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HomeMy WebLinkAboutOrd 1998-2766ORDINANCE NO.2766 AN ORDINANCE OF THE CITY OF CHULA VISTA AMENDING CHAPTER 2.56 OF THE CHULA VISTA MUNICIPAL CODE TO UPDATE THE CITY PURCHASING SYSTEM The City Council of the City of Chula Vista does hereby ordain as follows: SECTION h That Chapter 2.56 of the Chula Vista Municipal code is hereby amended to read, in its entirety, as follows: Chapter 2.56 PURCHASING SYSTEM Sections: 2.56.010 2.56.020 2.56.030 2.56.040 2.56.050 2.56.060 2.56.070 2.56.080 2.56.090 2.56.100 2.56.110 2.56.120 2.56.130 2.56.140 2.56.150 Centralized Purchasing System Established. Purchasing Agent - Appointment - Powers, Duties, and Authority. Option to Delegate Authority for Purchases of Supplies and Equipment. Requisitions or Estimates; Required Revisory Changes Permitted. Required Contract Forms; City Attorney. Budget, Availability of Funds Required. Formal contract and bid procedure - Contracts Exceeding $100,000. Contracts Exceeding $100,000 - Notice inviting bids. Open market procedure - Contracts of $100,000 or less. Emergency Purchases. Exception Selection Process for architectural, engineering, environmental, land surveying, legal, construction project management, and other professional services. Supplies, materials, and equipment no longer used - Disposition procedure. Sale of Real Property - Procedure. Cooperative purchasing agreements permitted when. Reports to City Council. 2.56.010 Centralized Purchasing System Established. Pursuant to Section 1010 of the City Charter, there is established a centralized purchasing system for City departments, offices, and agencies, in order to (1) establish procedures for the purchase of services, supplies and equipment, at the lowest possible cost commensurate with quality needed, (2) exercise positive financial control over purchases, (3) cleariy define authority for the purchasing function, and (4) to assure the quality of purchases. 2.56.020 Purchasing Agent - Appointment - Powers, Duties, and Authority. The Director of Finance shall appoint, in accordance with Section 507 of the Charter, a Purchasing Agent, who shall be in the unclassified service as provided in Section 500 of the City Charter, and such deputies as may be necessary. The Purchasing Agent shall be the head of the Purchasing Division of the Finance Department and shall conduct a centralized purchasing system. The Purchasing Agent shall have the power, and it shall be his or her Ordinance 2766 Page 2 duty, to purchase or contract for all supplies, equipment, and services needed by any and all departments, offices, and agencies of the City subject to the terms and conditions provided for in this chapter. The Purchasing Agent shall have the authority to: Negotiate, purchase, and obtain supplies, equipment, and contractual services used by the City in accordance with City and state law, and such rules and regulations as are prescribed by the Director of Finance subject to the review of the City Manager or by the City Council; Act to procure for the City the needed quality in supplies, equipment, and contractual services, at least expense to the City; Endeavor to obtain as full and open competition as possible on all purchases and sales; Prepare and recommend to the Director of Finance rules, regulations and procedures governing the purchase of supplies, equipment, and services for the City and amendments thereto as necessary; Keep informed of current developments in the field of purchasing, prices, market conditions, and new products, and secure for the City the benefits of research done in the field of purchasing by other governmental jurisdictions, national technical societies, trade associations having national recognition, and by private businesses and organizations; Prescribe and maintain such standardized contracts, subject to the approval of the City Attorney, and other rules and regulations as are reasonably necessary for the operation of the purchasing system; Prepare and adopt a standard purchasing nomenclature for City departments and suppliers; Prepare, adopt, and maintain a vendor file. Said file shall be organized according to commodity and shall contain vendor addresses and descriptions of vendor goods and services; Exploit the possibilities of buying "in bulk" so as to take full advantage of discounts, and establish written policies for inventory management in size of purchases; Recommend the transfer of surplus or unused supplies and equipment between departments as needed and the sale of all supplies and equipment which cannot be used by any department or which have become unsuitable for City use and the scrapping or surveying of unsalable surplus items, Take such other actions, consistent with the provisions of this chapter, all other applicable laws, and current good purchasing practices, that are reasonable and appropriate to effectively operate the City's centralized purchasing system. Ordinance 2766 Page 3 Control and supervise all existing and future storerooms and warehouses of regularly purchased City supplies and equipment. 2.56.030 Option to Delegate Authority for Purchases of Supplies and Equipment. The Purchasing Agent may authorize a department, office, or City agency to purchase supplies, services and equipment directly when he or she determines that direct purchasing can improve efficiency and/or reduce costs and is in the best overall interests of the City. All direct purchasing authorized by the Purchasing Agent under this Section shall be carried out in compliance with the procedures established by this chapter and on such forms or through such purchasing mechanisms as shall be determined by the Purchasing Agent. Direct purchases may be effected through the use of procurement cards or other similar mechanisms. 