Chapter 3.12
CONTRACT, PURCHASE, AND SALE PROCEDURES
Sections
3.12.010 Contract, purchase, sale, and transfer procedure
3.12.020 Limitation on city manager’s authority
3.12.030 Open market procedures
3.12.055 Prebid and preaward conferences
3.12.070 Exceptions to bidding requirements
3.12.080 Lowest responsible bidder
3.12.085 Labor requirements—public improvement projects
3.12.090 Purchase, contract, or sale valid when—prohibited when
3.12.100 Purchase of heavy equipment
For statutory provisions regarding procurement preference for state agricultural and fishing products, see AS 29.71.040; for recycled Alaska products, see AS 29.71.050.
3.12.010 Contract, purchase, sale, and transfer procedure
The city manager shall:
(a) Contract for, purchase, or issue purchase authorizations for all supplies, materials, equipment, and services for the offices, departments, and agencies of the city;
(b) Sell surplus, obsolete, or unusable personal property for the offices, departments, and agencies of the city;
(c) Transfer supplies, materials, and equipment to or between the offices, departments, and agencies of the city; and
(d) Contract for the construction, repair, or improvement of city facilities. [Ord. 479 §1, 1976]
3.12.020 Limitation on city manager’s authority
(a) The city manager may make an acquisition, sale, transfer, or contract authorized by KCC 3.12.010 without council approval, open market, or bidding procedures, if the value of the property, service, or contract does not exceed $50,000 and the contract, purchase, or sale is not subject to the requirements of City Charter Section V-17.
(b) The manager may delegate contracting authority provided by KCC 3.12.010(a) and (d) to the director of a city department or agency or to the city clerk for any contract or purchase that does not exceed $20,000. [Ord. 1440 §2, 2023; Ord. 1360 §1, 2016; Ord. 1106 §1, 2000; Ord. 944 §1, 1992; Ord. 849 §1, 1988; Ord. 479 §1, 1976]
3.12.030 Open market procedures
(a) Purchases, sales, or contracts authorized by KCC 3.12.010, having an estimated value in excess of $35,000 but not more than $50,000, shall be made on the open market without newspaper advertisement.
(b) Market purchases, sales, and contracts shall, whenever possible, be based on at least two competitive bids or price quotes and shall be awarded by the city manager to the lowest responsible bidder.
(c) The city manager or authorized designee shall solicit written bids or price quotes for open market purchases or sales, and shall maintain a record of all bids or price quotes received. [Ord. 1360 §2, 2016; Ord. 1106 §2, 2000; Ord. 970, 1993; Ord. 944 §2, 1992; Ord. 849 §2, 1988; Ord. 633 §1, 1982; Ord. 479 §1, 1976]
3.12.040 Advertising for bids
(a) Purchases, sales, or contracts authorized by KCC 3.12.010 having an estimated value of more than $50,000 may be made only after a notice calling for bids is printed in a newspaper of general circulation published within the city. The notice shall be published at least once, not less than 30 days prior to the date of the bid opening. The notice shall contain a general description of the property, work, or service; state where the bid forms and specifications may be obtained; and specify the place for submission of bids and the time by which they must be received. Requirements for local publication need not be followed if the item or commodity cannot be purchased locally.
