Chapter 2.50
PURCHASE OF SUPPLIES, EQUIPMENT AND CONTRACTUAL SERVICES
Sections:
2.50.010 Adoption of purchasing system.
2.50.015 Purchasing system – Power bestowed by city charter.
2.50.030 Purchasing procedure.
2.50.040 Formal bidding procedures.
2.50.050 Informal bid procedures.
2.50.060 Purchasing of services.
2.50.070 Exceptions to bidding.
2.50.090 Public works projects.
2.50.010 Adoption of purchasing system.
In order to establish efficient procedures for the purchase of supplies, equipment and services, to obtain these items at the lowest possible cost commensurate with the quality needed, to exercise positive financial control over all purchases, and to clearly define authority for the purchasing function and to assure the quality of purchases, a purchasing system is adopted. (Ord. 97-611 § 2; Ord. 81-455 § 1).
2.50.015 Purchasing system – Power bestowed by city charter.
The Charter of the city of Fortuna, Article IV, Section 401, Purchasing, provides: “The city shall have the power to establish standards, procedures, rules, or regulations related to the purchasing of goods, property, or services.” (Ord. 97-611 § 2).
2.50.020 Purchasing agent.
The city manager shall act as purchasing agent for the city. The city manager may delegate any of the powers and functions of the purchasing agent to any other officer or employee of the city. The purchasing agent shall have the authority and duty to:
A. Purchase or contract for supplies, equipment and contractual services required by any using city department or agency in accordance with purchasing procedures prescribed herein, such administrative regulations as the purchasing agent shall adopt and such other rules and regulations as shall be prescribed by the city council or city manager, at all times endeavoring to obtain as full and open competition as possible on all purchases;
B. Negotiate and recommend execution of contracts for the purchases of supplies, equipment and contractual services;
C. Act to procure for the city the needed quality in supplies, equipment and contractual services at least expense to the city;
D. Discourage uniform bidding and endeavor to obtain as full an open competition as possible on all purchases;
E. Keep informed of current developments in the field of purchasing, prices, market conditions and new products;
F. Prescribe and maintain such forms as reasonably necessary to conform to the requirements of this chapter and other rules and regulations;
G. Supervise the inspection of all supplies, contractual services and equipment purchased to ensure conformance with the specifications;
H. Administer the transfer of surplus property between departments as needed, or sell, or otherwise dispose of such surplus property;
I. Oversee the operation of all storerooms for the storage of common use items to ensure the safe keeping and proper storage and handling of all supplies and equipment therein;
J. Maintain a bidder’s list, vendor’s catalogue file and other records used in modern procurement operations. (Ord. 97-611 § 2; Ord. 81-455 § 2).
2.50.030 Purchasing procedure.
Except as otherwise provided in this chapter, all purchases and contracts for supplies, equipment and commodities of any value shall be accomplished either by or through the purchasing agent. Purchases shall be processed by one of the following:
A. Requisitions. Using agencies shall submit requests for supplies and equipment to the purchasing agent by standard requisition forms.
B. Purchase Orders. Purchase of supplies and equipment shall be made only by purchase order.
C. Encumbrance of Funds. Except in cases of emergency, as determined pursuant to FMC 2.50.070, the purchasing agent shall not issue any purchase order for supplies or equipment unless there is an appropriation in the fund account against which such purchase is to be charged. (Ord. 97-611 § 2; Ord. 81-455 § 3).
2.50.040 Formal bidding procedures.
Except as otherwise provided in this chapter, when the value of any purchases or contract for goods, supplies or equipment is $10,000 for a single item or bulk purchase of a single item, the purchase shall be by bid procedure. In all such cases a written contract must be executed. Written contracts shall mean either purchase order or formal contract, whichever is appropriate as determined by the purchasing agent. The purchasing agent has the authority to award bids up to $30,000. The bid procedure shall be as follows:
A. Notice Inviting Bids. Notices inviting bids shall include the general description of the articles to be purchased, shall state where bid blanks and specifications may be secured, and the time and place for opening of bids. The purchasing agent shall solicit sealed bids from all responsible prospective suppliers whose names are on the bidders’ list or who have requested their names to be added thereto, and any other source known to the purchasing agent.