2.56.040 Requisitions or Estimates; Required Revisory Changes Permitted. All City departments and offices shall file with the Purchasing Agent detailed requisitions or written estimates of their requirements for supplies, equipment, and services, in such manner, and at such times, as the Purchasing Agent shall prescribe. The Purchasing Agent shall examine each requisition or estimate and shall have the authority to revise it as to quantity, quality, or estimated cost; provided, however, that a change in quality will not vary substantially from the standards of the using department or office; and provided further, that the using department head, or designee, is first consulted. 2.56.050 Required Contract Forms; City Attorney. All purchase orders and contracts for purchase of supplies, equipment or services shall be on forms prescribed or approved by the Purchasing Agent and City Attorney. 2.56,060 Budget, Availability of Funds Required. For all purchases or contracts for services, the Purchasing Agent shall certify that (a) the required purchase price or compensation is provided for in the budget of the using department or has been approved by the City Council by resolution; and (b) there is to the credit of each using department concerned a sufficient and appropriate unencumbered balance in excess of all unpaid obligations to defray the cost of such purchase or contract. 2,56.070 Contracts Exceeding $100,000 - Formal Competitive bid procedure and City Council approval required. A. In General. Except as provided below, all supplies, equipment, and services, when the estimated cost thereof shall exceed one hundred thousand dollars ($100,000), shall be awarded by the City Council to the lowest responsive and responsible bidder submitting the best bid in accordance with the competitive bidding process set forth in Section 2.56.080 of this Chapter, below. B. Exceptions. The following purchases shall be exempt from these requirements: Ordinance 2766 Page 4 1. Public Works Contracts for those public works, materials and services that are governed by the purchasing requirements of Section 1009 of the Charter. 2. Professional Services Contracts for certain professional services that are governed by Section 2.56.110 of this chapter. 3. City Council Waiver Contracts for which it is determined by resolution of the City Council, that the competitive bidding requirements as applied to that contract are impractical, impossible or that City interests would be materially better served by applying a different purchasing procedure approved by the Purchasing Agent as being consistent with good purchasing practices. 4. Sinqle/Sole Source A cornmodity or service available froin only one known source as the result of unique performance capabilities, manufacturing processes, compatibility requirements or market conditions. 5. Emerqencv Emergency purchases which shall be governed by Section 2.56.100 of this chapter. 2.56.080 Contracts Exceeding $100,000 - Competitive Bidding Process. For non-exempt contracts for supplies, equipment and services valued in excess of $100,000, the following competitive bidding and award process shall be followed: A. Notice Invitinq Bids. When required, notices inviting bids shall include a general description of the article or service, and shall be published by the Purchasing Agent at least once in a newspaper of general circulation in the City at least ten days prior to the bid opening date. In the event a newspaper of general circulation within the City is unable to publish such notice for any reason, the Purchasing Agent shall post such notice in at least three public places in the City designated as places for posting public notices. B. Bidder's List. The Purchasing Agent shall also solicit sealed bids from responsible prospective suppliers who have requested that their names be added to a "bidder's list," which the Purchasing Agent shall maintain, by sending them a copy of such newspaper notice or such other notice as will acquaint them with the proposed Ordinance 2766 Page 5 purchase or sale. In any case, invitations sent to the vendors on the bidder's list shall be limited to commodities that are similar in character and ordinarily handled by the trade group to which the invitations are sent. Bidder's security. The Purchasing Agent may require a bidders' security in an amount equal to ten percent of the bid either in cash, certified or cashier's check, or surety bond approved by the City Attorney and the Risk Manager. In the event a bidder's security is required, no bid shall be considered unless the required security is submitted therewith. All bidder's security is refundable, except in the case of a successful bidder who shall forfeit this security if the bidder fails to execute a contract within ten days after the notice of award has been mailed or personally delivered, or otherwise fails to comply with the requirements to complete the transaction. Bid oDeninQ. Sealed bids shall be submitted to the Purchasing Agent, who shall open them in public at the time and place stated in the public notices. A tabulation of all bids received shall be available for public inspection in the office of the Purchasing Agent for a period of not less than thirty calendar days after the bid opening. The Purchasing Agent may delegate this responsibility hereunder to responsible assistants and deputies. Compilation of bids and recommendations. Following the opening of formal bids, the Purchasing Agent shall compile all of the bids and submit them to the requesting department head, together with a recommendation as to which bid he or she considers best, taking into consideration, the amount of money bid, compliance with specifications, and responsiveness and responsibility of the bidder. The responsiveness of the bidder