Chapter 3.08 — PURCHASING SYSTEM

Editor's note— Sec. 1 of Ord. No. 751, adopted Feb. 11, 2014, amended Ch. 3.08 in its entirety. Exhibit A of said Ord. No. 751 is included herein as set out. Former Ch. 3.08 pertained to the same subject matter, consisted of §§ 3.08.010—3.08.140, and derived from the prior code, Ord. 456, 1991; Ord. 503, 1993; Ord. 548, 1997; and Ord. No. 714, adopted May 25, 2010.

A centralized purchasing system is adopted as managed by the purchasing agent to administer Article XIII of the city Charter; this code regarding purchasing matters and such other ordinances, resolutions, rules and regulations and procedures governing the contract for, purchasing, storing, distribution or disposal of all supplies, materials and equipment required by any department, office or agency of the city government. The centralized purchasing system is adopted to provide an efficient and flexible means to secure city supplies, materials, service and equipment at the lowest responsible cost commensurate with quality needed; to exercise positive financial control over purchases; to clearly define the authority for all purchases; and to limit the administrative demands imposed by the purchasing system to those reasonably necessary to achieve the other objectives of that system.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

This chapter applies to contracts for the procurement of supplies, equipment, and services, entered into by the city after the effective date of the ordinance codified in this chapter. It shall apply to the expenditure of

public funds by any city department for public purchasing. It shall not apply to public works construction projects, as that term is defined by the public contracting code.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

"Contract" means agreements, regardless of what they may be called, for the procurement of supplies, equipment, or services.

"Cost" as used in this chapter does not include tax, freight charges or other charges not part of the cost of the items or services purchased.

"Department" includes any sub-organization of city staff, agency, commission, or board created by the city which requires supplies, equipment, or services pursuant to this chapter.

"Equipment" means procured items which are maintained on inventory as fixed assets. These items are durable and have a fixed, predetermined life expectancy.

"Invitation for bids" means documents, whether attached or incorporated by reference, utilized for soliciting bids.

"Procurement" means the buying, purchasing, renting, leasing or other acquisition of supplies, equipment, or services. It also includes the definition of requirements (specifications), the selection and solicitation of sources, the preparation and award of a contract, and the administration of the contract.

"Professional services" means work performed by specially trained and experienced persons, firms or corporations rendering professional services and advice such as accounting, financial, legal, medical, engineering, architectural, environmental, economic, real estate, insurance, lobbying, public relations, code publication or similar services.

"Public procurement unit" means any purchasing entity involved in the acquisition of commodities for a governmental unit such as: state, county, city, school district, or other similar entity.

"Request for proposal" means documents, whether attached or incorporated by reference, utilized for soliciting proposals.

"Responsible vendor or offeror" means a person who has the capacity in all respects to perform fully the contract requirements, and the experience, tenacity, perseverance, integrity, reliability, capacity, facilities, equipment and credit which will assure good faith performance.

"Responsive vendor" means a person who has submitted a bid which conforms in all material respects to the requirements set forth in the invitation for bids.

"Services" means the furnishing of labor, time or effort (sometimes parts are included) to perform or complete a designated task. Precise specifications (taskings) shall be delineated in the contract.

"Supplies" means property, including but not limited to materials, required to perform a department's function. It can mean office or departmental supplies.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

A.

Establishment. There is created the position of purchasing agent, which shall be the city's principal purchasing and contracting official.

B.

Appointment. The purchasing agent shall be the city manager or his/her designee, unless specified otherwise within this chapter.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

A.

Principal Purchasing Official. Except as otherwise provided in this section and in Section 3.08.060, the purchasing agency shall serve as the principal purchasing and contracting official for the city, and shall be responsible for the procurement of, or the coordination of the procurement of, supplies and equipment in accordance with this chapter, and for the management and disposal of surplus supplies and equipment.

B.

Duties. In accordance with this chapter, and subject to applicable fiscal review of the finance department, the purchasing agent or his/her designee shall:

Procure, or coordinate the procurement of, all supplies, equipment and services needed by the city;

Exercise general supervision and control over inventories of equipment (fixed assets) and certain supply items belonging to the city;

Dispose of surplus supplies and equipment belonging to the city;

Assist city departments, as needed, in the development of specifications, contract administration, and inspection and acceptance procedures;

Endeavor to obtain as full and open competition as possible on city purchases;

Prepare and recommend to the finance director procedures governing the procurement of supplies, equipment, services and construction items;

Exercise supervision and control and provide contract administration for contracts for professional services.

