HomeMy WebLinkAbout04/15/2003, 6A-6B - REGULAR COUNCIL MEETING AGENDA FOR 4/15/03 ITEMS #6A AND 6B (PURCHASING SYSTEM IMPROVEMENTS) RED FILE
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council memoRanbum DATE4s o3 ITEM I>
lCity of San Luis Obispo
DATE: April 10, 2003
TO: Mayor&Members of the City Council
VIA: Ken Hampian, CAO
FROM: Lee Price, City Clerk
SUBJECT: Regular Council Meeting Agenda for 4/15/03
Items #6A and 6B (Purchasing System Improvements)
Unfortunately formatting to legislative drafts did not copy well and it is difficult to determine what
changes are being recommended. Therefore,please make the following revisions to Items#6A and
6B in your agenda packets:
#6A:
• Replace all white pages behind the blue staff report(pages 6A4 through 8)
#6B:
• Replace all white pages behind the blue staff report(pages 6B-4 through 10)
Note: There have been no changes other than formatting for clarity.
Thank you.
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Council Memorandum
ORDINANCE NO. (2003 Series)
AN ORDINANCE OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
AMENDING CHAPTER 3.24, ARTICLE III OF THE MUNICIPAL CODE
TO PROVIDE FOR THE USE OF JOB ORDER CONTRACTING AND
ALTERNATIVE BIDDING PROCEDURES FOR PUBLIC CONSTRUCTION PROJECTS
WHEREAS, the citizens of San Luis Obispo approved Measure L-02 on November 5,
2002, which amended the City Charter to authorize the use of job order contracting for
maintenance-related projects as provided under Section 20128.5 of the Public Contract Code and
alternative bidding procedures as provided under Section 22000 of the Public Contract Code
("Uniform Public Construction Cost Accounting Act") for public construction projects; and
WHEREAS, Section 901 (E) and (F) of the City Charter states that the Council shall
establish by ordinance guidelines for the use of such contracts and procedures:
NOW, THEREFORE, BE IT ORDAINED by the Council of the City of San Luis Obispo
as follows:
SECTION 1. Article III of Chapter 3.24 of the Municipal Code of the City of San Luis
Obispo is hereby amended as set forth in Exhibit A..
SECTION 2. A summary of this ordinance, approved by the City Attorney, together with
the names of the Council members voting for and against it, shall be published at least five days
prior to its final passage, in The Tribune, a newspaper published and circulated in this City. This
ordinance will go into on effect at the expiration of thirty (30) days after its final passage.
INTRODUCED on April 15, 2003 AND FINALLY ADOPTED by the Council of the
City of San Luis Obispo on , 2003 on the following roll call vote:
AYES:
NOES:
ABSENT:
David F.Romero, Mayor
ATTEST:
Lee Price, City Clerk
APPROVED AS TO FORM:
Gilbert A. T o, Inte CityAttorney
GA
Exhibit A
AMENDMENT-TO FORMAL CONTRACT PROCEDURES
Chapter 3.24 of the Municipal Code
ARTICLE III. FORMAL CONTRACT PROCEDURE
3.24.140 Requirements for purchase.
Except as otherwiseprovided in this chapter, purchases and contracts for supplies,
services, equipment and construction..proiects , which
are equal to or in excess of the bid requirement amount specified by council resolution, shall be
by written contract with the lowest responsible bidder pursuant to the procedures prescribed in
this article.
3.24.145 . Job_order-contracting.
_ _'As provided in Section 901_(E) of the Charter, the city may perform maintenance-related
construction proiects_for_repair,_remodeling or other repetitive work.under.a..unit-price contract
for all necessary.labor,_materials.and-equipment;_subject to_the_following_conditions:.
A.Such contracts are secured on a comnetitive basis in accordance with the procedures
set forth in this Article
B. No new construction will be nerformed_under_such contracts
C.-The specifications for such contracts provide for unit-price-terms for all work that will
typically be..performed under individual-Task Orders:
_ _ D..The.specifications for such contracts establish any limits.on the amount of individual
Task Orders to be issued under the contract; or on any minimum or maximum cumulative
amounts of Task Orders to-be issued under the contract.
_
E.-The council.will specify-limits.on_the_authority to_approve_individual.Task Orders by
resolution!
