HomeMy WebLinkAboutOrdinance 646 Revision to Purchasing SystemORDINANCE NO. 646
AN ORDINANCE OF THE CITY COUNCIL
OF THE CITY OF MORRO BAY, CALIFORNIA,
AMENDING MORRO BAY MUNICIPAL CODE CHAPTER 3.08
OF TITLE 3 TO UPDATE THE CITY'S PURCHASING SYSTEM
THE CITY COUNCIL
City of Morro Bay, California
WHEREAS, the City's current purchasing policy is documented in the Municipal Code as
well as several fragmented documents that have been approved over the years including various
resolutions and administrative direction; and
WHEREAS, recent changes to State law have been made, particularly regarding
procurement of recycled material, and the City has not yet brought its Municipal Code up to date
to reflect compliance with those updates; and
WHEREAS, the City's purchasing policy must be updated from time to time to remain
compliant with State law, to achieve consistency across all City documents, and to reflect
changing purchasing needs and priorities over time.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF MORRO BAY,
CALIFORNIA, FINDS AND ORDAINS AS FOLLOWS:
S ECTION 1. RECITALS. The City Council hereby finds that the recitals set forth above are all
true and correct and are incorporated herein by this reference.
S ECTION 2. CODE AMENDMENT. Chapter 3 08 of the Morro Bay Municipal Code is hereby
repealed and replaced with a new Chapter 3.08 of the Morro Bay Municipal Code, which is
attached hereto as Exhibit A.
S ECTION 3. REPEAL OF RESOLUTIONS AND POLICIES. Effective on the effective date of
this ordinance, all City resolutions and administrative polices regarding the City's purchasing
system that were adopted or implemented prior to the effective date of this ordinance are hereby
repealed.
INTRODUCED at a regular meeting of the City Council held on the 14th day of December
2021, by motion of Mayor Headding and seconded by Council Member Barton.
PASSED AND ADOPTED on the 11th day of January 2022, by the following vote.
AYES' Headding, Addis, Barton, Ford, Heller
NOES. None
ABSENT: None
ATTEST:
aVYy- wV•rSd�-�
AA SWANSON, City Clerk
APPROVED AS TO FORM:
Chris Akeuvienwm,, h
CHRIS F. NEUMEY R, City
rney
JO ' N 1H�--A1DDI�NG; 117iayor
STATE OF CALIFORNIA
COUNTY OF SAN LUIS OBISPO )
CITY OF MORRO BAY )
I, Dana Swanson, City Clerk of the City of Morro Bay, do hereby certify that the
foregoing Ordinance Number 646 was duly passed and adopted by the City Council of the City of
Morro Bay at a regular meeting thereof, held on the 11 th day of January, 2022, by the following
vote:
AYES' Headding, Addis, Barton, Ford, Heller
NOES None
ABSENT: None
IN WITNESS WHEREOF I have hereunto set my hand and affixed the official seal of the
City of Morro Bay, California, this '' day of ajJ , ,boa.
DANA SWANSON, City Clerk
EXHIBIT A
Chapter 3.08 PURCHASING SYSTEM
3.08.010 Adoption of purchasing system; applicability.
A. In order to establish efficient procedures for the purchase of goods and services 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.
B. This chapter is applicable to all city purchases of goods and services, including purchases made
through third -party agents.
3.08.020 Purchasing policy.
The city manager may adopt a policy for the detailed administration and implementation of this
chapter, referred to herein as the Purchasing Policy, and may revise the Purchasing Policy from time to
time as needed. All city purchases shall be made in compliance with the provisions of this chapter and
the Purchasing Policy, provided that in the event of a conflict between the Purchasing Policy and the
provisions of this chapter, the provisions of this chapter shall govern.
3.08.030 Definitions.
For purposes of this chapter, the following terms shall be defined as follows:
"Goods" means equipment, goods, materials, or supplies.
"Paper products" include, but are not limited to, paper janitorial supplies cartons, wrapping packaging,
file folders, hanging files, corrugated boxes, tissue, and toweling, or as otherwise defined in 14 CCR
Section 18982(a)(51).
"Printing and writing papers' include, but are not limited to, copy, xerographic, watermark, cotton fiber,
offset, forms computer printout paper, white wove envelopes, manila envelopes, book paper, note
pads, writing tablets, newsprint, and other uncoated writing papers posters index cards, calendars,
brochures, reports magazines, and publications, or as otherwise defined in 14 CCR Section
18982(a)(54).
' Professional services" means the services of attorneys, physicians, architects, engineers, consultants,
financial experts, auditors, specialized printers or other individuals or organizations possessing a high
degree of professional, unique, specialized, or technical skill or expertise
` Public project" means a public project as defined in Public Contract Code Section 22002.
