Agenda packet — Cypress City Council, November 12, 2024 (part 7 of 7)

15593-06 TG Memo

PROJECT TRIP GENERATION
Table 1 summarizes the Project trip generation as evaluated in the 2024 Traffic Study. The proposed Project is anticipated to generate 406 two-way trips per day with 21 AM peak hour trips and 24 PM peak hour trips (actual vehicles). Intersection operations analysis for an industrial project must be evaluated using the passenger car equivalent (PCE) trip generation consistent with the City’s Guidelines. As such, the Project’s trip generation in PCE is also summarized in Table

1. The Project is anticipated to generate 604 two-way PCE trips per day with 29 PCE AM peak hour trips and 32 PCE PM peak hour trips.

TABLE 1: PROJECT TRIP GENERATION

EXISTING TRIP GENERATION
In an effort to understand the existing traffic associated with 100% occupancy of the existing office use, the trip generation rates used for this assessment are based upon information collected by the Institute of Transportation Engineers (ITE) as provided in their Trip Generation Manual (11th Edition, 2021). General Office (ITE Land Use Code 710) land use category has been used to calculate the trip generation for the existing 150,626 square feet of available office space.

The trip generation summary illustrating daily, and peak hour trip generation estimates for the existing uses are shown in Table 2 along with the applicable trip generation rates. As shown in Table 2, 150,626 square feet of general office use generates a total of 1,634 two-way trips per day with 228 AM peak hour trips and 217 PM peak hour trips.

Land Use Quantity Units1 In Out Total In Out Total Daily Actual Vehicles:

High-Cube Cold Storage Warehouse 191.394 TSF
Passenger Cars: 15 1 16 4 14 18 262
2-axle Trucks: 1 1 2 1 1 2 50
3-axle Trucks: 0 0 0 0 0 0 16
4+-axle Trucks: 1 2 3 2 2 4 78
Total Truck Trips (Actual Vehicles): 2 3 5 3 3 6 144
Total Trips (Actual Vehicles)2 17 4 21 7 17 24 406
Passenger Car Equivalent (PCE):

High-Cube Cold Storage Warehouse 191.394 TSF
Passenger Cars: 15 1 16 4 14 18 262
2-axle Trucks: 1 2 3 1 2 3 76
3-axle Trucks: 0 1 1 1 0 1 32
4+-axle Trucks: 3 6 9 5 5 10 234
Total Truck Trips (PCE): 4 9 13 7 7 14 342
Total Trips (PCE)2 19 10 29 11 21 32 604
Note: Due to rounding, some of the numbers reflected in the table to not reflect actual calculated amounts. 1 TSF = Thousand Square Feet
2 Total = Passenger Cars + Trucks
AM Peak Hour PM Peak Hour
Alicia Velasco, City of Cypress
February 20, 2024

Page 3 of 3 ends

15593-06 TG Memo
TABLE 2: EXISTING TRIP GENERATION

TRIP GENERATION COMPARISON
Table 3 shows the trip generation comparison between the proposed Project uses and the existing office use (assuming 100% occupancy). The resulting net change in trips is identified in Table 3. As shown, the proposed Project is anticipated to generate 1,030 fewer two-way PCE trips per day with 199 fewer PCE AM peak hour trips and 185 fewer PCE PM peak hour trips as compared to the existing office use (resulting in a net reduction).

TABLE 3: TRIP GENERATION COMPARISON
If you have any questions or comments, I can be reached at [email protected].

ITE LU AM Peak Hour PM Peak Hour
Land Use1 Units2 Code In Out Total In Out Total
General Office (based on average rates) TSF 710 1.34 0.18 1.52 0.24 1.20 1.44 10.84 Land Use Quantity Units2 In Out Total In Out Total Daily General Office3 150.626 TSF 201 27 228 37 180 217 1,634 1 Trip Generation Source: Institute of Transportation Engineers (ITE), Trip Generation Manual, Eleventh Edition (2021). 2 TSF = Thousand Square Feet
3 100% occupancy of the 150,626 square foot office building.

