South Pasadena Municipal Code Art. XI Purchasing

(1) Purchasing System Adopted—Purpose. In order to establish efficient procedures for the purchase of supplies, nonprofessional 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.

(a) Authority to Legally Bind. The authority to legally bind the city is limited to the city council, city manager, finance director (purchasing agent) and department directors, in accordance with the purchase types and dollar thresholds in accordance with this chapter and the adopted purchasing policy.

(b) Unauthorized Purchases. Purchases approved by anyone other than the designated award authorities are unauthorized and do not constitute a valid charge against city funds. The city is under no obligation to pay vendors for unauthorized purchases, and employees who make such purchases will be subject to disciplinary procedures in accordance with the city’s personnel policies and may be required to provide reimbursement.

(c) All employees are responsible for impartially ensuring fair competitive access to procurement opportunities by responsible suppliers and contractors. All employees shall abide by the ethical conduct standard stated in the purchasing policy.

(2) Definition of Terms. The following terms, whenever used in these procedures, shall be construed as follows:

(a) “Bidders’ list” means a current file of sources of supply of articles for each category of commodities repetitively purchased for city use.

(b) “Department” means any department, commission or other unit of the city government, which derives its support wholly or in part from the city.

(c) “Lowest responsible bidder” means in addition to price, the “lowest responsible bidder” will be determined after the following factors have been considered:

1. The ability, capacity and skill of the bidder to perform the contract or provide the service required;

2. Whether the bidder has the facilities to perform the contract or provide the service promptly, or within the time specified, without delay or interference;

3. The character, integrity, reputation, judgment, experience and efficiency of the bidder;

4. The bidder’s record of performance of previous contracts or services;

5. The previous and existing compliance by the bidder with laws and ordinances relating to the contract or services;

6. The sufficiency of the financial resources and ability of the bidder to perform the contract or provide the services;

7. The quality, availability and adaptability of the supplies, equipment or services to the particular use required;

8. The ability of the bidder to provide future maintenance and service for the use of the subject of the contract;

9. The number and scope of conditions attached to the bid.

(d) “Open market” means and pertains to purchases or transactions that are executed without recourse to formalized purchasing procedure.

(e) “Over the counter” means and pertains to purchases or transactions that are executed without recourse to competitive bidding and without a purchase order.

(f) “Professional services” means services of engineers, architects, accountants, attorneys, doctors, and other persons or businesses with specialized scientific, expert, technical, or other skills of a similar nature.

(g) Purchases. Purchases of supplies, equipment and personal property shall include leases or rentals as well as transactions by which the city acquires ownership.

(h) “Purchase order” means a document which authorizes the delivery of specified merchandise or the rendering of certain service and the making of a charge for such merchandise or service.

(i) “Requisition” means a written demand or request from the using department to the purchasing agent for specified article or service.

(j) “Responsible bid” means an offer, submitted by a responsible bidder, to furnish supplies, equipment or services in conformity with the specification, delivery terms and conditions and other requirements included in the invitation for bids.

(k) “Responsible bidder” means a bidder who submits a responsible bid and who is not only financially responsible, but is possessed of the resources, judgment, skill, ability, capacity and integrity requisite and necessary to perform the contract according to its terms.

(l) “Services (general)” means any and all services rendered by independent contractors not otherwise specified including but not limited to the following: custodial services, building/equipment maintenance, the repair or maintenance of equipment, machinery and other city-owned or operated property. The term does not include services rendered by city officers or employees, or professional services which are in their nature unique and not subject to competition.

(m) “Specification” means a formulated, definite and complete statement of what is required by the city of the vendor, in the way of composition, construction, utility, durability, efficiency, texture, shape, form or dimension.

(n) “Supplies and equipment” means any and all articles or things which shall be furnished to or used by any department, including all printing, binding, publications, stationery, forms, journals or reports.

(o) “Using department” means the department that uses the supplies, equipment or services obtained pursuant to a particular requisition.

(p) “Goods” means materials, equipment and supplies needed by any department, including those items purchased with city funds and furnished to contractors for use with public works projects.

(q) “Purchasing policy” means the South Pasadena Finance Policies and Procedures Manual, as adopted by the city council on September 7, 2022, and as may be amended from time to time by action of the city council.

(3) Purchasing Department Established. There is created a centralized purchasing department, in which is vested authority for the purchase of supplies, nonprofessional services and equipment.

