Ione Municipal Code Ch. 2.44 Purchasing and Bidding Policy

Footnotes:

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Editor's note— Ord. No. 505, adopted November 6, 2019, amended Chapter 2.44 in its entirety to read as herein set out. Former Chapter 2.44, §§ 2.44.010—2.44.120, pertained to the purchasing department, and derived from Ord. No. 133, 1968; Ord. No. 436, adopted September 21, 2010 and Ord. No. 462, adopted March 19, 2013.

The City of Ione hereby establishes a purchasing and bidding policy under the direction of the city manager and finance office director.

(Ord. No. 505, 11-16-2019)

The purchase and bidding policy provides a fair and equitable process for all interested and qualified vendors in providing a bid to the city. The city will make an award in a manner consistent with the city purchase and bidding policy. Any exceptions to this policy must be approved by the city council. The city council may, by majority vote and in accordance with its fiduciary responsibilities, approve expenditures of any amount, for any length of term, not otherwise inconsistent with any applicable law.

(Ord. No. 505, 11-16-2019)

The duties of the city manager and/or finance office director, or their designee, shall be to make and provide all purchases of materials and services for the city:

A. As are required and requested by the various departments and activities of the city which are usual, normal and necessary for the achievement of the end objective of said departments and are within and contemplated by the regularly adopted budget of the city for said department or departments; and

B. As requested by various departments and as specifically authorized by the city council, whether included within or without the then valid budget for said city.

(Ord. No. 505, 11-16-2019)

The city purchasing department will set up and submit to the city council, for its approval, and within 60 days after the appointment by the city council of the purchasing agent, proposed rules and regulations with respect to the policy of purchasing, the manner of purchasing and the coordination of such purchases with budgetary provisions and limitations, and, when such rules and regulations have been adopted by the city council, then, and continuing from the date of said adoption until otherwise modified, such rules and regulations shall afford direction to the city purchasing department and to the city purchasing agent in the exercise of the duties, responsibilities and authority granted by this chapter.

Definitions:

"City manager" means the appointed city manager or a designee authorized to act on behalf of the city manager.

"Department director" means the city employee or consultant authorized to act as the head of a city department or authorized designee acting on behalf of the director, regardless of title.

(Ord. No. 505, 11-16-2019)

No provision in this chapter abrogates or alters the basic legal requirements for competitive bidding for materials and services where otherwise required by state law.

(Ord. No. 505, 11-16-2019)

A. Definition. "Local business" means a vendor, contractor, or consultant who has paid its local business tax to the City of Ione at least 24 months prior to bid or proposal opening date; does business in the City of Ione by providing goods, services, or construction; and maintains a physical business address located within the 95640 ZIP Code and performs business within such geographical limit on a day-to-day basis. Post office boxes shall not be used for the purpose of establishing said physical address. However, should there be a lack of bids by a local business, preference will be next given to bidders within Amador County and then to all others in that order.

B. Local Preference in Purchasing. In bidding for, or letting contracts for procurement of, supplies, materials, and equipment, as described in the purchasing policies of the city, the city council, or other authorized purchasing authority, may give a preference to local businesses in making such purchase or awarding contracts in an amount not to exceed five percent of the local business' total bid price.

The total bid price shall include not only the base bid price, but also all alterations to the base bid price resulting from alternatives which were both part of the bid and actually purchased or awarded by the city council or other appropriate authority.

C. Local Preference for Services. In awarding contracts for services, including consultant services, preference to local businesses shall be given whenever practicable, and, the contractor or consultant will also, to the extent legally permitted, solicit applications for employment and proposals for subcontractors and sub-consultants for work associated with the proposed contract from local residents and firms as opportunities occur and hire qualified local residents and firms whenever feasible.

D. Local Preference in Public Works Contracts (Sub-Contracting).

1. A contractor shall use good faith efforts to sub-contract the supply of materials and equipment to local business enterprises and to sub-contract services to businesses whose work force resides within the 95640 ZIP Code.

2. A "good faith" effort, includes but is not limited to, the following or similar actions to recruit and maintain a work force that resides within the 95640 ZIP Code.

a. Contact local recruitment sources to identify qualified individuals.

b. Advertise in local trade papers and local newspapers of general circulation in the 95640 ZIP Code area.

c. If portions of the work are performed by subcontractors, identify qualified subcontractors whose workforce includes persons living within the 95640 ZIP Code or demonstrate that no local subcontractors are qualified to perform the work or supply the materials or equipment.

d. Develop a written plan to recruit a work force within the 95640 ZIP Code.

e. Establish a goal for local hiring that is based upon the types of skills needed to complete the project with the city.

3. Any notice inviting bids that may require the use of subcontractors shall include notification of this section.

4. Every bidder must complete and sign under penalty of perjury a certification of good-faith effort to hire a work force that resides within the 95640 ZIP Code or within Amador County if not within the City of Ione, on the form provided in the City of Ione's bid package, and submit said certification with the sealed bid no later than the date and time of the bid opening. Bidder shall attach to the certificate documentary evidence supporting bidder's promise to meet or make a good-faith effort to meet the local hiring goal. The purchasing agent may reject as non-responsive the bid of any contractor proposing to use subcontractors that fails to comply with the requirements of this subsection.

5. If the city finds that a contractor to whom a city contract for public works has been awarded, or a subcontractor listed by contractor on a public works project, has failed to comply with the good-faith requirement during the performance of the contract, the city may disqualify the contractor and/or subcontractors for bidding or being listed in any bid on any city contract for public works for a period of one year from the date of the city's disqualification. The city clerk shall keep a current list of all disqualified contractors and subcontractors on file.

E. Exceptions to Local Business Preference Policy. The preference set forth in this section shall not apply to the following purchases or contracts:

1. Goods or services provided under a cooperative purchasing agreement.

2. Purchases or contracts which are funded in whole or in part by a governmental entity, other than the city, and the laws, regulations, or policies governing such funding prohibit application of that preference.

