Scotts Valley Municipal Code Ch. 2.70 Purchasing

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Editor's note— Ord. No. 157.2, § 1, adopted Dec. 7, 2022, repealed the former Ch. 2.70, §§ 2.70.010—2.70.150, and enacted a new Ch. 2.70 as set out herein. The former Ch. 2.70 pertained to similar subject matter and derived from Ord. 157 § 1 (part), adopted 1993; Ord. 157.1 §§ 1, 2 (part), adopted 1996.

This chapter establishes the policy requirements to be followed for the purchase of goods, services and public works construction using public funds. This chapter enumerates the contracting authority of the city council, the city manager, and designated employees.

The purpose of this chapter is to facilitate efficient procedures for the purchase of services, materials, supplies and/or equipment (goods) for the city at the lowest possible cost commensurate with quality needed, to exercise positive financial control over purchases, and to clearly define authority for the purchasing function to assure the quality of purchases.

(Ord. No. 157.2, § 1, 12-7-2022)

For the purpose of this chapter:

"Best value procurement" refers to the application of evaluative factors in addition to price for the purpose of awarding a purchase contract for goods, services and/or Professional services.

"Contract" means all types of city agreements, regardless of what they may be called, for the procurement of goods, services or public works construction.

"Cooperative purchasing" refers to the use of another public entity's procurement process similar to that required by the city in order to purchase goods and/or services that result in time and/or cost savings or otherwise provide the best overall value. The practice of using another public entity's competitive solicitation process can be referred to as "piggybacking."

"Emergency" means any natural disaster, work stoppage or other action or activity that impairs public health, safety or both.

"Formal bidding" refers to the process by which sealed bids or proposals are solicited.

"Informal bidding" refers to the processes by which price quotations are solicited.

"Local vendor" means any wholesaler, distributor, dealer, merchant or seller of goods and/or services with their primary place of business located within the city limits of Scotts Valley.

"Materials, supplies and/or equipment," also referred to as "goods," means all materials, supplies and/or equipment of whatever kind purchased by the city except materials, supplies and/or equipment for public works projects and governed by law related to bidding for public works projects.

"Professional services" means the services of attorneys; physicians; architects; engineers; consultants; auditors; specialized printers; other individuals or organizations possessing a high degree of professional, unique, specialized, technical skill and/or expertise; individuals contracting for special activities or negotiating for the acquisition of land; individuals contracting to provide services related to insurance bonds or any other services of a similar nature engaged for a particular project or series of projects; or other governmental agencies.

"Responsive bidding" means a person or entity who has submitted a bid that conforms in all material respects to the requirements set forth in the bidding documents.

"Responsible bidder" means a person or entity who possesses the demonstrated ability, capacity, experience and skill to deliver the required goods and/or services.

"Services" means all types of service except services provided by persons performing professional services.

"Sole source" refers to a situation where a good or service can only be obtained from one source due to its proprietary or specialized nature, or a situation where product/service compatibility is an overriding consideration to price.

"Surplus property" means materials, supplies, or equipment that is no longer used or has become obsolete, to be sold, exchanged or donated in accordance with established procedures.

(Ord. No. 157.2, § 1, 12-7-2022)

A. City Manager. The city manager shall be designated as the purchasing officer and shall have the authority to:

1. Purchase or contract for public works construction, services, materials, supplies and/or equipment (goods) required by any city department in accordance with purchasing requirements contained in this chapter;

2. Adopt, or submit for adoption to the city council as may be required, such administrative regulations necessary to effectively and efficiently administer the purchasing function;

3. Designate another city employee or employees to function as, or perform the functions of, the purchasing officer;

4. Negotiate and recommend execution of contracts for the purchase of services, materials, supplies and/or equipment;

5. Procure for the city the needed quality in services, materials, supplies and/or equipment for the best overall value in exchange for public funds;

6. Endeavor to obtain as full and open competition as possible on all purchases;

7. Prepare and recommend revisions and amendments to the purchasing ordinance based on best practices or to comply with changes in the law;

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

9. Prescribe and maintain such forms as reasonably necessary to the operation of this chapter and other purchasing rules and regulations;

10. Supervise the inspection of all services, materials, supplies and/or equipment purchased to insure conformance with specifications;

11. Authorize the transfer of surplus or unused supplies, materials and/or equipment between city departments as needed and the sale or trade of all supplies, materials and/or equipment which cannot be used by any city department or which have become unsuitable for city use; and

12. Maintain bidders' lists, vendor catalog files and records needed for the efficient operation of the purchasing office, as required.