(4) Purchasing Agent Designated—Powers and Duties.

(a) The city manager is designated as purchasing agent. The city manager may delegate the responsibilities specified in this section, the purchasing policy, or in any other applicable purchasing regulations. The purchasing agent or the person designated by the city manager as the purchasing agent shall be the head of, and have general supervisory duties over, the purchasing department. The duties of the purchasing agent may be combined with those of any other office or position.

(b) The purchasing agent shall:

1. Negotiate where appropriate and purchase and contract for equipment, supplies (other than library books and periodicals), nonprofessional services or services not involving peculiar ability required by any office or department of the city in accordance with purchasing procedures prescribed by this section, and such other rules or regulations as shall be prescribed by the city council;

2. Act to procure for the city at least expense and/or best quality to the city the needed quality in equipment, supplies, nonprofessional services or services not involving peculiar ability;

3. Where competitive bidding is required, ensure that it is conducted with full and open competition and in full compliance with applicable law. Where competitive bidding is not required, ensure that the city’s procurement of services is undertaken in a fair and transparent manner, based on demonstrated competence and qualifications, at a fair and reasonable price. Discourage uniform bidding, and endeavor to obtain as full and open competition as possible on all purchases;

4. Prepare and recommend to the city manager and city council rules governing the purchase of supplies, services and equipment for the city in accordance with best practices;

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

6. Prescribe and maintain such forms as are reasonably necessary to effectively administer the operation of this section and other rules and regulations;

7. Oversee the disposal of surplus equipment and supplies that have become unsuitable for city use. Recommend the transfer of surplus or unused supplies and equipment between departments as needed, and the sale of all supplies and equipment which cannot be used by any department, or which have become unsuitable for city use.

(c) The responsibility of staff in other departments in support of the efficient and effective administration of the purchasing system may be identified through the purchasing policy.

(5) Filing of Estimated Requirements. Each city department 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.

(6) Exemptions From Centralized Purchasing. The purchasing agent may, in writing and with the approval of the city manager, authorize any city department to purchase or contract for specified supplies, services and equipment independently of the purchasing department, but the purchasing agent shall require that such purchases or contract be made in conformity with the procedures established by this section, and shall further require periodic reports from the department on the purchases and contracts made under such written authorization.

(7) Repealed by Ordinance No. 2397.

(8) Local Vendor Purchasing Preference. Local preference is the practice of procurement from South Pasadena vendors because they are also local taxpayers. Purchases from South Pasadena vendors are strongly encouraged where competitive prices and quality exist. With all specifications and conditions equal except price, a preference will be given to in-city vendors equal to five percent of the quoted price when general fund monies are used for the acquisition. The rationale for local preference is that one percent of the sales tax on most acquisitions returns to the city general fund as revenue, effectively reducing the cost of acquisition.

(9) Competitive Bidding.

(a) Contracts resulting from competitive bidding will be awarded by the appropriate award authority based on the lowest responsible bidder who submitted a bid that was responsive to the solicitation request. A bid is considered to be responsive if it conforms in all material respects to the solicitation requirements; minor defects may be waived by the purchasing agent. A bidder is considered to be responsible if they possess the demonstrated ability, capacity, experience and skill to provide the goods and/or services required by the solicitation.

(b) Whether soliciting price quotations or conducting sealed bidding, it is a best practice to provide notice to as many qualified bidders as possible to ensure fair and open competition. It is the policy of the city that a minimum of three quotations must be solicited whenever possible; provided, however, all quotations may be dispensed with in an emergency, or where said goods and/or services can be obtained from only one source. With regard to emergency purchases, Public Contracts Code Sections 1102 and 22050 may apply and if applicable, shall be followed.

(c) If fewer than three quotes are received, the using department must provide an explanation with the purchase requisition that good faith efforts were made to obtain the required number of quotations. The requisition must also include documentation of the good faith efforts, i.e., vendor “no bid” response, email(s) sent to prospective vendors, etc. Though professional services are exempt from competitive bidding under the city’s purchasing policy, proposals should be solicited from at least three sources to ensure best value and/or to comply with federal or state law as required.

(d) The city council may authorize purchase of supplies, equipment and services of a value greater than $30,000 without complying with the above procedures when in the opinion of the council, compliance with competitive bidding is not in the best interest of the city.

(e) Conditions.

