Chapter 3.50
PURCHASING SYSTEM
Sections:
3.50.030 Duties of Purchasing Officer.
3.50.040 Authority to purchase.
3.50.060 Formal bidding procedure.
3.50.080 Availability of funds.
3.50.090 Inspection and testing.
3.50.100 Surplus supplies and equipment.
3.50.010 System adopted.
In order to establish efficient procedures for the purchase of supplies, services and equipment, to secure supplies, services and equipment for the City at the lowest possible cost commensurate with quality needed, to exercise positive financial control over purchases, to clearly define authority for the purchasing function, to assure the quality of the purchasing system, and to provide for the orderly disposal of surplus property no longer necessary for operations, a purchasing system is adopted. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.020 Purchasing Officer.
The City Manager shall be designated as the Purchasing Officer, and may delegate day-to-day administration to another City official or employee. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.030 Duties of Purchasing Officer.
The duties of the Purchasing Officer may be combined with those of any other office or position, and shall include the following:
(A) Facilitate and coordinate departments in the purchase of supplies, services and equipment required by any department in accordance with purchasing procedures prescribed by this chapter;
(B) Prepare and recommend to the City Council rules governing the purchase of supplies, services and equipment for the City;
(C) Negotiate and recommend execution of contracts for the purchase of supplies, services and equipment;
(D) Act to procure for the City the needed quality in supplies, services and equipment at the least expense to the City;
(E) Discourage collusive bidding and endeavor to obtain as full and open competition as possible on all purchases;
(F) Keep informed of current developments in the field of purchasing, prices, market conditions and new purchases;
(G) Prescribe and maintain such forms as reasonably necessary to carry out the purchasing procedures contained in this chapter;
(H) Supervise the inspection of all supplies, services and equipment purchased to ensure conformance with specifications;
(I) Recommend the transfer of surplus or unused supplies and equipment between departments as needed and the sale or disposal of all supplies and equipment which cannot be used by any department or which have become unsuitable for City use;
(J) Maintain a bidders’ list, vendors’ catalog file and records needed for the efficient operation of the Purchasing Department. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.040 Authority to purchase.
The Purchasing Officer may authorize a department director to purchase or contract for specified supplies, services and equipment, requiring that the purchases or contracts be made in conformity with the procedures established by this chapter, provided there is an unencumbered appropriation remaining in the applicable account. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.050 Bidding required.
(A) Purchases of supplies, services and equipment, and the sale of personal property shall be by bid procedures pursuant to the provisions of this chapter, except that bidding may be dispensed with in the following instances:
(1) When an emergency requires that an order be placed with the nearest available source of supply;
(2) When the commodity or service, for all practical purposes, can be obtained from only one vendor;
(3) When personal services are required of such nature as not to be customarily subject to bid procedure; or
(4) When informal quotations are authorized according to subsection (C) of this section; or
(5) When, under unusual circumstances, and at the request of the City Manager, approved by the City Council, goods or services are proposed to be purchased which do not constitute public works projects.
(B) An emergency shall be defined as any breakdown in equipment or utility service requiring immediate repair or replacement, wherein the item or items broken down do not fall within the definition of a “public works project” as such is defined in the Government Code of the State. Only the City Manager, or, in his absence, the Finance Director, may determine that an emergency exists for the purpose of dispensing with the ordinary bidding procedures required by this chapter.
(C) Price comparisons or bids shall be obtained for all purchases except items under $500.00 and recorded with the purchase order.
(1) Informal Comparison. For items between $500.00 and $1,500, at least three bids should be secured by telephone or other informal means as the basis for purchases.
(2) Informal Written Quotations. For purchases between $1,500 and $5,000, at least three written quotations shall be secured as the basis for purchases.
(3) Formal Bidding. On purchases over $5,000, the formal bidding procedure shall be utilized.
(D) Use of public agency purchasing pools with similar bidding requirements, in order to secure economies of scale, will suffice to meet the bidding requirement. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.060 Formal bidding procedure.
(A) Bids shall be opened publicly in City Hall at a stated time as specifically set forth in the advertisement calling for bids.
(B) Formal report of the full contents of each bid shall be made in tabulated form to the City Council. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.070 Purchase orders.
(A) Except as stated in this section, no purchases of supplies, services and equipment shall be made without a purchase order.
(B) Emergency purchase orders may be made available to department heads by the Purchasing Officer on the basis of probable need. In the case of emergencies arising after working hours, the emergency purchase may be made; provided, however, that information substantiating the purchase shall be filed by the interested department head within four hours after the start of the next regular work day. Preagreements with vendors may be made to avoid emergency purchases.