B. Responsibilities of End Users. End users of the purchasing system shall:

1. Comply at all times with the requirements of this chapter and associated administrative policies and procedures;

2. Identify procurement needs and the availability of funding;

3. Submit to the designated approver accurate specifications and bidding documents for required goods, services or public works construction;

4. Participate in the evaluation of submitted bids and proposals, as required;

5. Inspect goods delivered and services performed to verify conformity with bidding requirements and contractual obligations, and authorize payment for conforming goods and/or services; and

6. Report non-conforming goods and/or services and surplus property available for disposal to designated approvers.

(Ord. No. 157.2, § 1, 12-7-2022)

A. City Manager. The city manager shall be the award authority for contracts up to one hundred thousand dollars. This provision shall apply to modifications to contracts awarded by the city manager so long as the total of such modifications does not exceed the city manager's award threshold.

B. City Council. The city council shall be the award authority for all contracts greater than one hundred thousand dollars, or subsequent modifications to such council-approved contracts. This provision shall apply to modifications to contracts awarded under the city manager's authority if such modifications result in the contract exceeding the city manager's award threshold.

C. Delegation of Contract Award Authority. The authorities established in this section may be delegated as follows.

1. City Manager. For operational effectiveness, the city manager may delegate contract award authority in writing to other city officials and staff to procure goods and/or services and public works construction. Such delegated authority shall not exceed the city manager's contract award authority established in Section 2.70.040.A.

2. City Council. The city council may delegate its contract award authority to the city manager if deemed necessary for operational effectiveness. Such delegation shall not be extended to city officials other than the city manager unless expressly authorized by majority vote of the city council.

(Ord. No. 157.2, § 1, 12-7-2022)

A. Open Market Procedure. Any single purchase of contractual goods and/or services of an estimated value of up to ten thousand dollars, may be made by the purchasing officer in the open market without the necessity of competitively bidding. However, nothing shall preclude the use of prudent judgment and conducting price comparisons in order to obtain the best possible value.

B. Informal Bidding Procedures. Any single purchase of goods and/or services of an estimated value between ten thousand one dollars and one hundred thousand dollars may be made by the purchasing officer by observing the following procedures:

1. Inviting Informal Bids. The purchasing officer may solicit bids by written requests to prospective vendors, by telephone or by public notice posted on a public bulletin board in the Scotts Valley City Hall or by any other means deemed reasonably effective.

2. Written Bids Required. Solicitations, whether requested verbally or in writing, must be submitted in writing as price quotations or on bidding forms, as deemed appropriate by the purchasing officer. The purchasing officer may accept sealed bids if deemed appropriate.

3. Minimum Number of Bids. Purchases shall, wherever possible, be based on the solicitation of at least three informal bids, and shall be awarded to the lowest responsive and responsible bidder except as provided by this chapter.

C. Formal Bidding Procedures. Except as otherwise provided in this chapter, purchases of goods and/or services of an estimated value in excess of one hundred thousand dollars shall be formally bid as provided hereinafter.

1. Notice Inviting Bids. Notice inviting bids shall be published at least ten days before the date set for opening the bids. Notice shall be published at least once in a trade paper, magazine or a newspaper of general circulation. Notices inviting bids shall include a general description of the required goods and/or services, where and how bidding documents can be obtained, and the time and place for opening bids.

2. Sealed Bids. Bids shall be submitted in sealed envelopes by the due date and time set by the city to receive the bids, in further accordance with bidding instructions contained in the bidding documents.

