bond for all or any portion of the contract retainage in a form acceptable to the public body and from a bonding company meeting standards established by the public body.

Contracts $10,000 - $35,000, using small works roster: Retainage may be waived if the contractor is selected through the small works roster process, as outlined in section 6.2 of this policy.

Contracts $10,000 - $35,000, not using small works roster: A 5% retainage will be withheld from all contractor payments for the purpose of completion of projects and fulfillment of claims and liens. If the contractor has exercised their option to waive performance and payment bond (section 7.2), then 50% retainage will be withheld.

All claims filed against a contractor’s retainage and/or performance bond on a public work project shall be submitted to the City Clerk Division and filed within 45 days of final project closeout. Copies will be forwarded to the project manager, risk manager, and City attorney. The original will be forwarded to the Accounts Payable Division of the Finance Department. The closeout provisions in section 7.5 of this policy must be fulfilled within 60 days of project completion so retainage is ready for release provided the City has received all State releases identified in RCW 60.20.021.

7.4    CHANGE ORDERS AND ADDENDA: A change order, a supplement, an amendment, or an addendum is any alteration to an existing contract or agreement.

Change orders and addenda may occur during a project in progress that is consistent with the initial scope, quantities, specifications, or contracting period upon which the contract was awarded. New bids are not required when unforeseen extra work becomes necessary under a valid preexisting contract. However, when change in scope and purposes deviates substantially from the original plans as to constitute a new undertaking, such change shall be reviewed by the City Attorney in consultation with the contracting department to determine if it constitutes a separate project and requires a new selection and contract process.

When the cumulative value of addenda or change orders exceeds the higher of $100,000 or 10% of the initial contract award amount, that contract will be highlighted on the City Clerk’s quarterly contract report to the City Council as information only. At the Council’s request, further information on specific contract change orders or addenda that exceed the $100,000 or 10% thresholds will be provided by the Department Head or designee.

7.5    PROJECT CLOSEOUT: All public work contracts must be authorized and approved for final completion by the authority that originally approved the contract (i.e. contracts less than $35,000 will require a department head signature for final closeout). For projects requiring Council authorization the project manager will present the final completion to Council for approval.

1.     Once the project has been authorized for final completion, the project manager will issue the Notice of Completion and send to Accounts Payable (A/P). A/P will send the Notice of Completion to Department of Revenue, Department of Labor & Industries, and the Employment Security Department to start the process of retainage release. A/P will also review the project file to ensure that all the affidavits of prevailing wages have been filed by the primary contractor and all the sub-contractors. If there are any outstanding claims against the bond, A/P will contact the project manager to get those claims cleared up prior to release of retainage.

2.     Once A/P receives all notifications of compliance from Department of Revenue, Department of Labor & Industries and the Employment Security Department, and all claims against the bond have been cleared, a final email will be sent to the project manager verifying the job is complete and ready to release the retainage.

Final pay estimates can be paid to the contractor prior to council approval, but retainage will not be released until project closeout is complete and any claims against the retainage have been settled. Full project closeout must be completed within 60 days of project completion, so retainage may be released, provided all state releases identified by RCW 60.28.021 have been received.

8.0 APPROVAL AND EXECUTION OF CONTRACTS AND AGREEMENTS:

8.0    COUNCIL APPROVAL OF CONTRACTS: All contracts and agreements that exceed $100,000 or public works contracts that exceed $150,000 require Council approval prior to execution.

8.1.1    Public Work Contracts: Following bid opening and tabulation, an agenda bill will be prepared by the City Clerk. The project manager shall prepare a memo to the City Council recommending award of the project contract to the lowest, responsible bidder and identifying the funding source. The memo will be submitted to the City Clerk to accompany the agenda bill and the bid tabulation. If all three of the following criteria are met, the project will be placed on the Council’s consent agenda for a recommended action of “Council concur”:

1.     The lowest responsible bid is within the project budget;

2.     More than one bid was received; and

3.     The bids contained no significant irregularities

If one of more of these criteria are not met, the bid award will be referred to the appropriate Council committee for review and recommendation.

All bid packages, including date-stamped envelopes, shall be returned to the City Clerk Division for archiving.

8.1.2    Non-Public Work Contracts: Non-public works contracts $100,000 and over shall be placed on the Council consent agenda with recommended action of referral to the appropriate Council committee, unless the purchase is for routine or reoccurring goods or services, in which case it may be placed on the Council consent agenda with the recommended action of “Council concur.”

If the contract or purchase is through an interlocal agreement that has not been previously approved by the City Council, the interlocal agreement requires adoption of a resolution.