Daily
AM Peak Hour PM Peak Hour
Land Use In Out Total In Out Total Daily
Proposed Project
Passenger Cars: 15 1 16 4 14 18 262
Total Truck Trips (PCE): 4 9 13 7 7 14 342
Total Trips (PCE) 19 10 29 11 21 32 604
Existing Use: General Office
Passenger Cars: 201 27 228 37 180 217 1,634
Total Truck Trips (PCE): 0 0 0 0 0 0 0
Total Trips (PCE) 201 27 228 37 180 217 1,634
Variance
Passenger Cars: -186 -26 -212 -33 -166 -199 -1,372
Total Truck Trips (PCE): 4 9 13 7 7 14 342
Total Trips (PCE) -182 -17 -199 -26 -159 -185 -1,030
AM Peak Hour PM Peak Hour

9200 Valley View Street, Cypress, CA 90630  714-484-7126 [email protected]  cypresscollegefoundation.org November 7, 2024
Alisha Farnell
City Clerk
City of Cypress
5275 Orange Avenue
Cypress, CA 90630
[email protected]
Dear Ms. Farnell,
On behalf of the Cypress College Foundation, we would like to express our support for Goodman as a partner in the community. As an organization dedicated to meeting the needs of both our students and campus, we see tremendous value in the good work that Goodman does in the community.

The Cypress College Foundation sees the results of Goodman’s work providing job opportunities for our students and future partnership possibilities that align with our mission. Their ongoing commitment to the community, demonstrated by their support of the Cypress College Foundation and other local organizations, further solidifies them as a valuable partner.

We believe that Goodman’s projects will contribute to the long-term vitality of Cypress, strengthening the local economy while providing meaningful opportunities for education and workforce development. The Cypress College Foundation fully supports Goodman’s efforts in the community.

Sincerely,
Howard Kummerman
Executive Director
CITY OF CYPRESS
CITY COUNCIL REPORT
City Council Regular 15.

FROM: Matt Burton, Director of Finance and Administrative Services DATE: 11/12/2024
SUBJECT: Amend Section 21A of the Municipal Code Related to Purchasing Thresholds

RECOMMENDATION
Introduce for first reading an Ordinance, by title only, amending Section 21A of the Municipal Code authorizing changes in purchasing bid procedures and contract award thresholds.

DISCUSSION
The City Council’s Strategic Plan includes an objective to recommend updates to the $25,000 administrative purchasing threshold based on an analysis of Orange County cities.

A review of Orange County cities with a population of greater than 10,000 revealed that Cypress' $25,000 limit is the lowest in the county. Purchasing limits in these cities range from $25,000 to $1 million, with the majority having administrative approval authority between $50,000 and $100,000 (Exhibit One attached).

Background
Municipal Code Section 21A establishes the City's purchasing system, including bid procedures and contract award thresholds, which may be updated periodically based on inflation to ensure the purchasing process remains efficient. Section 21A was last updated in 1999, when the City Council increased administrative approval authority for purchases of supplies, equipment, and services to the lowest responsible bidder from $10,000 to $25,000.

The 1999 update made the City's procurement process more efficient by decreasing the time and costs associated with small dollar purchases and enabled the City Council to focus on policymaking.

Discussion
In the 25 years since Section 21A was updated, the cost of all goods and services has risen significantly. This has increased the number of contracts and purchases that require City Council consideration. Rampant inflation since the pandemic has dramatically eroded purchasing power, requiring limited staff resources to be spent on preparing agenda reports for minor purchases that previously could have been approved administratively.

In addition to the survey of Orange County cities, the recommendation to update the administrative approval threshold is also based on:

Consumer Price Index (CPI) increases. CPI is the most widely-accepted methodology for calculating the impact of inflation. Between 1999 and 2024, CPI in Southern California increased by approximately 105 percent, meaning a $25,000 purchase in 1999 is the equivalent of $51,250 in 2024.

Growth in the City's budget. In FY 1998-99, the General Fund operating budget was $16 million. In FY 2024-25, it has increased 150% to $40 million. In 1999, $25,000 represented 0.16 percent of the General Fund operating budget. In 2024, $25,000 represents 0.06 percent of the General Fund operating budget, while $50,000 represents 0.13 percent of the General Fund operating budget.

