Chapter 3.16
PURCHASING AND PURCHASING CONTRACTS

Sections:

3.16.010    Purpose.

3.16.020    Limitations.

3.16.030    General procedural requirements.

3.16.040    Definitions.

3.16.045    Contractors list.

3.16.050    City manager authority.

3.16.060    City manager delegation of purchasing authority.

3.16.070    Informal purchases – Purchases under five thousand dollars.

3.16.075    Open market purchases – Purchases between five thousand dollars and twenty-five thousand dollars.

3.16.080    Formal purchases – General services, supplies, and equipment greater than twenty-five thousand dollars.

*    Prior ordinance history: Ords. 120 and 425.

3.16.010 Purpose.

The purpose of this chapter is to:

A. Provide for the authority of city officers to enter into certain contracts even without a formal city council approval of the specific contract or transaction and to set forth procedural requirements; and

B. Establish efficient procedures for the purchase of supplies, equipment and general services at the lowest possible cost commensurate with quality needed, to exercise positive financial control over purchases to clearly define authority for the purchasing function, and to assure the quality of purchases; and

C. To inform those wishing to contract with the city of the authority of the city employee or official to create a binding contract; and

D. To assist the city treasurer in carrying out his or her duties under Government Code Section 41001. (Ord. 972 § 1, 2012; Ord. 832, 2001)

3.16.020 Limitations.

The authority created by this chapter applies only to contracts, the predominant purchase of which is the purchase by the city of goods or services; and the city’s primary performance under such contract is the payment of money. This chapter does not confer authority to authorize the payment of money for grants, gifts, or other expenditure that is without consideration.

Authority conferred in this chapter upon the city manager applies to situations in which an interim city manager is serving or in situations in which the city manager has appointed an acting city manager. (Ord. 972 § 1, 2012; Ord. 832, 2001)

3.16.030 General procedural requirements.

All contracts must be in writing and be signed in the name of the city. They may be transmitted by facsimile or electronic mail. (Ord. 972 § 1, 2012; Ord. 832, 2001)

3.16.040 Definitions.

For the purposes of this chapter, the following definitions shall apply:

A. “Best value” means the best value to the city based on all factors, including, but not limited to, the following:

1. Cost;

2. The ability, capacity, and skill of the contractor to perform the contract or provide the supplies, services or equipment required;

3. The ability of the contractor to provide the supplies, services, or equipment promptly or within the time specified without delay or interference;

4. The character, integrity, reputation, judgment, experience, and efficiency of the contractor;

5. The quality of the contractor’s performance on previous purchases or contracts with the city;

6. The ability of the contractor to provide future maintenance, repair, parts, and services for the use of the supplies purchased;

7. The contractor’s ability to supply or act in a timely manner;

8. Compliance by the contractor with federal acts, executive orders, and state statutes governing nondiscrimination in employment;

9. The results of any evaluation relating performance and price, such as testing, life-cycle costing, and analysis of service, maintenance, and technical data.

B. “Change order” means a change or addendum of an executed contract.

C. “Consultant or professional services” means the services of an attorney, engineer, doctor, financial consultant, planning or environmental consultant, investment advisor, bank or trustee officer, or other professional.

D. “Contract” means any agreement to do or not do a certain thing. “Contract” and “agreement” are synonymous. The term “contract” includes, but is not limited to, a purchase order, a contract for services, an addendum or change order or a letter agreement.

E. “Emergency” means a sudden, unexpected occurrence that poses a clear and imminent danger, requiring immediate action to prevent or mitigate the loss or impairment of life, health, property, or essential public services, or proclaimed pursuant to Section 8.08.060.

F. “General services” means and includes any work performed or services rendered by an independent contractor, with or without the furnishing of materials, including, but not limited to, the following:

1. Maintenance work as defined in Section 22002(d) of the Public Contract Code.

a. Routine, recurring, and usual work for the preservation or protection of any publicly owned or publicly operated facility for its intended purposes,

b. Minor repainting,

c. Resurfacing of streets and highways at less than one inch,

d. Landscape maintenance, including mowing, watering, trimming, pruning, planting, replacement of plants, and servicing of irrigation and sprinklers systems,

e. Work performed to keep, operate, and maintain publicly owned water, power, or waste disposal systems, including, but not limited to, dams, reservoirs, power plants, and electrical transmission lines of two hundred thirty thousand volts and higher;

2. Repair, modifications and maintenance of city equipment and software;

3. Cleaning, analysis, testing, moving, removal or disposal (other than by sale) of city supplies and equipment;

4. Providing temporary personnel services;

5. Providing other miscellaneous services to facilitate city operations;

6. Performing repair, demolition or other work required to abate nuisances under this code;

7. Licensing software;

8. Leasing or rental of equipment (personal property) for use by the city;

9. A maintenance agreement for equipment owned or leased by the city.

“General services” does not include:

a. Work defined as public projects that must be put out to bid pursuant to Public Contract Code Section 22002(c);

b. Items such as meals or transportation, which personally are consumed or utilized by the individual who contracts for the item.