C.

Operational Procedures. Consistent with this chapter, the purchasing agent shall adopt specific operational procedures pertaining to the execution of his/her duties.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

Notwithstanding the provisions of Section 3.08.050 and with the approval of the city manager, the purchase of certain supplies, equipment, services or construction items may be delegated by the purchasing agent to individuals in other city departments, if such delegation is deemed necessary for the effective procurement of those items.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

Except as otherwise provided in this chapter, contracts for supplies, equipment, and services of estimated value fifty thousand dollars or greater shall be awarded by the city council. The city manager, or his/her designee, may award and execute on behalf of the city contracts costing less than fifty thousand dollars. The city council shall annually, on or before January 1, through the adoption of a resolution, adjust these limits and the limits specified in Sections 3.08.090, 3.08.100, 3.08.110, 3.08.120, 3.08.130, and 3.08.160 based upon the Consumer Price Index established and published by the State of California Department of Industrial Relations for all California urban consumers.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 1, 4-27-2021)

A.

Contracts shall be awarded by competitive sealed bidding or negotiated bid proposals, pursuant to Sections 3.08.100 and 3.08.110, except as provided in:

Contracting for designated professional services pursuant to Section 3.08.120;

Small purchases pursuant to Section 3.08.130;

Sole source procurement pursuant to Section 3.08.140;

Emergency procurement pursuant to Section 3.08.150; and

Cooperative purchasing pursuant to Section 3.08.160.

B.

Whenever competitive sealed bidding procedures or negotiated bid proposals are not utilized, as authorized in this chapter, a waiver of bid delineating the reason(s) for noncompetitive award shall be prepared in writing by the requesting department and filed with the finance director. Prior to being filed, the waiver shall be reviewed by the purchasing agent and the finance director and approved by the city manager.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 2, 4-27-2021)

A.

Conditions for Use. City contracts for supplies and equipment of estimated value of fifty thousand dollars or greater shall be awarded by competitive sealed bidding except as otherwise provided in Section 3.08.090.

B.

Public Notice. Public notice of the invitation for bids shall be given at least ten calendar days prior to the date set forth therein for the opening of bids. Such notice shall include publication at least once in a newspaper of general circulation within the city. This notice shall state the place, date and time of bid opening.

C.

Invitation for Bids. An invitation for bids shall be issued to vendors who request such and shall include specifications and all contractual terms and conditions applicable to the procurement. Prior to the invitation for bid, the requesting department may contact respective vendors to obtain specific product information, product demonstration/evaluation/testing, etc.

D.

Bid Opening. Bids shall be opened publicly in the presence of one or more witnesses at the time and place designated in the invitation for bids. The amount of each bid, and such other relevant information as the purchasing agent deems appropriate, together with the name of each bidder shall be recorded; this record, as well as each bid, shall be open to public inspection after the award of the contract.

E.

Bid Acceptance and Bid Evaluation. Bids shall be unconditionally accepted without alteration or correction, except as authorized in this chapter. Bids shall be evaluated based on the requirements set forth in the invitation for bids, which may include criteria to determine acceptability such as inspection, testing, quality, workmanship, delivery and suitability for a particular purpose. Those criteria that will affect the bid price and be considered in the evaluation for award shall be objectively measurable, such as discounts, transportation costs, and total or life cycle costs.

F.

Correction or Withdrawal of Bids—Cancellation of Awards. Correction or withdrawal of inadvertently erroneous bids before or after bid opening, or cancellation of awards or contracts based on such mistakes, may be permitted where appropriate. Prior to bid opening the bidder may modify or withdraw a bid by written notice providing it is received by the city prior to the time set for bid opening. After bid opening, corrections in bids or withdrawals of bids shall be permitted only to the extent that the bidder can show by clear and convincing evidence that the bidder made a material mistake of fact that is evident on the face of the bid. Decisions to permit the correction or withdrawal of bids, or to cancel awards or contracts based on bid mistakes, shall be supported by a written recommendation made by the purchasing agent and approved by the city manager for contracts costing less than fifty thousand dollars and by the city council for contracts costing fifty thousand dollars or more.

G.

Award. The contract shall be awarded with reasonable promptness by appropriate written notice to the lowest responsible and responsive bidder whose bid meets the requirements and specifications set forth in the invitation for bids. In the event the low responsive and responsible bid for any contract exceeds available funds by ten percent or less, as certified by the finance director, the purchasing agent, or his/her designee, is authorized, when time and economic consideration preclude re-solicitation of work of a reduced scope, and upon approval from the requesting department and the finance director, to negotiate an adjustment of the bid price with the low responsive and responsible bidder, in order to bring the bid within the amount of available funds.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 3, 4-27-2021)

A.

