item 3 Adoption of Resolutions amending the City Manager's contracting authority, revising bidding thresholds, and updating the City's Purchasing Policy and Procedures Manual. (Action Item) — Garden Grove City Council, September 8, 2026

CITY OF GARDEN GROVE

PURCHASING POLICY
AND

PROCEDURE MANUAL

REVISED JUNESEPTEMBER, 2020 2026 (REV 6-090826)

CITY OF GARDEN GROVE

PURCHASING POLICIES & PROCEDURES

TABLE OF CONTENTS
Table of Contents ................................................................................... ii Mission Statement of the Purchasing Division ............................................. v Code of Ethics ........................................................................................ vi

CHAPTER 1 – GENERAL PURCHASING OVERVIEW AND STRUCTURE ................. 1

1.1 Introduction ....................................................................................... 1

1.2 Overview ........................................................................................... 1

1.3 Purchasing Structure ........................................................................... 2

1.4 The Purchasing Cycle ........................................................................... 2

1.5 Responsibilities ................................................................................... 3

CHAPTER 2 – PURCHASING AUTHORITY & THRESHOLDS AND REQUIREMENTS 5

2.1 Purchasing Authority ........................................................................... 5

2.2 Purchasing Thresholds and Requirements ............................................... 6

CHAPTER 3 – VENDOR INFORMATION AND RELATED
POLICIES ........................................................................................................ 101 1 3.1 New Vendor Approval
Process ............................................................................................................ 101 1 3.2 Planet Bids On-Line Vendor
Registration ...................................................................................................... 101 1 3.3 Local Vendor
Preference ................................................................................................... 111 2 3.4 Using Vendor Contracts versus City Approved
Contracts.......................................................................................................... 111 2 CHAPTER 4 – METHODS OF
PROCUREMENT ............................................................................................... 131 214

4.1 Requisition/Purchase Order and
Requirements ............................................................................................... 131 4 iii

4.2 Exemptions to Requisition and Purchase Order
Requirements .................................................................................................... 131 4 4.3 Procurement Cards/P-
Cards ...................................................................................................... 1415

4.4 Blanket Purchase Orders
1415

CHAPTER 5 – INFORMAL AND FORMAL BIDDING
PROCEDURES .................................................................................................. 161 7 5.1 Informal Bidding
Process ............................................................................................................ 161 7 5.2 Formal Bidding
Process ............................................................................................................ 161 7 5.3 Formal Bidding Process
Requirements .................................................................................................... 161 7 5.4 Award of Purchase
Order/Contract .................................................................................................. 171 8 5.5 No Bids Received/Non-Responsive Bids and
Proposals .......................................................................................................... 171 8 5.6 Rejection of Formal
Bids ...................................................................................................... 1718

CHAPTER 6 – EXCEPTIONS TO THE COMPETITIVE BIDDING
PROCESS ........................................................................................................ 181 9 6.1 Emergency Purchases
1819

6.2 Sole Source/Proprietary
Purchases ......................................................................................................... 192 0 iv

6.3 Cooperative Purchasing and Piggybacking on
Contracts.......................................................................................................... 202 1 6.4 Qualification Based Selection
2122

CHAPTER 7 – PURCHASE ORDERS FOR MATERIALS, SUPPLIES, EQUIPMENT AND OTHER
COMMODITIES ................................................................................................ 242 6 7.1 Requirements for Purchases up to
$15,000 ........................................................................................................... 252 7 7.2 Requirements for Purchases of $15,001-
$75,000 ........................................................................................................... 252 7 7.3 Requirements for Purchases of $75,001 and
greater ............................................................................................................. 252 7 7.4 Environmentally Friendly Purchasing (SB-
1383) ...................................................................................................... 2527

7.5 Vehicle
Purchases ......................................................................................................... 252 7 7.6 Change Orders to Purchase
Orders ...................................................................................................... 2627

CHAPTER 8 – PROFESSIONAL SERVICES/CONSULTANT AGREEMENTS 2729

8.1 Professional Service Agreements up to
$15,000 ........................................................................................................... 283 0 8.2 Professional Service/Consultant Agreements of $15,001- $75,000 ........................................................................................................... 283 0 8.3 Requirements for Professional Services Agreements of $15,001- $75,000 ........................................................................................................... 283 0 8.4 Professional Services/Consultant Agreements of $75,001 and greater 2931

8.5 Amendments to Professional and Consultant Services
Agreements ...................................................................................................... 293 1 8.6 Assembly Bill 339 (AB 339) Contraction Contracting Notifications and Labor Relations .......................................................................................................... 303 2 8.7 Low Dollar/High Risk
Services ........................................................................................................... 313 3 CHAPTER 9 – PUBLIC WORKS/CONSTRUCTION AGREEMENTS
3234

9.1 Uniform Public Construction Cost Accounting
Act 3537

9.2 Public Works Projects up to
$15,000 ........................................................................................................... 353 7 9.3 Public Works Projects of $15,001-
$75,000 ........................................................................................................... 353 7 9.4 Public Works Projects of $75,001-$220,000 (Informal Bid Procedure) ........................................................................................................ 363 8 9.5 Public Works Projects of $220,001 and greater (Formal Bid Procedure) .................................................................................................. 363 8 9.6 Change
Orders ...................................................................................................... 3840

9.7 Prevailing Wage Rates and Public Works
Projects ............................................................................................................ 384 0 9.8 Project Registration with the CA Department of Industrial Relations …….. ........................................................................................................... 394 1 9.9 Department of Industrial Relations (DIR) PWC 100
System ....................................................................................................... 404 2 vi

CHAPTER 10 – FEDERAL PURCHASING
REQUIREMENTS .............................................................................................. 424 4 10.1
Background ...................................................................................................... 464 8 10.2 Micro
Purchases ......................................................................................................... 464 8 10.3 Small
Purchases ......................................................................................................... 464 8 10.4 Sealed
Bids ...................................................................................................... 4648