shall be determined by comparing the bid to the bid specifications. In determining the responsibility of the bidder, the Purchasing Agent will be guided by, but not limited to, a consideration of the following factors: 1. The experience of the City in dealing with the low bidder; The experience of other governmental agencies known to the Purchasing Agent in their previous transactions with the low bidder; Knowledge of the quality and fitness of the product offered by the low bidder, substantiated by reports of using departments within the City or other governmental agencies; Options to renew contracts for continuing purchases at the same bid price or with reasonable fixed or capped increases, in those circumstances where price increases are expected or have been experienced in the past; Ordinance 2766 Page 6 2.56.090 5. Financial stability and business standing of the low bidder. The requesting department head shall forward the compilation of bids and his or her recommendation with respect to an award to the City Manager, who in turn, will forward a recommendation for award to the City Council. The Purchasing Agent may reject any or all bids, or any one or more commodities or contractual services included in the proposed contract if it is determined that the public interest will be served thereby. Contract awardinQ authority. The City Council may make an award of contract to the lowest responsive and responsible bidder submitting the best bid in all respects. Rejection of bids; Alternative Procedures. The City Council may reject any or all bids, direct City forces to provide the required commodity or service, authorize the readvertising of bids, or authorize the purchase of supplies or services pursuant to the open market procedure set forth in Code Section 2.56.090. Tie bids. In accordance with Section 1011 of the Charter, in the event two or more bids are received which are for the same total amount or unit price and in all other respects are equal, the contract shall be awarded to a local bidder. In the event, however, that such tie bids are all from vendors either wholly inside or all outside of the City, then the contract shall be awarded by drawing lots in public. Performance bond. The Purchasing Agent shall have authority to require a performance bond in such amount as he or she shall find reasonably necessary to protect the best interests of the City. Contracts of $100,000 or Less - Open market procedure and Purchasing Agent/City Manager Approval Required. In General. Purchases of supplies, equipment, and services of an estimated value in the amount of one hundred thousand dollars ($100,000) or less may be made by the Purchasing Agent in the open market without observing the formal bidding procedure prescribed in Section 2.56,080; provided, however, purchases between $50,000 and $100,000 shall also require City Manager approval. Notwithstanding the foregoing, informal bidding shall be required, and, whenever practical, be based on at least three bids. Contracts shall be awarded to the lowest responsive and responsible bidder submitting the best bid in all respects. Responsiveness and responsibility shall be determined pursuant to the standards set forth in Section 2.56.080.E. of this chapter. The Purchasing Agent shall keep a record of all open market orders and the bids Ordinance 2766 Page 7 2.56.100 A. submitted in competition thereon, and such records shall also be open to public inspection. Exceptions: The following purchases shall be exempt from these requirements:: 1. Less Than $10,000 Contracts for a commodity or service costing less than ten thousand dollars ($10,000), in which case the contract may be awarded by the Purchasing Agent based upon suitability of the item and market rates in the case of a commodity, and demonstrated competence at reasonable fees in the case of services; 2. Impractical or Impossible When it is determined by the Purchasing Agent that it would be impractical or impossible to obtain competitive bids on the open market; 3. Certain Section 2.56.070 Exemptions Those purchases exempted under Section 2.56.070.B. 1,2, 4 and 5 of this chapter; Emergency purchases. By Purchasinq Aqent permitted when. In case of an emergency which poses an immediate threat to public health, safety or welfare and which requires immediate purchase of supplies, equipment, or contractual services, the City Manager or Purchasing Agent are authorized to secure in the open market at the lowest obtainable price any supplies, equipment, or contractual services, regardless of the amount of the expenditure; provided however, that a full explanation of the circumstances of such emergency shall be entered in the minutes of the Council at the first available meeting following the commitment to the expenditure and shall be open to public inspection. By usinq department - Procedure. In case of an emergency, and with the prior consent of the City Manager or Purchasing Agent, any using department may purchase directly any supplies, equipment, or services when the estimated cost thereof shall not exceed one hundred thousand dollars, whose immediate procurement is essential to prevent delays in the work of the using department which may affect the life, health, or public safety of citizens. The head of such using department shall send to the Purchasing Agent a copy of the delivery record, together with a full written explanation of the circumstances of the emergency, which shall be filed by the Purchasing Agent as a permanent and public record of the purchase. The Purchasing Agent shall, by rules and regulations, prescribe the procedures under which such emergency purchases may be made. Ordinance 2766 Page 8 2.56.110 By Director of Civil Defense and Disaster. Nothing herein contained shall limit the authority of the City