8.2    CHANGE ORDERS AND ADDENDA: Any eligible addenda or change order that either individually or cumulatively have a cost in excess of $100,000 or 10% of the original contract (whichever is greater), shall be highlighted on the City Clerk’s quarterly contract list and placed on the consent agenda with the recommended action of “Council concur” if the following conditions exist:

1.    The cost of the change order or addenda does not exceed the budgeted amount originally approved for the contract, including previously approved addenda;

2.    The line item has been budgeted and does not exceed the budgeted amount;

If one or more of the conditions listed above are not met, a separate consent agenda item the change order or addenda will be referred to the appropriate Council committee for review and recommendation.

Change orders and addendum shall be executed by both parties before the contract period of the performance ends and before the contractor begins work as authorized by the amendment.

8.3    EXCEPTIONS THAT APPLY TO ALL CONTRACTS: In addition to the new contracts, changes orders, and addenda referenced above, the following circumstances also require Council review:

1.    The line item exceeds the amount budgeted or is not budgeted, in which case it will require referral to appropriate Council committee.

2.    The contract or purchase is through an interlocal agreement or grant that has not been approved by the City Council and requires adoption of a resolution.

8.4    EXECUTION OF CONTRACTS

8.4.1    Transmittal and Approvals Required: Transmittal and Approvals Required: All City contracts and contract change orders, amendments, addendum, supplements, regardless of signature authority, will be submitted to the City Clerk Division accompanied by a completed contract checklist form (available through the City Clerk and on the intranet). Staff is responsible for completion and attachment of all applicable requirements as indicated on the contract checklist. Whenever possible, the original contracts should be signed first by the contractor, consultant or governmental agency entering into the contract before being submitted to the City Clerk for execution by the Mayor.

8.4.2    Signing Authority: All contracts $35,000 and over, including amendment shall be approved by the Mayor. The Mayor may delegate the authority to execute contracts and agreements whose value is less than $100,000, or $150,000 for public works contracts to Department Heads. Following execution, the City Clerk Division will return one or more original contracts to the department to transmit to the contractor, consultant or agency. One original contract will be retained by the City Clerk Division.

8.4.3    Indexing and Archiving: All City contracts will be assigned a CAG (Contract Agreement) number, indexed and archived by the City Clerk Division in accordance with the State records retention schedule.

8.5    INFORMATIONAL REPORT

The City Clerk Division shall maintain a contract log and provide Council with quarterly reports on all new contracts executed by the City during the past quarter that are $50,000 or more in value.

EXHIBIT A

Sample of Supplemental Bidder Responsibility Criteria

Supplemental criteria can vary from contract to contract. Project managers should keep in mind that not all criteria are applicable to all projects and some criteria will require customization for a specific project. When developing supplemental criteria the project manager should ensure the criteria are 1) relevant to the specific project, 2) necessary, and 3) clear and specific. General and subjective language should not be used. The following are some examples that are generally relevant to most contracts. More specific criterion may be developed for each contract.

1. Criterion:     The Bidder shall not owe delinquent state taxes to the Washington State Department of Revenue in the past three years.

Documentation: The Bidder shall not be listed on the Washington State Department of Revenue’s “Delinquent Taxpayer List” on State website.

2. Criterion: The Bidder shall not currently be debarred or suspended by the Federal Government.

Documentation: The Bidder shall not be listed as a current debarred or suspended bidder on the U.S. General Administration’s “Excluded Parties List System” on the GA website.

3. Criterion: The Bidder shall not have been convicted of a crime involving bidding on a public works contract within five years from the bid submittal deadline.

Documentation: The Bidder shall sign a statement (on a form to be provided by the City) that the Bidder has not been convicted of a crime involving bidding on a public works contract. The City may also use independent sources of information to demonstrate whether the Bidder is in compliance with the criterion.

4. Criterion: The Bidder shall not have had any public works contract terminated for cause by a government agency during the five year period immediately preceding the bid submittal deadline for this project.

Documentation: The Bidder shall sign a statement (on a form to be provided by the City) that the Bidder has not had any public works contract terminated for cause by a government agency during the five year period immediately preceding the bid submittal deadline for this project. The City may also use independent sources of information to demonstrate whether the Bidder is in compliance with this criterion.

5. Criterion: The Bidder shall not have lawsuits with judgments entered against the Bidder within five years of the bid submittal date.

Documentation: The Bidder shall submit a list of lawsuits with judgments entered against the Bidder within five years of the bid submittal date, along with a written explanation of the circumstances surrounding each such lawsuit.

6. Criterion: The Bidder shall not have a record of prevailing wage complaints filed against it within five years of the bid submittal date that demonstrates a pattern of failing to pay workers prevailing wages.

Documentation: The Bidder shall submit a list of prevailing wage complaints filed against it within five years of the bid submittal date. The City may also evaluate complaints filed within the time period specified that were not reported by the Bidder.


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1. WAC 296-127-010(7)(b) lists situations under which prevailing wages do not have to be paid. The phrase "not performed by public contract" must be in the definition of "ordinary maintenance," when prevailing wages are at issue because cities must pay prevailing wages when contracting for services as opposed to using City force. City of Spokane v. Department of Labor and Industries.