PURCHASING POLICY Citywide Policy Manual
CITY OF
Attachments:
Exemption Request Form, Purchasing Matrix
CUPERTINO
Effective Date: Responsible Department:
February 13, 2024 Administrative Services
Related Policies & Notes:
Credit Card Policy, Travel Policy, Environmentally Preferred Purchasing Policy, Ethics Policy, Gifts and Gratuities Policy, Public Works Purchasing Policy, Conflict of Interest Code I. GENERAL INFORMATION
Purpose
To provide the City of Cupertino a means of assuring continuity and uniformity in its purchasing operations, and to provide guidelines in implementing Cupertino Municipal Code Chapter 3.22 regarding the purchase of supplies and services.
Goals
The objectives of this Purchasing Policy ("Policy") are:
• To comply with all current laws and regulations.
• To be transparent and accountable.
• To provide a cost-effective purchasing function.
• To buy materials and services at the optimum time, in the appropriate quantities and of the appropriate quality for the intended purpose.
• To ensure the continuity of City operations.
• To encourage competitive bids and proposals from responsible providers who are qualified, capable and willing to meet the City's requirements. • To maintain a reputation for fairness and integrity.
• To ensure open, honest and fair competition for the City's business. • To support the City's ultimate goal to serve the best interests of the public.
Responsibilities
The City Manager or designee is the Purchasing Officer authorized to execute purchases in the manner established by this Purchasing Policy.
The Finance and Purchasing Divisions shall be responsible to:
• Oversee and coordinate the City purchasing program including, without limitation, to prepare and maintain purchasing policies and procedures which define the purchasing function and adhere to City, State and Federal law, as applicable. 1|Page
• Review requisitions and solicitation documents for compliance to the policies and procedures contained herein.
• Advise on purchase solutions that provide best price, favorable terms, cost savings or other benefits to the City.
• Prescribe and maintain such forms as are reasonably necessary to perform the necessary purchasing procedure.
City Departments shall be responsible to:
• Adhere to all Local, State, and Federal purchasing laws, policies and procedures. • Be familiar with and conform to the solicitation and contract award limitations prescribed by law, legal opinions, and such other regulations as may be established by the City. • Inform the Finance and Purchasing Divisions in writing of designated Departmental representatives authorized to execute or approve contracts or purchasing documentation. • Keep informed of current developments in the field of purchasing, prices, market conditions, and new products.
• Prepare descriptive specifications for materials, supplies, and equipment that are sufficiently broad to promote competitive and uniform bidding, detailed to meet the intended need and encourage participation from responsible bidders able to offer the best prices consistent with the required quality, delivery, and service. • Explore and encourage bulk purchasing when possible to take advantage of available discounts, including identifying the Federal, State, quasi-public, or any other public agency cooperative purchasing or piggy-backing opportunities on another agency's bid effort.
• Purchase equipment and supplies that conform to Occupational Safety and Health Administration (OSHA) requirements.
• Perform full and open competition on all purchases, unless an approved exemption exists. • Prepare formal and informal bid packages (scope of work, requirements, timelines, etc.) through use of developed templates or in coordination with Purchasing Division. • Negotiate and prepare contracts for the procurement of the needed quality and quantity of materials, supplies, services, and equipment, required by any Department at the best value or lowest cost to the City in conformity with the procedures established for the purpose.
• Coordinate with Purchasing Division, as appropriate, to obtain City Council, City Manager or delegee approval to award contracts as required by the Cupertino Municipal Code and purchasing policy.
• Designate a Contracts Administrator to facilitate the development of contracts through the Cobblestone system.
• Designate Responsible Staff Member(s) to facilitate the development of purchase orders through the Financial System.
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• Perform the inspection of all supplies, materials, equipment and services to ensure conformance with the specifications, requirements and/or deliverables.
Overview
As a general rule and unless exempt by the Cupertino Municipal Code (CMC"), this Policy or applicable law or regulation, purchases shall be based on a competitive process.
The City Manager, or designee, shall review the results of all formal competitive bid solicitations and make recommendations to the City Council as to the action to be taken.
Under no circumstances should purchases be artificially split to avoid competitive procurement requirements as noted in Public Contracts Code section 20150.11. If a contract is for known and expected services across multiple years then the total contract amount for the complete term determines the procurement process to ensure the contract is not split. Compliance with these rules shall be monitored via the City's Financial System, responsible department staff, Department Director, or designee, and Finance and Purchasing Divisions.
The Purchasing Division can assist, counsel, direct and inform Departments of resources and actions to take to ensure compliance with the City's Municipal Code, applicable law and this Policy. However, staff and Departments are each fully responsible for being knowledgeable about applicable law, this Policy and any related policy regarding purchasing (i.e. environmental preference, clean vehicle, technology use, purchasing card, etc.). Each staff member is responsible for making purchases that comply with applicable law and policy.
Ethical Standards for Purchasing
When contracting with the business community (i.e. vendor, contractor) to support the delivery of services throughout the City, it is every employee's responsibility to follow good business and ethical practices and to adhere to the City's applicable laws, policies, and procedures. This is a responsibility that should not be taken lightly as staff engaged in purchasing decisions are subject to state laws related to conflicts of interest, and in accordance with the City Ethics Policy. All vendors shall be treated ethically and fairly by City personnel, with equal information given to each vendor who participates in a competitive situation.
City Employees must discharge their duties in an impartial manner to foster the integrity of the City's purchasing function and to assure fair and open competition required for the selection of competent and responsible vendors.
The following actions constitute a violation of Ethical Standards:
• Aiding or assisting a potential vendor or bidder (other than providing information available to all vendors) in securing a contract to furnish labor, materials or other supplies; • Favoring one bidder over another without merit or outside of the evaluation and selection process;
• Giving or withholding information from any potential bidder not given or withheld from other bidders;
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• Willfully misleading any potential bidder in regard to the character of the materials or supplies, specifications, requirements or deliverables as defined in the solicitation or in an anticipated contract;
• Knowingly certifying to a greater amount of labor performed or material or supplies furnished than has been performed or received OR knowingly certifying to a higher quality of labor performed or material or supplies furnished than has been performed or received; and
• Accepting, directly or indirectly, any gift, rebate, money, or anything else of value whatsoever from any person or entity if the gift, rebate, money, or item of value is intended as a reward or inducement for conducting business, placing orders with, or otherwise using the Employee's position to favor the contributor in accordance with the Gifts and Gratuities Policy.
Conflict of Interest
California Government Code section 1090 prohibits City officers and Employees from having a financial interest in any contract "made" by them or by any board or body of which they are members. Contracts entered into in violation of Government Code section 1090 are void and payment by the agency is prohibited. Willful violation of section 1090 by a public official or employee is a felony with a maximum fine of $1,000 or imprisonment and the official is "forever disqualified from holding any office in this state." (CA Gov. Code § 1097).
The following conduct is prohibited by this Policy, and may be a violation of Government Code section 1090:
• For any Employee to participate directly or indirectly in City procurement when the Employee knows that:
• The Employee, or any member of the Employee's immediate family, has a financial interest pertaining to the procurement;
• A business or organization in which the Employee or any member of the Employee's immediate family has a financial interest pertaining to the procurement; and/or
• Any other person, business, or organization with whom the Employee, or any member of the Employee's immediate family, is negotiating, or has an arrangement concerning, prospective employment, is involved in the procurement.