Conditions for Use. City contracts for services of estimated value of fifty thousand dollars or greater shall be awarded by negotiated bid proposal as described in this Section. Further, the competitive sealed bidding procedures described in Section 3.08.100 shall be the preferred method of procurement for purchase of supplies and equipment of estimated value of fifty thousand dollars or greater, and as such,

shall be utilized for most contract awards. However, when the purchasing agent determines that the use of competitive sealed bidding does not provide sufficient detail to evaluate the bidder's proposal or is otherwise too technical or not advantageous to the city, a contract to furnish supplies or equipment of estimated value of fifty thousand dollars or greater may be entered into by use of the negotiated bid proposal method. In this manner the bidder will delineate his/her entire proposal to include, at a minimum, specific parts and/or processes used to complete the designated contract specifications. The purchasing agent shall provide instructions and required forms to each requesting vendor.

B.

Request for Proposals. Proposals shall be solicited through a request for proposals.

C.

Public Notice. Public notice of the request for proposals shall be given in the same manner as provided in Section 3.08.100.

D.

Receipt of Proposals. Proposals shall be handled in a manner which does not permit the disclosure of the identity of any offeror or the contents of any proposal to competing offerors during the process of negotiation. A register of proposals shall be prepared containing the name of each offeror and a description sufficient to identify the item offered. The register of proposals shall be open for public inspection only after contract award.

E.

Evaluation Factors. The request for proposals shall state the relative importance of price and other criteria used to determine the award.

F.

Discussion with Responsible Offerors and Revisions to Proposals. As provided in the request for proposals, discussions may be conducted with responsible offerors who submit responsive proposals determined to be reasonably competitive for award for the purpose of clarification to assure full understanding of, and conformance to, the solicitation requirements. Offerors shall be accorded fair and equal treatment, with respect to any opportunity for discussion and revision of proposals. Such revisions may be permitted after submissions and prior to award for the purpose of obtaining best and final offers. In conducting discussions, the identity of competing offerors or any information derived from proposals submitted by the competing offerors shall not be disclosed.

Award. Award shall be made to the responsible offeror whose proposal is determined by the council to be the most advantageous to the city, taking into consideration price and the evaluation factors set forth in the request for proposals. The contract file shall contain the basis on which the award is made.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 4, 4-27-2021)

A.

For the purpose of procuring the services of persons providing professional services as defined in Section 3.08.030, any department head requiring professional services estimated to cost less than fifty thousand dollars may procure them on its own behalf. The department head procuring such services shall notify and obtain the purchasing agent's approval prior to the procurement. That department shall also prepare the request for proposals (RFP) or request for qualifications (RFQ) for the procurement of such services. Professional services, as defined in Section 3.08.030 costing fifty thousand dollars or greater shall be contracted for by the city council or their designee.

B.

For professional services costing less than fifty thousand dollars, where a consultant selected through the RFP or RFQ process has provided satisfactory services within the past twelve months, a department head may enter into a renewed or new contract for the same or similar services with that consultant without the resort to a further RFP or RFQ process.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 5, 4-27-2021)

A.

General. Purchases of goods, equipment, supplies or other fixed assets costing less than fifty thousand dollars shall be made according to the procedures in this section.

B.

Purchases Greater than Five Thousand Dollars. For purchases in excess of five thousand dollars, but less than fifty thousand dollars, no less than three vendors shall be solicited to submit quotations. Quotations may be received in writing, in person, or via the telephone. The purchasing agent shall award the contract to the vendor offering the lowest acceptable quotation. The names of the vendors submitting quotations and the date and amount of each quotation shall be recorded and maintained as a public record for no less than two years after the award of the contract.

Procurement. Procurement of supplies, equipment, services and materials shall be made by written contract or purchase order unless directed otherwise by the purchasing agent according to established procedures.

Department heads shall submit requests for supplies, equipment, and services to the purchasing agent by means determined by the purchasing agent and reviewed by the finance director.

C.

Purchases of Five Thousand Dollars or Less. Department heads may make purchases of five thousand dollars or less without approval by the purchasing agent. An informal or formal bid process or request for quotes is not required, but may be used at the discretion of the department head authorizing the purchase. Upon the completion of such purchase, the department head will be responsible for approving the invoice for payment, coding the invoice to the proper budget account(s) and submitting the invoice to the finance director for payment.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 6, 4-27-2021)

A.