(b) The purchase or contract shall be awarded to the lowest responsible bidder or, in the case of a sale, to the highest responsible bidder. [Ord. 1360 §3, 2016; Ord. 1106 §3, 2000; Ord. 849 §3, 1988; Ord. 633 §2, 1982; Ord. 479 §1, 1976]
3.12.050 Processing of bids
Notwithstanding other provisions of this chapter relating to the award after competitive bid for purchases, sales, and contracts, the city may:
(a) Reject defective or nonresponsive bids;
(b) Waive any irregularities in any and all bids;
(c) Reject all bids;
(d) Negotiate with two or more of the lowest bidders, if bid prices are in excess of the money available or authorized, for a reduction in the scope, quality, or quantity of the purchase, service, or contract;
(e) Readvertise for bids with or without making changes in the plans or specifications. [Ord. 479 §1, 1976]
3.12.055 Prebid and preaward conferences
(a) Whenever a contract subject to this chapter involves a project which entails the provision of construction services to the city, the city manager may cause the solicitation for bids or proposals to require that any person or entity seeking to bid on such contract (1) submit preliminary information describing the bidder’s relevant background, qualifications, and experience and demonstrating the bidder’s probable ability to fulfill the contract, if awarded, and (2) attend a mandatory prebid conference held for the purpose of clarifying and quantifying the work to be done on the project. Admission to a mandatory prebid conference may be conditioned upon the prospective bidder’s written certification that all bid specifications and requirements have previously been reviewed in detail, that the prospective bidder has the present intention of actually submitting a bid on the project or contract in question, and that actual estimates of all essential items called for by the bid specifications have been prepared. The failure of a prospective bidder, for any reason whatsoever, to attend and fully participate, personally or through the personal presence of a representative authorized to make all disclosures, representations, and certifications called for by this section, a prebid conference or meeting designated as mandatory under this section shall preclude such bidder from further participating in the bidding process or receiving an award of any resulting contract.
(b) After the opening of bids on any project involving the provision of construction services to the city but before any bid has been accepted or contract awarded, the city manager may also require the apparent low bidder to attend and participate in a further bid confirmation or preaward conference to assure and confirm that the bidder is a responsible bidder within the meaning of KCC 3.12.080, that the bid is in fact responsive, and that the bid specifications and solicitation documents contain no uncertainties, omissions, or ambiguities which might prejudice or prevent the achievement, without diminution of the project or additional cost to the city of Kodiak, of the purposes for which the expenditure of public funds has been authorized. Any bidder who fails or declines to attend and fully participate in a mandatory preaward conference, which participation may at the city’s discretion require the bidder to furnish detailed proof of bid estimates and strategies utilized in the preparation of the bid, may be deemed nonqualified or nonresponsible within the meaning of KCC 3.12.080. At the end of a mandatory preaward conference, a fully authorized representative of the bidder shall certify in writing and on a form acceptable to the city that, except for extraordinary circumstances beyond the control and without the fault or negligence of said bidder and except for circumstances which could not reasonably have been discovered from the bid specification and solicitation documents plus careful preparation for and active participation in the prebid and preaward conferences, the bidder is willing and able to perform the said contract at the price bid without modification of or increase in either the time for completion, the schedule for accomplishing interim goals, or the cost of the project. In the event the bidder should decline to submit such certification, the bidder shall submit to the city manager a written statement under oath stating fully each and every reason or circumstance which prevents or precludes the bidder from rendering the required certification without qualifications or reservations of any kind. The city manager shall, in good faith, examine the representations made by an apparent low bidder who fails to submit the required certification before presenting the bid to the city council for further action.
(c) If the city manager, in his or her discretion, determines that a refusal by a bidder to execute the certification described in subsection (b) of this section is based upon valid concerns, then the city manager shall further determine whether the uncertainties or other circumstances underlying those concerns involved significant prejudice to other bidders. If the city manager determines that there was significant prejudice to other bidders, then he or she may prepare an amendment to the bid solicitation documents and offer all bidders who were qualified to and did submit a bid in the initial instance to respond to such revised solicitation. If the city manager so elects, a minimum of 10 days shall be allowed for responses to the amended solicitation. After the opening of bids on a revised solicitation, the city manager may require the apparent low bidder to attend and participate in another preaward conference and to otherwise comply with subsection (b) of this section.
(d) Nothing in this section shall be interpreted as limiting either the city’s authority under KCC 3.12.050(d) to negotiate with two or more of the lowest bidders when bid prices are in excess of the money available or authorized or the city’s authority under KCC 3.12.050(e) to readvertise for bids with or without making changes in the plans or specifications. [Ord. 1029 §1, 1996]
3.12.060 Local bid preference
(a) Notwithstanding KCC 3.12.040, the council shall direct an award of a contract for the purchase of personal property or services or for the construction, repair, or improvement of city facilities after competitive bidding to a local bidder who is also a responsible bidder if that bid does not exceed the otherwise lowest responsible bid by more than 10 percent or $30,000, whichever is less.