(C) The requirements for purchase orders may be waived for certain classes of purchases, not exceeding $1,500, by the Purchasing Officer, provided an adequate means of control is available to ensure compliance with this chapter. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.080 Availability of funds.
Except in cases of emergency, the Purchasing Officer shall issue purchase orders only when there is an unencumbered appropriation in the fund account against which the purchase is to be charged. When emergency purchases are requested of items for which no funds have been encumbered, the department head shall initiate a request for a fund transfer the next regular work day. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.090 Inspection and testing.
The department head for whom supplies and equipment are purchased shall inspect the supplies, equipment and work performed to determine their conformance with the specifications set forth in the order and shall certify the conformance to the Purchasing Officer in accordance with the procedures established therefor. The department head shall have authority to require chemical and physical tests of samples submitted with bids and samples of deliveries which are necessary to determine their quality and conformance with specifications. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.100 Surplus supplies and equipment.
All using departments shall submit to the Purchasing Officer, at such times and in such form as he shall prescribe, reports showing all supplies and equipment which are no longer used or which have become obsolete or worn out. Upon prior authorization by the City Council, the Purchasing Officer shall have authority to sell all supplies and equipment which cannot be used by any City department or which have become unsuitable for City use, or to exchange them for, or trade them in on, new supplies and equipment. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.110 Unlawful purchases.
(A) If any department purchases or contracts for any supplies, materials, equipment or contractual services contrary to the provisions of this chapter, the purchase or contract shall be void and of no effect. The head of the department making the purchase transaction shall be personally liable for the amount of the purchase or contract, and, if already paid for out of City funds, the amount thereof may be recovered in the name of the City in appropriate action therefor.
(B) It is unlawful for any department to split its requirements for supplies, materials, equipment and contractual services into estimated amounts of less than $5,000 in order to evade the provisions of this chapter. The procurement of supplies for ongoing operations for which need arises periodically, and storage or spoilage is not an issue, in amounts less than a full budget year’s requirements, shall not be a violation of this section. (Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)
3.50.120 Contracts.
(A) Procedures. Except as provided in this chapter, contracts for services, supplies, equipment and the sale of property with an estimated value greater than $5,000 shall be by written contract with the lowest responsible bidder, in accordance with the following procedure:
(1) Notices inviting bids shall include a general description of the project or item, shall state when the bid blanks and specifications may be secured and the time and place for opening bids, and shall be published at least 10 days before the date of opening of the bids, at least once in a newspaper of general circulation printed and published in the City, or if there is none, shall be posted in public places in the City that have been designated as the places for posting public notices. The Purchasing Officer shall invite sealed bids from all responsible prospective suppliers whose names are on the bidders’ list or who have requested their names to be added thereto.
(2) When deemed appropriate by the Purchasing Officer, bidders’ security may be prescribed in the public notices inviting bids. Bidders shall be entitled to return of 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 may, on refusal or failure of the successful bidder to execute the contract, award it to the next lowest bidder. If the City Council awards to the next lowest responsible bidder, the amount of the lowest bidder’s security shall be applied by the City to the difference between the low bid and the second lowest bid and the surplus, if any, shall be returned to the lowest bidder.
(3) Sealed bids shall be submitted to the Purchasing Officer and shall be identified as bids on the envelope. Bids shall be opened in public at the time and place stated in the public notices. A tabulation of all bids received shall be open for public inspection during regular business hours for a period of not less than 30 calendar days after the bid opening.
(4) In its discretion, the City Council may reject any and all bids presented and readvertise for bids.
(5) Contracts shall be awarded by the City Council to the lowest responsible bidder except as otherwise provided in this chapter.
(6) If two or more bids received are for the same total amount or unit price, quality and service being equal, and if the public interest will not permit the delay of readvertising for the bids, the City Council may accept the one it chooses or accept the lowest bid made by negotiation with the tied bidders.
(7) The City Council shall have authority to require a performance bond before entering into a contract in such amount as it shall find reasonably necessary to protect the best interests of the City. If the City Council requires a performance bond, the form and amount of the bond shall be described in the notice inviting bids.
(B) Exemptions from Competitive Bids. All contracts shall be based upon competitive bids except:
(1) Contracts with public agencies.
(2) Personal service contracts.
(3) Contracts under $5,000.
(4) Contracts for items whose price is regulated by the government.
(5) Copyrighted materials or sole source items.
(6) Advertising contracts.
(7) Investment contracts.
(8) Data processing contracts.
(9) Employee benefit insurance contracts.
(10) Contract amendments.
(11) Equipment maintenance.
(12) Purchases through State of California.
(13) Transfers, including recyclables, to another public agency, sheltered workshop, or nonprofit agency, provided the property is duly designated as surplus to the needs of the City.