1. Bid Security. When deemed necessary by the purchasing agent, bidders’ security shall be required. Bidders shall be entitled to return of bid security upon execution of the contract or upon the readvertisement for bids; provided, that a successful bidder shall forfeit his bid security upon refusal or failure to execute the contract within 10 days after the notice of award of contract has been mailed, unless the city is responsible for the delay. The awarding authority may, on refusal or failure of the successful bidder to execute

the contract, award it to the next lowest responsible bidder. If the awarding authority awards the contract to the next lowest bidder, the bidder first awarded the contract shall forfeit only the portion of his security, which is equal to the difference between his bid and the bid of the next lowest responsible bidder. If the next lowest bidder is awarded the contract and he fails or refuses to execute the contract, he shall forfeit his entire bid security.

2. 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 30 calendar days after the bid opening.

3. Rejection of Bids. At its discretion, the awarding authority may reject any and all bids presented, and readvertise for bids.

4. Tie Bids. If two or more bids received are for the same total amount or unit price, quality, service and delivery being equal, and if the public interest will not permit the delay of readvertising for bids, the awarding authority may accept the one it chooses, or accept the lowest bona fide offer by negotiation with the tie bidders at the time of the bid opening.

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

6. Purchases of goods or services that can be obtained from only one source may be made by the purchasing agent without advertising and after approval by the awarding authority.

(10) Goods and/or General Services—Competitive Bidding and Contract Award Thresholds.

(a) Purchases up to $2,500 (Over the Counter). Purchase of goods, supplies, equipment, or services not involving a unique ability and not exceeding an estimated value of up to $2,500 may be made by the department director over the counter. Quotations are encouraged. Purchases may be made by the relevant department director.

(b) Purchases Between $2,501 and $10,000 (Open Market Procedures). Purchase of goods, supplies, (other than library books and periodicals), equipment, or services not involving a unique ability with an estimated value above $2,500 and not exceeding $10,000 may be made by the department director in the open market after obtaining written quotations. Written quotations shall be submitted to the department director, and routed to the purchasing agent for final verification. Purchases are awarded by the department director. The city attorney shall determine whether the required written agreements for the purchase shall be in purchase order or contract form.

(c) Purchases Between $10,001 and $30,000 (Open Market Procedures). Purchase of goods, supplies, (other than library books and periodicals), equipment, or services not involving a unique ability with an estimated value above $10,000 and not exceeding $30,000 may be made by the purchasing agent in the open market after obtaining written quotations solicited by written notice inviting quotations. Written quotations shall be submitted to the department director, and routed to the purchasing agent for final verification. Purchases are awarded by the purchasing agent. The city attorney shall determine whether the required written agreements shall begin purchase order or contract form.

(d) Purchases Above $30,000 (Formal Sealed Bidding). Purchase of goods, supplies (other than library books and periodicals), equipment, or services not involving a unique ability and exceeding an estimated value of $30,000 shall be made by formal sealed bidding, using city’s standard bidding templates, associated product specifications, and/or scope of services, except as otherwise provided herein. Notification to prospective bidders must be provided by issuing a notice inviting bids, published and processed in accordance with the procedures identified in the purchasing policy, and sent to names on the bidders’ list. Award of contract shall be made by the city council. Written contracts shall be required for purchases made under this section, and reviewed by the city attorney. The purchasing agent is authorized to execute such contracts on behalf of the city, attested to by the city clerk.

(e) Maintenance Work. Notwithstanding the provisions set forth in this section, for services related to maintenance work, as defined by Public Contract Code Section 22002(d), purchases in the amount of $75,000 or less may be made utilizing the open market procedure set forth in subsection (c) of this section. The city manager is authorized to enter into a contract or purchase order in the amount of $75,000 or less for maintenance work. If the state controller makes an adjustment to the dollar limit for public projects under Public Contract Code Section 22020(a), the dollar limit for maintenance work under this subsection shall automatically adjust to the same amount as Public Contract Code Section 22020(a) without city council action.

(11) Best Value Procurement and Qualifications-Based Selection. Best value procurement and qualifications-based selection shall be undertaken in accordance with the purchasing policy.

(12) Professional Services. Contracts for services of specially trained and professional persons or businesses shall be exempt from bidding. No solicitation method is required but quotations are encouraged; contracts for architects and engineers shall be on a qualifications-based selection process. If the contract is equal to or below $30,000, the contract shall be reviewed by the city attorney and require the approval of, and be executed by, the city manager. All contracts exceeding $30,000 must be reviewed by the city attorney and approved by the city council.