Director of Civil Defense and Disaster to make emergency purchases and take such other emergency steps as are or may be authorized by resolution of the City Council. Exception - Selection Process for architectural, engineering, environmental, land surveying, legal, construction project management, and other professional services. General. Pursuant to Government Code Sections 4525, et. seq. with regard to architectural, engineering, environmental, land surveying, legal services, construction project management services, and professional consultant services; all services provided to the City by contract shall not be governed by the bidding requirements set forth in Sections 2.56.080 or 2.56.090, but shall be negotiated on the basis of demonstrated competence and qualifications for the services required and at fair and reasonable fees in accordance with the procedures set forth in this Section. Notwithstanding the foregoing, once demonstrated competence and qualifications have been established, expense may be considered as one factor in the selection of a consultant hereunder. Notwithstanding the above requirement, the Purchasing Agent may require competitive bidding pursuant to the requirements of Sections 2.56.080 or 2.56.090 of this chapter, upon a finding that the professional services required are of more of a technical nature or involve little professional judgment, and requiring bids would be in the public interest. If the estimated cost of professional services exceeds fifty thousand thousand dollars ($50,000), it shall be awarded by the City Council after compliance with the procedures specified in Subsection C., below. Contracts for services for fifty thousand dollars or less may be awarded pursuant to Subsection D., below. Definitions. For purposes of this chapter, the following terms have the following meanings: "Architectural, engineering, environmental, and land surveying services" includes those professional services of an architectural, engineering, environmental, or land surveying nature as well as incidental services that members of these professions and those in their employ may logically or justifiably perform. "Construction project management" means those services provided by a licensed architect, registered engineer, or licensed general contractor which meet the requirements of Government Code Section 4529.5 for management and supervision of work performed on construction projects. Ordinance 2766 Page 9 "Environmental services" means those services performed in connection with project development and permit processing in order to comply with federal and state environmental impact laws and the analysis of hazardous material. "Legal services" are those of a specialized legal nature as determined by the City Attorney. "Professional services" include services which provide intellectual products of a specialized nature unique to a given situation or requirement. Selection Process for Contracts of Greater than $50,000. Any department head desiring to enter into a contract for outside professional consultant services whose estimated cost exceeds fifty thousand dollars shall first analyze the cost effectiveness of having the proposed service completed in-house versus the cost for outside services. Public announcement of all projects of an estimated cost in excess of fifty thousand dollars ($50,000) requiring architectural, engineering, environmental, land surveying, legal services, construction project management, or other professional consultant services shall be made by the City through notice to the respective professional societies or by publication in a newspaper of general circulation. The notice shall invite service providers to submit letters of interest for specific projects. The recommendation to City Council for the award of the contract shall be made by a selection committee. The responsible department head, or designee, and two or more staff members shall perform the duties of the selection committee. After reviewing all proposals submitted, the selection committee may choose the most qualified firms for personal interviews to discuss anticipated concepts and the relative utility of alternative methods of approach for furnishing the required services. The selection committee shall evaluate and rank the firms based upon criteria established in advance by the City. Cost comparisons between service providers may also be considered as a factor. A list containing the ranking information will be sent to the responsible department head. The responsible department head shall negotiate a contract with the firm ranked No. 1 by the selection committee at a price determined to be fair and reasonable to the City. The agreement shall define the conditions of the contract scope, work plan, schedule, costs, method of payment, duration, insurance, indemnification and other appropriate matters. If the department head is unable to negotiate a satisfactory contract with the first ranked firm, negotiations shall be formally terminated. The department head shall then undertake negotiations with the second ranked firm. This process shall continue until a satisfactory contract is negotiated. Ordinance 2766 Page 10 2.56.120 A. If the list of qualified firms is exhausted without a contract being negotiated, the selection committee shall choose additional firms, and the process shall continue until a satisfactory contract is negotiated. Selection Process for Contracts of $50,000 or Less. Purchases of professional services of an estimated value of $50,000 or less may be made by the Purchasing Agent. Informal solicitation of proposals shall be required in accordance with the same standards and exceptions set forth in Section 2.56.090 of this chapter. Contracts may be made using pre- qualification lists maintained by the