• For any Employee to solicit, demand, accept, or agree to accept from another person, a gratuity or an offer of employment in connection with any decision, approval, disapproval, recommendation or preparation of any part of a purchase request.
For a person, business, or organization to be retained, or for these entities to retain a person, business, or organization to solicit or secure a City contract when upon contract execution there is an understanding for a commission, percentage, brokerage or 4| Page
contingent fee to be paid to the retained person, business, or organization, except for bona fide organizations established for the purpose of securing business. • For any Employee who is participating directly or indirectly in the procurement process to be, while such an Employee, the employee of any person, business or organization contracting with the City.
• For any Employee to engage in selling supplies, equipment, or services to the City. • For any Employee of the City to act as a principal, or as an agent for anyone other than the City, in connection with any judicial or other proceeding, contract, claim, charge, or controversy related to City business, other than when acting within the Employee's official responsibility.
• For any Employee or former Employee to knowingly use confidential City-related information for actual or anticipated personal or business gain, or for the actual or anticipated gain of any other person or business.
• For any Employee or officer to accept gifts, rebates, money, entertainment, personal services, or in any way incur material personal gain from any vendor doing business with the City or from any potential City vendor, or if circumstances create the impression that the Employee or officer's vote, judgment or action could be affected, or that the Employee or officer is being rewarded for the performance or nonperformance of an official duty in accordance with the Gifts and Gratuities Policy.
For clarity, promotional items of nominal value such as calendars, pens, balloons, etc., shall not constitute a gift if received as a non-personal item by the Employee, and the item is distributed to customers or potential customers routinely by the contributor. Care should be taken in the receipt and use of these promotional items as the display or use may in and of itself cause a potential conflict when participating in purchasing decisions.
A contractor or consultant that prepares, advises or assists in the preparation of plans and/or specifications that will be included as part of an invitation for bids or request for proposals may enter into a subsequent contract for a later phase of the same project if the contractor or consultant's involvement was limited to conceptual, preliminary, or initial plans or specifications and all bidders or proposers for the subsequent contract have access to the same information, including the conceptual, preliminary or initial plans. Nothing in this section is intended to differ from State conflict of interest law, as may be amended from time to time, and in the event of a conflict between this section and State conflict of interest law, State conflict of interest law shall control.
When a circumstance presents an actual or potential conflict of interest, the staff member involved shall declare and/or recuse themselves from further participation in the procurement, selection or award recommendation decision.
Violations of this section may result in disciplinary actions in accordance with the City's Administrative Rules and Regulations, in addition to potential civil and criminal penalties. 5| Page
Competition
All purchases must be conducted in a manner providing full and open competition, unless otherwise allowed by this Policy and applicable law. In order to ensure objective vendor performance and eliminate unfair competitive advantage, staff and vendor participation shall follow the Ethical Standards section of this Policy. Some of the situations considered to be restrictive of competition include but are not limited to:
• Placing unreasonable requirements on firms in order for them to qualify to do business; • Requiring unnecessary experience and excessive bonding; • Noncompetitive pricing practices (i.e. collusion) between firms or between affiliated companies;
• Noncompetitive service orders, purchase orders or new contracts issued to vendors that currently have ("on-call") contracts;
• Specifying a "brand name" product without allowing an "or equal" product to be offered that meets the performance or other relevant requirements of the procurement; and • Any arbitrary action in the procurement process.
Budget
The budget appropriation is the authorization by the City Council to procure specified equipment, supplies, materials and consulting or construction services for City operations during a specific fiscal year, July 1 through June 30. Unexpended and unencumbered appropriations expire at the end of the fiscal year, unless a budget carryover is approved.
Funding and Appropriation
Resources to purchase goods and services for the City's operating Departments are appropriated in the various operating and capital funds identified in the approved annual budget by Department and account codes. It is the user department's responsibility to ensure that expenditures are applied to the appropriate existing account codes and that adequate funding exists within the Department's budget before a purchase is made or contract is executed. In the event a new account code needs to be added to a Department's budget, contact the Finance Division.
Vendor Development
Department staff are responsible for ensuring that vendors are established in the Financial System before initiating a new purchase order or contract request. Vendor changes may be necessary when a vendor is acquired, changes names, or changes addresses, and those requests are initiated by the department. Refer to the Finance Division HUB for the New Vendor Request or Update Vendor Request form.
Allowable and Prohibited Purchases
Allowable and prohibited purchases are further defined in the Food and Reimbursement Policy, Travel Policy and Gifts and Gratuities Policy and should be referenced when confirming appropriate ability for City to fund the purchase.
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Prevailing Wages
The Department of Industrial Relations ("DIR"), in accordance with Labor Code 1720, requires that prevailing wages are paid to classifications identified by the DIR for public work projects.
While the DIR defines a public work as construction, alteration, demolition, installation, or repair work, a project that may require prevailing wages include those with trade labor, certain consultants, land surveyors, furniture installers and other specific trades. By state law, prevailing wages are required to be paid by a contractor for a public works project contract that exceeds $1,000. However, if a public work project exceeds $15,000 for maintenance work; or $25,000 for construction, alteration, demolition, installation or repair; then the project shall be registered with the DIR and appropriate payroll submittals and additional reporting requirements will need to be met by the contractor. State law may be amended, so refer to the DIR website for Prevailing Wage Requirements and more information or contact the Purchasing Manager or City Attorney.
Responsible Staff Member
The Responsible Staff Member(s) coordinates purchases for its designed department to ensure they align with this Policy and any other related polices. They are the individual(s) that collects the appropriate and required information and is knowledgeable of the contract or the purchase.
A Responsible Staff Member is not necessarily the Project Manager that will oversee the delivery of the goods or services. A Responsible Staff Member may be the Contract Administrator or an administrative level staff, generally including Senior Office Assistants, Administrative Assistant and Executive Assistants, that will provide and insert details such as vendor, purchase description, dollar amount and any other required reference information into the Financial System's purchase order module. Departments may designate another classification or multiple staff for this role.
II. PURCHASE ORDERS, REQUEST FOR CHECK and PURCHASING CARD PAYMENT Introduction
Purchase Orders are a necessary and important tool for tracking expenditures in the Financial System. A Request for Check is an alternative means to pay vendors when a Purchase Order is not appropriate. Finally, City issued Purchasing Cards are used for specific small purchases of goods or some services in limited situations.
Request for Check
A Request for Check ("RF") is authorization to process payments for employee reimbursements, refunds or for vendor purchases when a purchase order is not accepted. This method should not be used to supplant existing arrangements. Request for checks are processed by using the Check Request Form and should include appropriate documentation and authorization. Any employee may complete this form but must have appropriate approval and documentation as defined in the RFC process on the Finance Hub.