B. Bidders’ Security. When deemed necessary by the purchasing agent, bidders’ security may be prescribed in the public notices inviting bids. Bidders shall be entitled to return to bid security provided that a successful bidder shall forfeit his bid security upon refusal or failure to execute the contract within 10 days after the notice of award of contract has been mailed unless the city is responsible for the delay. The city council or purchasing agent may, on refusal or failure of the successful bidder to execute the contract, award it to the next lowest responsible bidder. If the city council or purchasing agent awards the contract to the next lowest bidder, the amount of the lowest bidder’s security shall be applied by the city to the difference between the low and the second lowest bid, and the surplus, if any, shall be returned to the lowest bidder.
C. Performance Bond. The city council and purchasing agent shall have authority to require a performance bond before entering a contract in such amount as it shall find reasonably necessary to protect the best interest of the city. If the city council or purchasing agent requires a performance bond, the form and amount of the bond shall be described in the notice inviting bid.
D. Bid Opening Procedure. Sealed bids shall be submitted to the purchasing agent and shall be identified as bids on the envelope. Bids shall be opened in public at the time and place stated in the public notice. A tabulation of all bids received shall be opened for public inspection during regular business hours for a period of not less than 30 calendar days after the bid opening. No bids shall be accepted after the stated time specified in the notice inviting bids.
E. Approval. The bids shall be submitted to the purchasing agent. City council, or the purchasing agent, shall approve a contract or purchase order for the lowest responsible bidder, or reject all bids.
F. Tie Bids. If two or more bids received are for the same total amount or unit price, quality and service being equal, the city council or purchasing agent may accept one of them or accept the lowest bid made by negotiations with the tie bidders at the time of or after the bid opening. (Ord. 97-611 § 2; Ord. 81-455 § 4).
2.50.050 Informal bid procedures.
In cases where the value of supplies, equipment or contractual services is less than $10,000, the purchasing agent shall purchase the item or items by informal bidding, negotiations, or annual purchase agreement. Informal bidding means solicitation by the purchasing agent of at least three price quotations, either written or verbal, of which the bid yielding the lowest ultimate cost shall be accepted. The lowest ultimate cost shall mean the lowest informal bid price commensurate with the quality needed and shall include consideration of anticipated operating costs, transportation or packing charges, availability, storage costs, and supplier responsibility when such factors are relevant. (Ord. 97-611 § 2; Ord. 81-455 § 5).
2.50.060 Purchasing of services.
When the city council or city manager authorize the hiring of services for which standard specifications cannot be drawn due to the nature of the service or because of national association by-laws or professional policies prohibiting competitive bidding, such as, but not limited to, architectural services, consultant services, legal services, and engineering services, the city manager shall negotiate for the authorized service. Proposals shall be submitted whenever practicable from at least three firms. When the service lends itself to written standard specifications, then bidding for this service shall be conducted pursuant to FMC 2.50.040. When the value of any service is greater than $10,000 the contract or purchase order shall not be executed unless approved by the city council. (Ord. 97-611 § 2; Ord. 81-455 § 6).
2.50.070 Exceptions to bidding.
Purchases of supplies, equipment and contractual services shall be by formal or informal bid procedures pursuant to this chapter except:
A. In case of an emergency as determined by the city manager or, in his absence, the acting city manager. The city manager shall be advised of such emergency purchase as soon as practicable;
B. When the supplies, equipment or contractual services can be obtained from only one vendor;
C. When the city has a contract with another governmental unit to purchase a particular item on a cooperative basis;
D. When the city council finds that negotiations shall best serve the city due to the nature of the supplies, equipment or contractual service. (Ord. 97-611 § 2; Ord. 81-455 § 7).
2.50.080 Unlawful purchases.
No purchase or contract for any supplies, materials, equipment or contractual services shall be made contrary to the provisions of this chapter. No contract or purchase shall be subdivided or split to avoid any of the provisions of this chapter. (Ord. 97-611 § 2; Ord. 81-455 § 8).
2.50.090 Public works projects.
A. Prevailing Wages. Contracts for city-funded public works construction projects valued in excess of $25,000, and contracts for city-funded alteration, demolition, repair or maintenance projects valued in excess of $15,000, shall require payment of prevailing wages in accordance with the requirements of the California Labor Code.
B. Force Account Construction Work. As authorized by City Charter Section 400, Public Works, the city of Fortuna hereby exercises the right granted by the voters to establish force account limits for public works projects. No limit is established and the city has the right to complete part of a project and bid part of a project, or bid the entire project. (Ord. 2014-716 § 2; Ord. 2012-695 § 1; Ord. 97-611 § 2; Ord. 97-607 § 2).