Purchasing Agent. The Purchasing Agent shall review types of services required and determine for which types of services pre-qualification lists would be appropriate. Unlawful Acts and Conflicts of Interest Prohibited. In the selection and award of professional consultant contracts pursuant to this exception, all unlawful activity, including but not limited to, rebates, kickbacks, or other unlawful consideration is prohibited. No City officer or employee shall be a member of a selection committee, or otherwise participate in the selection process, when they have a relationship with a person or business entity seeking a contract which would constitute a conflict of interest under Government Code Section 87100 or under City conflict of interest rules. Supplies, materials, and equipment no longer used - Disposition procedure. General Procedures. All using departments shall submit to the Purchasing Agent at such times and in such form as he or she shall prescribe, reports showing stocks of all supplies, materials, and equipment which are no longer used or which have become obsolete, worn out, or scrapped. The Purchasing Agent may transfer such stock to other departments, which have need for and can use it. The Purchasing Agent, shall also have the power to sell all supplies, materials, and equipment which have been unsuitable for public use, or to exchange for, or trade in the same on new supplies, materials, and equipment. Approval ReQuired; Competitive Process. Where the value of an item, or a group of items expected to be sold to one bidder, exceeds $100,000, such sale must be approved by resolution of the City Council. Any such sale, exchange, or trade-in shall be made to the highest responsive and responsible bidder, in accordance with the competitive bid procedures established by the Purchasing Agent. Donations. Supplies, materials, and equipment when the estimated value involved is ten thousand dollars ($10,000) or less may be donated, or sold for less than fair market value, to local civic or social organizations, where it is deemed by the City Manager that such a disposition of property would best Ordinance 2766 Page 11 serve the City's public interests. Such donations or discounted sale of items valued in excess of $10,000 must be approved by resolution of the City Council. Worthless Property. In the case of scrap or survey items having no estimated or appraised value and which have not been desired by any civic or social organization, the Purchasing Agent may dispose of such items in any manner he or she deems appropriate, keeping full records of such disposition. Special Procedures for Disposition of Library Materials. The City Librarian shall submit to the Purchasing Agent reports showing used, damaged, or unneeded library materials and indicating disposition thereof. The Librarian may, at his or her discretion, donate such materials to the Friends of the Chula Vista Public Library for such book sales as they may desire, or he or she may offer such materials to any bona fide charitable or nonprofit institutional organizations serving primarily the interests of the City. If at any time the Librarian chooses to dispose of such materials other than as provided herein, he or she shall follow the general procedures set forth hereinabove. 2.56.130 Sale of Real Property - Procedure. The Purchasing Agent, with the recommendation of the City Manager and approval of the City Council shall have the power to sell for fair value any real property owned by the City which has been declared by the City Council to have no present or future use for public purposes. Notice of such sale shall be published at least once in a newspaper of general circulation in the City. Real property maybe sold for less than fair market value upon a determination by the City Council that such sale will be in the public interest. 2.56.140 Cooperative purchasing agreements permitted when. No provision of this chapter shall be interpreted or construed to prohibit or prevent the City from purchasing supplies, equipment, and services by contracts, arrangements, and agreements for cooperative purchasing programs with the State of California, the County of San Diego, the City of San Diego, or any other public agency, school district, or water authority within the State of California; provided that such items are purchased through a competitive process that the Purchasing Agent determines to be consistent with good purchasing practices. If the contract, agreement, or arrangement exceeds one hundred thousand dollars, then City Council approval is required. 2.56.150 Reports to City Council. The Director of Finance shall provide the City Council with reports regarding City purchasing practices in such form and at such intervals as the City Council may direct. SECTION Ih This ordinance shall take effect and be in full force on the thirtieth day from and after its second reading and adoption. Ordinance 2766 Page 12 Presented by Robert W. Powell Finance Director Approved as to form by Ordinance 2766 Page 13 PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista, California, this 8th day of December, 1998, by the following vote: AYES: Councilmembers: Davis, Moot, Padilia, Salas and Horton NAYS: Councilmembers: None ABSENT: Councilmembers: None ABSTAIN: Councilmembers: None ATTEST: Beverly~A Authelet, City Clerk STATE OF CALIFORNIA ) COUNTY OF SAN DIEGO ) CITY OF CHULA VISTA ) I, Beverly A. Authelet, City Clerk of Chula Vista, California, do hereby certify that the foregoing Ordinance No. 2766 had its first reading at a regular meeting held on the 24th day of November, 1998 and its second reading and adoption at a regular meeting of said City Council held on the 8th day of December, 1998. Executed this 8th day of December, 1998. Beverly A~tAuthelet, City Clerk