10.5 Competitive
Proposals .......................................................................................................... 474 9 10.6 Sole
Source ............................................................................................................. 474 9 10.7 Debarment and
Suspension ....................................................................................................... 474 9 CHAPTER 11 – PURCHASING DURING PROCLAIMED EMERGENCY OR DISASTER ....................................................................................................... 485 0 11.1 Purpose and
Definition ......................................................................................................... 485 0 11.2 Delegation of Purchasing Authority in
Emergencies ..................................................................................................... 485 0 11.3 Reporting
Requirements .................................................................................................... 495 1 11.4 Procurement Procedures in
Emergencies ..................................................................................................... 495 1 vii

11.5 Ratification, Notification and Post-Award
Procedures ....................................................................................................... 515 3 CHAPTER 12 – INSURANCE AND CONTRACTUAL RISK TRANSFER
....................................................................................................................... 525 4 12.1 Inclusion in Bid
Materials .......................................................................................................... 525 4 12.2 Determination of Insurance
Requirements .................................................................................................... 525 4 12.3 Contract Indemnification Agreement and
Insurance ......................................................................................................... 535 5 12.4 Minimum Insurance
Specifications .................................................................................................... 535 5 12.5 High-Risk
Contracts.......................................................................................................... 545 6 12.6 Additional Types of Insurance
Coverage .......................................................................................................... 555 7 12.7 Surety
Bonds ...................................................................................................... 5658

12.8 Verification of Insurance
Coverage .......................................................................................................... 565 8 12.9 City of Garden Grove Insurance
Policies/Coverage .............................................................................................. 575 8 12.10
Definitions ........................................................................................................ 575 9 CHAPTER 13 – CENTRAL STORES
WAREHOUSE ................................................................................................... 586 0 viii

13.1 Services
Provided ........................................................................................................... 586 0 13.2 Surplus Property and
Equipment ........................................................................................................ 596 1 13.3 City Record
Storage ............................................................................................................ 616 3 CHAPTER 14 – CELLULAR PHONES AND OTHER
DEVICES ......................................................................................................... 626 4 APPENDIX- REFERENCE
DOCUMENTS ................................................................................................... 636 5 Bid Threshold Reference
Sheet ...................................................................................................... 6466 DIR
Guidelines ........................................................................................................ 656 7 Assembly Bill 339 (AB 339) Implementation
Guidelines ........................................................................................................ 666 8 Flowchart: Purchase of Materials, Supplies, Equipment and other Commodities ..................................................................................................... 676 9 Flowchart: Professional Services and Consultant
Agreements ...................................................................................................... 687 0 Flowchart: Public Works/Construction
Contracts.......................................................................................................... 697 1 Flowchart: Informal Bidding
Procedures ....................................................................................................... 717 2 Flowchart: Formal Bidding
Procedures ....................................................................................................... 727 3 ix

CODE OF ETHICS

As public employees, purchasing professionals, and staff members of the Purchasing Division for the City of Garden Grove, we owe our institutions our best, unbiased judgment every time we spend their money and/or act on their behalf. All staff members who engage in the procurement process shall agree to, be familiar with and be bound by the City of Garden Grove Code of Ethics for Public Officers and Employees as set forth in Chapter 2.02 of the Municipal Code.

In addition, the following rules of professional conduct shall govern the behavior of Assistant Buyer(s), Buyer(s), Storekeeper(s), Stock Clerk(s) and the Purchasing Division Manager in the fulfillment of their duties.

A. Act impartially and with the highest degree of integrity to foster public confidence in City Government, and make every effort to ensure open and fair competition for available City Business in accordance with the Garden Grove Municipal Code and the Garden Grove Purchasing Manual.

B. Do not to accept, directly or indirectly, any tangible or intangible benefit, the value of which is five dollars ($5.00) or more, including, but not limited to, money, gifts, favors, entertainment, discounts, passes, transportation, accommodation, hospitality, or offers of employment that may influence or give the appearance of influencing procurement-related decisions. This includes those items exceeding said value that have an imprinted company logo and could be perceived, by virtue of their use in the Department, as an endorsement of, or preference for a particular product or service.

C. Declare a conflict of interest when a potential organization is to be selected for contract award that employs him or her, is about to employ him or her, or his or her family members or partner. The officer, employee of agent shall not solicit or accept gratuities, favors or anything exceeding five dollars ($5.00) in value from contractors, potential contractors, or parties to sub-agreements and subcontracts.

D. Immediately disclose any real or apparent potential conflict of interest to the employee’s supervisor and refrain from all activity with respect to this vendor upon learning that the City is conducting or intends to conduct business with a vendor which the employee, or a member of the employee’s family may have a financial interest.

E. Conduct themselves in a courteous and professional manner with the Department’s customers and vendors, and act professionally and without discrimination or bias.

F. Do not utilize confidential or sensitive information acquired in the course of their duties for personal gain or for the benefit of family or friends.

G. Immediately inform their supervisor and other department management upon learning of a potential or existing problem that the Department has an interest in. Employees will strive to ascertain all relevant facts in a timely manner as well as analyze all possible solutions, and present what they believe to be the best solution to their supervisor.

H. Do not willfully or unlawfully conceal, remove, mutilate, falsify or destroy any document or records.

I. Do not make any false or fictitious statements in connection with any official matter, document or record.

Violation of any provision of this policy may be cause for disciplinary action. Disciplinary action may range from an oral reprimand to termination. The City reserves all rights to pursue appropriate legal action to the fullest extent permitted by law.