3. Purchases made or contracts let under emergency or noncompetitive situations.

4. Application of the local business preference to a particular purchase, contract, or category of contracts for which the city council is the awarding authority may be waived at the city council's discretion.

(Ord. No. 505, 11-16-2019)

A. In the bidding of a construction contract, procurement of goods, or delivery of services, the purchasing agent shall give a preference to a small business in an amount not to exceed five percent of the small business total price. The total bid price shall include not only the base bid price, but also all alterations to the base bid price resulting from alternatives which were both part of the bid and actually purchased or awarded by the city council or other appropriate authority. This preference shall not be in addition to any preference granted under Section 2.44.080(B).

B. As used in this section, "small business" means a business entity that has for at least the 24 months prior to submittal of its bid: (i) held a current business license issued by the city, and (ii) maintains its principal business office within the 95640 ZIP Code, and that either employs fewer than 100 employees or has average annual gross receipts of $10,000,000.00 or less over the previous three years.

C. No preference shall be given pursuant to this section where legal constraints on the expenditure of funds prohibit the giving of such contract.

(Ord. No. 505, 11-16-2019)

A. Any vendor or consultant claiming to be a local business or small business shall so certify in the bid in writing. The purchasing agent shall not be required to verify the accuracy of any such certifications, and shall have the discretion to determine if a vendor or consultant meets the definition of "local business" or "small business." The decision of the purchasing agent declaring that any person or business is not a local business or small business shall be subject to appeal.

B. Enforcement.

1. The information furnished by each bidder requesting a local business or small business preference shall be under penalty of perjury.

2. No person or business shall knowingly and with intent to defraud, fraudulently obtain, retain, attempt to obtain or retain, or aid another in fraudulently obtaining or retaining or attempting to obtain or retain certification as a local business or small business for the purpose of this chapter.

3. No person or business shall willfully and knowingly make a false statement with the intent to defraud, whether by affidavit, report, or other representation, to a city official or employee for the purpose of influencing the certification or denial of certification of any entity as a local business or small business.

4. A business which has obtained city certification as a local business or a small business by reason of having furnished incorrect supporting information or by reason of having withheld information, and which knew or should have known the information furnished was incorrect or the information withheld was relevant to its request for certification, and which by reason of such certification has been awarded a contract to which it would not otherwise have been entitled, shall:

a. Pay to the city any difference between the contract amount and what the city's costs would have been if the contract had been properly awarded;

b. Be subject to debarment from future award of contracts from the city at the discretion of the city.

(Ord. No. 505, 11-16-2019)

The preferences established in this section shall in no way be construed to inhibit, limit or restrict the right and obligation of the city council and the purchasing agent to compare quality and fitness for use of supplies, materials, equipment, and services proposed for purchase and to compare the qualifications, character, responsibility, and fitness of all persons, firms, or corporations submitting bids or proposals. In addition, the preferences established in this section shall in no way be construed to prohibit the right of the city council or the purchasing agent from giving any other preference permitted by law or this chapter.

(Ord. No. 505, 11-16-2019)

A. The city manager may designate public works projects or parts thereof that require specialized skills or cost in excess of $2,000,000.00 to be subject to prequalification of bidders.

B. To become a prequalified bidder, a contractor must submit to the city a prequalification application consisting of a standardized questionnaire, financial statement, and statement of experience. The forms for the questionnaire, financial statement, and statement of experience will be provided as part of the prequalification bidding packet.

C. The questionnaires and financial statements submitted by prospective contractors are not public records and are not subject to public inspection. Records of the names of contractors applying for prequalification status are public records and subject to disclosure. Documents submitted by a prospective contractor will be submitted under penalty of perjury.

D. The city will rate prospective contractors in accordance with the rating system attached as Exhibit "A" ("rating system"). The city will devise the questions, process and scoring of the rating system, so as to best evaluate a contractor's ability to successfully complete a particular project. The city will complete the rating system prior to closing of the period for submission of pre-qualification packages for any given project or pre-qualification process. The rating system will be applied uniformly and objectively to all prospective contractors, which have submitted properly completed documents in accordance with this policy.

Editor's note— Exhibit "A" was not included in the codification of this chapter.

The city may determine that only a certain number of the top scoring rated contractors shall be considered prequalified for a specific project. This determination shall be made prior to issuing the notice inviting pre-qualifications for the specific project.

E. When the city uses this pre-qualification process, the only contractors eligible to submit a bid are prequalified contractors. Further, such contractors shall submit bids only naming a prequalified subcontractor, if the city also pre-qualifies subcontractors in a similar manner as prime contractors. Any bid received listing an unqualified subcontractor will automatically be disqualified as nonresponsive. No bid shall be accepted for the project from unqualified contractors.

F. A contractor's pre-qualification status will immediately terminate if: (1) the contractor fails to give the city written notice of changes in the information previously provided within ten days before a bid opening; (2) the contractor's license is suspended or terminated by the California State Licensing Board; (3) the contractor is convicted of any crime of moral turpitude; (4) the contractor's application contains materially false information; or (5) the contractor's control over a public works contract, whether within the city's jurisdiction or otherwise, is terminated for cause.

G. The city shall give written notice to each contractor of the pre-qualification determination for that contractor. A contractor may appeal a rating of "not qualified," including a decision to revoke a previous qualified rating. There is no appeal from a finding that a contractor is not pre-qualified because of a failure to submit required information, because of failure to submit required information in a timely manner, because of the omission of requested information or because of the falsification of information. Without a timely appeal, the contractor waives any and all rights to challenge the decision of the City of Ione, whether by administrative process, judicial process, or any other legal process or proceeding.

H. A contractor may appeal the decision as follows:

1. By giving written notice of appeal to the city manager no later than ten days after receipt of the not qualified rating.