For Purchases of Less than Fifty Thousand Dollars. Prior to submitting a purchase request, the requesting department shall conduct a survey of available sources to determine whether there is only one source for the required supply, equipment, or service. After review of this request by the purchasing agent and the finance director and approved by the city manager, a contract may be awarded without competition. The purchasing agent, or his/her designee, shall conduct negotiations, as appropriate, as to price, delivery and terms. The requesting department head shall prepare a statement of the basis for the sole source determination and the waiver of bid and submit it to the purchasing agent for filing with the finance department.

B.

For Purchases of Fifty Thousand Dollars, or Greater. Where the city council determines, based upon staff conducting a good faith review of available sources or staff recommendation of the city's need for unique or custom goods or services, that there is only one source for the required supply, service or material, the city council may approve by four-fifths vote a sole source purchase without a competitive bid process.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 7, 4-27-2021)

Notwithstanding any other provisions of this chapter, the city manager shall make, or authorize others to make, emergency procurement of supplies, equipment, services or construction items when there exists a threat to public health, welfare or safety; provided, that such emergency procurement shall be made with sufficient competition as is practicable under the circumstances. The requesting department shall obtain the purchasing agent's approval of the emergency procurement and submit a written waiver of bid justification to the purchasing agent for filing with the finance director.

The city manager may declare a state of emergency, if circumstances do not permit city council action in order to meet the threat to public health, welfare or safety. The council shall meet and consider the city manager's declaration as soon as practicable, and ratify the declaration if appropriate.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

NOTE: The above matrix is intended to summarize the requirements of this chapter and not to change them. If the matrix contradicts the text of this chapter in any respect, the language of the chapter will prevail.

(Ord. No. 751, § 1(Exh. A), 2-11-2014; Ord. No. 809, § 8, 4-27-2021)

Without complying with the requirements of Sections 3.08.080, 3.08.090 and 3.08.100, the purchasing agent may participate in, use, sponsor, conduct or administer a cooperative purchasing agreement for the procurement of any supplies, equipment, or service with one or more public procurement units in accordance with an agreement entered into between the participants. Such cooperative purchasing may include, but is not limited to, joint or multiparty contracts between public procurement units and open- ended state and/or federal public procurement unit contracts which are made available to the city.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

Where stated in the invitation for bid, the city council or purchasing agent may cancel an invitation for bid, a request for proposal, or other solicitations, or may reject any or all bids or proposals when it is for good cause and in the best interests of the city.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

A.

Specifications. Specifications shall be drafted by the requesting department in a manner to promote overall economy for the purposes intended and to encourage competition in satisfying the city's needs; they shall state the city's minimum requirements, avoiding, where possible, unduly restrictive requirements which may otherwise prevent competition. The policy enunciated in this section applies to all specifications including, but not limited to, those prepared for the city by architects, engineers, designers and draftsmen. The department requiring the supply, equipment, or service shall prepare the specification(s) as a part of their purchase request.

B.

Dividing Requirements. Contract or purchase order requirements shall not be artificially divided so as to constitute a small purchase or to avoid complying with any other provision of this chapter.

C.

Encumbrance of Funds. The purchasing agent, or others authorized to establish purchase orders, shall not issue any contract or purchase order for supplies, equipment, services and construction materials unless there exists an unencumbered appropriation in the proper account against which the purchase is charged.

D.

Purchase of Surplus Commodities. The purchasing agent is authorized to procure, when economically feasible, commodities from other governmental agencies which are surplus to their requirements and determined to be valid needs of this city.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

A.

Definitions. For purposes of this section:

"City Manager" shall mean the city manager or his/her designee.

"Market Value" is the value estimated by the city manager or his/her designee at which the property would sell if offered at auction or other open competitive bid sale.

"Surplus Personal Property" shall mean any personal property or equipment owned by the City of Grass Valley which a department head determines, subject to approval of the city manager or the city council, is no longer needed or used for city purposes or which has become obsolete, worn out or past its useful life.

B.

Prior to disposal, a list of surplus city personal property specifying the item, its actual or estimated purchase price and date of purchase and its estimated present value shall be submitted to the city council for approval as to its "surplus" status. Surplus personal property of the city shall be disposed of on annual or semi-annual basis, in the following manner:

The city manager may authorize the sale or disposition of surplus personal property which has a market value equal to or less than his/her contracting authority.