(b) For the purposes of this section, “local bidder” shall mean a responsible bidder who had, at the time of bid award, maintained a business office or store within the borough of Kodiak Island which was open for business on a substantially full-time basis and staffed by at least one full-time employee for at least one year.
(c) This section does not govern purchases of personal property or services authorized by KCC 3.12.020 and 3.12.030. [Ord. 942, 1992; Ord. 744, 1985; Ord. 737, 1984; Ord. 695 §13, 1983; Ord. 578 §1, 1980; Ord. 479 §1, 1976]
3.12.070 Exceptions to bidding requirements
The requirements of this chapter relating to solicitation of competitive bids and award to the lowest responsible bidder shall not apply to:
(a) Contracts for professional services, or where the city determines that it is not practicable to develop sufficiently detailed contract terms or specifications for competitive sealed bidding, or that either vendor qualifications or the means and methods that a vendor will use are material to vendor selection.
(1) Contracts in this category may be awarded to a preferred provider, by open competitive proposals, by competitive proposals solicited from a limited group of providers, or by another method deemed by the city manager to be appropriate, considering such factors as the urgency in selecting a provider, and the specific selection requirements of any state or federal agency providing project funding.
(2) Providers of professional services shall be selected solely on experience and qualifications and price shall not be a factor in the selection process.
(b) Contracts for property or services necessitated by an emergency, if the delays required for compliance with the bidding requirements would jeopardize the public health, safety, or welfare.
(c) Contracts for property or services where other units of government, through their formal bidding process, have established the lowest responsible bidder and where the property or service meets or exceeds the city’s specifications, when the best interests of the city would be served thereby, and the same is in accordance with the city and state law.
(d) Contracts for supplies, materials, equipment, or services for which the city manager determines in writing that there is only one source. The city manager shall negotiate with the sole source to obtain contract terms that best serve the interests of the city. [Ord. 1264 §1, 2009; Ord. 1199a §1, 2005; Ord. 758, 1985; Ord. 479 §1, 1976]
3.12.080 Lowest responsible bidder
In determining the lowest responsible bidder factors to be considered shall include, but not necessarily be limited to, the following criteria:
(a) The ability, capacity, and skill of the bidder to perform the contract;
(b) Whether the bidder can perform the contract within the time specified, without delay or interference;
(c) The character, integrity, reputation, judgment, experience, and efficiency of the bidder;
(d) The quality of performance of previous contracts;
(e) The previous and existing compliance by the bidder with laws and ordinances related to the contract;
(f) The sufficiency of the financial resources and ability of the bidder to perform the contract;
(g) Litigation by the bidder on previous orders or contracts with the city; and
(h) Attendance at and compliance with any requirements associated with or arising out of mandatory prebid or preaward meetings or conferences. [Ord. 1029 §2, 1996; Ord. 745 §1, 1985; Ord. 479 §1, 1976]
3.12.085 Labor requirements—public improvement projects
(a) Under any contract for the construction, repair, or alteration of public improvements funded in whole or in part by city funds, or funds which, in accordance with a federal grant, state grant, or otherwise, the city expends or administers, and to which the city is a signatory to the construction contract, the worker hours shall be performed at least 50 percent by bona fide residents of the borough of Kodiak Island. To the extent there are not sufficient borough resident workers qualified and available for work, a contractor shall be exempted from the provisions of this section to the extent of such unavailability.
