Nevada City Municipal Code Ch. 3.08 Purchasing System

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Editor's note— Ord. No. 2022-06, § 2, adopted June 8, 2022, repealed the former chapter 3.08, §§ 3.08.010—3.08.080, and enacted a new chapter 3.08 as set out herein. The former chapter 3.08 pertained to similar subject matter and derived from Ord. 85-11 adopted in 1986; and Ord. 2001-05 adopted in 2001.

In order to establish efficient procedures for the purchase of supplies, services and equipment, to secure for the city supplies, services and equipment at the lowest possible cost commensurate with quality needed, to exercise positive financial control over purchases, to clearly define authority for the purchasing function and to assure the quality of purchases, a purchasing system is adopted.

(Ord. No. 2022-06, § 2, 6-8-2022)

There is created a centralized purchasing division of the finance department in which is vested authority for the purchase of supplies, services and equipment.

(Ord. No. 2022-06, § 2, 6-8-2022)

The director of finance shall be the purchasing agent. The director of finance may delegate any of the powers and duties conferred upon him or her as purchasing agent under this chapter to any other officer or employee of the city. The purchasing agent shall be the head and have general supervision of the purchasing division. The duties of a purchasing agent may be combined with those of any other office or position. The purchasing agent shall have the authority to:

1. Purchase or contract for supplies, services and equipment required by any city department in accordance with purchasing procedures prescribed by this chapter, formally adopted city council policies, such administrative regulations as the purchasing agent shall adopt for the internal management and operation of the purchasing division, and such other rules and regulations as shall be authorized by the City Manager in accordance with this chapter;

2. Negotiate and recommend execution of contracts for the purchase of supplies, services and equipment;

3. Act to procure for the city the needed quality in supplies, services and equipment at least expense to the city;

4. Discourage uniform bidding and endeavor to obtain as full and open competition as possible on all purchases;

5. Prepare and recommend to the City Manager administrative purchasing policies and procedures consistent with the city's municipal code setting forth procedures for the purchase of supplies, services and equipment for the city, the adoption of which and revisions and amendments to which the City Manager is empowered to authorize;

6. Prepare and recommend to the City Manager revisions and amendments to purchasing policies;

7. Keep informed of current developments in the field of purchasing, prices, market conditions and new products;

8. Prescribe and maintain such forms as reasonably necessary to the operation of this chapter and other rules, regulations and policies;

9. Supervise the inspection of all supplies, services and equipment purchased to ensure conformance with specifications;

10. Recommend the transfer of surplus or unused supplies, services and equipment between departments as needed;

11. Maintain a bidders' list, vendors catalog file and records needed for the efficient operation of the purchasing division.

(Ord. No. 2022-06, § 2, 6-8-2022)

The purchasing agent, with approval of the City Manager, may authorize, in writing, any city department to purchase specified supplies, services and equipment independently of the purchasing division; but he or she shall require that such purchases shall be made in conformity with the procedures established by this chapter, and shall further require periodic reports from the agency on the purchases made under such written authorization.

(Ord. No. 2022-06, § 2, 6-8-2022)

All city departments shall file detailed estimates of their requirements in supplies, services and equipment in such manner, at such time, and for such future periods as the purchasing agent shall prescribe.

(Ord. No. 2022-06, § 2, 6-8-2022)

All city departments shall submit requests for supplies, services and equipment to the purchasing agent by standard requisition forms, or by other means as may be established by the city council or City Manager.

(Ord. No. 2022-06, § 2, 6-8-2022)

Purchase of supplies, services and equipment shall be by bid procedures, pursuant to Sections 3.08.100 and 3.08.110. Bidding may be dispensed with only when:

1. An emergency requires that an order be placed with the nearest available source of supply or using the fastest possible method of procurement; or

2. When the amount involved is less than two thousand five hundred dollars ($2,500.00) (bids may be obtained if, in the opinion of the purchasing agent there will be a reasonable possibility of obtaining better prices commensurate with the time and effort expended); or

3. When participating in an established governmental "cooperative purchasing program"; or

4. When purchasing from a supplier who has been awarded a contract resulting from a formal competitive bid process by another governmental agency within the state or by the federal government; or

5. When there is a need to purchase used equipment which may not be available following the formal bid process; or

6. The commodity can be obtained from only one (1) vendor. A commodity shall be considered obtainable only from one (1) vendor when only one (1) vendor offers it for sale, lease or rental, or when only one (1) vendor is able to do so within the time frame and/or under the terms and conditions which reasonably meet the needs of the city, or when there is a sole distributor or manufacturer of a product or service such that there is no acceptable substitute within a specific geographical area.