Purchase Order
A purchase order ("PO") is a contract to purchase equipment, supplies, materials and/or services with a specified consultant, contractor, or vendor. A PO shall identify the specific items to be purchased and include attachments for reference and clarification including a specific quote, contract, or detailed requirements, as required. An approved and posted PO encumbers a 7| Page
specified amount in the Financial System to provide specified equipment, supplies, services, • materials and/or fixed assets.
Whenever possible, end users should purchase goods and/or services directly from a supplier through an approved and established Purchase Order. In those instances where a Purchase Order does not exist, or is not appropriate, either a Request for Check or P-Card is an available option.
Staff will be required to provide documentation to support requested PO or payment via P-Card or Request for Check.
A blanket purchase order is a contract to purchase goods or services for an undetermined quantity but not to exceed a total contract amount and for a specific period. While goods will include standard terms, services may be established through an executed On-Call Contract. The cost for goods or services during the contract period may be pre-determined based on a vendor quote or may be quoted at the time of order or service delivery. Blanket purchase orders are utilized when a budget encumbrance is not feasible due to varying funding sources that may cross fiscal years.
PO's are typically paid up to the purchase order amount at the conclusion of performance (delivery of materials, services, etc.), in incremental (progress) payments as provided in a specific contract or each time goods, services or public works are delivered. Generally, any City employee with access to the Financial System can be granted authority to request a PO, however each department's identified Responsible Staff Member should coordinate and ensure requests meet this Policy.
Purchase Order Submittal Process .
The Responsible Staff Member will enter a requisition into the Financial System and either a management analyst, supervisor, manager, or their designee, will approve the entry. Submitting a request for a PO indicates appropriate department approval outside the Financial System has occurred. The Responsible Staff Member ensures there is adequate funding in the appropriate Department budget before submitting a PO requisition. The final approvals of the PO request are completed by the Purchasing and Finance Divisions. A PO number is generated by the Financial System once the Responsible Staff Member or Department available user prints the fully approved PO.
A PO will not be approved in the Financial System until all documents and/or agreements have been appropriately uploaded, approved and/or executed and funding exists in the appropriate account. Specifically identified exemptions for competitive purposes outlined in this Policy shall be identified on an Exemption Request Form when requesting a PO.
The Responsible Staff Member shall attach the following documentation to the PO, if applicable:
• Documentation of the vendor selection process (include bids, quotes, and justification for vendor selection);
• Justification for exemption and form for sole source purchase; • Justification for fewer than three vendor responses received; • Council reports; and
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• Executed contracts with all exhibits.
A PO shall be issued prior to the goods and/or services being purchased and/or performed. When the vendor issues an invoice, the PO number should be reflected on the invoice.
Each Department is responsible for verifying the quantity, quality, and delivery of all goods and services and to address any problems or conflicts that may arise. Invoices will not be paid until delivery of an order is verified and the Department assures that the goods or service meets the required specifications. Proof of delivery can be a packing slip attached to the invoice entry.
Noting "okay to pay" on the invoice or a "received" stamp with department signature would suffice as verification that goods and/or services have been delivered as required.
Payment Against a Purchase Order
All invoices from consultants, contractors, or vendors shall be directed to the Department. The City desires to pay its bills in a prompt manner to avoid late charges and penalties and pays approved invoices on a weekly payment cycle.
Prior to submitting an invoice for payment, the Responsible Staff Member and the approver shall ensure:
• Authorization to process payment against the invoice exists. Authorization occurs by name and signature on the invoice, a note of "okay to pay this amount ($X)" or "received" and the appropriate general ledger accounts);
• Adequate funding in all accounts is designated in the Purchase Order; • The accurate Purchase Order is associated to the invoice; • All required documents are attached and acceptable; and • The purchase adheres to the City's Purchasing Policy.
Purchasing Card (CAL-Card or P-Card)
Purchasing items via a P-Card is acceptable when a contract, purchase order or RFC are not available or practicable or are a more costly option. P-card purchases are typically below $1,000, limited to the single and monthly transaction limits for each cardholder and generally are used to pay for goods and limited services when the transaction is simple and is typically a one-time occurrence. Frequent payments of a vendor via p-card may be acceptable, however care should be taken to confirm whether other forms of payment are appropriate. Refer to the Credit Card Policy for more information on appropriate purchases.
Split Purchases
A split purchase occurs when the quantity of a required item or service is known prior to the initial purchase and is divided into multiple purchases in order to avoid the requirement for obtaining bids, proposals, required authorization, award authority approval or guidance in this policy. Splitting purchases does not allow for a competitive market among vendors, increases the administrative workflow, and evades risk mitigation procedures and potentially the appropriate award authority. Split purchases may or may not be vendor specific, but rather are focused on the specific goods or services to be procured. Where a vendor provides for broad goods or services that were not previously included in the competitive process, multiple procurement processes (POs) may exist for one vendor without being considered a split purchase. 9|Page
In certain circumstances, split purchases are criminal misdemeanors under State law (Public Contract Code § 20163), and are considered fraud, waste, and/or abuse in violation of City policy.
Multiple purchases with the same vendor for the same goods or services under separate contracts are typically considered a split purchase, but are not the only circumstance that might be considered a split purchase.
Any violation of split purchases may result in disciplinary action up to and including termination and may result in the removal of access rights in the Financial System or the ability to participate, lead or support purchasing activities through an informal or formal solicitation process.
III. THRESHOLDS FOR PROCUREMENT
Introduction
As a general rule, unless exempt or not applicable by the Cupertino Municipal Code ("CMC"), this Policy or applicable law, purchases shall be by a competitive process. The complexity of the procurement process generally will increase with the dollar value of the purchase. Although competitive low bid procurements typically result in lower purchase prices, there are costs associated with any procurement process in terms of time and effort. For that reason, the smaller the purchase, the less stringent the competitive procurement requirements and vice versa.
Additionally, some services are more appropriately subject to procurement through a best value evaluation where cost is not the prevailing consideration. The resulting contract for any purchase may include a required Purchase Order, appropriate agreement for services, and any applicable documentation maintained by the City Contact. The Purchasing Matrix provides a summary of the procurement process, delegated department purchasing authority and contract award authority as a supplement to this Policy. Care must always be taken to ensure that the City receives appropriate value for each expenditure.
The procurement threshold is established by the estimated, budgeted or expected cost of purchase for the entire term. If cost of purchase requires a contract for multiple years then the total contract amount for the entire term of the contract determines the procurement threshold.
A contract term is determined by each department based on a needs analysis for the goods or service with consideration given to the budget approval and strategic contracting approach. A multi-year contract may require a budget carryover request initiated by the Department of Record and approved by Administrative Services and the City Manager.
As a preliminarily matter, staff should determine the purpose for retaining a contractor or consultant, evaluate the scope of services for the contract, and the amount of time that such service shall take to be completed. The purpose of determining the appropriate contract term should be evaluated early to ensure the appropriate procurement process is followed and the contract approval authority is obtained.
Any procurement process that is unsuccessful due to (a) no responses being received; (b) all quotes/bids being above the estimated budget amount; or (c) all proposals being determined not to meet the minimum qualifications; may go through a new competitive process when conditions 10 | P a ge
are appropriate or pursue the procurement without further adherence to any competitive process at the discretion of the awarding authority.