1 CHAPTER 1:

GENERAL PURCHASING OVERVIEW AND STRUCTURE

1.1 INTRODUCTION

This Purchasing Manual has been prepared to provide guidance and training for the procurement of all equipment, materials, supplies and services needed by departments within the City. This manual outlines the steps of each type of procurement process from the beginning to the end. The Garden Grove Municipal Code is the guideline for this manual and can be referenced on the City’s Intranet.

The Purchasing Division is responsible for managing the informal and formal bidding process, processing of all purchase requisitions, developing and reviewing contracts, and the administration of the p-card and cell phone programs. The Purchasing Division also oversees the operations of the Central Stores Warehouse which includes receiving and surplus property disposal.

1.2 OVERVIEW

As a public entity, it is critical that the purchasing procedures adopted by the City Council are equitable, transparent and follow the applicable statutory requirements.

The Purchasing Manual was created to serve as a reference tool for departments in translating needs into tangible items and services. The purpose of this manual is to provide the necessary guidance for staff to obtain needed products and services as directed by the Municipal Code, Ordinances and Resolutions, Administrative Regulations, and State and Federal Regulations.

In addition to outlining the basic purchasing processes and threshold limits, this manual also provides detailed information on the informal and formal bidding processes, insurance requirements and the Central Stores Warehouse operations.

This manual cannot address every situation. When an unusual situation occurs or a difficult legal problem arises, the City Council, City Manager or designee, may approve exceptions to this policy, when in the best interest of the City, so long as the proposed exceptions are consistent with local, state, and federal laws. The final authority for City purchasing procedures is the law itself.

It shall be the policy of the City to fully comply with and make purchases or expenditures pursuant to this manual.

The goal of this manual is to present a user-friendly, easy-to-understand document that summarizes the procurement process and provides information that is most useful to the procurement process. If you cannot find the answer to your question in this manual, please call the Purchasing Division for assistance. We are happy to be of service.

2 1.3 PURCHASING STRUCTURE

The City of Garden Grove operates under a decentralized purchasing function for purchases that do not exceed a total amount of $75,000 in which specific employees in the various departments are responsible for purchasing decisions for services, equipment, and goods within a certain dollar threshold per the approval of the department head/designee and City Manager. The Purchasing Division advises and assists the departments as needed, and initiates purchases that benefit the City.

City departments may contact vendors for product information and to obtain informal quotes for materials, supplies and equipment and proposals for services that do not exceed the $15,000 purchasing threshold. All purchases that do not fall within this dollar threshold must be executed per the guidelines established within this Purchasing Manual.

1.4 THE PURCHASING CYCLE
Purchasing and procurement are citywide functions. Virtually every City employee participates either directly or indirectly in the process. Procurement begins with employees identifying a requirement for a product or service. The purchasing cycle establishes the proper steps for all department staff to follow when requisitioning supplies, materials, and equipment; public works projects; and/or professional/consultant service contracts.

The Budget
Step One: Approval of the City’s budget. The budget authorizes the City Manager and designees to purchase the materials, supplies, services, and equipment in the budget document. Purchases for certain dollar amounts are subject to further requirements, such as department head approvals, City Manager/Designee approval, City Council approval, and/or bidding requirements.

Method of Purchase
Step Two: Departments choose the method of purchase according to the type and dollar value of the purchase. A requisition is submitted, routed through the approval workflow process, and is eventually converted into a purchase order or contract.

Risk Management Review
Step Three: Risk Management evaluates the potential risk and determines the appropriate insurance requirements and contract language.

Receiving and Acceptance
Step Four: Once the product or service has been received or accepted, payment authorization can proceed. All goods should be shipped to a City facility to ensure receipt by City staff, unless approved by the Purchasing Division Manager prior to making the purchase.

3 1.5 RESPONSIBILITIES
Department Responsibilities
 Obtain full and open competition in accordance with City policies and procedures in a manner that presents the best overall value to the City.  Know the requirements of your funding source. Grants and Federal funding may have different requirements and always defer to the stricter funding requirements or the City purchasing policies
 Verify available budget prior to making purchases
 Anticipate requirements sufficiently in advance to allow adequate time to obtain goods in accordance with the best purchasing practices  Determine if prevailing wages are required and confirm DIR registration requirements are met prior to obtaining bids and quotes  Contact Risk Management to obtain insurance recommendations and contract language prior to obtaining bids and quotes or issuing contracts  Do not split orders for the purpose of avoiding purchasing and bid requirements or approval levels
 Provide detailed, accurate specifications to ensure goods obtained are consistent with requirements and expectations
 Enter requisitions according to instructions and provide all required supporting documentation required for procurements to minimize processing time
 Limit urgent and sole source purchases and provide written documentation for review when these purchases are necessary
 Obtain the required approvals prior to purchasing goods or services  Provide fair and equitable treatment of contractors
Risk Management Responsibilities
 Review draft contracts and contract amendments and provide insurance recommendations and language
 Contact vendors to obtain additional insurance documents when needed  Evaluates risk to determine if insurance requirements can be waived based on risk assessment
Purchasing Responsibilities
 Ensure full and open competition on all purchases as required by the purchasing policy
 Coordinate vendor relations, locate sources of supply and evaluate vendor performance
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4  Recommend revisions to purchasing procedures when necessary and stay informed of current developments in the field of public purchasing and state laws pertaining to purchasing

 Prescribe and maintain all forms and records necessary for the efficient operation of the purchasing function
 Act as the City’s agent in the transfer and disposal of surplus equipment and materials

5 CHAPTER 2:

PURCHASING AUTHORITY & THRESHOLDS AND REQUIREMENTS

2.1 PURCHASING AUTHORITY

Under the provisions of Chapter 2.50.020 of the Garden Grove Municipal Code, the Finance Director has been given the authority to purchase or contract for all supplies, services or equipment required by any City department. The Municipal Code further sets forth formal and open market procedures to be followed in carrying out purchasing functions. The Finance Director may delegate this responsibility to the Purchasing

6 Division.

City Council Resolution No. 9212-14####-26______ authorizes the City Manager or his/her designee to approve contracts for professional services and for the purchase of supplies and equipment up to $75,000 per person or entity, in any single fiscal year.