The volume of contracts that require City Council consideration. The City Council has considered 120 contracts and purchases since 2021. Twenty-eight (23%) were less than $50,000 and 92 (77%) were more than $50,000. 100% of these purchases were approved by the City Council and nearly all of them were approved unanimously. The recommended administrative approval threshold update would impact approximately seven contracts and purchases annually and free up approximately 80 hours of staff time a year.

Additionally, it is common for departments to bring notable matters to the City Council for consideration even when the contract/purchase is under $25,000 and that practice will continue with the recommended update. Finally, all contracts and purchases that are administratively approved must be included in the annual operating budget approved by the City Council. Any contract or purchase that was not included in the Budget, or that requires an additional appropriation, will continue to require City Council approval.

Bidding Requirement
In 2001, the City Council set the bid threshold for supplies and equipment at $2,500 and services at $5,000. However, the City's practice has been more rigorous and the purchasing system has generally operated with a $1,000 bid threshold to ensure purchases are transparent and cost-effective. The availability of information on the Internet, cooperative purchasing agreements, and other technologies have made it possible to adhere to the $1,000 threshold without overtaxing staff.

The Municipal Code establishes two types of bid processes: informal and formal. Purchases under $25,000 are bid informally, which requires a minimum of three bids solicited directly from vendors or online. The informal bids must be summarized/documented before the purchase is approved. Contracts and purchases over $25,000 are subject to formal bidding.

Formal bidding is a significant undertaking and involves preparing and publishing a notice inviting bids, soliciting bids from prospective vendors who have requested to be on the City's bidders' list, and establishing a deadline for the submission of sealed bids. The formal bid process is designed to ensure bidding on larger purchases is competitive and open to all interested vendors. Formal bidding requires considerable staff resources and takes much longer than informal bidding.

The recommended update would only adjust the formal bidding threshold. Informal bidding is still required for all purchases supplies and equipment at $2,500 and services at $5,000.

Based on the survey, the impact of inflation, and analysis of the City's contracts and purchases since 2021, it is recommended that:

Formal bidding is required for contracts or services of more than $50,000, regardless of the length of the contract. This will ensure the City receives the lowest possible market pricing available through a competitive bid process open to all interested parties.

The threshold for administrative approval of formally bid agreements increases to $50,000.

The threshold for administrative approval of formally bid multi-year agreements is $50,000 annually for a maximum of three years.

The $50,000 threshold is updated every five years based on CPI and rounded to the nearest $5,000.

All administratively approved contracts and purchases are presented to the City Council twice a year. This new practice is consistent with the City's core values of accountability, transparency, and fiscal prudence, and will be incorporated into the City's fiscal strategies.

No other changes are recommended to the purchasing system or policies, and all other requirements of Section 21A remain in effect.

BUDGET IMPACT
There is no direct budget impact associated with the recommendation. However, the City's limited staff resources required to prepare agenda reports for contracts and purchases under $50,000 per year will be available to provide other services to the community.

LEGAL REVIEW
The City Attorney has reviewed and approved the attached Ordinance.

APPROVED BY: Peter Grant, City Manager
Attachments
Exhibit One
Ordinance
Ordinance - Redline
City Population Authority Limit
Irvine 316,691 $1,000,000
Anaheim 338,463 $200,000
Newport Beach 81,794 $120,000
Costa Mesa 107,211 $100,000
Fullerton 137,911 $100,000
Huntington Beach 190,037 $100,000
Los Alamitos 11,944 $100,000
Westminster 88,015 $100,000
Buena Park 81,324 $80,000
Laguna Beach 22,110 $75,000
Yorba Linda 65,455 $75,000
Aliso Viejo 49,659 $50,000
Brea 48,889 $50,000
Fountain Valley 54,966 $50,000
Garden Grove 167,024 $50,000
Laguna Hills 29,887 $50,000
Laguna Niguel 64,536 $50,000
Laguna Woods 22,110 $50,000
Lake Forest 85,811 $50,000
San Clemente 61,679 $50,000
San Juan Capistrano 34,619 $45,000
Seal Beach 24,072 $40,840
Placentia 52,032 $40,000
Stanton 39,054 $40,000
Dana Point 32,403 $35,000
La Habra 60,320 $35,000
Mission Viejo 89,679 $30,000
Orange 137,965 $30,000
Rancho Santa Margarita 45,619 $30,000
Cypress 48,360 $25,000
La Palma 14,852 $25,000
Santa Ana 310,304 $25,000
Tustin 76,971 $25,000
Villa Park 5,609 $20,000
OC Average $86,642
OC Median $50,000
Non-Public Works Administrative Signing Authority
ORDINANCE NO.