3.08.040 Purchasing oversight.
The city manager, or his or her designee, shall be responsible for overseeing and facilitating
compliance with this chapter and the Purchasing Policy. This responsibility includes:
A. Staying informed of current developments in the field of purchasing;
B. Prescribing and maintaining such forms as are reasonably necessary to the operation of this
chapter and the Purchasing Policy;
C. Recommending updates to this chapter and making revisions to the Purchasing Policy, as needed;
D. Maintaining centralized purchasing records and tracking citywide expenditures; and
E. Coordinating the purchase of goods that will be used by multiple city departments where feasible
and practical.
3.08.050 Purchasing responsibilities of department heads.
Each department head shall be responsible for ensuring that all purchases by or for his or her
department are made in compliance with this chapter and the Purchasing Policy including but not
limited to compliance with the following requirements:
A. Preparing requests for proposals, requests for bids, requests for qualifications, and other
solicitation materials, as needed, for each purchase;
Making a good faith estimation of the cost of each purchase to determine the appropriate
solicitation procedure;
C. Ensuring that the proper solicitation procedure is followed based on the estimated cost of the
purchase (informal formal, etc.)•
D. Evaluating received bids or proposals in accordance with the selection criteria and process
described in this chapter and the Purchasing Policy;
E. Ensuring that the purchase contract is approved and executed by a person or body with sufficient
approval authority based on the dollar amount of the purchase;
F. Ensuring that sufficient funds are appropriated to pay for the purchase;
G. Ensuring that the vendor, contractor, or consultant has provided insurance certificates and bonds
meeting the requirements of the purchase contract as applicable, before work under the contact
begins, and ensuring that such insurance and bonds are renewed, as applicable, during the term of
the agreement;
H. Ensuring that the vendor, contractor, or consultant has obtained a City of Morro Bay business
license, as required by the municipal code prior to beginning work and ensuring that such license is
renewed, as applicable during the term of the agreement;
I. Inspecting supplies and equipment delivered to determine their conformance with the
specifications set forth in the order;
J. Monitoring the performance of vendors, contactors, and consultants under approved contracts to
e nsure compliance with contract requirements;
K. Recommending and preparing contract amendments and change orders as needed, and ensuring
that such amendments and change orders are approved and executed by a person or body with
sufficient approval authority based on the dollar amount of the amendment or change order, and
that sufficient funds are appropriated to pay for the amendment or change order;
L. Ensuring that due diligence is performed before determining that a purchase can only be made
from a single vendor, contractor, or consultant, and ensuring that decisions to forego a competitive
purchase process on the basis of sole sourcing are properly documented and submitted for
approval by the city manager or designee, or city council, in accordance with this chapter and the
Purchasing Policy;
M. Taking reasonable steps to avoid conflicts of interest in the purchasing process;
N. Keeping sufficient records of all departmental contracts and expenditures, and ensuring that such
records are properly stored and filed in accordance with city recordkeeping procedures;
0. Submitting reports to the city manager or designee showing all departmental supplies and
e quipment that are no longer used or have become obsolete or worn out so that the city manager
o r designee can sell, exchange, or trade in such supplies and equipment, if desired and
P. Transferring surplus or unused goods between departments as needed, or selling, exchanging, or
trading in surplus goods to interested private or public agencies or vendors.
3.08.060 Contract approval authority.
A. All contracts and contract amendments shall be approved by a person or board with proper
approval authority, as described in this section.
B. Approval authority for all contracts and amendments other than for public projects is as follows:
1. The department head of the department initiating the contract is authorized to approve
contracts for up to $25,000 and amendments that do not result in a total contract amount
greater than $25 000.
2. The city manager is authorized to approve contracts for up to $125,000 and amendments that
do not result in a total contract amount greater than $125,000.
3. Contracts and amendments that exceed the city manager's approval authority may only be
approved by the city council
C. Approval authority for contracts and amendments for public projects is as follows:
1. The department head of the department initiating the contract is authorized to approve
contracts for up to $25,000 and amendments that do not result in a total contract amount
greater than $25,000.
2. The city manager is authorized to approve contracts for up to the maximum dollar amount for
which an informal bidding procedure is permitted under Public Contract Code Section
22032(b), including any amendments thereto, and amendments that do not result in a total
contract amount greater than the maximum dollar amount for which an informal bidding
procedure is permitted under Public Contract Code Section 22032(b), including any
amendments thereto.
3. Contracts and amendments that exceed the city manager's approval authority may only be
approved by the city council.