Public Works contracts are authorized under the California Public Contract Code and Chapter 2.52 (Public Works Construction Bid Procedure) of the Garden Grove Municipal Code.

Pursuant to Section 2.50.020 (Purchasing Authority) of the Garden Grove Municipal Code, the City of Garden Grove Purchasing Manager has the authority, as delegated by the Finance Director, to:

A. Purchase or contract for supplies, services, and equipment required by any using agency in accordance with purchasing procedures prescribed by the Code, such administrative regulations as he or she shall adopt for the internal management and operation of the Purchasing Division, and such other rules and regulations as shall be prescribed by the City Council or City Manager;

B. Negotiate and recommend execution of contracts for the purchase of supplies, services, and equipment;

C. Act to procure for the City the needed quality in supplies, services, and equipment at the least expense to the City;

D. Discourage uniform bidding and endeavor to obtain as fully and open competition as possible on all purchases;

E. Prepare and recommend to the City Council through the City Manager, rules governing the purchase of supplies, services, and equipment for the City;

F. Prepare and recommend to the City Council through the City Manager, revisions and amendments to the purchasing rules;

G. Keep informed of current developments in the field of purchasing, prices, market conditions, and new products;
H. Prescribe and maintain such forms as reasonably necessary to the operation of this chapter and other rules and regulations; I. Supervise the inspection of all supplies, services, and equipment purchased to ensure conformance with specifications;
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7 J. J. Recommend the transfer of surplus or unused supplies and equipment between departments as needed and the sale of all supplies and equipment that cannot be used or that have become unsuitable for City use; and K. K. Maintain a bidder’s list and records needed for the efficient operation of the Purchasing Division (2813 § 1, 2012; 1274 § 1, 1972)

2.2 PURCHASING THRESHOLDS AND REQUIREMENTS

The following charts are reference guides that outline the different types of procurements, the requirements for each process, and the proper channels of approval. Please reference Chapters 7, 8 and 9 of this manual for a detailed explanation of each procurement process.

Purchase of Materials and Supplies, Equipment and other Commodities Dollar Threshold Requirements Requisition
Approval/Authority
$1–$15,000
Requisition/PO and one (1) informal
quote required for amount over
$1,000

*Purchases under $1,001 do not
require a Requisition/PO

Requisition Approval:

Department Head/Designee
approval required

Authority: Department
Head/Designee approval
required

$15,001–$75,000
Obtain three (3) informal quotes

Requisition/PO Required
Requisition Approval:

Department Head/Designee
approval required

Authority: City
Manager/Designee approval
required up to $75,000

Note: All vehicles require City
Council approval regardless
of dollar amount per Section

5.7: Vehicle Purchases.

$75,001 and greater
Formal Bid (IFB) Process
Required

Requisition/PO Required

Requisition Approval:

Department Head/Designee
approval required

Authority: City Council approval
required for purchases greater
than $75,000

Note: All vehicles require City
Council approval regardless
of dollar amount per Section

5.7: Vehicle Purchases.

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8 Contracts for Professional Services and Consultant Services Dollar Threshold Requirements Requisition
Approval/Authority
$1–$15,000
Requisition/PO and one (1) written
proposal required for all services that
exceed $1,000
*Services under $1,001 do not
require a Requisition/PO
Contract and insurance validation is not
required for services between $1,001-
$15,000 unless deemed as necessary by
Risk Management
Requisition Approval:

Department Head/Designee
approval required

Authority: City
Manager/Designee signature
required on all contracts

$15,001–$75,000
Requisition/PO, one (1) written proposal
and contract required

Mini Brooks Act may apply

Insurance required as per contract and
Risk Management recommendations
Requisition Approval:

Department Head/Designee
approval required

Authority: City
Manager/Designee signature
required on all contracts

$75,001 and
greater
Formal Request for Proposal (RFP)
Process Required

Mini Brooks Act may apply

Requisition/PO, scope of work and
contract required
Insurance required as per contract and
Risk Management recommendations
Requisition Approval:

Department Head/Designee
approval required

Authority: City Council
approval required

9 Purchase Orders and Contracts for Public Works/Construction Projects Dollar Threshold Requirements Requisition Approval/Authority $1-$15,000

Provide a detailed scope of work to
potential contractors and obtain one
(1) written quotation which includes
prevailing wage rates

Prevailing Wage rates required for work
of $1,000 and greater

Requisition/PO and one (1) written
quotation required for amount over
$1,000

Contract and insurance validation is
not required for services between
$1,001-$15,000 unless deemed as
necessary by Risk Management
Valid Contractor License in good
standing required
Requisition Approval/Authority:

Department Head/Designee approval
required

DIR: Notice of contract award
through DIR’s PWC-100 NOT

REQUIRED

$15,001 –$75,000

Provide a detailed scope of work to
potential contractors and obtain three
(3) written quotations which includes
prevailing wage rates

Valid Contractor License in good
standing required

Must provide proof of registration (prime
and all sub-contractors) with the DIR:

Department of Industrial Relations

Contract and Insurance required as per
contract and Risk Management
recommendations
Labor/Material & Performance Bonds
required for contracts over $25,000

Prevailing Wage rates required

Requisition Approval: Department
Head/Designee approval required

Authority: City Manager/ Designee
signature required on all contracts
up to $75,000

. The small project exemption
applies for all public works projects
that do not exceed:
- $25,000 for new construction,
alteration, installation,
demolition or repair
- $15,000 for maintenance
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10 Dollar Threshold Requirements Requisition Approval/Authority