2. The notice of appeal shall contain at least the following:

a. The name, address and telephone number of the person making the appeal;

b. A description of the determination which is the subject of the appeal, and the date of the notice of determination; and

c. A brief description of the grounds for the appeal.

I. The city will provide the contractor with a written statement of the basis for the not qualified determination and supporting evidence received from others or adduced as a result of investigation.

J. The informal hearing is to be concluded no later than five business days after the City of Ione's receipt of the notice of appeal, and no later than five business days prior to the last date for the receipt of bids on the project. It is the intention of the City of Ione that the date for the submission and opening of bids will not be delayed or postponed to allow for completion of an appeal process.

K. The city manager or designee shall hear the appeal. The hearing shall be an informal one. The contractor may rebut evidence which is the basis for the determination and present evidence why the contractor is qualified.

L. The city manager or designee may affirm the earlier determination or reverse the determination and assign a different rating. This decision will be in writing containing a summary of the facts that led to the decision. The decision of the city manager is final. A contractor shall have no right to appeal that decision to the council.

M. The city manager may cancel the pre-qualification process at any time during the prequalification process, even after receiving and scoring applications. If the pre-qualification process is cancelled, the normal competitive bidding rules will apply. The city assumes no liability for the cost a prospective contractor may have incurred by submitting an application for pre-qualification, and the submittal of a pre-qualification application is a waiver to claim any such cost or losses due to cancellation of the process.

(Ord. No. 505, 11-16-2019)

A. Vendor Limit. Combined purchase orders cannot exceed $50,000.00 per vendor, per fiscal year except in the case of major expenditures in which a vendor has participated in a public formal bidding process.

B. Change Orders or Amendments. A change order or amendment is a change in a contract term, other than as specifically provided for in the contract, that authorizes or necessitates any increase or decrease of the cost of the contract or in the time of completion that can be authorized by the city manager or department director. A valid request for a change order or amendment must meet the following criteria:

1. The change was not reasonably foreseeable at the time that the contract was signed;

2. The change must be relevant to the original contract; and

3. The change is authorized by the contract provisions and in the best interest of the city.

C. Conflict of Interest. No employee, officer, councilmember, or agent shall participate in the selection, award, or administration of a contract if he or she has a real or apparent conflict of interest. Such a conflict of interest would arise when the employee, officer, councilmember, agent, or any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated, herein, has a financial or other interest in or a tangible personal benefit from a firm considered for a contract.

Nothing in this policy does or is to be construed as limiting the applicability of any other federal, state, or local laws and regulations governing prohibitions against financial conflicts of interest, including but not limited to the Political Reform Act (Government Code Section 81000 et seq.) and implementing regulations from the Fair Political Practices Commission (Title 2, Section 18110 et seq., of the California Code of Regulations), and Government Code Sections 1090—1999 and 1126. All such laws and regulations shall apply to every employee, officer, councilmember, and agent of the city.

D. Local Vendors. Purchasing goods and services from local vendors which stimulate the local economy is encouraged but not required.

E. Green Purchasing Practices. The city is committed to green purchasing practices in obtaining goods and services. The city shall consider environmentally-preferable products when appropriate. Nothing in this policy requires the procurement of products that do not adequately perform their intended use, requires procurement that excludes adequate competition, or requires the procurement of products that are unavailable at a reasonable price or at a reasonable time. An environmentally-preferable product means a product that meets any of the following criteria:

1. Is durable, repairable, reusable, or recyclable;

2. Has minimal packaging, toxic content, or chemical-hazard potential;

3. Is resource or energy efficient in any or all phases of its manufacture, use, or disposal; or

4. Its use or disposal minimizes or eliminates the city's potential environmental liability.

(Ord. No. 505, 11-16-2019)

Purchases, which include those made by purchase order (PO), written agreement, amendment or change order that require city expenditures, are classified into five categories based on the anticipated expenditure amount. Each category establishes an authorization level, procurement method, and maximum term, which shall apply unless specifically exempted in accordance with this policy.

A. Expenditures of $50.00 or Less.

Note: These transactions take the place of ordinary ongoing purchases and shall be limited in use.

A cash disbursement or reimbursement may be obtained from the finance department and must not exceed $50.00. A petty cash request form shall be completed and signed by the department director before submittal. The form shall include the date, description of the item to be purchased, and account number. Petty cash amounts will be advanced to accommodate miscellaneous minor expenditure amounts of $50.00 or less and for which normal payment provisions are not practical. The finance department will periodically audit petty cash expenditures as to form and regulations and may confirm purchases.

B. Expenditures of $51.00 to $5,000.00 During the Initial Term. [5]

C. Expenditures of $5,001.00 to $10,000.00 During the Initial Term.

D. Expenditures of $10,001.00 to $15,000.00 During the Initial Term.

E. Expenditures over $15,001.00.

F. Report to City Council. Any and all expenditures by department director or city manager in excess of $1,000.00 shall be reported to the city council at the next regular council meeting following said expenditure. Said report may be in the form of a list provided by the city manager describing the purpose and the amount of the expenditure.

(Ord. No. 505, 11-16-2019)

Footnotes:

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For purposes of this policy, the "initial term" shall be either: (i) a term under the contract or PO not to exceed one year, or (ii) a term longer than one year but not to exceed the maximum number of years authorized under a "Term limit" (set forth below) as long as the contract includes a continuing obligation for performance by a contracting party and the city has an obligation for payment only for the services actually performed and accounted for by invoice or other monthly or regular periodic documentation acceptable to the city. Under any contract or PO, either the contracting party or city may terminate the contract or PO prior to the expiration of the initial term for the other party's nonperformance.

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Designee must have signature authorization form on file with the finance department, or active designation letter for a specific date range.

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"Informal" bid/proposal means verbal or written, via telephone, e-mail or other casual medium.