(Ord. No. 2022-06, § 2, 6-8-2022)

Purchase of supplies, services and equipment shall be made only by purchase order or other documents as authorized by the purchasing agent. No purchase order or other equivalent document to purchase supplies, services or equipment shall be issued without the prior approval of the purchasing agent or his or her designated representative.

(Ord. No. 2022-06, § 2, 6-8-2022)

There shall be three (3) levels of authority for purchases and approval of contracts: department award, City Manager award, and city council award. Generally, authority is established by the dollar amount of the purchase or contract.

1. Department Award—Up to two thousand five hundred dollars ($2,500.00). The City Manager may authorize any department head of the city to purchase supplies, services or equipment as needed for his or her area of responsibility in an amount up to two thousand five hundred dollars ($2,500.00).

2. Purchasing Agent Award—Over two thousand five hundred dollars ($2,500.00) up to fifteen thousand dollars ($15,000.00). The City Manager may authorize the purchasing agent of the city to purchase supplies, services or equipment as needed in an amount up to fifteen thousand dollars ($15,000.00).

3. City Manager Award—Over fifteen thousand dollars ($15,000.00) up to twenty-five thousand dollars ($25,000.00). Subject to the provisions of this chapter, the City Manager shall be authorized to award or approve, and sign, contracts for the purchase of supplies, services or equipment of an estimated value of twenty-five thousand dollars ($25,000.00) or less.

4. City Council Award—Over twenty-five thousand dollars ($25,000.00). All contracts for the purchase of supplies, services or equipment of an estimated value of greater than twenty-five thousand dollars ($25,000.00) shall be approved by the city council. The applicable provisions of state or federal law, this chapter, or any other procedures, rules or regulations adopted by the city council shall apply to such contracts.

(Ord. No. 2022-06, § 2, 6-8-2022)

Except in cases of emergency or in cases where specific authority has been first obtained from the city council, the purchasing agent shall not issue any purchase order or equivalent document (such as a contract) for supplies, services or equipment unless there exist unencumbered funds against which said purchase is to be charged.

(Ord. No. 2022-06, § 2, 6-8-2022)

Except as provided in the City of Nevada City Municipal Code and as otherwise provided herein, purchases of supplies and equipment of an estimated value of greater than twenty-five thousand dollars ($25,000.00) shall be by written contract with the lowest responsible bidder pursuant to the procedure hereinafter prescribed.

1. Notice Inviting Bids. Notices inviting bids shall include a general description of the articles to be purchased, shall state where bid blanks and specifications may be secured, and the time and place for opening bids.

a. Published Notice. Notices inviting bids shall be published at least ten (10) days before the date of opening of the bids. Notices shall be published at least twice in a newspaper of general circulation, published in the city, or if there is none, it shall be posted in at least three (3) public places in the city, one (1) of which places shall be the City Hall.

b. Bidders' List. The purchasing agent shall also solicit sealed bids from all responsible prospective suppliers whose names are on the bidders' list or who have made written request that their names be added thereto.

c. Bulletin Board. The purchasing agent shall also advertise pending purchases by a notice posted on a public bulletin board in the City Hall.