(13) Encumbrance of Funds. Except in cases of emergency and as approved by the city manager and later ratified by the city council, the purchasing agent shall not issue any purchase order for goods, supplies, equipment, nonprofessional services or services not

involving a unique ability for which there is an insufficient appropriation in the budgetary account against which said purchase is to be charged. Emergency transactions may be subject to Public Contract Code Sections 1102 and 22050.

(14) Inspection and Testing of Materials and Services. The purchasing agent may inspect supplies and equipment delivered, and determine their conformance with the specifications set forth in the order or contract. 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.

(15) Surplus Supplies and Equipment. All using departments shall submit to the purchasing agent, at such times and in such forms as he shall prescribe, reports showing all supplies and equipment which are no longer used or which have become obsolete or worn out. The using department, with the concurrence of the purchasing agent, shall have authority to sell all supplies and equipment which cannot be used by any department, or which have become unsuitable for city use, or to exchange the same for or trade the same in on new supplies and equipment. City manager approval is needed for sale of supplies and/or equipment when the total estimated value exceeds $10,000. The purchasing agent shall also have the authority to make transfers between departments of any usable surplus supplies or equipment.

(16) Splitting Orders to Avoid Competitive Bidding or More Rigorous Purchasing Procedures Prohibited. Purchases of supplies, materials, equipment or services shall not be split into smaller orders or components for the purpose of avoiding competitive bidding or more rigorous purchase procedures.

(17) Equipment Leasing Agreements.

• (a) As used in this section:

1. “Leasing of nonpurchasable equipment” means equipment which is available through “lease only” plans;

2. “Leasing purchasable equipment” means equipment which can be acquired through “lease with option to purchase” type plans;

(b) Equipment Leasing. Leasing of purchasable or nonpurchasable equipment shall be in accordance with subsections (7), (8), (9), (10) and/or (19) of this section.

(18) Maintenance Agreements.

(a) As used in this section, “maintenance agreements” means agreements with maintenance service providers for the maintenance of city equipment in good operating condition subject to terms and conditions agreeable to both the provider and the city.

(b) Maintenance agreements shall be signed or terminated before agreement expiration by the purchasing agent with prior approval of the department head responsible for the equipment.

(19) Noncompetitive Procurements. Nothing contained in this section shall prohibit procurement made by sole source, single source, or cooperative procurement methods as addressed through and in accordance with the purchasing policy, where competitive bidding may otherwise be required.

(20) Library Books and Periodicals. The city librarian may purchase library books, periodicals, audiovisual, CD-ROM, and electronic format materials in accordance with the budget approved by the city council.

(21) Nothing contained in this section shall prohibit the city from purchasing supplies, services or equipment, without complying with the herein bidding procedure, from a supplier who offers the same or better price, terms and/or conditions as the supplier previously offered as the lowest responsible bidder under competitive procurement conducted by another city or public agency; provided, that the competitive procurement process of the other agency meets or exceeds the standards of the city, is for like or greater quantities and that, in the opinion of the purchasing agent, it is in the best interest of the city.

(22) Purchases Utilizing Federal Funding. Uniform guidance requirements contained in the Code of Federal Regulations at 2 CFR 200.318 through 200.327 shall be followed when purchasing goods and services that utilize federal grants funds.

(23) Emergency Situations.

(a) If the city manager determine there is an emergency situation that gives rise to the need to procure goods, supplies, equipment or services, the city manager is authorized to expend city funds without limitation on amount and without following the purchasing or bidding procedures otherwise required by this article. An emergency purchase shall be limited to those goods, supplies, equipment or services necessary to satisfy the emergency situation.

(b) Expenditures made in an emergency situation as determined by the city manager must be reported to the city council for ratification at the next regular council meeting, or as soon as is reasonably possible given the nature of the emergency situation, if approval for such expenditures would otherwise have been made by the city council.

(c) As used herein, an “emergency situation” is defined as an urgent or sudden unforeseen situation that threatens life, property, essential services or general public health and safety and demands immediate action.