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The city's templates for contracts, agreements, amendments and change orders shall be used for category D and E purchases. The city manager may allow for modifications of these templates or use of other contracts, agreements, amendments and change orders, or may require use of city templates for category B and C purchases when the city manager determines it is prudent due to the level of risk exposure to the city, the need to spell out a complex scope of work, or any other reason s/he believes to be in the best interest of the city. To meet prevailing wage requirements any maintenance or repair project over $15,000.00 or construction project over $25,000.00 will require a written contract.

A. Formal Bids for Major Public Works Projects and Major Supplies and Equipment Purchases. Major public works projects and supplies and equipment are defined as purchases and projects having an actual or estimated value of greater than $50,001.00. The solicitation and selection of bids and award of contracts shall comply with the Ione Municipal Code (public works contracts), and this policy, and shall be administered through each city department, according to the following procedures:

1. Invitation for Bids. An invitation for bids (the "invitation") shall be published at least two times in a newspaper, electronic bulletin board or online submission source, city website, or other generally-recognized source of local public works contract information, at least ten days and at least five days prior to the date of the opening of bids. Invitations shall include general descriptions of the work to be performed, the time and place of the opening of bids, the place where bidders may obtain bid documents, the amount of bid security required, and the amount and nature of performance and labor materials security that will be required.

2. Form of Bids. Bids conforming to the requirements of the invitation shall be submitted to the department director (the "director") in sealed packages or by other means which will prevent the divulging of bids prior to the stated time for opening of bids, all as specified in the invitation or the bid documents. Unopened bids should be clearly marked or otherwise identifiable as bids for the project to which they apply.

3. Bid Security for Public Works Projects. Bids for public works projects shall be accompanied by cash, cashier's check, certified check, surety bond, or other form of security stated in the invitation or bid documents, in a sum equal to at least ten percent of the amount of the bid.

4. Opening of Bids. At the time and place stated in the invitation, the bids shall be publicly opened and announced. The bid amounts shall be tabulated and the tabulation shall be available for public inspection at the public works department during regular business hours for a period of not less than 30 calendar days after the bid opening.

5. Review of Bids. The director shall review all bids received for completeness, accuracy, responsiveness to the invitation and the bid documents, and the city's experience with or knowledge of the qualification and reliability of each bidder and shall prepare a recommendation to the city council. Written amounts shall take precedence over associated numeric amounts. Mathematical errors, if found, shall be corrected and shall not disqualify a bid. The corrected total shall be the bid amount considered in determining the lowest responsible bidder and shall be the contract amount awarded if the bid is selected.

6. Award of Contract. Contracts shall be awarded by the city council to the lowest responsible bidder. Determination of the lowest responsible bidder shall be at the sole discretion of the city council pursuant to findings and recommendations presented by the director at the time of the award of contract.

7. Equal Bids. If two or more equal low bids are received, the city council may award the contract to any one of the equal low bidders by the following:

a. Select one bid;

b. Reject all bids and re-solicit for bids;

c. Reject all bids and authorize negotiated agreement if consistent with federal and state laws;

d. Select one bid, which is the most responsible bidder; or

e. Take any other action that the city council deems to serve the best interest of the city.

8. No Bids. When no bids are received from responsible firms, the city council may accomplish the project in any manner it sees fit.

9. Rejection of Bids. The city council may reject any or all bids presented and may then direct that the project be re-advertised, may authorize negotiation of a contract with one or more responsible firms, or may resolve that the project can be performed more economically by city forces, day labor, time and materials contract, or other method.

10. Execution of Contract. The successful bidder shall execute the contract and furnish required performance security and labor and materials security when required pursuant to the bid document.

11. Forfeiture of Bid Security for Public Works Projects. If the successful bidder fails to execute the contract and furnish security within the stated time, and said failure is not primarily due to actions or omissions of the city or to acts of god, the bidder shall forfeit the bid security provided. The city council may then consider the bid of the next lowest responsible bidder.

12. Release of Bid Security for Public Works Projects. Bidders are entitled to the return of their bid security unless forfeited as provided herein. The city shall retain all bid security until a contract has been executed or until the city council rejects all bids at which time all bid security not forfeited shall be returned to the appropriate bidders.

13. Disposition of Forfeited Bid Security for Public Works Projects. The city shall retain forfeited bid security until a contract is awarded to another firm or the project is cancelled. The city shall retain an amount equal to the difference between the forfeiting firm's bid and the new contract amount, if any, and an additional amount equal to administrative and other costs incurred as a result of the failure of the forfeiting bidder to enter into a contract and provide required security, and shall return any remaining amount of the bid security to the forfeiting bidder.

14. Performance Security and Labor and Materials Security for Public Works Projects. The bidder to whom the contract is awarded (the "successful bidder") shall furnish performance security and labor and materials security in amounts specified in the invitation or bid documents.

B. Formal Proposals for Major Professional and Technical Services. Major professional and technical services are defined as services having an actual or estimated value of greater than $50,001.00. The solicitation and selection of proposals and award of contracts shall comply with the Ione Municipal Code, and this policy, and shall be administered through each city department, according to the following procedures:

1. Maintenance and Repair Services. Services intended to preserve and/or restore a public work to a clean, safe, efficient, and/or continually usable condition. Maintenance and repair services include, but are not limited to: carpentry, electrical, painting, plumbing, glazing, and other craftwork to preserve a facility in the condition for which it was intended; repairs, cleaning and other operations on machinery and other equipment permanently attached to a facility as fixtures; the mowing, pruning, and trimming of lawns, grass, trees, shrubs, bushes and hedges; and the regular removal or relocation of by-products or waste products accumulated at city facilities as the result of ongoing environmental processes.

2. The city manager shall approve the preparation and release of all requests for proposals (RFP) and requests for qualifications (RFQ).

3. City staff shall determine, based on professional judgment, whether an RFP or an RFQ process best suits its needs and city staff, or a city-authorized consultant, shall prepare the RFP/RFQ document.