2. Bidder's Security. When deemed necessary by the purchasing agent, bidder's security may be prescribed in the public notices inviting bids. Bidders shall be entitled to return of bid security; provided, however, that a successful bidder shall forfeit his or her bid security upon his or her refusal or failure to execute the contract within ten (10) days after the notice of award of contract has been mailed, unless in the latter event the city is solely responsible for the delay in executing the contract. The city council, on refusal or failure of the successful bidder to execute the contract, may award it to the next lowest responsible bidder or reject all bids. If the city council awards the contract to the next lowest bidder, the amount of the lowest bidder's security shall be applied by the city to the contract price differential between the lowest bid and the second lowest bid, and the surplus, if any, shall be returned to the lowest bidder. If the city council rejects all bids presented and readvertises, the amount of the lowest bidder's security may be used to offset the cost of receiving new bids (and the surplus, if any, shall be returned to the lowest bidder).

3. Bid Opening Procedure. Sealed bids shall be submitted to the purchasing agent and shall be identified as "bids" on the envelope. Bids shall be opened in public at the time and place stated in the public notices. A tabulation of all bids received shall be open for public inspection during regular business hours for a period of not less than thirty (30) calendar days after the bid opening.

4. Rejection of Bids. In its discretion, the city council may reject any and all bids presented and readvertise for bids pursuant to the procedure hereinabove prescribed.

5. Award of Contracts. Except as otherwise provided herein, contracts shall be awarded by the city council to the lowest responsible bidder.

6. Tie Bids. If two (2) or more bids received are for the same total amount or unit price, quality and service being equal, and if the public interest will not permit the delay of readvertising for bids, the city council may in its discretion accept the one (1) it chooses or accept the lowest bid made by and after negotiation with the tie bidders at the time of the bid opening.

7. Performance Bonds. The city council shall have authority to require a performance bond before entering a contract in such amount as it finds reasonably necessary to protect the best interests of the city. If the city council requires a performance bond, the form and amount of the bond shall be described in the notice inviting bids.

(Ord. No. 2022-06, § 2, 6-8-2022)

Purchases of supplies, services and equipment of an estimated value of twenty-five thousand dollars ($25,000.00) or less may be made by the purchasing agent, with the written approval of the City Manager, in the open market pursuant to the procedure hereinafter prescribed; provided, however, that all bidding may be dispensed with for purchases of supplies, services and equipment having a total estimated value of less than two thousand five hundred dollars ($2,500.00).

1. Minimum Number of Quotations. Open market purchases shall, wherever possible, be based on at least three (3) quotations, and shall be awarded to the lowest responsible vendor.

2. Notice Inviting Quotations. The purchasing agent shall solicit bids by written request to prospective vendors, by telephone, and by public notice posted on a public bulletin board in the City Hall.

3. Quotations. Quotations shall be submitted to the purchasing agent who shall keep a record of all open market orders and quotations for a period of one (1) year after the submission of quotations or the placing of orders. This record, while so kept, shall be open to public inspection.

4. Nothing contained in this section shall prohibit the purchasing agent from negotiating and entering into contracts for personal or professional services on terms the purchasing agent determines are most advantageous to the city after consideration of price, quality, demonstrated competence, qualifications, and other relevant factors.

5. Nothing contained in this section is intended to be in conflict with applicable state or federal law.

(Ord. No. 2022-06, § 2, 6-8-2022)

The purchasing agent shall inspect supplies, services and equipment delivered to determine their conformance with the specifications set forth in the order. The purchasing agent shall have authority to require chemical and physical tests of samples submitted with bids and samples of deliveries which are necessary to determine their quality and conformance with specifications.

(Ord. No. 2022-06, § 2, 6-8-2022)

All city departments shall submit to the purchasing agent, at such times and in such forms as shall be proscribed, reports showing all supplies and equipment which are no longer used or which have become obsolete or worn out. The purchasing agent shall have authority to exchange for or trade in on new supplies and equipment all supplies and equipment which cannot be used by department or which have become unsuitable for city use.

(Ord. No. 2022-06, § 2, 6-8-2022)

Notwithstanding the provisions of this Chapter, the immediate requirement of an item or items necessary for the preservation of life or property shall be deemed an emergency. Such purchases may be approved by the City Manager or his designee, provided that a full report of the circumstances of all emergency purchases in excess of five thousand dollars shall be filed with the City Council at its next regular meeting.

(Ord. No. 2022-06, § 2, 6-8-2022)