D. For purposes of subsections (B) and (C), "amendments" means any amendment, renewal, or
change order that results in an increase to the total amount of money that may be spent under a
single contract. For purposes of clarity, there is not a separate approval authority limit for
amendments. Approval authority limits are based on the total contract amount inclusive of
amendments.
E. Contracts that renew from year to year or have a regularly recurring term shall not be split into
multiple single -term contracts to avoid approval by the city council or the city manager, as
applicable.
F. Purchases of similar goods and/or services from a single vendor, contractor, or consultant, which
could reasonably be included in a single contract, shall not be split into multiple contracts in order
to avoid approval by the city council or the city manager, as applicable.
3.08.070 Purchasing procedures Purchases other than public projects.
With the exception of purchases made for public projects, all purchases, including purchases of
professional services, shall be made as follows:
A. Solicitation Procedures. Prior to making any purchase, the person or department initiating the
purchase shall make a reasonable and good faith estimate of the anticipated cost of the purchase
and then proceed with the appropriate solicitation procedure below. If the proposals or bids
received exceed the cost threshold for the solicitation procedure used, a new solicitation shall not
be required unless directed by the city manager. Purchases shall not be split or separated into
smaller orders for the purpose of circumventing the procedures hereunder.
1. Purchases of goods for an estimated cost of up to $10,000, and purchases of services
(including professional services) for an estimated cost of up to $40,000, shall not require
competitive bidding but may be made following the receipt of at least one price quote or
proposal.
2. Purchases of goods for an estimated cost of greater than $10,000 up to $125,000, and
purchases of services (including professional services) for an estimated cost of greater than
$40 000 up to $125,000, shall be made following the receipt of at least three written price
quotes or proposals, which may be solicited using any means reasonably calculated to obtain
a combination of the lowest price and highest quality of goods or services available. Such
solicitations do not need to be published in a newspaper and may be made by posting a
notice in a public location, including a website, or by mail, fax, or email The person or
department initiating the purchase shall keep a record of all such solicitations and the price
quotes or proposals submitted in response thereto. If the person or department initiating
the purchase is unable to obtain three price quotes or proposals from responsive and
responsible bidders after making diligent efforts to do so, the purchase may be made without
obtaining three price quotes or proposals, provided that the efforts made to obtain three
quotes or proposals shall be documented in the contract file for the purchase and shall be
presented to the city manager as part of the request for contract approval.
3. Purchases with an estimated cost of greater than $125,000 shall be made following the
posting of a written solicitation.
(a) Such written solicitations and offers or responses thereto may be in any reasonable
form, or as may be established in the Purchasing Policy. Each solicitation shall
describe the purchases sought and all other requirements, including the quantity and
quality thereof, any desired warranty insurance, or bonds the time, place and
manner of delivery of the purchases, the desired terms of payment, and the form,
method, and timing of the response to the solicitation.
(b) Such written solicitations shall be posted in at least one publicly accessible location
likely to reach the intended service provider, supplier, or vendor. The first publication
or posting of the solicitation shall be at least ten days before the due date for
responses to the solicitation. The posting location may include the city's website, an
electronic bulletin board, a newspaper of general circulation in the city, or a trade
journal, magazine, or other publication, whether in print or electronic.
(c) Bids or proposals may also be directly solicited from individuals and businesses if
such individuals or businesses are known to be capable of providing the item or
service that is being solicited. However, such direct solicitations shall be in addition
to solicitations made under subsection (A)(3)(b).
B. Award of Contract.
1. The city may reject all bids or proposals in its sole discretion.
2. If no bids or proposals are received the city may make the purchase by any reasonable and
available means notwithstanding the other requirements of this chapter.
3. If two or more bids or proposals received are for the same total amount or unit price, quality
and service being equal the contract may be awarded to either bidder or proposer.
4. Contracts for goods shall be awarded to the lowest responsive and responsible vendor,
where the goods offered are identical However, where the goods offered are not identical,
the city may consider the fitness and quality of the goods offered, in addition to price, and
may award the contract to the vendor that offers that best combination of price and fitness
and quality of goods.
Contracts for services (including professional services) shall be awarded on the basis of
demonstrated competence and the professional qualifications necessary for the satisfactory
performance of the services, offered at a fair and reasonable price, as determined by a
consideration of the following criteria:
(a) Whether the price is fair, reasonable, and competitive;
(b) The quality of the services offered;
(c) The demonstrated competence, ability, capacity, and skill of the person or business
to provide the services promptly, within the time specified, within budget, and
without delay or interference;
(d) The credentials and licenses of the person or business, if required;
(e) The character integrity, reputation, judgment, training, experience, and efficiency of
the bidder or proposer;
The person's or business's proven working relationships with city project staff and
knowledge of local conditions;
(f)
(g)
The person's or business's previous history of working on related projects or issues
for the city, where such previous experience will allow the services to be performed
more efficiently and will require less time spent on preparation and background
research;
(h) The sufficiency of the bidder's or proposer's financial and other resources; and
(i) The ability of the bidder or proposer to provide such future service as may be
needed.
