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Home My WebLink AboutA- 6 Ordinance Concerning the purchase, Bidding & Contracting rules for public projects • OFA�G tit •••., %, 4,1 ' 'Pt meCityofAzusi 'a -.1<woo Finance Department• 213 E.Foothill Blvd.■P.O.Box 1395 •Azusa,CA 91702-1395 Tel: (626)812-5203 • FAX(626)334-6358 July 15, 1999 City of Azusa Agenda Report TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS FROM: SONIA R. CARVALHO, CITY ATTORNEY VIA: RICK COLE, CITY MANAGER(.`/ RE: ORDINANCE CONCERNING THE PURCHASING, BIDDING AND CONTRACTING RULES FOR PUBLIC PROJECTS, SERVICES, EQUIPMENT AND SUPPLIES RECOMMENDATION: Introduce and waive further reading of an ordinance restating Article VII of Chapter 2 of the Azusa Municipal Code regarding bidding, contracting and other purchases of supplies, services and equipment. BACKGROUND: In January 1999, we presented a staff report and ordinance to the City Council concerning a proposed restructuring of the City's bidding and contracting procedures. At that time, the City Council passed a resolution addressing the bidding procedures for"public works projects." The City Council deferred a decision on the bidding and purchasing rules for supplies, services and equipment. The City Council then appointed an ad hoc committee to review the matter and make a recommendation on revised rules and procedures. Mayor Pro Tern Stanford and Council Member Beebe served on the ad hoc committee. After numerous meetings among staff and two meetings with the ad hoc committee, we prepared an ordinance. ,d161 "//1 4 if 16). ' RVPUB\SRC\521134 g//9/9 61/ e ANALYSIS: The proposed ordinance addresses the following: For Public Works Projects, the ordinance incorporates the terms of the resolution that the Council adopted last January. In particular, this ordinance provides for an informal or alternative bidding process for public works projects under $25,000. For such projects that are between $25,000 and $74,999, the project is subject to a special informal bidding procedure. Finally, such projects that are $75,000 or more are subject to formal bidding procedures. The ordinance authorizes staff to develop administrative policies to implement the informal bidding procedures, such as the following: $1.00 - $24,999 Department head initiates the bidding process Three or more written quotes according to the City's alternative process City Manager contract approval $25,000 - $74,999 Cost Accounting Act Informal Process: Send notices to bid contractors on a City list; choose lowest responsive bidder. City Council awards the contract after the bidder is recommended. $75,000 or more -City Council must authorize the specifications and bids -City Council approves the award of contract For Professional Services the ordinance provides for the use of informal or alternative bidding procedures for contracts under $20,000. Contracts of$20,000 or more are subject to formal requests for qualifications. The proposed policy to implement the ordinance is as follows: $1.00 - $499 Informal procedures and purchases are made at the buyer's discretion $500 - $1,999 Three or more phone quotes shown in writing The contract or purchase order is subject to department head approval $2,000 - $4,999 Three or more quotes received in writing The contract or purchase order is subject to department head approval $5,000 - $9,999 Three or more quotes received in writing City manager must approve the purchase order or contract $10,000 or over Staff must solicit formal requests for qualifications The City Council must approve the contract RVPUB\SRC\521134 - 2 - For Maintenance Services, Supplies and Equipment the ordinance provides for informal or alternative bidding procedures for all contracts under $25,000. Formal bidding to award a contract to the lowest and responsive bidder is required for all contracts of$25,000 or more. The administrative policies would provide for the following: $1.00 - $499 Informal procedures and purchases are made at the buyer's discretion $500 - $1,999 Three or more phone quotes shown in writing The contract or purchase order is subject to department head approval $2,000 - $4,999 Three or more quotes received in writing The contract or purchase order is subject to department head approval $5,000 - $9,999 Three or more quotes received in writing/optional formal bidding City manager must approve the purchase order or contract $10,000 - $ 24,999 Written quotes or formal bid at the discretion of city manager City Council approval of form contracts $25,000 and over Formal requests for qualifications/bids Award contract to the lowest, responsive bidder City Council approval of contracts The ordinance also includes exemptions to the general rules. In other words, the bidding procedures would not apply in the following circumstances: • The purchase of electric transformers in an amount up to $50,000 (will require written quotes and award of the contract to the vendor with the lowest cost to own amount considering a twenty year period of use). • A purchase made pursuant to the State of California purchasing program. • The City has gone to bid in the last three months and bid is exactly the same. • It can be shown that a competitive market does not exist because it is a sole source item. • City Council, after receiving a staff report, waives bids for a special reason. • The city manager determines that a safety emergency exists. RVPUB\SRC\521134 - 3 - The ordinance also states that all contracts (not purchase orders) approved by a department head, the finance director or the city manager shall be reported to the City Council as a supplement to the bi-monthly warrant register. The ordinance authorizes the city manager to sign contracts in accordance with the ordinance limitations and the administrative policies set forth above. Attachment: Ordinance RVPUB\SRC\521134 - 4 -