Pursuing a new competitive process may include a change in condition, an increase in budget, identification of additional qualified bidders or proposers, a change in scope or other adjustments necessary to identify and solicit successful bids or proposals.
The City Manager, or designee, shall review the results of all formal competitive solicitations and make recommendations to the City Council.
Purchases Valued below $5,000
Goods and/or services valued below $5,000 are not required to complete a competitive procurement or proposal process. However, nothing shall prevent collecting informal quotes or proposals, when possible. In addition, in no situation shall a purchase be artificially split.
Purchases Valued from $5,000 through $60,000*
Goods and/or services valued from $5,000 through $10,000 awarded to a vendor based on lowest price are required to complete an informal competitive process by collecting verbal quotes, emailed quotes or via online pricing. A verbal quote is provided in person or over the phone; an emailed quote is provided by vendor via email information or attachment; and online pricing is identified via company or distributor website.
Goods and/or services valued from $10,000 through $60,000 awarded to a vendor based on lowest price are required to complete an informal competitive process by collecting written quotes or via online pricing. A written quote is provided by the vendor in person or via email by vendor on its company letterhead and is in response to a City email solicitation that defines the specific scope, project expectations and/or product requirements. Online pricing is identified via company or distributor website.
Services valued from $5,000 through $200,000 awarded to a vendor based on best-value demonstrated through qualifications and an evaluative process, and not determined based on lowest price, are required to complete an informal proposal process. Review Section V. and the Purchasing Matrix for guidance.
Vendors may be identified through online research, previous city contract work, referral from other departments or public agencies, the Business Opportunity Website or from other consultants or contractors. A minimum of three vendors should be outreached to with research, alternative pricing or vendor responses kept with the project file.
In no situation shall a purchase be artificially split.
Purchases Valued greater than $60,000 through $200,000* Unless exempt from bidding, goods and/or services valued greater than $60,000 through $200,000 shall be made through an informal competitive procurement or proposal process. In no situation shall a purchase be artificially split.
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Refer to informal procurement procedures identified in Section IV. or V. and the Purchasing Matrix for additional information. Authority to proceed with a solicitation or recommendation to purchase is granted at the Department Head level.
* The limit for informal competitive purchases will comply with PCC 22032(b), as may be amended.
Purchases Valued greater than $200,000**
Unless exempt from bidding, goods and/or services valued greater than $200,000 shall be made through a formal competitive bid or proposal process. In no situation shall a purchase be artificially split.
Keter to the formal procurement procedures identified in Section IV. or V. and the Purchasing Matrix for additional information. Authority to proceed with a solicitation or recommendation to purchase is granted at the Department Head level.
** The amount for formal competitive purchases will comply with PCC 22032(c) as may be amended.
IV. INFORMAL AND FORMAL COMPETITIVE BID SOLICITATIONS
The City requires that purchases of goods and services, inclusive of supplies, materials, equipment and non-professional services, valued above $5,000 go through a competitive selection process. Purchases between $5,000 and $60,000 require the collection of a verbal or written quote.
An informal Request for Quote process is utilized when the expected total contract cost is expected to be between $60,000 to $200,000 (or as adjusted in accordance with the CMC). A formal Invitation for Bid process is utilized when the expected total contract cost is expected to exceed $200,000 (or as adjusted in accordance with the CMC). The determination to proceed with an Request for Quote or Invitation for Bid is based on having a clearly defined project scope of work, product, materials, deliverables, requirements and/or expectations. These factors create a project- specific expectation for all vendors and dictates the selection based on a vendor that submits the lowest responsive and responsible quote or bid. The specific procedures that must be followed for informal and formal competitive solicitations are set forth in this policy as guided by CMC §
3.22. If selection of a vendor is based on best-value demonstrated through qualifications and an evaluative process, and is not determined based on price, then review Section V. for guidance.
Informal Request for Quote (RFQ)
When the expected total contract cost is expected to be between $60,000 to $200,000, a competitive Request for Quote shall be solicited from a minimum of three qualified contractors or vendors and shall be made available to any qualified contractor or vendor that expresses interest. If qualified contractors or vendors are unknown or the contract amount may exceed $200,000, posting on the City's Business Opportunity Website is appropriate to ensure adequate outreach. 12 | Pa ge
The Department of Record shall retain records of vendor outreach communication to document the process.
Typically, RFO's are communicated electronically and quotes are received electronically or via paper submittal by the due date set forth in the RFQ. However, if the purchase is needed immediately or is of an urgent nature, as determined by the Department Head, or designee, verbal quotes can be received. Verbal RF's should attempt to meet the same criteria and expectations outlined in this section for an RFQ and will require necessary documentation when submitting to Finance for a Purchase Order.
Informal RFO's should be developed by the City Contact and reviewed within the department or by the Department Head, as necessary. RFO's shall include specific details, project requirements, timelines, license or qualification requirements, quote sheet and other relevant details that will allow a potential bidder to understand and submit a quote for the need. A City Contact should be identified and accessible to address questions and clarifications. A date for quotes to be submitted shall be identified. An RFQ can be presented in a detailed email, word document, PDF or in a manner that best represents the need. The intention through an informal process is that a clear request will allow a potential bidder to easily develop a quote for the expected need.
Clarification information that changes details in the RFQ shall be provided to all identified contractors/vendors. RFO's posted on the Business Opportunity Website shall have bid clarifications items posted online.
Quotes can be provided directly to the City Contact in person, via email, or through another prescribed method and may be opened in person, online or electronically using a bidding platform. Receipt and retention of communication from a vendor indicating they will not bid is important. Reviewing the quotes to determine bidder responsiveness and responsibility is the role of the City Contact with support from the Purchasing Division and City Attorney, as necessary. Any RFQ information should be documented and maintained, with appropriate information submitted to Finance Division when requesting a purchase order.
The RFQ shall include this statement: The City reserves the right to reject any and all quotes, to accept or reject any one or more items of a quote, or to waive any irregularities or informalities in the quotes or the process.
Award: The Purchase Order and contract shall be awarded to the lowest cost, responsive and responsible bidder whose bid meets the requirements and criteria set forth in the request for quotes. If two or more responsive and responsible bidders submit the same lowest cost quote, the Purchasing Officer will select one through a blind selection process. The Purchasing Officer, or delegee, has contract award authority for informal procurements.
Formal Invitation for Bid (IFB)
When the expected total contract cost is expected to exceed $200,000, a formal Invitation for Bid shall be publicly available to any potential contractor or vendor and solicited from as wide a range of contractors or vendors as practical. Identification of, and outreach to, specifically qualified 13 | Page
contractors is encouraged. Typical public notification of a formal bid process occurs through the posting on the City's Business Opportunity Website but alternative advertisement on an online public bidding platform will also meet this requirement. Contractors desiring information about the IFB shall be directed to the Business Opportunity Website or specified public bidding platform for specific information. A record of vendor outreach is available in the Business Opportunity Website or alternate bidding platform for documentation or reference.