4. City staff, or a city-authorized consultant, or both shall prepare a list of suitable firms from known registries, professional organizations, and/or any other source.

5. City staff shall issue the RFP/RFQ to suitable firms, and may also advertise for competitive proposals.

6. City staff shall form a selection committee, which may include private consultants, to review the RFPs/RFQs received, and the selection committee may conduct interviews and/or hold discussions with proposing firms.

7. The selection committee shall rank the proposing firms according to the criteria specified in the RFP/RFQ and city staff shall notify firms of their position in the ranking.

8. City staff, or a city-authorized consultant, shall negotiate with the top-ranked firm to arrive at mutually-acceptable contract terms.

9. City staff, or its authorized consultant shall terminate negotiations and begin negotiations with the next-ranked firm if an agreement cannot be reached and continue this process until negotiations are successfully concluded or until the list of qualified firms submitting proposals is exhausted and an agreement cannot be reached.

10. The city council shall award or reject the contract negotiated by city staff.

C. Procurement Procedures—Non-Major Expenditures ($50,000.00 and Under).

Informal Bids or Proposals. Intermediate, minor, and operational expenditure category projects, including minor public works projects, supplies, goods, equipment and minor services are defined as projects having an actual or estimated value of $50,000.00 or less. The solicitation and selection of bids and award of contracts shall comply with the Ione Municipal Code for public works projects, service contracts, and this Policy, and shall be administered through each city department, according to the following procedures:

1. Informal bids shall be obtained verbally or in writing as dictated by this policy from the open market and a written record of informal bids shall be kept with the related PO.

2. Bid Security. Security and labor and material security shall conform to the requirements for major public works projects but may be modified or waived by the city staff person authorized to make the purchase if warranted and in the best interest of the city.

3. Execution and Award of Contracts. The city council may award contracts, or the city manager, or designated city director, or staff personnel may award and execute contracts, set forth in Categories A, B, C or D above, and may waive competitive bidding requirements if in the best interest of the city, provided there are unencumbered appropriations in the fund accounts against which the expenses are to be charged.

D. Exemption to Any Procurement Method. Justification for exemption to any required procurement method may be submitted to the city manager or in the case of a major expenditure, to the city council under the following circumstances:

1. Sole-Source or Select-Source Purchase. To determine that a sole-source or select-source purchase exists, rationale and/or proof must be provided in the purchase requisition.

a. Acquisition of brand name to insure compatibility with other city products and equipment. For example standardization of fleet inventory (select-source).

b. Change orders additions to an original scope of work when the original source is the only reasonable one to provide the additional goods, construction work or service needed (select-source).

c. Only one manufacturer or vendor makes and/or sells the required equipment (sole-source).

2. State, county, or other public agency cooperative purchasing program or contracts utilizing funding or other participation from agencies which require conformance with state, federal or other contracting regulations.

3. The city does not require a contract for equipment purchases such as a specific type or brand of supply or part necessary for acceptable operation of a machine or device, or as required by warranty or contract on the machine or device; written documentation supporting a purchase must be provided.

4. Emergency purchases made necessary by an immediate threat to life or property or a substantial disruption of a vital public service.

a. In advance of any local emergency, the city seeks to retain a list of available local businesses willing to provide necessary supplies, materials, equipment, services, food, care or shelter to the city through the office of emergency management. Once the emergency operations center (EOC) is activated, these memorandums will be activated.

b. In the event of an emergency, the city manager or designee may make immediate purchases of goods and services. Emergency purchases include any purchase required to prevent imminent danger or to prevent or mitigate the loss or impairment of life, health, property, or essential public services. Every effort shall be made to obtain advance approvals or to obtain approvals as soon as possible following the purchase.

c. The city is not required to engage in either formal or informal competitive bidding in an emergency. The city council delegates to the city manager and city manager's designee the authority to waive any procedures in the policy that are not statutorily mandated when making emergency purchase of supplies, equipment, materials or services.

d. The city council shall ratify emergency suspension of procedures at the next properly noticed council meeting following the emergency procurement and consider whether further suspension of procedures is required to abate the impacts of the emergency.

5. The awarding officer(s) may waive irregularities in formal or informal bids received provided that it is in the best interest of the city to do so, and it does not result in unfair advantage to any bidder.

6. The city council may authorize the award and execution of contracts without competitive bidding provided that such award is in the best interest of the city, or of the public health, safety and welfare.

(Ord. No. 505, 11-16-2019)

This section pertains to federal-funded projects and purchases.

A. Any procurement made pursuant to a federal award or subject to reimbursement, in whole or in part, with federal funds must comply with the city's procurement procedures and all applicable procurement standards codified in 2 CFR 200.318-200.326 to include the following:

1. Comply with general federal requirements and recommendations:

a. Comply with currently applicable Department of Homeland Security Standard Terms and Conditions.

b. Comply with the Solid Waste Disposal Act, 2 CFR section 200.322.

c. Complete a cost or price analysis, including independent estimates, when necessary under 2 CFR 200.323.

d. Profit must be negotiated as a separate element of price, where required under 2 CFR 200.323(b).

e. Use of federal excess and surplus property is encouraged over purchasing new.

f. Geographical (local) preferences may not be used, unless expressly authorized by the awarding agency.

g. A time and materials contract or a "cost-plus" contract may not be used.

h. Intergovernmental agreements are encouraged where appropriate.

i. Procurements are subject to requirements for monitoring and oversights, see 2 CFR 200.318(b).

j. Records must be maintained by each department consistent with 2 CFR 200.318(i).

2. Federal contractors must meet requirements of being responsible contractors (see CFR 200.318(h) and the city will take all necessary affirmative steps to assure minority businesses, women's businesses and labor surplus area firms are used when possible.

3. Consistent with 2 CFR Section 200.320, the city will use one of the following approved procurement methods: Micro-purchases, small purchase procedures, sealed bids (formal advertising), competitive proposals, and noncompetitive proposals.