The city council may authorize the sale or disposition of surplus personal property which has a market value in excess of the city manager's contracting authority.

Any surplus personal property within his/her contracting authority may be sold or disposed of by the city manager as follows:

a.

Surplus personal property with an estimated market value of greater than five thousand dollars per individual item of property shall be sold under sealed bid or by public auction. Public auctions may include electronic bidding or auction services.

b.

Surplus personal property with an estimated market value of less than five thousand dollars per individual item of property may be sold or disposed of by any method the city manager determines to be most advantageous to the city considering the value and nature of the property and the cost of sale, including, but not limited to, sale by salvage, recycling or disposal.

c.

Surplus property with less than one hundred dollars value may be disposed of by the department head, upon written approval of the city manager, in the manner most advantageous to the city considering the value of the property and the cost of sale, including, but not limited to, sale by salvage, recycling or disposal.

d.

Disposition of surplus city personal property pursuant to this section shall be "as is" without warranty, express or implied, and the buyer shall agree to pay applicable sales or transfer taxes.

e.

Notwithstanding other provisions in this section, surplus personal property may be sold to another public entity for market value or traded for market value equivalent property or services as approved by the city manager.

f.

Notwithstanding other provisions in this section, surplus personal property of any value may be traded in as consideration toward the acquisition of other personal property upon written approval of the city manager.

g.

Notwithstanding other provisions in this section, surplus personal property of any value may be transferred to other city departments without consideration as approved by the city manager.

Surplus personal property which the city manager deems unacceptable for sale to the public may be disposed of in the manner deemed appropriate by the city manager. Examples of such property include: City-owned animals, law enforcement equipment and property which may pose a hazard to the general public.

C.

The city council may, by resolution, authorize the donation of surplus personal property, if the city council finds that such donation serves a public purpose and/or benefit. All donations pursuant to this section shall be "as is" without warranty, express or implied, and the transferee shall agree to defend, indemnify and hold harmless the city, its officers and employees from any claim, cause of action, damage, loss or liability arising out of the condition of the property or its use by the organization or subsequent transferee.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

A.

No city official or employee shall accept any gratuity or kickback, provide confidential or contractual advance information to any potential bidder, or accept any fee contingent upon the award of a contract. The city will not award any contracts or purchase orders to city officials or employees or to family members of either, or purchase any items for the personal use of any city official or employee, without prior authorization of the city council.

B.

Collusion with Bidder. Any official or employee of the city who shall aid or assist a bidder in securing a contract to furnish supplies, equipment or services at a higher price than that proposed by any other bidder, or who shall favor one bidder over another by giving or withholding information, or who shall willfully mislead any bidder in regard to the character of the commodity called for, or who shall knowingly accept commodities of a quality inferior to those called for by the contract, or to the receipt of a greater amount or different kind of commodity than has been actually received, shall be deemed guilty of a misdemeanor.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

In cases where a sealed bid or public auction is required for the sale of property, reasonable notice to prospective bidders of such sale by sealed bid or public auction shall be given, as determined by the city manager or his/her designee, taking into account the circumstances and the item(s) to be sold.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

A.

Any department disposing of surplus personal property shall document the disposition and provide, in writing, to the finance director or his/her designee, who shall keep a record of sales, exchanges or other disposition of any property disposed of pursuant to the provisions of this chapter, at least the following information:

A description of the property transferred;

The name of the transferee;

The date of transfer;

The gross receipts, net receipts and/or transaction costs; and

A description, including the value of any personal property received in exchange for the property transferred.

B.

Such records shall be kept consistent with the city's records retention policy.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)

A.

Except as provided herein, all transfers, sales, donations or other disposition of real property interests in city property shall be approved by the city council.

B.

All city real property which is deemed surplus property by the city council may be approved for sale or disposition by the city council.

C.

The city council may authorize the method for disposition of real property interests by request for proposal, auction, sealed bid, open public sale process or other means it deems appropriate. The city council may set conditions or parameters which the buyer must meet. When the city council elects to proceed with a request for proposal, price is given strongest consideration, but the city council may also consider other factors, including permissible uses, experience required by the potential buyer, compatibility of a proposed development in the vicinity of the project, and other criteria as described in any offer for sale or request for proposal.

D.

The provisions of this section shall not apply to the grant or sale of minor easements as provided by resolution of the city council.

(Ord. No. 751, § 1(Exh. A), 2-11-2014)