An IFB is developed by the City Contact, specific subject matter experts and reviewed within the department or by the Department Head, as necessary. An FB shall include a specific scope of work, project requirements and specifications, license or qualification requirements, a Bid Form and any additional relevant details, including project plans or project completion deadlines for example, that will inform a potential bidder of the project or purchase. Bid documents are typically presented in a PDF format but may be presented in other document forms to best collect bid information or present the project or purchase.
A City Contact should be identified and accessible to address questions and clarifications.
Responses to questions, changes to any details in the IFB, or edits to bid forms or documents contained within the IF shall be posted on the Business Opportunity Website to ensure all prospective bidders are notified or aware of these changes. In the situation when a document or detail in the original IFB has changed, was replaced, or is newly included an Addendum shall be developed to identify the specific actions.
The following items shall also be included in the IFB process.
Competitive Sealed Bidding Process:
i. Invitation and Notice: An Invitation for Bids (IFB) shall include a description and specifications of the goods and/or services and all contractual terms and conditions applicable to the procurement including, but not limited to, the project name and number, the bid due date and time, bid opening date and time and location for the bid opening. Reasonable public notice of the invitation for bids shall be given not less than fourteen (14) calendar days prior to the date of the opening of bids. Notice shall be posted in at least three (3) public places in the City, including on the City website or alternate public bidding platform, and may be electronically mailed to any vendor or provider that can provide the required goods and/or services.
The IFB shall include this statement: The City reserves the right to reject any and all bids, to accept or reject any one or more items of a bid, or to waive any minor irregularities, informalities or variances in the bid documents, in the bids submitted or the bidding process.
ii. Bid Opening: Bids shall be opened at the place and not earlier than the time designated in the invitation for bids. A Bid opening may be held in person, 14 | Page
virtually via video or teleconference, or electronically via bid platform when the website, call-in number or instructions are included as the place of opening on the invitation for bids. The amount of each bid and such other relevant information as the City deems appropriate, together with the name of each bidder shall be provided to bidders and available upon request after the bid opening. The City is not responsible for any bids arriving after the scheduled bid due date and time or that are not clearly marked and shall be returned unopened. iii. Bid Evaluation and Acceptance: Bids received at or prior to the bid due date and time shall be unconditionally accepted without alteration or correction, except as authorized in this policy. Bids shall be evaluated based on the requirements set forth in the FB, which may include criteria to determine acceptability such as inspection, testing, quality, workmanship, delivery, staff qualifications, licensure requirements and suitability for a particular purpose. Those criteria that will affect the bid price and be considered in evaluation for award shall be objectively measurable, such as discounts, transportation costs, and total or life cycle costs.
The IFB shall set forth the criteria and submittal requirements to determine a responsive and responsible bidder. No criteria may be used in bid evaluations that are not set forth in the IFB. City Council will determine formal bids deemed as non-responsible in accordance with this policy.
iv. Correction or Withdrawal of Bids: Subject to any provisions of applicable law or regulations to the contrary, correction or withdrawal of inadvertently erroneous bids before or after bid opening, or cancellation of awards or contracts based on such bid mistakes, shall be in accordance with this section. Mistakes discovered before bid opening may be modified or withdrawn by written notice received in the office designated in the IFB prior to the time set for bid opening. After bid opening, no corrections to bid or provisions shall be permitted, but in lieu of bid correction, a low bidder alleging a material mistake of fact may be permitted to withdraw its bid if:
• The mistake is clearly evident on the face of the bid document; or • The bidder submits evidence that clearly and convincingly demonstrates that a mistake was made.
All decisions to permit the correction or withdrawal of bids shall be supported by a written determination made by the City.
Award: The City Council has contract award authority for formal procurements.
The Purchase Order and contract shall be awarded to the lowest cost, responsive and responsible bidder whose bid meets the requirements and criteria set forth in the request for bids. Other situations may be resolved as follows:
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a. If two or more responsive and responsible bidders submit the same lowest cost bids, the City Manager will select one through a blind selection process.
b. City Council may award a contract to the next lowest responsive and responsible bidder when the successful bidder fails or refuses to execute a contract within ten (10) days after they are provided notice of award, unless the City is responsible for the delay.
c. City Council may waive any minor irregularities or variances in any bid received.
d. City Council may reject all bids submitted and re-advertise for new bids. e. City Council may reject any bid that fails to meet the requirements of the IFB in any respect or is determined to be non-responsive. f. City Council may, if no bids are received, direct the Purchasing Officer to purchase the supplies, materials, equipment or Services without further adherence to the formal bidding procedure.
vi. Determination of Non-Responsible Bidder: The City Council, in its sole discretion, may reject the lowest responsive monetary bid upon a specific finding that the bidder is not responsible. To determine the lowest responsible bidder, as defined in CMC § 3.22, the City Council may consider, among other things, a bidder's attributes of trustworthiness, quality of current or previous work, fitness, capacity and experience to satisfactorily perform the contract. Specifically, this may include the bidder's financial responsibility, type of license, type of equipment, experience in related work, completed projects, and whether bidder has failed to complete any contract. If the City Council rejects the lowest bid upon its determination that the lowest bidder is not responsible, the City shall:
a. Give notice of the City Council's decision to the lowest monetary bidder, setting forth the reasons why the bidder is not determined a responsible bidder;
b. Give the bidder the opportunity to ask for a pre-award hearing before the City Council on the issue;
c. If the hearing is requested, agendize the matter before the City Council, giving written notice of such hearing to all bidders;
d. After the hearing, the City Council shall make a finding, supported by the evidence on the record as to the non-responsibility of the lowest monetary bidder.
e. Award will proceed to the lowest responsive and responsible bidder. vii. Contract Payment: Refer to the Purchase Order Payment Process for more information.
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V. PROPOSALS FOR PROFESSIONAL, CONSULTANT OR OTHER SERVICES Professional services requiring a competitive procurement process are defined as those provided by a person or firm engaged in a profession based on a generally recognized special knowledge or skill including, but not limited to, architectural, landscape architectural, environmental, engineering, land surveying, and construction project management services, or other occupations requiring specialized training. Consultant or other vendor services are inclusive of any support staff may need for the completion of a capital project, City work plan, to assist or provide services necessary to continue daily operations or for completion of a specialized project. Professional, Consultant or other Vendor services (collectively, "Services") offered may provide differing experiences, efficiencies, tools and resources to meet the requested solution. As such, to allow the City flexibility in selecting a professional consultant or vendor that best meets the needs of the project or expected solution through a distinct and unique proposal, a selection for such services should occur through a best value determination process and not via lowest bid/proposal.
Additionally, for those services not legally required to be procured through a competitive process, nothing prevents the City from doing so when appropriate.
Before proceeding with requesting proposals from consultants it is important to have an identified scope of work, deliverables, required qualifications and any other elements which outline expectations to meet the requested solution. It is important to note that negotiation with a selected consultant may be needed to reach the desired solution.
An informal proposal process is utilized when the expected total contract cost is expected to be above $5,000 and below $200,000 (or as adjusted in accordance with the CMC). Informal Request for Proposals ("RFP's") shall be solicited from a minimum of three qualified consultants and made available to any qualified consultant that expresses interest. If qualified consultants are unknown, posting on the City's Business Opportunity Website or through trade and professional organizations is appropriate to ensure adequate outreach. The Department of Record shall retain records of vendor outreach communication to document throughout the process A formal RFP process is utilized when the expected total contract cost is expected to exceed $200,000 (or as adjusted in accordance with the CMC). Formal competitive RFP shall be publicly available to any potential consultant and solicited from as wide a range of consultants as practical.