AN ORDINANCE OF THE CITY COUNCIL OF THE CITYOF CYPRESS, CALIFORNIA, AMMENDING SECTION 21A OF THE CYPRESS

MUNICIPAL CODE ESTABLISHING UPDATED PURCHASING

AUTHORITY LIMITS FOR CITY PERSONNEL
WHEREAS, section 21A of the Cypress Municipal Code establishes the requirements for the City’s purchasing system and includes monetary limits on bid procedures and contract award thresholds; and
WHEREAS, the current monetary limits on bid procedures and contract award thresholds was last adjusted in 1999 from $10,000 to $25,000; and WHEREAS, inflation since 1999 in the Los Angeles, Long Beach and Anaheim area has increased by more than 100% over this time; and WHEREAS, a survey of all 34 Orange County cities was conducted which indicated Cypress’ threshold was the second lowest in the County; and WHEREAS, it is appropriate to periodically update the monetary limits on bid procedures and contract award thresholds to ensure the efficient use of staffing resources and limit the number of routine business items presented to City Council for consideration; and
NOW, THEREFORE, the City Council of the City of Cypress DOES HEREBY ORDAIN as follows:

SECTION 1. Section 21A of the Cypress Municipal Code is hereby amended to read as follows:
“Sec. 21A-10(d).Bidding generally
When there is to be a contract for professional services such as, but not limited to, the services of attorneys, architects, or engineers or where the service contracted for deals with public relations or promotions, elections, negotiations, acquisition of land, trash, garbage or refuse disposal or the like, insurance, bonds, any other services of similar nature to those listed, those items which are in their nature unique and not subject to competition or other services for which by law another officer or body is specifically charged with obtaining. For professional services, a request for qualifications, ('RFQ'), should be used to select the appropriate professional or professionals. For contracts under $50,000 the city manager is authorized to enter into the contract. Further, the city manager may enter into contracts up to three years in duration if the total annual value of the contract does not exceed $50,000 in any given year, and the contract is for a recurring professional service. All contracts in excess of $50,000 shall be approved by the city council, except as noted above.

Sec. 21A-10(h).Bidding generally
Any contract which combines professional services and the acquisition of goods or equipment where the professional services are specifically retained to advise the city on the selection of the goods or equipment and the professional services utilized under the contract also include designing, retrofitting, or modifying the goods or equipment to meet the particular needs of the city. This exemption shall also include the acquisition by the city of 'intellectual property.' In utilizing this exemption, an RFQ shall be used. For contracts under $50,000 the city manager is authorized to enter into the contract. Further, the city manager may enter into contracts up to three years in duration if the total annual value of the contract does not exceed $50,000 in any given year, and the contract is for a recurring, budgeted service, good, equipment or subscription. All contracts in excess of $50,000 shall be approved by the city council, except as noted above.

Sec. 21A-12.Formal contract procedure
Except as otherwise provided herein and in accordance with the city's power as a Charter City, purchases of supplies, equipment, or services of an individual of an estimated value greater than $50,000 shall be by written contract with the lowest responsible bidder, pursuant to the procedure hereinafter prescribed.

Sec. 21A-13.Open market procedure
Purchases of supplies, equipment, and services of an estimated value in the amount of $50,000 or less may be made by the purchasing officer in the open market pursuant to the procedure prescribed in section 21A-12; provided, however, all bidding may be dispensed with for purchases of supplies, equipment, and services having a total estimated value of less than the amount established by resolution of the city council pursuant to section 21A-10.

Sec. 21A-17 Contracting for the purchase of supplies, equipment, services, or leases; exemption.