6. Where two or more bidders or proposers are reasonably comparable based on a
consideration of the criteria in subsection (B)(5), a preference may be given to a bidder or
proposer that has a primary place of business located within the city. The city council finds
that this preference serves the public purposes of supporting local economic stability and of
e ncouraging businesses to locate and remain in the City of Morro Bay.
C. Exceptions. The solicitation procedures in this section shall not apply to purchases that satisfy one
or more of the following criteria:
1. No price advantage would be gained from a competitive solicitation process, including but
n ot limited to circumstances when goods or services are unique and are only available from
o ne source, also known as a "sole source" contract. However, if the person or department
initiating the purchase proposes to forego a competitive solicitation process based on this
subsection (C)(1) a justification for this decision shall be presented in writing either to the
city manager or designee, where the city manager has approval authority or to the city
council, where the city council has approval authority, and shall be placed in the contract file;
provided that failure to provide such information to the city manager or city council shall not
n ullify the approval of a contract;
When the purchase is based on any master agreement, cooperative agreement, multiple
award schedule, or other types of agreements entered into by the State of California or the
federal government. Examples include but are not limited to, California Multiple Award
Schedules (CMAS) and Federal General Services Administration (GSA) contracts;
3. When the vendor or service -provider was awarded a bid by another public agency, said
agency used solicitation procedures substantially similar to those that the city would have
been required to use, and the vendor or service -provider offers the same price(s) to the city
that it offered to the other agency;
4. When there is a local emergency, as determined by the city manager, and the life, health or
safety of employees or the general public is at risk, or when significant harm may occur to
city property or operating systems and goods and/or services must be procured immediately
to prevent loss or substantial disruption of city services or functions; or
5. When the city council determines by resolution that bidding would be impractical inefficient,
or otherwise not in the best interest of the city, provided that the city council shall state the
basis for its determination in the resolution.
3.08.080 Purchasing procedures — public projects.
A. Uniform Public Construction Cost Accounting Act. The city has adopted the Uniform Public
Construction Cost Accounting Act (Public Contract Code Section 22000 et seq., as may be amended)
(the ' Act') and all expenditures for public projects by the city shall be made in accordance with the
Act.
B. Solicitation Procedures. Prior to making any purchase, the person or department initiating the
purchase shall make a reasonable and good faith estimate of the anticipated cost of the purchase
and then proceed with the appropriate solicitation procedure below. Purchases shall not be split or
separated into smaller orders for the purpose of circumventing the procedures hereunder.
1. No Competitive Bidding Required. Public projects with an estimated cost of up to the
maximum dollar amount stated in Public Contract Code Section 22032(a), including any
amendment thereto, may be performed by city employees by force account or else may be
awarded by negotiated contract or by purchase order without competitive bidding.
2. Informal Bidding Required. Public projects with an estimated cost of up to the maximum
dollar amount stated in Public Contract Code Section 22032(b), including any amendment
thereto, shall require either the informal bidding procedures set forth in section 3.08.080(C)
or the formal bidding procedures set forth in section 3.08.080(D).
3. Formal Bidding Required. Public projects with an estimated cost of greater than the
maximum dollar amount stated in Public Contract Code Section 22032(b), including any
amendment thereto, shall require the formal bidding procedures set forth in section
3.08.080(D).
C. Informal Bidding Procedures. The following procedures shall apply to informal bids: A notice
inviting bids shall be prepared, which describes the project in general terms, explains how to obtain
more detailed information about the project, and states the time and place for the submission of
bids. The notice shall be mailed to all contractors for the category of work to be bid, as shown on
the list developed in accordance with section 3.08.080(E), and to all construction trade journals as
specified by the California Uniform Public Construction Cost Accounting Commission
('Commission"), in accordance with Public Contract Code Section 22036. Notices sent to
contractors on the contractors list shall be sent not less than ten calendar days before bids are due
and may be sent by mail, fax, or email. Additional contractors and/or construction trade journals
may be notified at the discretion of the department soliciting bids, provided, however:
1. 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.
2. 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
such contractor or contractors.
D. Formal Bidding Procedures. The following procedures shall apply to formal bids: A notice inviting
bids shall be prepared, which describes the project in general terms, explains how to obtain more
detailed information about the project, and states the time and place for the submission of bids.