(14) Employment contracts for handicapped.
(15) Communications systems.
(16) Insurance contracts.
(17) Purchases of used personal property.
(C) Requests for Proposal. The City may, at its discretion, use request for proposal or request for qualifications competitive procurement methods when bidding is inappropriate.
(D) Emergency Contracts. A contract may be exempted from competitive bidding in accordance with Cal. Pub. Cont. Code § 20168 if the Council, by a four-fifths vote of members present, determines that emergency conditions require prompt execution of the contract. A determination of such an emergency shall be entered into the record of the meeting at which the determination is made.
(E) Security and Performance Bond. All surety, bid, performance and other such bonds required to be filed with the City pursuant to City Code provisions or contractual agreements shall be issued by companies with a rating of A: VII or better as determined by the most recent edition of Best’s Key Rating Guide published by A.M. Best Company.
(F) Bidder Disqualification. The Purchasing Officer may disqualify any person as a bidder on a contract if:
(1) The person does not have sufficient financial ability to perform the contract. Evidence that the person can acquire a surety bond in the amount and type required shall be sufficient to establish financial ability. If no performance bond is required, the Purchasing Officer may require such information as he/she deems necessary to determine the bidder’s financial ability;
(2) The person does not have equipment available to perform the contract;
(3) The person does not have key personnel of sufficient experience to perform the contract; or
(4) The person has repeatedly breached contractual obligations to public and private contracting agencies.
(G) Bid Rejection. The City Council may reject any bid not in compliance with all prescribed public bidding procedures and requirements, and may reject all bids if it is determined to be in the public interest to do so.
(H) City Business License Required. Pursuant to the authority of MSMC 5.12.010 it shall be the policy of the City of Mt. Shasta to require a valid City business license of any party contracting or subcontracting for the sale of goods or services to the City.
(I) Bid Protest Procedure. The following bid protest procedures are intended to provide a quick, efficient process for resolving disputes concerning City bids:
(1) Protest. Any person desiring to protest a City bid action may file a written protest with the City Clerk, City of Mt. Shasta, 305 North Mt. Shasta Boulevard, Mt. Shasta, CA 96067.
(a) The protest may be based on any alleged violation of the City’s procedures.
(b) The written protest should explain the basis for the protest and include the name, address and telephone number of the party protesting.
(c) The protest must be filed as soon as possible so as to avoid unnecessarily delaying the contract by the City Council, and in any case, within 10 days of bid opening.
(2) Hearing. Upon receipt of protest, the City will suspend the contract award until a hearing has been conducted before the City Manager or his designee.
(a) A hearing will be held within 10 working days of receipt of the protest;
(b) All other bidders will be notified of the hearing;
(c) The protester, other interested bidders, City staff and other interested parties will be afforded an opportunity to appear and present their position and/or concerns at the hearing.
(3) Recommendation. On the basis of the hearing, the City Manager shall make written findings and recommendations on the protest to the City Council. The City Manager’s findings and recommendations shall be accompanied by written minutes of the hearing. All persons appearing at the hearing shall be provided copies of the findings and recommendations.
(4) Council Action. Upon receipt of the City Manager’s findings and recommendations, the Council shall consider the matter and may take appropriate action, or may remand the matter back to the City Manager for further hearing. Council’s consideration of the protest shall be on the hearing, but at the Council’s discretion, parties may address the Council.
(J) Code of Conduct.
(1) No officer or employee of the City of Mt. Shasta shall have interest, direct or indirect, in work to be performed in connection with any contract.
(2) The City’s officers, employees or agents shall neither solicit nor accept gratuities, favors or anything of monetary value from contractors, potential contractors or parties to subagreements.
CONTRACTS / PURCHASES
COMPETITIVE QUOTE RECORD
The City’s Public Contracting Rules require that for contracts/purchases between ONE THOUSAND FIVE HUNDRED DOLLARS ($1,500.00) and $5000 a minimum of three (3) competitive quotes should be obtained. Contracts/purchases in excess of $5000 require formal bid.
Please use the following form to record your quotes. If written quotes are obtained, please attach copies.
PROJECT: __________________________________________________________________
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Department: _________________________________________________________________
Person Obtaining Quotes: _____________________________ Date: ___________________
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RECOMMENDATION: _________________________________________________________
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APPROVED |
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Department Director |
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Finance Director |
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City Administrator |
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City Attorney |
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NOTE: Contracts/purchases for more than $5000 require City Council authorization.
(Ord. CCO-11-05 §§ 8, 9, 2011; Ord. CCO-03-01, 2003; Ord. CCO-02-04, 2002)