4. Contracts for federally-funded procurements must comply with 2 CFR Section 200.326, by acknowledging that federal financial assistance will be used to fund the contract, requiring that the contractor comply with all applicable federal law, regulations, executive orders and applicable federal policies; and specifying the federal government is not a party to the contract.

B. General Procurement Standards.

1. Code of Conduct. As representatives of the City of Ione, all employees are expected to conduct themselves in a professional and ethical manner, maintaining high standards of integrity and the use of good judgement. Employees are expected to be principled in their business interactions and act in good faith with individuals both inside and outside the city. The following code of conduct shall govern the performance, behavior and actions of the city, including employees, directors, appointed or elected officials, volunteers, or agents who are engaged in any aspect of procurement, including, but not limited to, purchasing goods and services, awarding contracts and grants, and the administration and supervision of contracts:

a. No employee, director, appointed or elected official, volunteer, or agent of the city shall participate in the selection, award, or administration of contracts supported by a federal award if a conflict of interest is real or apparent to a reasonable person.

b. Conflicts of interest may arise when any employee, officer, or agent of the city, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a real or apparent financial or other interest in or a tangible personal benefit form a firm considered for the contract.

c. No employee, director, appointed or elected official, volunteer, or agent of the city shall do business with, award contracts to, or show favoritism toward a member of his or her immediate family, spouse's family, or to any company, vendor, contractor, or parties to subcontractors who either employ or has any relationship to a family member; or award a contract or bid which violates the spirit or intent of federal, state and local procurement laws and policies established to maximize free and open competition among qualified vendors.

d. The city's employees, directors, appointed or elected officials, volunteers, or agents shall neither solicit nor accept gratuities, favors, gifts, consulting fees, trips, or anything having a monetary value in excess of $25.00 from a vendor, potential vendor, family or employees of a vendor, contractor or parties to subcontractors.

e. Disciplinary measures for violations of the code of conduct by employees, directors, appointed or elected officials, volunteers, or agents who are engaged in any aspect of procurement, including, but not limited to, purchasing goods and services, awarding contracts and grants, and the administration and supervision of contracts could lead to disciplinary measures, up to and including possible termination of employment.

2. Solicitation Procedures.

a. Acquisition of unnecessary or duplicative items must be avoided. Consideration should be given to consolidating or dividing procurements to obtain a more economical purchase. When appropriate, an analysis will be made of lease versus purchase alternatives, and any other appropriate analysis to determine the most economical approach.

b. To foster greater economy and efficiency, and in accordance with efforts to promote cost-effective use of shared services, the city shall enter into state and local intergovernmental agreements or inter-entity agreements where appropriate for procurement or use of common or shared goods and services.

c. Procuring federal excess and surplus property in lieu of purchasing new equipment and property whenever such use is feasible and reduces project costs shall be utilized.

d. Value engineering clauses may be used in contracts for construction projects of sufficient size to offer reasonable opportunities for cost reductions. Value engineering is a systematic and creative analysis of each contract item or task to ensure that its essential function is provided at the overall lower cost.

e. Contracts shall only be awarded to responsible contractors possessing the ability to perform successfully under the terms and conditions of a proposed procurement. Consideration will be given to such matters as contractor integrity, compliance with public policy, record of past performance, and financial and technical resources.

f. Records will be maintained sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. The city clerk will be the repository for said records and shall be maintained for period of no less than seven years.

g. Time and material type contracts (open-ended) may be used only after a determination that no other contract is suitable. Time and material type contract means a contract where the cost to the city is the sum of the actual cost of materials and direct labor hours charged at fixed hourly rates that reflect wages, general and administrative expense, and profit. Each time and material contract will set a ceiling price that the contractor exceeds at its own risk. A higher degree of oversight is required in order to obtain reasonable assurance that the contractor is using efficient methods and effective cost controls.

h. The city alone will be responsible, in accordance with good administrative practice and sound business judgment, for the settlement of all contractual and administrative issues arising out of procurements. These issues include, but are not limited to, source evaluation, protests, disputes, and claims. These standards do not relieve the city of any contractual responsibilities under its contracts. The federal awarding agency will not substitute its judgment for that of the city unless the matter is primarily a federal concern. Violations of law will be referred to the local, state, or federal authority having proper jurisdiction.

3. Competition.

a. All procurement transactions must be conducted in a manner providing full and open competition. In order to ensure objective contractor performance and eliminate unfair competitive advantage, contractors that develop or draft specifications, requirements, statements of work, and invitations for bids or requests for proposals will be excluded from competing for such procurements. Some of the situations considered to be restrictive of competition include, but are not limited to:

i. Placing unreasonable requirements on firms in order for them to qualify to do business;

ii. Requiring unnecessary experience and excessive bonding;

iii. Noncompetitive pricing practices between firms or between affiliated companies;

iv. Noncompetitive contracts to consultants that are on retainer contracts;

v. Organizational conflicts of interest;

vi. Specifying only a brand name product instead of allowing an equal product to be offered and describing the performance or other relevant requirements of the procurement; and

vii. Any arbitrary action in the procurement process.

b. Procurements shall be conducted in a manner that prohibits the use of statutorily or administratively imposed state or local geographical preferences in the evaluation of bids or proposals, except in those cases where applicable federal statutes expressly mandate or encourage geographic preference. Nothing in this section preempts state licensing laws. When contracting for architectural and engineering (A/E) services, geographic location may be a selection criterion provided its application leaves an appropriate number of qualified firms, given the nature and size of the project, to compete for the contract.

c. All solicitations will incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured. Such description must not, in competitive procurements, contain features which unduly restrict competition. The description may include a statement of the qualitative nature of the material, product or service to be procured and, when necessary, must set forth those minimum essential characteristics and standard to which it must conform if it is to satisfy its intended use. Detailed product specifications should be avoided if at all possible. When it is impractical or uneconomical to make a clear and accurate description of the technical requirements, a brand name or equivalent description may be used as a means to define the performance or other relevant requirements of procurement. The specific features of the named brand which must be met by offers must be clearly stated.

d. Bids and proposals shall identify all the requirements which the offerors must fulfill and all other factors to be used in evaluation bids or proposals.