3. Bidders' Security. When deemed necessary by the purchasing officer, bidders' security shall be required as set forth in public notices inviting bids. Unsuccessful bidders shall be entitled to return of their bid security. The successful bidder shall forfeit his bid security upon refusal or failure to execute the contract within ten days after the notice of award has been issued by the city. The city council may, on refusal or failure of the successful bidder to execute the contract, award the contract to the next lowest responsive and responsible bidder.

4. Bid Opening Procedure. Bids shall be opened at the time and place stated in the public notices. A tabulation of all bids received shall be available for public inspection as soon as practicable following the bid opening.

5. Rejection of Bids. Competitive bids not conforming to the solicitation requirements may be rejected by the purchasing officer as non-responsive. Notwithstanding any relevant provisions in state law, the city may, in its discretion reject any or all bids presented, readvertise for bids, or waive the bidding procedure if deemed necessary and approved by a four-fifths vote of the city council. Minor irregularities in bids may be waived by the purchasing officer if the irregularity does not materially affect bid pricing or result in a competitive advantage.

6. Award of Contract. A contract shall be awarded to the lowest responsive and responsible bidder by the appropriate award authority, except as otherwise provided in this chapter.

7. Tie Bids. If two 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 for delay to readvertise for bids, the appropriate award authority may, upon successful negotiation or recommendation by the purchasing officer, accept the bid that provides the best overall value to the city.

D. Best Value Procurement. Nothing in this chapter shall preclude the use of formal or informal solicitation processes to procure goods, services and/or professional services based on the best overall value obtained in exchange for public funds. In these situations, contracts are awarded based on factors in addition to price, the evaluation criteria of which are included in the solicitation document and determined by the purchasing officer. The following methods are representative of best value procurements.

1. Request for Proposals. The request for proposals (RFP) process is used to procure goods and/or services that require specialized technical knowledge or professional expertise that cannot be exactly specified for the purpose of determining the lowest bid.

2. Request for Qualifications. The request for qualifications (RFQ) process is used mainly to procure professional services where demonstrated competence and expertise are overriding considerations, and where pricing is not typically requested until a top rated proposer or proposers are identified. Unless otherwise determined by the purchasing officer, the solicitation document used for the RFQ process shall request statements of qualifications (SOQ) from prospective proposers for evaluating qualifications and experience.

(Ord. No. 157.2, § 1, 12-7-2022)

The following procurement methods or situations may not require competitive bidding, subject to purchasing officer authorization and applicable state or federal laws.

A. Purchasing Cooperatives. Use of purchasing cooperatives is a best procurement practice and is encouraged as a way of obtaining goods and services by aggregating volume, securing value pricing, and reducing administrative overhead. Measured use of purchasing cooperatives can significantly reduce the time and resources needed to competitively bid goods and services contracts. There are numerous purchasing cooperatives the staff can evaluate for use. Some leading cooperatives include state contracts such as California Multiple Award Schedules (CMAS) of the Department of General Services (DGS); OMNIA Partners, Public Sector (formerly U.S. Communities); Sourcewell (formerly National Joint Partners Alliance); and NASPO ValuePoint (formerly WSCA-NASPO, or the Western States Contracting Alliance-National Association of State Procurement Officials).

B. Emergency Purchases. In the event of an emergency as defined in Section 2.70.020, the purchasing officer may purchase, or authorize the purchase, of goods and/or services in the open market without complying with the provisions of this chapter, unless competitive bidding is otherwise required by law and/or as a condition of grant reimbursement under emergency assistance programs.

C. Sole Source Purchases. Purchases that are only available from one source may be made without competitive bidding in accordance with instructions required by, and approval obtained from, the purchasing officer.

D. Piggyback Contracting. Subject to the appropriate approval authority, the city may enter into contracts for goods and services purchases, the pricing and terms of which have been previously established by another public agency. The following requirements apply to piggyback contracts, and must be verified by the purchasing officer prior to contract award:

a. The parties to the original contract agree to the piggyback.

b. The contract is for identical or nearly identical goods and/or services.

c. The original contract resulted from competitive bidding or proposal procedures similar to those required by the city.

d. The original contract was awarded within two years of the city's purchase, or written justification is provided to support the use of an older solicitation.

e. The price of the purchase is comparable to that estimated by the requesting department.

