Salinas Municipal Code Art. III-A Local Purchasing Preference

Local businesses contribute significantly to the economic health of the city and to the quality of life of the city's residents and visitors. The Salinas City Council encourages the growth of local businesses by means of increasing the participation of local businesses in the city's purchasing of goods and services through the adoption and the implementation of local purchasing regulations. Current purchasing regulations maximize competition and allow the city to obtain the best price and value for its purchases and contracts and allow for efficient procurement of goods and services with a minimum expenditure of administrative resources. Open competition is a fundamental component of the city's procurement process and this will continue through implementation of the city's local purchasing regulations.

(Ord. No. 2552, § 2, 10-21-2014)

(a) "Bid" or "bids" shall mean a formal written offer, in response to a solicitation, to furnish goods including, but not limited to, supplies, equipment, vehicles, and/or services in conformity with the specifications, delivery terms, and conditions required at a guaranteed maximum cost.

(b) "Bidder" shall mean any person, including any corporation or other business entity, who submits a response to a competitive invitation from the city.

(c) "City" shall mean the city of Salinas acting through the city council, the city manager, the purchasing agent or such other person who is authorized under the city Code or otherwise duly designated to procure and execute contracts on behalf of the city.

(d) "Local business enterprise" means a business enterprise, including but not limited to, a sole proprietorship, partnership or corporation, which has a legitimate business presence in the city of Salinas. Evidence of a legitimate business presence in the city of Salinas shall include:

(1) Having a current city of Salinas business license;

(2) Having a business office within the city of Salinas and employing at least one full-time employee within the city of Salinas;

(3) Being current on all city of Salinas taxes, fees, assessments, and fines;

(4) Not subject to enforcement action by the city or in litigation with the city;

(5) Began doing business within the city of Salinas at least one year prior to the city's inviting bids or quotations for the respective purchases or is a newly established business enterprise which is owned by an individual(s) formerly employed by a local business enterprise, as defined in this subsection, for at least two years immediately prior to the issuance of either a request for competitive bids or request for qualifications from the city; and

(6) Submitting a declaration of local business enterprise on a form provided by the city.

(e) "Public work(s) purchases" shall, for purposes of this article, mean purchases for public works projects. "Public Works Projects" means construction, alteration, demolition, or repair work done under contract and paid for in whole or in part out of public funds. Public Works Project does not include maintenance work, which includes routine, recurring, and usual work for the preservation or protection of any publicly owned or operated facility for its intended purpose.

(f) "Purchase" shall mean the acquisition of those supplies, materials, equipment, or service bought in a single transaction from a single vendor.

(g) "Responsible" shall, for purposes of this article, mean a bidder's quality, fitness, and capacity to perform or otherwise meet the particular requirements of the proposed work or service.

(h) "Responsive" shall mean a bidder's compliance with the solicitation instructions.

(Ord. No. 2576 (NCS), § 1, 8-30-2016; Ord. No. 2689(NCS), § 2, 10-14-2025)

For purchases and procurements of goods, supplies, equipment, materials, and services where price is the determinative factor, the local preference established under this article shall be applied as follows:

(a) In determining the lowest responsible, responsive bidder, bidders who qualify as a local business enterprise shall receive a ten-percent preference. If application of the ten-percent preference results in a responsible, responsive local business enterprise's bid being at or lower than the non-local business enterprise, the contract shall be awarded to the local business enterprise at the local business enterprise's bid amount.

(b) If equal bids are submitted by a local business enterprise and a non-local business enterprise, the contract shall be awarded to the local business enterprise.

(Ord. No. 2552, § 2, 10-21-2014)

Where competitive bidding is utilized for those services where price is not the determining factor and where such services would otherwise be excepted from the competitive bidding requirements pursuant to city Code Section 12-25, including but not limited to contracts covered by the Little Brooks Act (California Government Code section 4525, et seq.) the local preference established under this article shall be applied as follows:

(a) In determining the best-qualified and responsible, responsive bidder, bidders who qualify as a local business enterprise shall receive a credit of ten-percent of the total points.

(b) If equal scores result from the evaluation process for a local business enterprise and a non-local business enterprise, the contract shall be awarded to the local business enterprise.