G. “Public project” is defined by Section 22002(c) of the Public Contract Code as construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operating facility. It also includes painting or repainting of any publicly owned, leased, or operated facility. Section 20002(d) does not include maintenance work included in subsection (F)(1).

H. “Supplies and equipment” means and includes all such items purchased on behalf of the city except for supplies or materials finished for a public project. (Ord. 972 § 1, 2012; Ord. 832, 2001)

3.16.045 Contractors list.

A list of contractors shall be developed and maintained in accordance with the provisions of Section 22034 of the Public Contract Code. (Ord. 972 § 1, 2012)

3.16.050 City manager authority.

A. The city manager is authorized to enter into and sign for and on behalf of the city, without the prior approval of the city council, a contract:

1. Which contains an initial maximum compensation figure of twenty-five thousand dollars or less, or a change order not exceeding seven thousand five hundred dollars. (Cumulative additional orders exceeding twenty-five thousand dollars must be approved by the city council);

2. Contracts for single capital equipment purchases that do not exceed fifty thousand dollars; which are clearly defined and identified in the budget;

3. For which moneys have been appropriated; and

4. For which he or she determines the city has made reasonable efforts to obtain best value.

B. In an emergency (as defined in Section 3.16.040), the city manager may authorize the expenditure of any unencumbered moneys in the emergency reserve fund, notwithstanding the fact that such moneys may not have been appropriated for such purpose, to the extent that other moneys have not been appropriated or are otherwise unavailable therefor.

C. Contracts wherein all the city’s costs will be reimbursed pursuant to an existing separate contract. (Ord. 972 § 1, 2012; Ord. 832, 2001)

3.16.060 City manager delegation of purchasing authority.

Providing the city manager first establishes written procedures, the city manager may delegate the purchasing authority for other city employees to enter into contracts for purchases of general services or supplies and equipment for twenty-five thousand dollars or less. (Ord. 972 § 1, 2012; Ord. 832, 2001)

3.16.070 Informal purchases – Purchases under five thousand dollars.

Purchases under five thousand dollars may be made by persons authorized by Section 3.16.060 in the open market. There are no specific bidding requirements for these purchases; however competitive bidding should be used whenever practical. Quotations for these purchases may be written or verbal. All purchases subject to this section will be awarded by the department either by voucher or purchase order. (Ord. 972 § 1, 2012; Ord. 832, 2001)

3.16.075 Open market purchases – Purchases between five thousand dollars and twenty-five thousand dollars.

The purchase of supplies, equipment and general services of a value from five thousand dollars to twenty-five thousand dollars may be made by persons authorized by Section 3.16.060 in the open market, following the procedure prescribed in this section and the city manager’s procedures.

A. Invitation for Bids.

1. Supplies, Equipment, and General Services Between Five Thousand Dollars and Twenty-Five Thousand Dollars. Open-market purchases shall, whenever feasible, be based on at least three quotations. The purchasing employee shall solicit quotations by written request or telephone to prospective vendors. Telephone quotations shall be memorialized in a contemporaneous writing.

2. Public Projects Between Five Thousand Dollars and Twenty-Five Thousand Dollars. Notices inviting bids for public projects between five thousand dollars and twenty-five thousand dollars, shall be mailed to list of qualified contractors, identified according to categories of work, at least ten calendar days before the bids are due. Notices shall also be mailed within ten calendar days before the bids are due to all construction trade journals as required by the commission. If the city does not have a qualified list of contractors for the particular type of work to be performed, notices inviting bids will only be sent to the construction trade journals as required by the commission. If the product or service is proprietary in nature and can only be obtained from a certain contractor or contractors, notices inviting bids will only be mailed to such contractor or contractors.

3. Exceptions. The quotation procedure under this section may be dispensed with for purchases between five thousand dollars and twenty-five thousand dollars where supplies and equipment are purchased through cooperative purchasing arrangements with the state or other group of multiple governmental entities.

B. Bids – Retention. Quotations shall be submitted to the finance director who shall keep a record of all open-market orders and quotes for a period of one year after the submission of quotes or placing of orders. This record is open to public inspection. For a purchase in an amount between five thousand dollars and twenty-five thousand dollars, the quotations shall be written (including facsimile and electronic mail).