$75,001-$220,000
Informal Bid Process Required per
GGMC 2.52.030

Requisition/PO, Scope of Work/Plans
and Contract required

Notice of Inviting Bids required

Valid Contractor License required

Must provide proof of registration
(prime and all sub-contractors) with
the DIR: Department of Industrial
Relations

Labor/Material and Performance Bonds
required

Insurance required as per contract and
Risk Management recommendations

Prevailing Wage rates required
Requisition Approval: Department
Head/Designee approval required

Authority: City Council approval
required

DIR: Project Managers are required
to submit notice of contract award
through DIR’s PWC-100 system on
projects that fall outside of the small
project exemption within 30 days of
the award/approval date, or before
beginning any work.
. The small project exemption
applies for all public works projects
that do not exceed:
- $25,000 for new construction,
alteration, installation,
demolition or repair
- $15,000 for maintenance

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11 Dollar Threshold Requirements Requisition Approval/Authority $220,001 and greater
Formal Bid Process Required per
PCC 22037

Requisition/PO, Scope of Work/Plans
and Contract required

Notice of Inviting Bids required

Valid Contractor License required

Must provide proof of registration
(prime and all sub-contractors) with
the DIR: Department of Industrial
Relations

Labor/Material and Performance Bonds
required

Insurance required as per contract and
Risk Management recommendations

Prevailing Wage rates required

Requisition Approval: Department
Head/Designee approval required

Authority: City Council approval
required

* A purchase order will be required once cumulative fiscal year spending with any vendor exceeds $1,000.

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12 CHAPTER 3:

VENDOR INFORMATION AND RELATED POLICIES

3.1 NEW VENDOR APPROVAL PROCESS
Before making purchases other than with petty cash and p-cards, new vendors must be set up in the City’s financial system. New vendor requests are to be entered by the departments.

For one-time transactions under $1,001 where purchase orders are not required, the Finance Department will be responsible for setting up these vendors so invoices can be processed. The Finance Department will also be responsible for updating all existing vendor records which include changes to vendor address, payment method, W-4, etc.

Departments are responsible for new vendor setup only when the department is trying to initiate a purchase requisition with that vendor. New vendors are required to submit a Vendor Set-Up form and other documents will need to be filled out by the vendor which include:
 Required - New Vendor set-up information. This form also includes changes to existing vendor information.
 Required - W-9 Form
 Optional - EFT form
The Vendor Set-Up form is to be attached in PEUPPE in Financial Enterprise (FE) at the time the vendor number is created and all the pertinent information needs to be entered in the screen. All information must be complete and accurate in order for invoices to be processed. Purchasing will reject any vendor creation that does not have the documents mentioned above attached to the record in PEUPPE.

The vendor request will be submitted to the Purchasing Division for review and approval. Once approved, a vendor number is assigned and the department will be notified. The new vendor is then available to use by all departments.

3.2 PLANET BIDS ON-LINE VENDOR REGISTRATION

The Purchasing Division utilizes an online registration and bidding system to conveniently assist and notify vendors and businesses of various bid opportunities, news, and updates. The electronic bidding system provides an easy and accessible way to obtain solicitation documents. Registered companies will receive customized emails notifying them of specific bids, the ability to search for bids, and download documents.

The City utilizes a customized list of commodity codes to register and notify potential bidders for opportunities. In order to access the system, vendors must register with the City.

Current and new vendors that would like to receive notification of bid opportunities from the City are encouraged to register online. The system requires all vendors to

13 have email capability to download solicitations, documents, addendums, and award information. Both formal and informal solicitations can be processed through the online bidding system. When a vendor does not have access to register online, Purchasing Division staff will assist in the registration and bidding process. Once registered, all vendors are solely responsible for maintaining current and accurate profile information.

Vendors may edit their profile at any time.

This system provides vendors with a searchable online database of current bid and proposal solicitations and opportunities.

Some of the key system features and vendor benefits include:

A. Vendors’ ability to maintain their own profiles as a new or existing vendor B. Receive automatic email notifications for selected bid opportunities based on product/service categories
C. Searches for requests, addenda, plan holders lists, bid results, and awards D. Request and download bid document(s) when available
E. Receive automatic addendum notifications as a bid participant

The City now conducts the majority of its formal bid and proposal solicitations through this on-line bidding system. To receive full advantage of this program, we encourage all vendors to register online by accessing the City’s website.

3.3 LOCAL VENDOR PREFERENCE

Where all factors are considered and are deemed equal, preference shall be given to local merchants when the local merchants’ bids are within 2% of the lowest bid received, provided that the dollar amount represented by the 2% difference does not exceed $5,000. This provision shall only be utilized where bids in the amount of $5,000 or higher are solicited.

3.4 USING VENDOR CONTRACTS VERSUS APPROVED CITY CONTRACTS

Project Managers may encounter a situation where the vendor prefers for the City to use their contract versus a standard City approved contract. It is recommended that the project manager send the vendor a sample copy of the City’s standard contract for review prior to agreeing to use a vendor’s contract.

If a decision is made to use the vendor’s contract, the following steps must be followed by the project manager to ensure that the proper insurance requirements are included within the contract and that the City is able to comply with all of the terms of the vendor contract.

A. Risk Management Review: A copy of the vendor contract and the scope of work should be forwarded to Risk Management for review and insurance recommendations and language.

B. City Attorney Review: Once Risk Management reviews the vendor’s contract, it should then be forwarded to the City Attorney for review and approval as to

14 form. The City Attorney will make recommendations and may request that the vendor make changes to their contract prior to obtaining signatures.

C. Consult with the Vendor: The project manager shall communicate any changes or recommendations back to the contractor for review and revisions to their contract. Once the contract has been revised, signatures can be obtained. In the event that the contractor does not agree with the proposed changes, Risk Management and/or the City Attorney should be contacted for further discussion and negotiation.