(b) For the purpose of this section, a bona fide resident is a person who maintains, and has maintained for at least 30 days, a domicile in the borough. Domicile is the true and permanent home of a person from which that person has no present intention of removing and to which that person intends to return whenever away from that home. [Ord. 746 §1, 1985]
3.12.090 Purchase, contract, or sale valid when—prohibited when
(a) A purchase, contract, or sale subject to the provisions of this chapter shall not be valid, enforceable, or binding upon the city unless the established requirements have been satisfied and the contract, purchase, or sale is approved in accordance with this section.
(b) An acquisition, sale, or transfer of property or services shall not be divided or split into several acquisitions, sales, or transfers for the purpose of avoiding the requirements of this chapter relating to open market or bidding requirements.
(c) Except as provided in subsection (e) of this section, a contract, purchase, or sale that does not exceed $50,000 may be approved by the city manager.
(d) Except as provided in subsection (e) of this section, a contract, purchase, or sale with a value exceeding $50,000 may be approved by the council. Such approval may be provided by motion, resolution, or ordinance.
(e) The following contracts, purchases, or sales must be approved by ordinance as specified by Charter V-17:
(1) Any contract which by its terms will not be fully executed within five years and which cannot be terminated by the city upon not more than one month’s notice without penalty; and
(2) The sale or lease of any city property, real or personal, or the sale or other disposal of any interest therein, the value of which property, lease, or interest is more than $30,000.
(f) For the purpose of subsection (e)(2) of this section, the value of a lease of an interest in city property shall be determined by the total rent payable for the term of the lease; provided, however, that if the city may terminate the lease prior to the end of the term without penalty, the value of the lease shall be determined based on the total rent payable for the minimum term or duration before the city may terminate without penalty. [Ord. 1440 §3, 2023; Ord. 1360 §4, 2016; Ord. 1146 §2, 2002; Ord. 1106 §4, 2000; Ord. 852, 1988; Ord. 633 §3, 1982; Ord. 479 §1, 1976]
3.12.100 Purchase of heavy equipment
(a) Notwithstanding any other provision of this chapter, the city manager may purchase used heavy equipment for the public works department without advertising or standard competitive bidding under the terms, conditions, and procedures as set forth in this section.
(b) If the public works department desires to purchase one or more items of used equipment, the public works director shall submit a written request to the city manager recommending that the city purchase or bid at a sale of such equipment. The request shall contain the following information:
(1) A description of each item of equipment to be purchased, including type of equipment, manufacturer’s name, model number and year of manufacture, approximate price for the item of equipment when new, the approximate current price range for similar new equipment, and any available information relating to the condition, prior use, and maintenance of the equipment;
(2) The location of the equipment, the prior owner, and the name of the auctioneer or seller;
(3) Any minimum bid established by the seller, the maximum purchase price recommended, and the minimum deposit necessary to hold the equipment after bid or purchase until final payment;
(4) The estimated cost for preparation and shipping of the equipment to Kodiak;
(5) The person or persons to be designated to inspect and purchase the equipment, including any equipment broker to be used;
(6) The need of the public works department for each item of equipment to be purchased.
(c) If the city manager concurs, a request shall be submitted to the city council together with a recommendation that the purchase be authorized. The council shall, if it approves the recommended purchase, establish a maximum price to be paid for the used equipment.
(d) Used heavy equipment may not be purchased under this section unless:
(1) The price of each item of equipment when new was not less than $11,000;
(2) The equipment is inspected by a city mechanic prior to submission of a bid or purchase offer and determined to be in good operating condition and repair; and
(3) Brokerage fees and commissions related to the sale will not exceed 10 percent of the purchase price.
(e) Purchases authorized pursuant to this section may be made by a city employee or by a broker retained by the city to act on its behalf at the sale. The finance director is authorized to issue a check prior to the sale made payable to the auctioneer or other person conducting the sale in an amount necessary to hold any equipment that may be purchased pending final payment of the purchase price, and deliver that check to the person authorized to make the purchase.
(f) After the purchase of any used equipment pursuant to this section, the city manager shall prepare a summary of the transaction and submit it to council for review at a regular council meeting. [Ord. 566 §1, 1979]