Provided that the above conditions are met, and the purchase is approved by the appropriate award authority, the purchasing officer will issue a purchase order and execute a separate contract with the vendor selected by the originating agency which incorporates by reference the original solicitation, terms, conditions and prices.

(Ord. No. 157.2, § 1, 12-7-2022)

By city council Resolution Nos. 1137 and 1137.1, the city council elected to be subject to the uniform construction accounting procedures set forth in Article 2 (commencing with Section 22010) of the California Public Contract Code (the "Act"). Public projects of the public works department, as defined in the Act (Section 22002), or as those sections may be amended from time to time by the state legislature, shall be advertised, bid and awarded in accordance with Article 3 (commencing with Section 22030) of the Act. To the extent Sections 2.70.071 through 2.70.074 are inconsistent with the Act, the provisions of the Act shall prevail.

(Ord. No. 157.2, § 1, 12-7-2022)

Public projects, as defined in the Act, of less than two hundred thousand dollars, or such amount established in Section 22032 of the Act, may be let as set forth in Section 22032, et seq., of the Act.

(Ord. No. 157.2, § 1, 12-7-2022)

A list of contractors shall be developed and maintained in accordance with the provisions of Section 22034 of the Act and criteria promulgated from time to time by the California Uniform Construction Cost Accounting Commission (the "commission").

(Ord. No. 157.2, § 1, 12-7-2022)

When a public project is to be performed that is subject to Section 2.70.071, a notice inviting informal bids will be mailed to all contractors for the category of work to be bid, as shown on the list developed in accordance with Section 2.70.072. Additional contractors or construction trade journals may be notified at the discretion of the department soliciting bids; provided however:

A. If there is no list of qualified contractors maintained by the city for the particular category of work to be performed, the notice inviting bids shall be sent only to the construction trade journals specified by the commission; and

B. If the product or service is proprietary in nature such that it can be obtained only from a certain contractor or contractors, the notice inviting informal bids may be sent exclusively to that contractor or contractors.

(Ord. No. 157.2, § 1, 12-7-2022)

The city council will award informal contracts under Section 2.70.071 or designate a specific city officer to make the award on a project by project basis.

(Ord. No. 157.2, § 1, 12-7-2022)

Unless otherwise specified by the purchasing officer, city departments requiring goods and/or services, or public works construction, shall submit requests to the purchasing officer by standard requisition forms and purchase orders shall be issued prior to receiving the required goods and/or services or initiating construction work.

(Ord. No. 157.2, § 1, 12-7-2022)

Except in the event of an emergency as outlined in Section 2.70.060.B of this chapter, the purchasing officer shall not issue any purchase order for services, materials, supplies and/or equipment unless there exists an unencumbered appropriation in the fund account against which the purchase is to be charged.

(Ord. No. 157.2, § 1, 12-7-2022)

All city departments shall submit to the purchasing officer, at such times and in such manner as he/she may prescribe, reports showing all supplies, materials and/or equipment which are no longer used or which have become obsolete or no longer usable by the city. The purchasing officer shall have authority to sell, exchange or trade supplies, materials and/or equipment which no longer can be used by any city department or which are unsuitable for city use, or trade the same for new supplies, materials and/or equipment.

(Ord. No. 157.2, § 1, 12-7-2022)

Whenever available at a reasonably comparable price, quality and fitness for intended use, or as otherwise required by law or order of the purchasing officer, environmentally preferable materials and supplies shall be purchased.

(Ord. No. 157.2, § 1, 12-7-2022)

The purchasing officer shall establish and maintain procedures which provide for award of contracts for services, materials, supplies and/or equipment to local vendors in the city so long as their bid is no greater than five percent over the otherwise lowest bid.

(Ord. No. 157.2, § 1, 12-7-2022)