4. Methods of Procurement. In addition to the city's purchasing policy approval limits, one of the following methods should be used:

a. Micro-purchase: Purchases where the aggregate dollar amount does not exceed $3,000.00, or the current limitation set by the Federal Acquisition Regulation at 48 CFR Subpart 2.1, where this threshold is periodically adjusted for inflation.

b. Small purchase: Purchases up to the simplified acquisition threshold, which is currently $150,000.00. Informal purchasing procedures are acceptable, but price or rate quotes must be obtained from an adequate number of sources.

c. Sealed bid: Purchases over the simplified acquisition threshold, which is currently $150,000.00. Under this purchase method, formal solicitation is required, and the fixed price (lump sum or unit price) is awarded to the responsible bidder who conformed to all material terms and is the lowest in price. This method is the preferred procurement method for construction contracts, if the following conditions apply:

i. A complete, adequate, and realistic specification or purchase description is available;

ii. Two or more responsible bidders are willing and able to compete effectively for the business, and,

iii. The procurement lends itself to a firm fixed price contract and the selection of the successful bidder can be made principally based on price.

If this method is used, the following requirements shall apply:

i. The invitation for bids will be publicly advertised and bids must be solicited from an adequate number of known suppliers, providing them sufficient response time prior to the date for opening the bids;

ii. The invitation for bids, which will include any specifications and pertinent attachments, must define the terms or services in order for the bidder to properly respond;

iii. All bids will be publicly opened at the time and place prescribed in the invitation for bids;

iv. A firm fixed price contract award will be made in writing to the lowest responsive and responsible bidder. Where specified in bidding documents, factors such as discounts will only be used in determining which bid is lowest. Payment discounts will only be used to determine the low bid when prior experience indicates that such discounts are usually taken advantage of; and

v. Any or all bids may be rejected if there is a sound documented reason.

d. Competitive proposals: Purchases over the simplified acquisition threshold, which is currently $150,000.00. This procurement method requires formal solicitation, fixed-price or cost-reimbursement contracts, and is used when sealed bids are not appropriate. The contract should be awarded to the responsible firm whose proposal is most advantageous to the program, with price being one of the various factors. If this method is used, the following requirements apply:

i. Requests for proposals must be publicized and identify all evaluation factors and their relative importance. Any response to publicized requests for proposals must be considered to the maximum extent practical;

ii. Proposals must be solicited from an adequate number of qualified sources;

iii. The methods for conducting technical evaluations of the proposals received and for selecting recipients may include, but not limited to: Oral interviews, references, past performance, availability to perform work, and certifications as determined by project scope.

iv. Any response that takes exception to any mandatory items in this proposal process may be rejected and not considered;

v. Contracts must be awarded to the responsible firm whose proposal is most advantageous to the program, with price and other factors considered; and,

vi. Competitive proposal procedures may be used for qualifications-based procurement of architectural/engineering (A/E) professional services whereby competitors' qualifications are evaluated and the most qualified competitor is selected, subject to negotiation of fair and reasonable compensation. The method, where price is not used as a selection factor, can only be used in procurement of A/E professional services. It cannot be used to purchase other types of services, though A/E firms are a potential source to perform the proposed effort.

e. Noncompetitive proposals: Also known as sole-source procurement, this may be appropriate only when one or more of the following criteria are met:

i. The item is available only from a single source;

ii. The public emergency for the requirement will not permit a delay resulting from competitive solicitation;

iii. The federal awarding agency or pass-through entity expressly authorizes noncompetitive proposals in response to a written request from the non-federal entity; or

iv. After solicitation of a number of sources, competition is determined inadequate.

5. Contract Cost and Price. A cost or price analysis shall be performed in connection with every procurement action in excess of the simplified acquisition threshold ($150,000.00) including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, independent estimates shall be made prior to receiving bids and proposals.

a. Profit shall be negotiated as a separate element of the price for each contract in which there is a no price competition and in all cases where cost analysis is performed. To establish a fair and reasonable profit, consideration must be given to the complexity of the work to be performed, the risk borne by the contractor, the contractor's investment, the amount of subcontracting, the quality of its record of past performance, and industry profit rates in the surrounding geographical area for similar work.

b. Costs or prices based on estimated costs for contracts under the federal award are allowable only to the extent that costs incurred or cost estimates included in negotiated prices would be allowable for the city under Subpart E — Cost Principles of Part 200 — Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.

c. The cost plus a percentage of cost and percentage of construction cost methods of contracting shall be used.

6. Federal Awarding Agency or Pass-Through Entity Review.

a. The city shall make available, upon request of the federal awarding agency or pass-through entity, technical specifications on proposed procurements where the federal awarding agency or pass-through entity believes such review is needed to ensure that the item or service specified is the one being proposed for acquisition. This review generally will take place prior to the time the specification is incorporated into a solicitation document. However, if the city desires to have the review accomplished after a solicitation has been developed, the federal awarding agency or pass-through entity may still review the specifications, with such review usually limited to the technical aspects of the proposed purchase.

b. The city will make available upon request, for the federal awarding agency or pass-through entity pre-procurement review, procurement documents, such as requests for proposals or invitations for bids, or independent cost estimates, when:

i. Procurement procedures or operations fails to comply with the procurement standards in this part;

ii. The procurement is expected to exceed the simplified acquisition threshold ($150,000.00) and is to be awarded without competition or only one bid or offer is received in response to a solicitation;

iii. The procurement, which is expected to exceed the simplified acquisition threshold, specifies a "brand name" product;

iv. The proposed contract is more than the simplified acquisition threshold and is to be awarded to other than the apparent low bidder under a sealed bid procurement; or

v. A proposed contract modification changes the scope of a contract or increases the contract amount by more than the simplified acquisition threshold.