The notice shall be published at least fourteen calendar days before the date of opening the bids in
a newspaper of general circulation, printed and published in the city or, if there is no newspaper
printed and published in the city, in a newspaper of general circulation which is circulated within
the city; or, if there is no newspaper which is circulated within the city, publication shall be by
posting the notice in at least three places within the city as have been designated by ordinance or
regulation of the city as places for the posting of its notices. The notice inviting formal bids shall
also be sent electronically, if available by either fax or email and mailed to all construction trade
journals specified by the Commission pursuant to Public Contract Code Section 22036. The notice
shall be sent at least fifteen calendar days before the date of opening the bids. In addition to notice
required by this section, the city may give such other notice as it deems proper.
E. Contractors List. The public works director or designee shall develop and maintain a list of
contractors in accordance with the provisions of Public Contract Code Section 22034 and criteria
promulgated from time to time by the Commission.
F. Preparation and Adoption of Plans. In accordance with Public Contract Code Section 22039, the
city engineer, or his or her designee, is authorized to and shall prepare and adopt plans,
specifications and working details for all public projects with an estimated cost greater than the
maximum dollar amount stated in Public Contract Code Section 22032(b), including any
amendment thereto.
G. Award of Contract.
1. If a contract is awarded it shall be awarded to the lowest responsive and responsible bidder.
If two or more bids are the same and the lowest, the contract may be awarded to either
bidder.
2. If the project was bid using informal bidding procedures, and all bids received exceed the
maximum dollar amount stated in Public Contract Code Section 22032(b), including any
amendment thereto, the city council may, by a four -fifths vote, adopt a resolution awarding
the contract to the lowest responsive and responsible bidder if the amount of the contract
does not exceed the dollar threshold stated in Public Contract Code Section 22034(d),
including any amendment thereto, and it determines the city s cost estimate for the project,
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upon which the decision to use informal bidding procedures was based, was reasonable.
Otherwise, the project shall be re -bid following the formal bidding procedures.
3. In its discretion, the city may reject all bids, and may do any of the following:
a. Abandon the project.
b. Re -advertise the bid in the manner described in this chapter.
c. By a four -fifths vote, the city council may declare by resolution that the project can
be performed more economically by city employees and may have the project done
by force account without further complying with this chapter. Prior to rejecting all
bids and declaring that the project can be more economically performed by city
employees, the city shall furnish a written notice to an apparent low bidder,
informing the bidder of the city's intention to reject the bid. Such written notice shall
be mailed at least two business days prior to the hearing at which the city intends to
reject the bid.
4. If no bids are received through the formal or informal procedure, the project may be
performed by city employees by force account or by a negotiated contract without further
complying with this chapter.
G. Emergencies.
1. In cases of emergency when repair or replacements are necessary, the city council may
proceed at once to replace or repair any public facility without adopting plans specifications,
strain sheets, or working details or giving notice for bids to let contracts. The work may be
done by day labor under the direction of the city, by contractor, or by a combination of the
two.
2. In case of an emergency, if notice for bids to let contracts will not be given, the city shall
comply with the requirements of Public Contract Code section 22050
H. Exemptions. The bidding procedures for public projects required by this chapter shall not apply
when an exemption is provided by state or federal law.
3.08.090 Purchase of paper products; procurement of recovered organic waste products.
A. When purchasing paper products and printing and writing paper, the city shall comply with 14 CCR
Section 18993.3, as may be amended.
B. All vendors providing paper products and printing and writing paper to the city shall make the
certifications required by 14 CCR Section 18993.3(c), as may be amended, and shall provide the city
with all records and documents required by the city to comply with the reporting requirements in
14 CCR Section 18993.4, as may be amended
C. The city shall procure recovered organic waste products in accordance with the requirements of 14
CCR Section 18993.1, as may be amended, and as further specified in the Purchasing Policy or a
different policy adopted by the city council.
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3.08.100 Encumbrance of funds.
Except in cases of emergency or in cases where specific authority has been first obtained from the
city manager, no purchase shall be made unless there exists an unencumbered appropriation in the
department, in the fund against which the purchase is to be charged.
3.08.110 Purchases with grant or loan funds.
Notwithstanding any other provision of this chapter, if a purchase is funded in whole or in part by
grant or loan funds and the grant or loan requires the city to use specific purchasing procedures that are
inconsistent with the requirements of this chapter, then the city shall follow the grant or loan
requirements unless they conflict with state or federal law.
01181.0007/741167.5
(Supp. No. 19)
Created: 2021-04-15 09:39:30 (EST]
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