(24) Purchasing Policy. If there are any inconsistencies between the purchasing policy and this section, the provisions of this section shall prevail. (Ord. No. 2048, § B; Ord. No. 2096, § 1; Ord. No. 2180, § 1, 2008; Ord. No. 2187, § 9, 2009; Ord. No. 2299, § 2, 2016; Ord. No. 2369, § 1, 2022; Ord. No. 2397, §§ 1–6, 2025.)

2.99-29A Purchase and sale of real property.

(a) Prior to the purchase or sale of real property the city shall cause an appraisal of the property in question in order to establish a fair market value.

(b) Any appraisal so prepared shall be prepared by a real estate appraiser whose sole business is to appraise real estate and by virtue of education and experience is qualified in real estate appraisal and is a member of any or all of the following:

1. American Society of Appraisers;

2. American Right-of-Way Association;

3. Society of Real Estate Appraisers;

4. American Institute of Appraisers.

(c) The appraisal report shall establish the appraised value on the comparable sales and listings used in the Direct Sales Comparison Approach and/or the Income Costs Approaches to Value, and/or replacement costs of building and land to market value, whichever is higher. If an insufficient number of properties exist within the city limits the appraiser may use property outside of the city limits when in his opinion it is necessary to establish a fair market value.

(d) The term “fair market value” means the highest price estimated in terms of money which a property will bring if exposed for sale in the open market allowing a reasonable time to find a purchaser who buys with the knowledge of all the uses it is adapted and for which it is capable of being used.

(e) In the absence of state laws to the contrary, the city will purchase property at the appraised price. In the event the city is selling property, it will be sold to the highest bidder utilizing the appraised price as a base. Where appraisals between the buyer and seller differ, the city council has the option to negotiate a price which is most advantageous to the city. (Ord. No. 1877, §§ 2—6; Ord. No. 2187, § 9, 2009.)

2.99-29B Disposal of surplus real property.

(a) Prior to disposal by public sale of real property which has been declared surplus by the city council, the city manager or his designee shall:

1. Provide written notice to public agencies in the manner prescribed by Government Code Section 54220 et seq.; and

2. Submit the proposed sale and disposition of the property to the planning commission for a determination of conformance to the general plan, pursuant to Government Code Section 65402.

(b) For all surplus real property not purchased by a public agency pursuant to Government Code Section 54222:

1. Surplus real property shall require city council approval for final agreement of the sale.

2. Conveyance of surplus real property shall be made to the highest responsible bidder who most closely meets the terms and conditions of the notice inviting bids. The city council may set a minimum acceptable bid amount and may reject any and all bids presented.

3. In cases where the city wishes the surplus property to be developed or used in a manner to support specified economic development, retail, industrial or housing goals and policies, the notice inviting bids shall require bidders to specify end uses for the property and the city may specify deadlines for the accomplishment of the end use. Preference shall be given to the bid with the highest monetary purchase price which most closely accomplishes the end use goals. As to all cases, the city and the purchaser shall enter into a purchase agreement approved by the city council.

4. Unless otherwise specified in the notice to bidders, sale of surplus property shall be completed in an escrow of the city’s choice. All successful bids shall be incorporated into a sale and purchase agreement to be approved by the city council.

5. The successful bidder shall close escrow as specified in the purchase agreement.

6. All bidders’ deposits shall be retained until escrow closes. If the apparent purchaser fails to complete the transaction and to close escrow, then the city may enter into a purchase agreement with the next lowest monetary bidder who most closely meets the requirements of subsection (b)(3) of this section and retain the original apparent purchaser’s deposit.

7. No city official, officer or employee shall bid or be financially interested in any bid for surplus real property sold in accordance with these procedures.

(c) If the parcel, which has been declared surplus real property by the city council, is an uneconomic remnant such that it is not eligible for development under the current zoning, then the city manager may negotiate a fair market value sale price with the adjoining property owner without advertising the property for sale. Such a transaction shall require city council approval.

(d) No area of the public right-of-way shall be sold or encumbered by a lease, easement, or otherwise converted to private use without first complying with the vacation of public right-of-way procedure set forth in Streets and Highways Code Sections 8300 through 8363. (Ord. 2311, § 1, 2017.)

2.99-29C Recovered organic waste product and recycled-content paper procurement requirements.

City departments, and direct service providers to the city, as applicable, must comply with the city’s recovered organic waste product procurement policy effective January 1, 2022, and recycled-content paper procurement policy effective on January 1, 2022. (Ord. No. 2359, § 4, 2021.)