Identification of, and outreach to, specifically qualified consultants is encouraged. Typical public notification of a formal RFP occurs through the posting on the City's Business Opportunity Website to ensure adequate outreach. Alternative advertisement on an online public procurement platform will also meet this requirement. Consultants desiring information about the RFP shall be directed to the Business Opportunity Website or specified public bidding platform for specific information. A record of vendor outreach is available in the Business Opportunity Website or alternate bidding platform for documentation or reference.
Contracts for Services should be awarded on the basis of demonstrated competence, qualifications and any other specific selection criteria set forth in the RFP necessary for the satisfactory performance of the services required at a fair and reasonable price to the public agency. The RFP shall identify the relative importance of any selection factors and sub factors. A 17 | Page
statement in the RFP of the specific weighting to be used for each factor and potential sub factors is recommended so that all offerors will have sufficient guidance to prepare their proposals.
Internal criteria and mechanisms for evaluating responses to such factors shall be developed before proposals are received. For these submittals, price can be considered but may not be the sole or primary determining factor. If price is a consideration, best practice would set the consideration at a small to moderate percentage weight of the total proposal. An RFP is developed by the City Contact, specific subject matter experts and reviewed within the department or by the Department Head, as necessary.
The following items shall also be addressed in the RFP process.
A. Competitive Proposals for Professional, Consultant or other Services:
i. Request for Proposals Solicitation: Requests for proposals shall specify the deadline and place for submission, the nature of the services required, and the selection criteria to be used for awarding the contract. A City Contact should be identified and accessible to address questions and clarifications. Responses to questions, changes to any details in the RFP shall be posted on the Business Opportunity Website, or directly sent to the qualified consultant list, to ensure all prospective bidders are notified or aware of these changes. Significant document or detail changes in the original RFP shall be distributed as an Addendum.
Contracts for Services should be, unless infeasible, based on evaluation of at least three proposals. The City Contact shall maintain and submit related documentation to Finance Division.
ii. Selection of Service Provider: An evaluation committee of at least 3 qualified evaluators shall independently evaluate the submitted proposals and convene to discuss the evaluative factors in selecting the highest ranked proposers. If further evaluation of the highest ranked proposers is necessary, a formal interview may be conducted or other means to collect information (i.e. reference checks, online research) necessary to make an informed decision of the highest ranked proposer. iii. Negotiation: At times, items related to the delivery of the project (i.e. scope of work, deliverables, schedule, price, etc.) require discussion and agreement in consideration of alternative solutions or additional and necessary details that are identified through the proposal process. As such, the City can consider modifications to the scope of work, tasks and deliverables during negotiation with the selected proposer. The final statement of work should be inclusive of the City scope of work and consideration of the consultant proposal. These negotiations should involve consultation with the Purchasing Manager and occur before a contract is recommended for award.
iv. Award of Contract: Except as otherwise provided herein, the awarding authority shall award a contract based on qualifications, experience, and responsiveness, in addition to any other criteria set forth in the RFP. The Purchase Order and contract shall be awarded to the highest ranked proposer based on the evaluative criteria 18 | Page
identified in the RFP and subsequent negotiations. A purchase order shall be requested through the Financial System after contract award.
The City Council is the award authority for any contract that exceeds $200,000 (or as adjusted in accordance with the CMC). City Council may award a contract to the next highest ranked proposer when the highest ranked proposer fails or refuses to execute a contract within ten (10) days after they are provided notice of award, unless the City is responsible for the delay.
Procurement of Services of any value is via a written contract approved as to form by the City Attorney's Office. The City Attorney and Department Head, considering advisement of the City's outside Risk Manager, may waive this requirement for purchases of $5,000 or less. Service contracts must be signed by the vendor, Purchasing Officer or delegee, and the City Attorney's Office.
V. Rejection of Proposals: All proposals may be rejected and/or the RFP reissued with adequate documentation of the results of the RFP process, in the event of one or more of the following occurs:
• All responses exceed the budgeted amount or the City was unable to negotiate a fair and reasonable price with any of the qualified consultants, • There are no responsive consultants,
• The project is abandoned,
• The specifications, scope, and/or terms and conditions are revised for a new RFP.
If the Purchasing Authority determines that rejection of all proposals is necessary, clear written justification should be provided. The decision must be made objectively, not to favor or solicit select vendors. The City Council shall approve a rejection of any or all proposals for formal RFP's. If no proposals are received, the award authority may allow purchase without further competition. vi. Contract Payment: Refer to the Purchase Order Payment Process for more information.
B. Contracts for Services values under $5,000 may be let to the most qualified consultant at the discretion of the Department without informal proposals, subject to fair, just, and equitable terms and conditions. This should not preclude competition when determined by the Purchasing Authority.
C. Contract Amendments: Increases to the approved not-to-exceed contract amount that exceeds the City Manager award authority or exceeds the contract amount City Council previously approved, require City Council approval. 19 | Page
Request for Qualifications (RFQL)
An RFQL is a competitive process to prequalify or short list vendors that can provide the required goods/services when future needs arise or when the Department desires to create a qualified short list to propose on a specific project. An RFQL is developed by the City Contact using city templates and should be broadly advertised to potential vendors and can be posted on the Business Opportunity website or alternate bidding platforms. A RFQL may be re-advertised or remain open for a longer period of time than a standard competitive process to allow for ongoing evaluations to occur, if appropriate. The Purchasing Manager can provide assistance and guidance when initiating this process.
The standard RFQL identifies the City's need and potential scope of service, what the vendor shall submit in response, and the process to determine qualified or short-listed vendors. City staff will evaluate any vendor response through an evaluation method to determine the vendor's ability, qualifications, and resources to meet the expected need. A "pre-qualification" is an evaluation process that results in identifying vendors that are qualified to provide the necessary goods/services. A "short-list" is an evaluation process which ranks vendors based on their ability to best provide the goods/services. A successful RFQL process should result in multiple vendors being identified as qualified or short-listed. The result of a RFQL process may be the issuance of contracts to the pre-qualified or short-listed vendors but does not have to. If the City contracts with more than one short listed vendor, Departments should engage in a "mini" RFP competition between the short-listed vendors prior to issuance of a service order.
A RFQL is not a substitute for the RFP process. Typically, based on the complexity of the services, an RFP would be issued to the prequalified or short-listed vendors for the purpose of determining the recommended vendor to award a specific and discreet project. The RFP would be developed as described in this policy with outreach only required to vendors either pre-qualified or short- listed.
VI. EXEMPTIONS FROM COMPETITIVE PROCUREMENT PROCESS
In certain situations, procurements are not subject to an informal or formal competitive procurement process. An exemption to the competitive procurement processes outlined in this policy is not an exception to meeting the City's contract requirements, complying with the contract development process or gaining appropriate approval authority.