15 CHAPTER 4:

METHODS OF PROCUREMENT

The most common methods of procurement are purchase orders and contracts which are discussed in detail in Chapters 7, 8 and 9. This chapter will discuss other methods that are available and the guidelines for each method. These alternate methods of

16 procurement should not be used when a purchase order or contract is required according to the purchasing policies and guidelines.

4.1 REQUISITION/PURCHASE ORDER AND REQUIREMENTS

A requisition and purchase order are required for the following purchases:

1. Materials/Supplies/Commodities

2. Equipment

3. Public Works/Construction contracts

4. Professional Service/Consultant contracts

5. Changes Order requests to make changes to existing purchase orders

6. Requests for Master Blanket Purchase Orders

7. Releases against Master Blanket Purchase Orders

8. Amendments to existing Professional Service/Consultant contracts

9. Change notices to Public Works/Construction contracts

10.Request to initiate a formal bid or request for proposal process

11.If the purchase involves obtaining any of the following items, a requisition and purchase order are always required, regardless of the dollar threshold.  Furniture (Chairs, Desks, Systems Furniture/Cubicles, etc.)  Software and Computer Products (may require prior approval from the Information Technology Department)
 Ammunition
 Weapons-replacement parts are exempt

4.2 EXEMPTIONS TO REQUISITION AND PURCHASE ORDER REQUIREMENTS

The following are exemptions to the requisition and purchase order process: The following products and services do not require the submission of a requisition or purchase order.

1. Filing Fees

2. Travel Services – such as hotel reservations, rental cars, and airfare

3. Licenses

4. Utility Payments-including usage and services that must be performed by utility companies such as pipeline relocations and meter replacements

5. Professional Membership Dues

6. Registration fees

7. Subscriptions for magazines/periodicals

8. Tuition

9. Other Governmental Agencies

10.Contracts for services under $1,001, until cumulative fiscal year spending with any vendor exceeds $1,000.

11.Purchases for goods/commodities under $1,001 until cumulative fiscal year spending with the vendor exceeds $1,000.

12.Reimbursement for items under the petty cash procedure

13.Insurance Premiums, Claims and Settlements

14.Conferences and Business Meetings

15.Mandated Payments

16. Gift Cards for City related events or programs

17 4.3 PROCUREMENT CARDS/P-CARDS

The procurement card program is an efficient, cost-effective method of purchasing and paying for small-dollar and high-volume purchases. P-Cards offer an alternative to the traditional purchasing process and can result in a significant reduction in the volume of paperwork, reporting and a more streamlined process. Cardholders must ensure that funds are available in the current fiscal year budget prior to making purchases. A purchase order is not required when using a P-Card.

The use of City issued procurement card (P-Card) shall comply with the City's Purchasing Policy and Procedures adopted by the City Council. P-Card purchases should not be “split” to circumvent transaction limits or bidding requirements established under the City's Purchasing Policy and Procedures.

Please reference Administrative Regulation 5.8 (Use of City Procurement Cards) for additional information and restrictions of use.

4.4 BLANKET PURCHASE ORDERS

 Blanket purchase orders are used for various categories of items such as office supplies, hardware, maintenance supplies, and certain types of on-call services.

Master blanket purchase orders will be established at the beginning of each fiscal year and must be a collaborative effort amongst various City departments. This will ensure discounted pricing based on larger purchases and economies of scale. Pricing should be based on discounted pricing through negotiated contracts or through contracts that have already been formally bid such as state contracts or cooperative agreements.

 Blanket purchase orders are required for all vendors that are frequently used and where the cumulative fiscal year spending with the vendor on similar purchases exceeds $1,000. Once a blanket purchase order is established, purchases that fall within the $15,000 bidding threshold must be applied towards the existing blanket purchase order via Release purchase orders. Invoices cannot be paid directly against a blanket purchase order, it is the department’s responsibility to initiate a Release purchase order to allow invoices to be paid. Release purchase orders must be established for all frequently used vendors even if the purchase is under $1,001.

 The available balances on blanket purchase orders must be used within the term specified. Once the blanket purchase order expires, purchasing staff will verify with the department that there are no pending payments before closing out the blanket purchase order and the associated Releases. Once the Releases are closed, any remaining balances will be automatically disencumbered, and cannot be carried over into future purchase orders.

 Blanket purchase orders should only be established for contracts that are for on-call or emergency services. Contracts that have a set annual budgeted amount should be set up as “C” Type purchase orders and the total annual amount will be encumbered up front. Examples of contracts that should not be set up as blanket purchase orders include but are not limited to: Park Maintenance, Janitorial

18 Services, Parking Citation Processing, Tree Maintenance, Graffiti Abatement and Street Sweeping.

Master Blanket Purchase Orders

• Master blanket purchase orders are “B” type purchase orders • The requestor will enter a requisition to initiate a new master blanket purchase order which includes the purchase order amount and negotiated pricing list or contract
• Purchasing will create the master blanket purchase order • Purchasing will verify annual spending amount based on history to ensure collaboration amongst City departments
• Purchasing staff can assist with negotiated pricing for the items to be purchased under the master blanket purchase order when needed
• Funds are not encumbered (non-encumbered) at the time the master blanket purchase order is created
• Master blanket purchase orders will be renewed at the beginning of each fiscal year
• Master Blanket Purchase Order and Terms and Conditions will be sent to the vendor

Releases against Master Blanket Purchase Orders

• Releases against Master Blanket purchase orders are “P” type purchase orders • The requestor will enter a requisition to initiate a release against the master blanket purchase order
• Releases are the anticipated spending amount per quarter or time period the user choses and are encumbered
• Releases can be done on a quarterly basis or as needed • Release purchase orders against the master blanket purchase orders will not be sent to the vendors
• Release purchase orders are only valid in the fiscal year they are created and must be closed out at the end of the fiscal year. New release purchase orders must be created for each new fiscal year.