3.24.150 Bids - Notice of invitation and submission.
A.. Notices inviting bids shall include, but not be limited to, the following:
1. A general description of the item(s) or service(s) to be purchased, or the public
work to be constructed or improved;
2. The location where bid blanks and specifications may be secured;
3. The time and place assigned for the opening of sealed bids;
4. The type and character of bidder's security required, if any; and
5. The location and deadline for submission of bids.
B. Notices inviting bids shall be publish made as_follows
1. For supplies, services and equipment, notices-inviting bids shall be published at
least once in the official newspaper of the city, with the first publication occurring at least ten
calendar days before the date of opening the bids.
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Exhibit A
AMENDMENT . FORMAL
• CONTRACT PROCEDURES
2.. For constructionproiects below .an amount specified by council resolution;
notices inviting bids shall be mailed to a list of qualified contractors, identified according to
categories of work, at least ten calendar days_before _the_bids are due... The City En inks eer is
responsible for developing and maintaining_this_list based on the criteria determined by the
California _Uniform---Construction Cost Accounting_Commission_ (hereinafter referred to :as
Commission in this Chapter). Notices shall.also be.mailed within ten-calendar_days before the
bids are due to all construction trade journals as required by the Commission. If the city does not
have a list of qualified contractors..for the particular type of work to be performed, notices
inviting bids will only be.sent.to the construction trade journals as required by the Commission.
If the--product is proprietary in nature and can only be obtained from a certain
contractor or contractors, notices inviting bids will only be mailed to such contractor or
contractors.
_ I. For construction projects above. an amount .specified-by council resolution,
notices inviting bids-distinctly describing the project.-be.published.at.least once in the.official
newspaper of.the.city, with the first_publication.occurring at least fourteen calendar days before
the date of opening-the-bids. Notices inviting bids distinctly describing the project shall also be
`mailed. at least thirty calendar days before the date of opening bids to all construction trade
journals as required by the Commission]
4. The city may also.give such.other notice as.it.deems appropriate.
C. Sealed bids shall be identified as bids on the envelopes and shall be submitted to the
purchasing authority.
3.24.160 Bids - Security requirement.
Bidder's security may be required when deemed necessary by the purchasing authority.
Bidders shall he entitled to return of bid security. However, a successful bidder shall forfeit his
bid security upon refusal or failure to execute a contract within fifteen days after notice of award
of that contract, unless the city is responsible for the delay. The contract may be awarded to the
next lowest responsible bidder upon the refusal or failure of the successful bidder to execute the
contract within the time herein prescribed.
3.24.170 Bids- Opening and retention.
Sealed bids shall be opened in public at the time and place stated in the notice inviting
bids. A tabulation of all bids received shall be made available for public inspection until the
award of a contract. All bids shall be retained on file for a period of not less than two years.
3.24.180 Bids - Rejection.
The purchasing authority may reject:
A. Any bid that fails to meet the bidding requirements in any respect; or
B. All bids, for any reason whatsoever, and may readvertise for new bids or_abandon.the
purchase:
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Exhibit A
AMENDMENT TO FORMAL CONTRACT PROCEDURES�
_C. In the case of construction projects, the council may, by---passage of:a resolutionby as
four-fifths vote,declare that-theme ect can:be-performed-more-economically. by—employees of
the city-and-may have the-.nroiect.done by force account;
3.24.185 _Bids-None.received.
if no bids_are.received, the purchase may be made through negotiated contract or other
process approved by the purchasing authority, including, in the case of construction vroiNIL
performing the work by employees of the city by force account:
3.24.187 Bids:for.construction-nroiects-In_excess.ofai t _
_in the.event that-all bids received for a construction.project-are more than the maximum
allowed under.Section 22034(f) of Public Contract Code, and.bids.were invited pursuant.to the
provisions.of Section.3.24.150(B.2),..the_Council may; by adoption of a resolution-by four=fifths
vote,award-the contract,.in an amountnotto exceed-the maximum set forth in Section 22034(f)
of-Public Contract Code, to the lowest responsible bidder, ifit.determines that the cost estimate
was reasonable. Otherwise, the bids shall be rejected; and if the agency decides to go forward
with the project, shall be re-bid in accordancewith the procedures. set forth in Section
3.24.150(13.3)j
3.24.190 Contract award.
Subject to the prior approval of the city administrative officer, contracts shall be awarded
by the purchasing authority to the lowest responsible bidder, except as follows:
A. If, at the time of bid opening, two or more bids received are for the same total amount
or unit price, quality and service being equal, and if in the discretion of the purchasing authority
the public interest will not permit the delay of readvertising for bids, then the purchasing
authority may accept the one sh oe r he chooses or the lowest bid obtained through subsequent
negotiation with the tie bidders.