The requesting department is the Department of Record that shall collect any appropriate information to document alignment with one of the specified categories, including the completion of any required forms or reports, and submit to the purchase approval authority. When a competitive procurement is not required, it is communicated and documented using the Exemption Request Form. The Department of Record shall maintain and produce copies (for audit or otherwise) of relevant documents and forms (i.e., Sole Source, Cooperative contract information, Bid/Quote/Proposal Summary, etc.) when requested. The following categories do not require a competitive procurement.
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i. From Another Government Agency: Formal and/or informal procurement is not required when the contract and/or purchase is able to be supplied from another governmental agency. Certain purchases may require an agreement to be in place. Coordinate with the City Attorney or Purchasing Manager, as appropriate, for more information. ii. Cooperative Procurement: When the contract or purchase is available through purchasing contracts negotiated by another governmental agency that utilized acceptable bidding procedures similar to this policy and in accordance with California law, an informal or formal procurement is not required. A cooperative procurement should identify that other public agencies beyond the lead agency can participate in the purchase of goods or services from that procurement. The resulting contract from a cooperative procurement can be piggy-backed upon by the City and, if applicable, modified to include appropriate contractual terms appropriate for the City.
For example, Joint Powers Authorities (JPAs) formed under California law are themselves governmental agencies; however, JP As formed in another state may not be, so out-of-state JPAs should be evaluated to determine eligibility. NASPO Value Point is a cooperative purchasing group made up of procurement officials from various governmental agencies, but is not a governmental agency itself; however, all NASPO Value Point contracts are solicited and issued by a lead state, making the contract eligible for piggybacking. The City can also participate in support of, or as a Lead Agency for a cooperative procurement.
It is appropriate to piggyback onto another government contract when the Responsible Staff Member has developed a specification for which another governmental agency has already completed a procurement for essentially the same product. If a governmental agency possess a contract for items that the City wishes to purchase, the Responsible Staff Member must determine that the other governmental agency used an appropriate competitive procurement process to secure its bid or proposal. The Responsible Staff Member should include any appropriate information in the exemption request form submitted to the Purchasing Division and then the appropriate awarding authority for review and approval.
iii. Emergencies: In the event of an emergency as defined herein, the City Manager may order the suspension of bidding or purchasing and/or competitive procurement requirements to abate the impacts or effects of such emergency. A report of the emergency purchase shall be provided to the City Council at its next scheduled meeting. An emergency shall be deemed to exist if:
• There is a public calamity such as a fire, flood, earthquake, storm, or similar disaster that poses a serious threat to the public safety; or
• There is an immediate need to prepare the national or local defense; or • An essential operation of City service affecting the public health, welfare, or safety or when preservation of life or property would be greatly hampered if adherence to the prescribed purchasing procedures would cause undue delay in procurement of the needed item or service.
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A condition where it would simply be expeditious, convenient, or in the City's best interests to dispense with a competitive process does not constitute an emergency.
Contact the Purchasing Division if contemplating an exception to bidding requirements on the basis of an emergency.
Department Staff is responsible for documenting each emergency purchase request following the identified emergency by submitting an Exception Request Form to the Purchasing Division and City Manager for approval before a report is made to the City Council.
iv. Sole Source: Sole source purchasing is authorized in the event the contract and/or purchase contemplated is only capable of being performed or provided by a sole provider and thus by definition, competitive procurement will be unavailing. Examples include a public utility that holds a monopoly, the holder of an exclusive patent or a franchise, that provides unique or innovative goods or services for which there is no "equal" including, but not limited to, (i) computer software and technology in which no other provider has a comparable product; (ii) those that meet a demonstrated need for compatibility with existing infrastructure in which no other provider's product is compatible; or (ili) those that achieve a City goal for standardization as determined by the purchasing authority.
An identified, required or certified distributor for the manufacturer may be considered a sole source only after concluding that the necessary goods or services are also a sole source. A sole source may be determined when it is apparent that a needed product or service is uniquely available from the source, no competition for similar "or equal" goods or services are available in the marketplace, and for all practical purposes, it is justifiably in the best interest of the City.
Under some circumstances, City bidding requirements may be dispensed with when the services or goods are only available from one source either because:
• The brand or trade name article, goods, or product or proprietary service is the only one which will properly meet the needs of the City, or; • The item or service is unique and or available only from a single source based on region or decision of a manufacturer or distributor, or; • The item/service is designed to match others already in use or necessary to be compatible with others already in use.
The following categories do not require an Exemption Request Form. v. Recurring or Essential Services: These services occur on a recurring basis or are essential in nature and support the City obligations and good management. These include, but are not limited to, the payment of claims and settlements against the City, utility services, insurance liability claims, necessary bonds, insurance premium renewal for authorized policies, and expenditures related to payroll and employee benefits. vi. Specialized Services: In accordance with Government Code 37103, services and advice in financial, economic, accounting, legal, or administrative matters are not procured through a competitive process.
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In addition to the categories listed, there may be situations when the City determines pursuing a competitive procurement would be unavailing or would not produce advantage, and advertisement of a competitive procurement would thus be undesirable, impractical, or impossible. For these situations, an approved Exemption Request Form is required before proceeding.
VIl. CONTRACTS/LEGAL AGREEMENTS
Contract Content
The City Attorney's Office is responsible for drafting and approving contracts as to form.
Template agreements, instructions and training for completing contracts are available on the City's intranet (Hub). Contract Administrators are responsible for utilizing these approved template agreements to develop and route for approval and questions regarding which template to use should be directed to the Purchasing Manager and City Attorney's Office. The City enters into contracts for acquisition of a variety of services, supplies and Public Works projects. Such contracts can vary in form, format, and complexity. However, every contract shall include the following:
1. A stated beginning and ending date - The term of a contract should coincide with the length of the anticipated scope of services. Although not a legal requirement, a term should not exceed 5 years without engaging in another competitive process to encourage a fair and competitive environment for vendors and contractors wishing to contract with
2. A total "not-to-exceed" amount.
3. A clear statement of the scope of services and payment terms. Payment terms should be associated with specific deliverables set forth in the scope of services.
4. Review and sign off by the Contractor, Purchasing Officer or delegee, City Attorney's Office, and City Clerk.
All City contracts are subject to the City's Purchasing Ordinance as well as the purchasing procedures outlined in this Policy. All Federal grant funded contracts must contain the applicable provisions in accordance with 2 C.F.R. Part 200 of the Uniform Guidance.
California law gives an electronic signature the same legal significance as an original signature - see California Civil Code from Sections 1633.1 to Section 1633.17 (known as the Uniform Electronic Transactions Act, or UETA). If electronic signatures are to be used, both parties should sign electronically.
Types of Contracts
Regular Contracts: Contracts for specified services and/or goods generally for a specified period of time and generally for a specified hourly rate or bid/proposal amount with a not to exceed amount. For contracts where the scope of services is specifically and thoroughly defined, it may be appropriate to negotiate a fixed lump sum price.