c. The city is exempt from the pre-procurement review in paragraph b. of this section if the federal awarding agency or pass-through entity determines that its procurement systems comply with the standards of this part.

d. The city may request that its procurement system be reviewed by the federal awarding agency or pass-through entity to determine whether its system meets these standards in order for its system to be certified. Generally, these reviews must occur where there is continuous high-dollar funding, and third-party contracts are awarded on a regular basis;

e. The city may self-certify its procurement system. Such self-certification must not limit the federal awarding agency's right to survey the system. Under a self-certification procedure, the federal awarding agency may rely on written assurances from the city that it is complying with these standards. The city must cite specific policies, procedures, regulations, or standards as being in compliance with these requirements and have its system available for review.

7. Bonding Requirements. For construction or facility improvement contracts or subcontracts exceeding the simplified acquisition threshold ($150,000.00), the federal awarding or pass-through entity may accept the bonding policy and requirements of the city provided that the federal awarding agency or pass-through entity has made a determination that the federal interest is adequately protected. If such a determination has not been made, the minimum requirements must be as follows:

a. A bid guarantee from each bidder equivalent to five percent of the bid price. The bid guarantee must consist of a firm commitment such as a bid bond, certified check, or other negotiable instrument accompanying a bid as assurance that the bidder will, upon acceptance of the bid, execute such contractual documents as may be required within the time specified;

b. A performance bond on the part of the contractor for 100 percent of the contract price. A performance bond is one executed in connection with a contract to secure fulfillment of all the contractor's obligations under such contract; and,

c. A payment bond on the part of the contractor for 100 percent of the contract price. A payment bond is one executed in connection with a contract to assure payment as required by law of all persons supplying labor and material in the execution of the work provided for in the contract.

8. Contract Provisions. All federal funding source compliance provisions shall include the following:

a. Equal Employment Opportunity. All contracts, when funded in whole or partly by monies derived from the federal government (either directly or indirectly), shall contain a provision requiring compliance with Equal Employment Opportunity.

b. Davis-Bacon Act. Applies to construction contracts in excess of $2,000.00. It requires contracts to pay laborers and mechanics wages not less than the prevailing wage as determined by the Secretary of Labor and must be required to pay wages not less than once a week. Each bid solicitation published by the city must contain the current prevailing wage determination. Any award of the contract must be conditioned on contractor's acceptance of that wage determination and suspected or reported violations of this act shall be immediately reported to the federal awarding agency.

c. Copeland "Anti-Kickback" Act. Applies to construction contracts in excess of $2,000.00. It prohibits kickbacks in construction contracts funded with federal monies. Contractors and subcontractors or subrecipients shall be prohibited from inducing any person employed in the construction, completion, or repair of public work, to give up any part of the compensation to which he or she is otherwise entitled and suspected or reported violations shall be immediately reported to the federal awarding agency.

d. Clean Air Act and Federal Water Pollution Control Act. Applies to contracts and sub grants in excess of $150,000.00. Contractor shall be required to comply with all applicable standards, orders or regulations issued pursuant to the Clean Air Act and the Federal Water Pollution Control Act. Suspected or reported violations must be reported to the Federal awarding agency and the Regional Office of the Environmental Protection Agency (EPA).

e. Debarment and Suspension. Contracts funded with federal grant monies may not be awarded to contractors that have been debarred or suspended from receiving federal monies pursuant to the System for Award Management (SAM).

f. Byrd Anti-Lobbying Amendment. Contractors that apply or bid for an award of $100,000.00 must certify that they will not and have not used federal funds to pay any person or organization for influencing or attempting to influence an officer or employee of any agency, a member of Congress, officer or employee of Congress, or an employee of a member of Congress in connection with obtaining any federal contract, grant or any other award.

9. Contracting with Small and Minority Business, Women's Business Enterprises, and Labor Surplus Area Firms. All necessary affirmative steps will be taken to assure that minority business, women's business enterprises, and labor surplus area firms are used when possible. Affirmative steps include:

a. Placing qualified small and minority businesses and women's business enterprises on solicitation lists;

b. Assuring that small and minority businesses and women's business enterprises are solicited whenever they are potential sources;

c. Dividing total requirements, when economically feasible, into smaller tasks or quantities to permit maximum participation by small and minority businesses and women's business enterprises;

d. Establishing delivery schedules, where the requirement permits, which encourage participation by small and minority businesses and women's business enterprises;

e. Using the services and assistance, as appropriate, of such organizations as the Small Business Administration and the Minority Business Development Agency of the Department of Commerce; and

f. Requiring the prime contractor, if subcontracts are to be let, to take the affirmative steps listed in paragraphs a. through e. of this section.

(Ord. No. 505, 11-16-2019)

In accordance with § 20168 PCC, in the event of an emergency, the city council may pass a resolution by a four-fifths vote of its members declaring that the public interest and necessity demand the immediate expenditure of public money to safeguard life, or property. Upon adoption of the resolution, it may expend any sum required in the emergency without complying with § 20162 et sec PCC. If notice for bids to let contracts will not be given, the city council shall comply with chapter 2.5 (commencing with § 22050 PCC.)

(Ord. No. 505, 11-16-2019)

City employees, officers or officials are not entitled to any special consideration from vendors and merchants in their personal affairs nor are such city employees, officers, or officials to attempt to procure materials for the personal use of any other person. City employees, officers or officials shall not solicit or accept gifts except for those items that can be shared by all staff such as food and flowers. Except for emergencies or other authorized exemption, no purchases shall be made without specific authorization as outlined in this policy. The person ordering the unauthorized purchase may be held personally liable for the costs of the purchase or contract.

(Ord. No. 505, 11-16-2019)