DATE: April 21, 2025
TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager
Marlene Subhashini, Assistant City Manager
FROM: Nate Cruz, Finance Director
Andrew Brozyna, Public Works Director
Derek Schweigart, Parks and Recreation Director
DEPARTMENT: Finance
SUBJECT: AMENDING SECTION 3.04.080, “FORMAL BID PROCEDURES
FOR PURCHASES OF SUPPLIES, SERVICES AND
EQUIPMENT”; SECTION 3.04.110, “AUTHORIZED PURCHASING
ALTERNATIVES FOR SUPPLIES, SERVICES AND EQUIPMENT”;
SECTION 3.04.140, “PURCHASE OF PROFESSIONAL
SERVICES”; AND SECTION 3.04.170, “PUBLIC PROJECTS-
DEFINITION” OF CHAPTER 3.04, PURCHASING SYSTEM
WITHIN TITLE 3 REVENUE AND FINANCE OF THE FOSTER
CITY MUNICIPAL CODE; AND APPROVING AN UPDATED
PURCHASING POLICY
RECOMMENDATION
It is recommended that the City Council update the City’s Purchasing Policy by:
1. Introducing the attached ordinance by title only and waive further reading, amending Section 3.04.080, “Formal bid procedures for purchases of supplies, services and equipment”; Section 3.04.110, “Authorized purchasing alternatives for supplies, services and equipment”; Section 3.04.140, “Purchase of professional services”; and Section 3.04.170, “Public Projects-Definition” within Chapter 3.04, Purchasing System, of Title 3 Revenue and Finance of the Foster City Municipal Code to make administrative revisions to the City’s purchasing system; and
2. Adopting the attached resolution approving an updated Purchasing Policy with an effective date of May 5, 2025 upon approval of the ordinance above.
EXECUTIVE SUMMARY
The purchasing processes of the City and EMID (hereinafter referred to as “City”) are governed by state law, Municipal Code Chapter 3.04, and the City’s Purchasing Policy.
The EMID Code adopts the City’s Purchasing System by reference in Chapter 3.04, thus they additionally apply to EMID through EMID Code Section 4.48.010. In order to increase efficiency in the purchasing process, staff recommend amendments to the Foster City Municipal Code and Foster City Purchasing Policy by making three distinct improvements:
1. Allow the City Manager to approve all issuances of an RFP for Professional Services and Supplies, Equipment, and Services instead of requiring that the City Council approve issuances of RFP’s that are anticipated to result in an agreement over $50,000. Award of any contract over $50,000 would remain subject to Council approval.
2. Extend the amount of time City staff can use the results of another public agency’s active competitive process as an alternative procurement method to three (3) years.
3. Clarify that the current practice of using cooperative purchasing agreements is permitted as an alternative procurement method for supplies, equipment, and services.
BACKGROUND
Purchasing regulations divide purchases into the following three types of purchases:
1. Public Projects: these purchases are for construction and construction related services. There are no changes proposed to the award process for this type of contract.
2. Professional Services: these purchases include services such as engineering, design, project management, and other complex professional design/consulting services.
3. Supplies, Equipment, and Services: these purchases include consumable supplies (such as paper, pens, and fuel), equipment (such as laptops, vehicles, and furniture), and routine or standard services (such as janitorial, pest control, or security service).
Each of the three types of contracts above has different approval and competitive bidding requirements, depending on the amount of the contract. The purchasing methods are set by the City Council through the adoption of the Purchasing Ordinance (Municipal Code Chapter 3.04). The dollar levels are set by the City Council through the adoption of the Purchasing Policy.
ANALYSIS
Proposed Professional Services and Supplies and Services Amendments Currently for Professional Services and Supplies and Services contracts over $50,000, the Purchasing Policy requires that the City Council approve both the issuance of RFPs and as well as award of contracts. This typically is done at two separate Council meetings. The recommended changes would streamline the process by allowing the City Manager to approve the issuance of an RFP for any dollar amount while City Council would retain full review of the selected proposal and contract award authority, as shown in Table 1 below. This would help reduce the 4–6 week timeframe it takes for Council action to approve the issuance of an RFP which includes agendizing the item (typically a routine consent calendar item) and staff report preparation.
Table: Summary of Current Approval Requirements
≤$50,000 >$50,000Type of
Contract Current Proposed Current Proposed
Professional
Services
City Manager
approves both
issuance of RFP
and award of
contract
No change Council approves
both issuance of
an RFP and award
of contract
City Manager
approves issuance
of RFP and
Council approves
award of contract.
Supplies,
Equipment, and
Services
City Manager
approves award
No change Council approves
both issuance of
an RFP and award
of contract
City Manager
approves RFP
then Council
approves award.
Proposed Amendments to Use of Other Agency Processes
The current language in Chapter 3.04 of the Municipal Code provides alternatives to the informal and formal competitive bidding processes for the award of contracts for supplies, equipment, and services, which includes the ability to use the results of another jurisdiction’s competitive process to award a contract. This practice is often referred to as “piggybacking”. Language in the current Municipal Code limits the time within which the City may award a contract after the other jurisdiction’s competitive process to 6 months for other public agencies or 12 months for the State of California.
Staff recommends increasing the timeframe to 36 months (three years) regardless of the agency/jurisdiction to align with the current Policy’s recommendation to award contracts for 36 months of term subsequent to a competitive process. This increases the City’s ability to leverage the work of other jurisdictions and efficiently purchase needed goods and services.
Proposed Amendments for Cooperative Purchasing Agreements Cooperative purchasing agreements, such as Sourcewell or the California Multiple Award Schedules, are competitively bid agreements covering a wide array of supplies, equipment, and services that were designed to be used by any jurisdiction. Staff has successfully used these cooperative purchasing agreements under the existing language allowing “piggybacking” described above. While cooperative purchasing agreements are similar to “piggybacking” agreements in that they are created by other public agencies, staff recommends formalizing their inclusion in the Municipal Code and Purchasing Policy. A review of the purchasing policies of three nearby jurisdictions confirmed it is typical to include specific language allowing cooperative purchasing agreements. The formal inclusion of cooperative purchasing agreements does not make any change to the Council approval thresholds.
Should the Council approve the attached ordinance and resolution, the effective date of these changes would be May 5, 2025.
CALIFORNIA ENVIRONMENTAL QUALITY ACT
Not Applicable
FISCAL IMPACT
There is no fiscal impact directly associated with this item.
CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Staff Empowerment and Operational Excellence
ATTACHMENTS
Attachment 1 – Ordinance
Attachment 2 – Resolution
Attachment 3 – Municipal Code Chapter 3.04 Red-lined
Attachment 4 – Purchasing Policy Clean Version
Attachment 5 – Purchasing Policy Red-lined