On-Call Contracts: On-call contracts are individual contracts awarded pursuant to the City's Purchasing Ordinance, for repair, remodeling, paving, sidewalk repair, professional, non- 23 | Page
professional and vendor services or other as-needed work to be done according to unit prices or per project proposal. These contracts are for a specific period of time and a not-to-exceed dollar amount. On-call contracts do not set aside or guarantee funds to pay the contractor, they merely qualify the contractor to work for the City. Qualified on-call vendors may be selected through an RFQL evaluative ranking process or through demonstrated ability to meet required qualifications to perform the work. Once a specific project is defined, a service order must be prepared and issued under the contract for completion of that specific project. Any Work or Service Orders for support from an on-call contract shall follow a procurement process identified in this policy and can only be issued up to the not-to-exceed on-call contract limit.
Change Orders and Amendments: Amendments to contracts, or change orders to Purchase Orders, shall be limited to avoid any material alteration in the original terms or scope. A material alteration would significantly change the original scope of work, significantly increase the total cost of the work, and result in the departure from the original contract as awarded.
While situations differ in every circumstance, for example, amending a contract to purchase additional parts needed to repair identified equipment or having a consultant attend an additional meeting with City Council that meet the intention of the original contract are not considered a material change. Amending a contract to add the repair of equipment not identified or having a consultant attend staff meetings not related to the original contract would be considered a material change. Contract amendments shall use and follow the appropriate amendment template and/or change order process in the Financial System and can be discussed with the Purchasing Division or City Attorney's Office.
If an amendment results in a contract exceeding the Purchasing Officer approval authority in accordance with the Cupertino Municipal Code, the change order will require the approval of City Council.
Expired Contracts: An expired contract is one that has exceeded the identified end date in the contract and should not be used to purchase goods or services identified therein. While an expired contract may, under certain circumstances, be revived via amendment, doing so places the City at significant risk during the time period between the expiration of the contract and the execution of an amendment incorporating the terms of the expired contract. It is not good practice to allow an ongoing contract to expire. Potentially, a new contract may have to be negotiated.
Additionally, any work performed by contractor under an expired contract is subject to non- payment by the City.
Contract Renewal: Contracts for services provided to the City are recommended to be reviewed and renewed every five (5) years, including solicitation of a new RFP, RFQ or IFB. This best practice procedure will ensure the City continues to receive favorable pricing and service and allows the City to evaluate whether its needs for the requested service(s) are being adequately met.
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VIlI. FEDERAL PROCUREMENT POLICY
When the City procures goods and services utilizing funds through Federal grants, the City will follow all guidance outlined by the grant agency to ensure proper financial stewardship of taxpayer resources. For guidance on accepting a grant, refer to the Grants Policy. This document serves as the City's procurement policy for all Federal grant funded projects and purchases. In addition to the policies outlined here, the City must comply with the applicable requirement of 2 Code of Federal Regulations Part 200. In any case where the provisions of this purchasing policy conflict with the requirements of 2 C.F.R. Part 200, the most stringent provisions shall prevail and be adhered to.
All City employees procuring goods and/or services utilizing Federal grants are responsible for complying with the applicable Code of Federal Regulations. Federal grant funds include funds that are Federal in origin that are passed through the state or other agencies. Employees obtaining grant funds are responsible for determining the source of funds and notifying the responsible Department/Division for grant reporting of any Federal funds awarded. Legal Agreements where the City provides services to the federal government are contracts for services, not grants, and as such follow each Agreement's purchasing guidelines, not the Federal grant procedures.
Where thresholds differ between City and Federal procurement policies, City employees utilizing Federal grants will follow the most stringent rule. Refer to the summary of procurement types under the Uniform Guidance (https://www.govinfo.gov/app/details/CFR-2014-title2-vol1/CFR-2014- title2-vol1-sec200-300) and as defined in FAR 48 CFR part 2 sub-part 2.1, specifically 200.318 through 200-327, for additional information or contact the Purchasing Manager for guidance. 25 | Pa ge
Definitions
Amendment: (1) An agreed addition to, correction or modification of a document or contract. (2) To revise or change an existing document; a formal revision, improvement or correction.
Bidder: See Responder.
Blanket Purchase Order: An unencumbered purchase order is typically associated with on-call services which are further defined in a specific and discreet work or service order per project.
Change Order: A written alteration that is issued to modify a construction contract or purchase order.
City: The City of Cupertino.
City Contact: A Project Manager and/or Responsible Staff Member identified as the point of contact for a solicitation for quotes, bids or proposals that external bidders, proposers or City staff can contact with questions or to submit a response.
Consultant: A person or company that possesses unique qualifications which allow them to perform specialized advisory services usually for a fee.
Contract Administrator: A department designee responsible for collaborating with project managers within their department to ensure contracts, exhibits and insurance documents are accurate and complete for legal review, approval and signature through the City's contract management platform. This role ensures contracts, exhibits and insurance are up to date and accurate throughout the contract lifecycle.
Contractor: Any individual or business having a contract with a governmental body to furnish goods or services.
Department of Record: The requesting department (the buyer) is the Department of Record and as such shall maintain copies, and produce copies for auditors, of relevant documents and forms.
Neither the Finance Division, Purchasing Division, City Attorney's Office nor the City Clerk's Office is the Department of Record.
Financial System: An Enterprise Resource Planning system that tracks budget, manages contractor expenditures and facilitates the payment process for vendors Open Market: an unrestricted market with free access by and competition of buyers and sellers.
Purchase Order: The document that obligates the purchase of goods or services that are not available from a Blanket Purchase Order; a request for check; or p-card purchase.
Proposer: See Responder.
Responder: One who submits a response to a solicitation document. May also be a bidder or proposer.
Responsible Bidder: A contractor, business entity, or individual who is fully capable to meet all of the requirements of the solicitation and subsequent contract. Must possess the full capability, including financial and technical, fitness, capacity, licenses, equipment and documented experience to perform as contractually required. Must be able to fully document the quality and ability to provide current and previous good faith performance.
Responsible Staff Person: The staff member who is responsible for thoroughly reading and understanding the contents of a contract, developing an accurate scope of work, editing and modifying the contract, negotiating contract terms, ensuring that any staff with responsibilities under the contract are aware of their responsibilities, etc. 26 | Page
Responsive Bidder: A contractor, business entity or individual who has submitted a bid or request for proposal that fully conforms in all material respects to the IFB/RFP, or any other solicitation, and all of its requirements, including all form and substance.
Solicitation: An invitation for bids, a request for proposals, a request for quote, telephone calls or any document used to obtain bids or proposals for the purpose of entering into a contract.
Specifications: Statement of precise requirements and detailed description of the design and materials used to make something.
Vendor: A supplier/seller of goods and services. A reference to a provider of product or service.
City Manager's signature: Pamela Wu
Date: 02/13/24
kos
Director of Administrative Services' signature:
Date: Feb 13, 2024
Revisions: 9/1/2013; 1/22/2024
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Purchasing Policy_Final_Feb_2024
Final Audit Report 2024-02-14
Created: 2024-02-13
By: Janet Liang ([email protected])
Status: Signed
Transaction ID: CBJCHBCAABAAZhZJ0cgVN9M|I8XEoAF6EsNT80qUOCFM "Purchasing Policy_Final_Feb_2024" History
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