19 CHAPTER 5:

INFORMAL AND FORMAL BIDDING PROCEDURES

5.1 INFORMAL BIDDING PROCESS
Informal bidding procedures require the solicitation of written informal quotes and proposals from vendors as required per the purchasing thresholds. These may be submitted by email, fax, internet websites, or mail. Informal bidding procedures apply to the following:
 Purchases – for materials, supplies, equipment and commodities up to $75,000  Professional/Consultant Service Contracts up to $75,000  Public Works Contracts up to $220,000. Notice of Inviting Bids is not required under the informal bidding process except for Public Works projects over between $75,0001 and $220,000, which require a Notice Inviting Informal Bids.

5.2 FORMAL BIDDING PROCESS
Formal bidding procedures require a formal type of bidding process such as an IFB (Invitation for Bids) or RFP (Request for Proposal) process. Formal bidding procedures apply to the following:
 Purchases – Materials, supplies and equipment that exceed $75,000 require a formal IFB process.
 Professional/Consultant Service contracts over $75,000- All professional and consultant services that exceed $75,000 require a formal RFP process.  Public Works Projects over $220,000- All Public Works projects that exceed $220,000, require a formal IFB (Invitation for Bids) process.

5.3 INFORMAL AND INFORMAL BIDDING PROCESS REQUIREMENTS
A. Informal Biddings - Vendor List: The City shall maintain a list of vendors which is maintained in the City’s Planet Bids portal to whom the City will send notices of informal bids no less than 10 calendar days before bids are due per Public Contracts Code sect. 22034. The notice inviting informal bids shall describe the project in general terms and how to obtain more detailed information about the project, and state the time and place for the submission of bids.

B. Formal Bids - Per Public Contracts Code sect. 22037, notice inviting formal bids shall state the time and place for the receiving and opening of sealed bids and distinctly describe the project. The notice shall be published at least 14 calendar days before the date of opening the bids in a newspaper of general circulation, printed and published in the City; or, if there is no newspaper printed and published within the City, in a newspaper of general circulation which is circulated within the City, or, if there is no newspaper which is circulated within the City, publication shall be by posting the notice in at least three places within the City as have been designated by ordinance or regulation of the City as places for the posting of its Formatted: Underline

20 notices. The notice inviting formal bids shall also be sent electronically, if available, by either facsimile or electronic mail and mailed to all construction trade journals specified in Section 22036. The notice to journals shall be sent at least 15 calendar days before the date of opening the bids. In addition to notice required by this section, the City may give such other notice as it deems proper.

The Notice Inviting Bids shall include:
(a) State the time and place for receiving and opening of sealed bids (b) Distinctly describe the project
(c) Project title and contract number
(d) Date, time, and place for receiving bids
(e) City’s address and phone number
(f) Brief description of work to be done
(g) Bond requirements-required for Public Projects of $25,000 and greater (h) Where plans or scopes of service may be obtained
(i) If a deposit is required and whether or not the deposit is refundable

C. Formal Bid Opening: Sealed bids can submitted to the Purchasing Division or the City Clerk’s Office in paper or electronic format, per bid instructions. DIR registration is verified for all contractors and subcontractors prior to bid opening.

Bids are publicly opened and recorded at the time and place stated in the public notices. All bids received will be available for public inspection at the time of the bid opening or within 24 hours if the submittal is electronic. The Purchasing Division or City Clerk’s Office will be responsible for bid tabulations.

5.4 AWARD OF PURCHASE ORDER/CONTRACT

If a purchase order or contract is awarded through an IFB (Invitation for Bid) process, it shall be awarded to the lowest responsible bidder. If two or more bids are the same and the lowest, the City may accept the one it chooses, subject to the local vendor preference in Garden Grove Municipal Code Section 2.50.110 (Open Market Procedure).

Contracts that are awarded through an RFP (Request for Proposal) process are based upon the specified scoring criteria and not based on the lowest priced proposal submitted.

5.5 NO BIDS RECEIVED/NON-RESPONSIVE BIDS AND PROPOSALS
If no bids or proposals are received through the formal or informal bidding procedure, the goods or services may be secured by negotiated contract.

5.6 REJECTION OF FORMAL BIDS

In the event that a decision is made to not award a formal bid that falls under the authority of the City Council, the department must obtain authorization from the City Council to reject all bids. If a decision is made to re-bid the project, then the department must also obtain City Council approval to re-bid the project. This request would be considered a Consent Item on the City Council agenda and the department must prepare the staff report accordingly.

21 CHAPTER 6:

EXCEPTIONS TO THE COMPETITIVE BIDDING PROCESS

Purchases of supplies, services, equipment, and the sale of personal property shall be by bid procedures pursuant to Garden Grove Municipal Code Section 2.50.060 (Bidding). Bidding may be dispensed with only when:

A. The amount is equal to or less than $75,000;
B. An emergency requires that the order be placed with the nearest available source of supply and/or service providers, subject to Garden Grove Municipal Code Section 2.50.070 (Emergency Purchase Justification); C. The Finance Director determines that the commodity can be obtained from only one vendor;
D. The City has a contract with another governmental agency to purchase a particular item or service on a cooperative basis; E. The purchase price and other terms are similar to those in a contract awarded for the same goods and/or services by another public agency or government purchasing cooperative organization based on a competitive process similar to the processes described in Garden Grove Municipal Code Section 2.50.100 (Formal Contract Procedure) or 2.50.110 (Open Market Procedure) [piggy-backing];
F. The contract is for professional services to be let primarily based on qualifications; or
G. The City Council determines it to be in the best interest of the City.