The purchasing officer, with the approval of the council, may contract for supplies equipment, services, or leases without observing the procedure required herein regardless of estimated value of such supplies, equipment, services, or leases when the best interests of the city would be served thereby. Whenever the council approves the purchase of supplies, equipment, services, or leases without observing the procedures required in this chapter, the council may require that the purchasing officer solicit informal bids under such conditions and limitations as the city council may impose. This exemption section shall not apply to any public work contract.

SECTION 2. If any section, subsection, subdivision, sentence, clause, phrase, or portion of this Ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of the Ordinance. The City Council hereby declares that it would have adopted this Ordinance and each section, subsection, subdivision, sentence, clause, phrase, or portion thereof irrespective of the fact that any one or more sections, subsections, subdivisions, sentences, clauses, phrases or portions thereof be declared invalid or unconstitutional.

SECTION 3. The City Clerk shall certify to the passage of this Ordinance and this Ordinance shall be published as required by law and shall take effect as provided by law.

FIRST READING at a regular meeting of the City Council of the City of Cypress held on the _______ day of ________, 2024 and finally adopted and ordered posted at a regular meeting held on the ______ day of _____, 2024.
_______________________________

MAYOR OF THE CITY OF CYPRESS
ATTEST:
___________________________________

CITY CLERK OF THE CITY OF CYPRESS
STATE OF CALIFORNIA }
COUNTY OF ORANGE } SS
I, ALISHA FARNELL, City Clerk of the City of Cypress, DO HEREBY CERTIFY that the foregoing Ordinance was duly adopted at a regular meeting of the said City Council held on the ___ day of ___, 2024, by the following roll call vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:
___________________________________

CITY CLERK OF THE CITY OF CYPRESS
ORDINANCE NO.

AN ORDINANCE OF THE CITY COUNCIL OF THE CITYOF CYPRESS, CALIFORNIA, AMMENDING SECTION 21A OF THE CYPRESS

MUNICIPAL CODE ESTABLISHING UPDATED PURCHASING

WHEREAS, it is appropriate to periodically update the monetary limits on bid procedures and contract award thresholds to ensure the efficient use of staffing resources and limit the number of routine business items presented to City Council for consideration; and
NOW, THEREFORE, the City Council of the City of Cypress DOES HEREBY ORDAIN as follows:

SECTION 1. Section 21A of the Cypress Municipal Code is hereby amended to read as follows:
“Sec. 21A-10(d).Bidding generally
When there is to be a contract for professional services such as, but not limited to, the services of attorneys, architects, or engineers or where the service contracted for deals with public relations or promotions, elections, negotiations, acquisition of land, trash, garbage or refuse disposal or the like, insurance, bonds, any other services of similar nature to those listed, those items which are in their nature unique and not subject to competition or other services for which by law another officer or body is specifically charged with obtaining. For professional services, a request for qualifications, ('RFQ'), should be used to select the appropriate professional or professionals. For contracts under $25,000 $50,000 the city manager is authorized to enter into the contract. Further, the city manager may enter into contracts up to three years in duration if the total annual value of the contract does not exceed $50,000 in any given year, and the contract is for a recurring professional service. All contracts in excess of $25,000 $50,000 shall be approved by the city council, except as noted above.

Further, the city manager may enter into contracts up to three years in duration if the total annual value of the contract does not exceed $50,000 in any given year, and the contract is for a recurring, budgeted service, good, equipment or subscription. All contracts in excess of twenty-five thousand $25,000 $50,000 shall be approved by the city council, except as noted above.

Sec. 21A-12.Formal contract procedure
Except as otherwise provided herein and in accordance with the city's power as a Charter City, purchases of supplies, equipment, or services of an individual of an estimated value greater than $25,000 $50,000 shall be by written contract with the lowest responsible bidder, pursuant to the procedure hereinafter prescribed.

Sec. 21A-13.Open market procedure
Purchases of supplies, equipment, and services of an estimated value in the amount of $25,000 $50,000 or less may be made by the purchasing officer in the open market pursuant to the procedure prescribed in section 21A-12; provided, however, all bidding may be dispensed with for purchases of supplies, equipment, and services having a total estimated value of less than the amount established by resolution of the city council pursuant to section 21A-10.