C. Rejection. The purchasing authority may reject:

1. Any quotations which fail to meet the specific purchase requirements in any respect; or

2. All quotations, for any reason whatsoever, and may invite new quotations.

D. Award of Contract. A contract shall be awarded to the quotation representing the best value as defined in Section 3.16.040. The basis upon which the award is made shall be in writing.

E. Public Projects – In Excess of Limit. In the event that all bids received for a construction project are more than the maximum allowed under this section, and bids were invited pursuant to the provisions of this section, the council may, by adoption of a resolution by four-fifths of a vote, award the contract, in an amount not to exceed the maximum set forth in Section 22034(f) of the Public Contract Code, to the lowest responsible bidder, if it determines that the cost estimate was reasonable. Otherwise, the bids shall be rejected; and if the agency decides to go forward with the project, shall be re-bid in accordance with the procedures set forth in Section 3.16.080. (Ord. 972 § 1, 2012)

3.16.080 Formal purchases – General services, supplies, and equipment greater than twenty-five thousand dollars.

A. Notice inviting bids shall include, but not be limited to, the following:

1. A general description of the item(s) or services to be purchased, or the public work to be constructed or improved;

2. The location where bid blanks and specifications may be secured;

3. The time and place assigned for the opening of sealed bids;

4. The type and character of bidder’s security required, if any;

5. The location and deadline for submission of bid.

B. Notices inviting bids shall be made as follows:

1. For supplies, general services, and equipment, notices inviting bids shall be published at least once in the official newspaper of the city, with the first publication occurring at least ten calendar days before the date of opening the bids.

2. For public projects greater than twenty-five thousand dollars, notices inviting bids distinctly describing the project shall be published at least once in the official newspaper of the city, with the first publication at least fourteen calendar days before the date of the opening bids. Notices inviting bids distinctly describing the project shall also be mailed at least thirty calendar days before the date of opening bids to all construction journals as required by the commission.

3. The city may also give such other notice as it deems appropriate.

C. Bids – Security Requirement. Bidder’s security may be required when deemed necessary by the purchasing authority. When required, the security form, amount and conditions, will be included in the bid documents. Bidders shall be entitled to return of bid security. However, a successful bidder shall forfeit his or her bid security upon refusal or failure to execute a contract within fifteen days after notice of award of that contract, unless the city is responsible for the delay. The contract may be awarded to the next lowest responsible bidder upon the refusal or failure of the successful bidder to execute the contract within the time herein prescribed.

D. Bids – Opening and Retention. Sealed bids shall be submitted to the purchasing authority and shall be identified as bids on the envelope. Bids shall be opened in public and read aloud at the time and place stated in the public notice. A tabulation of all bids received shall be available for public inspection during regular business hours for a period not less than thirty calendar days after the bid opening.

E. Rejection of Bids. The purchasing authority may reject:

1. Any bid that fails to meet the bidding requirements in any respect; or

2. All bids, for any reason whatsoever, and may readvertise for new bids or abandon the purchase;

3. In the case of public projects, the council may, by passage of a resolution by a four-fifths vote, declare that the project can be performed more economically by employees of the city and may have the project done by force account.

F. Bids – None Received. If no bids are received the purchase may be made through negotiated contract or other process approved by the finance director, including, in the case of public projects, performing the work by employees of the city by force account.

G. Contract Award. Subject to the approval of the city manager, contracts shall be awarded by the purchasing authority to the bid which represents the best value to the city as defined in Section 3.16.040, except as follows:

1. If at the time of bid opening, two or more bids received are for the same total amount or unit price, quality and service being equal, and if the discretion of the purchasing authority the public interest will not permit the delay of readvertising for bids, then the purchasing authority may accept the one he or she chooses or the lowest bid obtained through subsequent negotiation with tied bidders.

2. Sellers, vendors, suppliers and contractors who maintain places of business located within the limit of the city shall be given preference, if quality, price, service, and all other factors are equal.

The basis upon which the award is made shall be in writing.

H. Requiring Bond of Successful Bidder. The purchasing authority may require as a condition to executing a contract on behalf of the city, a performance bond or a labor and material bond, or both, in such amounts as the purchasing authority shall determine appropriate to protect the best interests of the city. The form and amounts of such bond(s) shall be described in the notice inviting bids.

I. Insurance. Insurance requirements will be provided via purchase order terms and conditions, or request for proposal terms and conditions information, or city contract. (Ord. 972 § 1, 2012)