B. Sellers, vendors, suppliers and contractors who maintain places of business located
within the limit of the city shall be given preference if quality, price, service and all other factors
are equal.
3.24.200 Requiring bond of successful bidder.
The purchasing authority may require as a condition to executing a contract on behalf of
the city, a performance bond or a labor and material bond, or both, in such amounts as the
purchasing authority shall determine appropriate to protect the best interests of the city. The
form and amounts of such bond(s) shall be described in the notice inviting bids.
3.24.210 Determination of lowest responsible bidder.
In addition to the bid or quotation price, criteria for determining the lowest responsible
bid or quotation, for the purposes of the Charter and this chapter, shall include, but not be limited
to, the following:
A. The character, integrity, reputation,judgment, experience and efficiency of the bidder
(this may include an analysis of previous work performed for the city);
_q_ bti ' �
Exhibit A
AMENDMENT TO FORMAL CONTRACTPROCEDURESi
B. The ability of the bidder to perform the contract, or provide the supplies, equipment or
services required, within the time specified, without delay or interference;
C. The ability of the bidder to provide future maintenance, repair parts and replacement
of purchased equipment or supplies;
D. Compliance by the bidder with federal acts, executive orders and state statutes
governing nondiscrimination in employment; and
E. The results of any evaluation relating performance and price, such as testing, life-cycle
costing, and analysis of service, maintenance and technical data.
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Attachment 1
PURCHASING SYSTEM OVERVIEW
Type Cate o -Features
Over-the-Counter ■ No specific requirements;competitive
bidding to be used whenever practical.
Less Than ■ Bid award by Department via Voucher or
$5,000 Purchase Order.
■ Job Order C-666act(JOC1 Task.Ordersl
Ey the City Enoinee!
Open Market
■ Department solicits at least 3 proposals; .
$5,000 to (may be verbal with written quotes).
U-5,000$45,998 a Bid award by Finance via Purchase Order or
Contract(orJ(5c-Task.Order bv.fhe-dtv-Enaineer),'
GENERAL
PURCHASES
Formal ■ Formal Bid or RFP documents.
■ Advertising for sealed bids or proposals.
Includes supplies, Greater Than (Mailed notice in the case of construction projects.)
equipment,operating or000$4§,899 ■ CAO approves soliciting for bids or
maintenance services proposals and awards the contract
and construction projects. for.aooroves JOG TaskArderl
■ Same as above except the Council
approves Bid/RFP documents and soliciting
Greater Than for proposals;contract award generally
10000$ BGG delegated by Council to the CAO.
■ CAO is authorized to aoorove all JOC Task Orders:
motto exceed,Council-aeoroved.annual limits.,
■ No specific requirements;
Less Than proposals to be solicited whenever practical.
$5,000 ■ Proposal award by Department via voucher
or purchase order.
■ Proposals solicited whenever practical.
CONSULTANT $5,000 to ■ Contract negotiated by Department.
SERVICES $25,000$#b8G8 ■ Contract award by CAO via purchase order
or contract.
Includes advisory Formal
services from professionals m Formal RFP document.
such as engineers, Greater Than a Council authorizes staff to request
architects,attorneys and f2-5,00-0$3§,889 proposals and generally delegates contract
other specialized award to the CAO.
consultants. Note. These are general guidelines,the evaluation and
selection process for consultant services may vary on a
case-by-case basis.
0 Proposed Changes
Attachment 2
iSummary-of General Purchases from $50,000 to $100,000
During 2001-02, thirteen bid or RFP documents went to the Council for approval (with the CAO
authorized to award the contract if within budget) that would have been approved by the CAO if
the authority to do so had been extended from$50,000 to $100,000.
As reflected below, most of these were contracts for ongoing operations for existing programs
and services, or were for routine infrastructure maintenance. And all amounts were budgeted for
and approved by the Council before issuance of the bid or RFP documents.
Contract
Purpose Amount
Operating Programs
Landscape and Park Maintenance Services $53,136
Janitorial Services: Various Locations 69,500
Utilities Conservation Public Information and Education Program 65,000
Street Light Maintenance 51,500
Janitorial Services: Parking Facilities 99,000
CIP Projects
Relocation and Undergrounding of Utilities Along Railroad Right-of-Way: Phase II 67,300
Bicycle Path Project(See Note 1)
New Sidewalk Installation: Various Locations 92,047
Utility Trench Repair. Various Locations 65,125
Water Storage Tank No. 2 Cleaning and Repair 71,445
Rodriguez Adobe Park Landscape Improvements 63,295
Fire Station 3 Remodel 89,564
Traffic Signal Interconnect Installation:Various Locations 73,800
Backhoe-Loader(See Note 2) 68,127
Note: All contracts were awarded via a competitive bid or RFP process except in the following
two circumstances:
1. Railroad ROW Utility Relocation. This was a sole source contract awarded by the Council
to Union Pacific Railroad, as they were the only vendor allowed to work in the railroad right-
of-way.