(Ord. No. 2552, § 2, 10-21-2014)

Notwithstanding what is otherwise provided in this article and where not otherwise excepted as set forth in this article and consistent with the competitive bidding requirement of Charter section 81, a local preference shall be applied to public works contracts as follows:

(a) For purposes of this section only and the application of the local preference for public works contracts, a local business provider shall be defined as:

(1) Having a current city of Salinas business license;

(2) Having its principal business office established at an office space and not a personal residence located within the tri-county area (Monterey County, San Benito County, Santa Cruz County) and employing at least one full-time employee within the tri-County area;

(3) Being current on all city of Salinas tax, fees, assessments, and fines;

(4) Not subject to enforcement action by the city or in litigation with the city;

(5) Began doing business within the tri-county area at least two years prior to the city's inviting bids or quotations for the respective project or is a newly established business enterprise which is owned by an individual(s) formerly employed by a local business enterprise, as defined in this section, for at least two years immediately prior to the issuance of either a request for competitive bids or request for qualifications from the city;

(6) Submitting a declaration of local business enterprise on a form provided by the city.

(b) In determining the lowest responsible, responsive bidder, bidders who qualify as a local business enterprise shall receive a five-percent preference. If application of the five-percent preference results in a responsible, responsive local business enterprise's bid being at or lower than the non-local business enterprise, the contract shall be awarded to the local business enterprise at the local business enterprise's bid amount.

(c) If equal bids are submitted by a local business enterprise and a non-local business enterprise after application of the five-percent local preference, the contract shall be awarded to the local business enterprise.

(Ord. No. 2552, § 2, 10-21-2014)

The provisions of this article and the local purchasing preference established pursuant to this article shall be applicable to purchases or contracts in excess of five thousand dollars.

(Ord. No. 2552, § 2, 10-21-2014)

The local preferences established in this article shall not be applicable to:

(1) Public works contracts where the funding or applicable regulations prohibit the use of preferences.

(2) Grant agreements where use of a preference is prohibited.

(3) Agreements for the design, fabrication or installation of art.

(4) Sole source purchases where the supplies, materials or equipment can be obtained from only one vendor or manufacturer.

(5) Unique services purchases where the purchasing agent and the city council determine that an unusual circumstance or situation exists that make the application of the local preference contrary to the public interest.

(6) Leases, licenses or other interests in property.

(7) Cooperative purchasing.

(8) Emergency purchases.

(9) Purchases where the funding source prohibits the use of preferences.

(Ord. No. 2552, § 2, 10-21-2014)

Notwithstanding what is otherwise set forth in this article, pursuant to the authority granted pursuant to city Code Section 12-27, upon approval of the city council, the purchasing agent shall have the power to purchase for and on behalf of the city any supplies, material, equipment or contractual service without application of the local preference.

(Ord. No. 2552, § 2, 10-21-2014)

The application of a local preference as set forth in this article shall not exempt any local business enterprise to which a contract is let or awarded from having to pay all applicable federal, state or local sales tax.

(Ord. No. 2552, § 2, 10-21-2014)

Any person that submits false information or fails to disclose material information in order to qualify for the local preference pursuant to this article shall:

(a) Pay the city any difference between the contract amount and what the city's cost would have been if the contract had been properly awarded; and

(b) Be prohibited from bidding on any city contract or receiving any city contract for a period of three years of the discovery of facts supporting the same.

(c) Any person who is sanctioned pursuant to this section may appeal the sanction to the city council. Appeals shall be in writing, shall be submitted to the city clerk within ten days of the date of the sanction, and shall clearly state the basis of the appeal. Grounds not stated in the appeal may not be considered.

(Ord. No. 2552, § 2, 10-21-2014)

(a) No less than annually, city staff will report to the city council the total number and dollar amounts of contracts awarded and the dollar percentage of distribution between no-local and local vendors. When the contracts are presented to the city council for approval, city staff will indicate in its report whether the vendor selected is local or non-local.

(b) Any person claiming to be a local business enterprise as defined in this article shall so certify in writing under penalty of perjury on a declaration of local business enterprise form provided by the city that they meet all the criteria listed in city Code Section 12-28.020, subsection (d). A local business enterprise shall be required to submit such declaration on an annual basis and shall immediately notify the city's finance director if there is any change in circumstances which would disqualify it from application of the local preference. The city shall not be responsible or required to verify the accuracy or any such certifications and shall have sole discretion to determine if a person meets the definition of "local business enterprise.

(Ord. No. 2552, § 2, 10-21-2014)