2. Backhoe-Loader. This contract was awarded to Quinn Company via cooperative
purchasing.
Lobe
Attachment 3
RESOLUTION NO. (2003 Series)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
UPDATING PURCHASING GUIDELINES
WHEREAS, in the course of conducting City operations it is necessary to purchase a broad
range of goods and services; and
WHEREAS, the Council has adopted purchasing policies and procedures as set forth in Chapter
3.24 of the Municipal Code that require the Council to specify by resolution the dollar amount of
purchases and contracts requiring the use of either open market or formal bidding procedures, and the
level of authority required to authorize invitations for bids (or requests for proposals), award contracts or
approve Job Order Contract Task Orders; and
WHEREAS,the Council desires to update existing guidelines to reflect current conditions and
implement improved procedures, including electing to become subject to the uniform construction cost
accounting procedures set forth in the Public Contract Code, commencing with Section 22010, as
required by the State in order to use the alternative bidding procedures for construction projects set forth
in Section 22032 of the Public Contract Code.
NOW,THEREFORE,BE IT RESOLVED by the Council of the City of San Luis Obispo that:
SECTION 1. Resolution No. 8239 (1993 Series) is hereby rescinded and the updated
purchasing guidelines set forth in Exhibit A are hereby adopted.
SECTION 2. The construction change order policy set forth in Exhibit B is hereby amended.
SECTION 3. The City hereby elects to become subject to the uniform construction cost
accounting procedures set forth in the Public Contract Code.
On motion of seconded by
and on the following roll call vote:
AYES:
NOES:
ABSENT:
the foregoing resolution was adopted on April 15,2003.
David F. Romero,Mayor
ATTEST:
Lee Price,City Clerk
APPROVED AS TO FORM:
filbert A. TniJiflo,Kerim City Attorney
too �to
Attachment 3: Exhibit A
PURCHASING GUIDELINES
In accordance with the policy framework set forth in Chapter 3.24 of the municipal code, City
purchases and contracts (including those for rentals and leases, but excluding those for real
property) will be made pursuant to these guidelines. Applicable competitive bidding categories,
authorization limits or contract award procedures will be based on unit cost, total purchase cost
for consolidated bid items or fiscal year aggregates in the case of blanket purchase orders or
similar ongoing purchasing arrangements. Staging of purchases in order to avoid these
competitive bidding procedures or authorization limits is prohibited.
GENERAL PURCHASES
Purchases and contracts for supplies, equipment, operating and maintenance services, and
construction projects will be made pursuant to the following guidelines.
A. Over-the-Counter. Purchases of less than $5,000 may be authorized by the Department
Head. Although no specific purchasing requirements are established for this level of
purchase, competitive bidding should be used whenever practical.
B. Open Market. Purchases between $5,000 and 25-000 $15,000 may be authorized by the
Director of Finance (or designee) pursuant to the open market bidding procedures established
in Chapter 3.24 (Article II) of the municipal code.
C. Formal Bids or Proposals. Purchases in excess of 25 000$15,008 will be made pursuant
to the formal bidding requirements established in Chapter 3.24 (Article III) of the municipal
code. Authority to approve specifications, invite bids or request proposals and award
contracts will be as follows:
1. For purchases with an approved budget and a cost estimate of 100 000 $38;888 or less,
the City Administrative Officer is authorized to invite bids or request proposals, approve
specifications and award the contract.
2. For purchases in excess of tIdd 000$50,000, Council approval of the specifications and
authorization to invite bids or request proposals is required. The Council may authorize
the City Administrative Officer to award the contract if the selected bid or proposal is
less than or equal to the Council-approved cost estimate and there are no substantive
changes to the specifications. Otherwise, Council award of the contract is required.
D. Job Order Contracts: Construction Proiects. Under the Job Order Contact provisions of
Chapter 3.24 (Article III) of the municipal code for maintenance-related construction
projects, individual Task Orders up to $25,000 may be approved by the Cityn Engineer.
Individual Task Orders in excess of $25,000 require approval by the City Administrative
Officer!
CONSULTANT SERVICES
Contracts for consultant services will be awarded pursuant to the following guidelines.
1
616 - 7
Attachment 3: Exhibit A
PURCHASING GUIDELINES
A. Contracts for consultant services estimated to cost less than $5,000 may be awarded by the
Department Head. Although no specific purchasing requirements are established for this
level of contract,proposals should be solicited whenever practical.
B. Contracts for consulting services estimated to cost between $5,000 and 25 000$15,009 may
be awarded by the City Administrative Officer. Proposals from at least three frons should be
solicited whenever practical.
C. Contracts for consultant services estimated to cost more than 25 000 $13,999 will generally
be awarded pursuant to the following guidelines; however, it is recognized that the City's
need for consultant services will vary from situation to situation, and accordingly, flexibility
will be provided in determining the appropriate evaluation and selection process to be used in
each specific circumstance.
1. The Council should generally approve request for proposal (RFP) documents before they
are issued. The Council may authorize the City Administrative Officer to award the
contract if it is less than or equal to the Council-approved cost estimate and there are no
substantive changes to the approved workscope. Otherwise, Council award of the
contract is required.
2. In the event that the timely evaluation and selection of a consultant precludes Council
approval of the RFP before it is issued, the RFP may be approved and distributed by the
City Administrative Officer; however, award of the contract will be made by the Council.
3. Cost will not be the sole criterion in selecting the successful bidder. Consultant
proposals will be evaluated based on a combination of factors that result in the best value
to the City, including but not limited to:
a. Understanding of the work.required by the City
b. Quality and responsiveness.of the proposal
c. Demonstrated competence and professional qualifications necessary for satisfactory
performance of the work required by the City
d. Recent experience in successfully performing similar services
e. Proposed methodology for completing the work
f. References
g. Background and related experience of the specific individuals to be assigned to the
project
h. Proposed compensation
4. If it is determined that it is in the best interest of the City for services to be provided by a
specific consultant—with contract terms, workscope and compensation to be determined
based on direct negotiations—contract award will be made by the Council.
Attachment-3: Exhibit B
OVERVIEW
When the City awards a construction contract, the need for contract change orders (CCO's) is
not unusual. CCO's are required whenever the scope of work changes from that in the original
contract or an unknown condition of the site requires a change in the scope of work. Usually a
contingency amount is established when the project budget is finalized upon contract award to
accommodate limited CCO's. The purpose of this policy is to establish limits of authority for
approving construction project CCO's.
GOALS
1. Ensure appropriate authority and accountability in the approval of change orders..
2. Minimize the time needed to approve a CCO in order to avoid project delays.
3. Establish a system under which the organizational level at which approval is given is
commensurate with the size of CCO and size of project.
4. Eliminate the potential for approval of a CCO when contingency funds are insufficient.
POLICIES
Conditions for Approval of CCO's by Staff
1. Sufficient contingency funds are budgeted and available in order for the Public Works
Director or City Administrative Officer(or CAO-approved designees) to approve a CCO.
2. The nature of work in the CCO is not significantly different from that in the contract.
3. Authorization limits are based on an individual CCO amount, not the aggregate amount of all
CCO's.
4. Authorization limits apply to CCO's for increases in contract amounts only.
5. When the aggregate amount of CCO's reaches 75% of the contingency, the awarding
authority shall be informed of the status of the project and the sufficiency of funding to
complete the project..
6. Work will not be broken up into multiple CCO's in order to circumvent this policy.
7. All CCO's must be in writing and approved by the appropriate contract parties consistent
with the authorized limits established in this policy.
Attachment 3: Exhibit B
!ICONSTRUCTION CONTRACT CHANGL • , s
8. A copy of each approved CCO will be transmitted promptly to the Finance Department.
9. The CAO may grant approval of CCO's in excess of' 166,066 $30;000 under the following
circumstances (all three factors must be present):
a. Immediate approval of the CCO is necessary to avoid delay.
b. The CCO is an integral and mandatory component of the project.
c. The costs associated with delay of the project would be excessive.
The Project Manager is responsible for carrying out this policy.
10. The CAO is also authorized to approve CCO's in excess of $100.000 related to Job Order
Contract Task Orders:
Authorization Limits
1. Public Works Director/Approved Designee Not to exceed $25,000
2. City Administrative Officer Not to exceed, 100 000$30,000
3. City Council Greater than contract or$100 000* $30,,800
*See circumstances above where the CAO may approve CCO's in excess of$100,000.
Originally Approved by the Council on August 3,1993;Revised by the Council on April 15,2003
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