6.1 EMERGENCY PURCHASES

In the event of an emergency, competitive bidding procedures may be bypassed when time is of the essence.

The City Manager has the final authority on all emergency requests. An emergency memo must be reviewed and signed by the City Manager or his/her designee.

Insurance Requirements will also be waived if the situation does not allow adequate time for the insurance approval process.

An emergency is defined as follows:

EMERGENCY: An emergency situation exists when the life safety, health or welfare of the public or employees is affected by a sudden and unexpected occurrence, which requires immediate action to prevent or mitigate a loss.

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6 pt
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22 An emergency situation does not exist when staff has neglected to allow sufficient time to process an order or obtain a product or service that does not fall under the requirements of an emergency as defined above.

When an emergency situation exists, Purchasing staff or the Finance Director should be contacted whenever possible. Purchasing staff will confirm if the situation qualifies as an emergency, and will assist the department as needed with placing an order or service call with the nearest available source.

If the Purchasing Division or the Finance Director cannot be reached, the Department Director may authorize placing an order or service call with the nearest available source. The Department Director is responsible to notify the City Manager of the emergency situation.

If an emergency situation requires expenditures in excess of $75,000, a Manager’s memo shall be sent to notify the City Manager and the approval of City Council may be required at its next scheduled meeting.

The requesting Department will be responsible for submitting the following documents to the Purchasing Division within 48 hours of the occurrence:

A. Requisition which is flagged with a requisition code of “99” to mark it as an emergency and enter notes regarding why it is an emergency in the PR notes field and attach the following documents:

 Emergency Memo-which explains and justifies the emergency situation and is signed by the Department Director or his/her Designee.

For purchasing policies during major disasters and emergencies that may require FEMA reimbursement, please reference Chapter 11: PURCHASING DURING PROCLAIMED EMERGENCY OR DISASTER.

6.2 SOLE SOURCE/PROPRIETARY PURCHASES

In some cases, the competitive bidding process cannot be accomplished due to a sole source condition where the services or products are available only from one source. A sole source situation may also exists when “compatibility” or “best fit” with existing equipment or services exists, and when in the best interest of the City. The Department Director or his/her designee must make this determination which is subject to the approval of the Purchasing Manager and Finance Director.

Sole Source requests should not be made unless the Department is confident that the request is reasonable, appropriately justified to meet the City’s requirements, and can withstand a possible audit. Sole source purchasing minimizes or eliminates fair and open competition and should be avoided whenever possible.

Sole sources purchases are not exempt from the purchasing thresholds or the City Manager and City Council approval requirements.

23 The requesting Department will be responsible for submitting the following documents to the Purchasing Division when requesting a sole source purchase:

A. Requisition which is flagged with a requisition code of “SS” to mark it as a sole source purchase and attach the following:

 A Sole Source Memo that is signed by the Department Director or his/her designee, and should provide an objective written explanation along with any written documentation signed the by sole source vendor to further support the request. Approved Sole Source Memos will be approved for the specific request only. Approvals may remain valid for a one year period if multiple purchases for the same product/service will be made within a one year period and the sole source situation has not changed. For services, the sole source approval will remain valid for the entire term of the specific contract for which it was approved. New contracts must be reviewed to ensure that a sole source situation exists. If at any time after approval it is learned that the product or service is now available from other sources, the sole-source approval will be revoked.

Services performed in connection with project development and permit processing must comply with federal and state environmental laws.

Sole source purchases that fall under the Federal Purchasing Requirements must be properly documented per federal requirements.

6.3 COOPERATIVE PURCHASING AND PIGGYBACKING ON CONTRACTS If a product or service is available through the utilization of another public entity’s contract (included but not limited to City, County, State, Federal, School District, California Communities Programs, Federal GSA, JSPA, and NASPO Value Point), the City can participate in a cooperative purchasing agreement or “piggyback” onto an existing contract and waive the competitive bidding process when all requirements are met.

Local vendors should also be taken into consideration before utilizing cooperative agreements.

In the case of a contract, the City will request that the same pricing be honored in the existing contract, but may issue a City approved contract since the City’s terms and conditions may vary from other entities.

Piggybacking may not be used for Public Works projects.

In order for the City to piggyback onto an existing contract with another public entity, the existing contract with that entity must meet the following requirements:

A. The product or service must have been competitively bid

B. The contract must be current

24 C. The contract must be for the same product or service

D. The contract must be approved and awarded by the entity’s governing body

E. The contractor must honor the contract pricing

The following items should be submitted to the Purchasing Division and the City Attorney for review to ensure that due diligence is performed when requesting to piggyback onto an existing contract of another public agency:

A. A copy of the bidder’s response to the public agency which includes a bid summary/comparison of all bids received
B. A complete copy of the existing contract with the other public agency

C. A copy of the clause that allows for another public entity to piggyback onto the existing contract, or written confirmation from the contractor honoring the other agency’s pricing to the City

D. Proof of the approval and award by the governing body of the other agency

6.4 QUALIFICATION BASED SELECTION

The Mini-Brooks Act (California Government Code Sections 4525-4529.5) provides exceptions to awarding a contract to the lowest bidder for the procurement of professional services in areas, which require a substantial amount of professional expertise and judgment.

Examples of such services include architectural and engineering (A/E), environmental, land surveying, and construction management services. The terms of these agreements should be negotiated and awarded to the most qualified and competent firms to perform the scope of work. It is necessary to engage market forces during these procurements through a Qualifications Based Selection (QBS) process to ensure that staff has a thorough understanding of the qualifications of the firms within the given industry and to obtain the best overall value for the City.

The QBS process is defined as follows:

A. Funding

1. Federal-if any federal dollars are involved with contracts for the “Architectural and Engineering” services, the procurement must comply with “Brooks Act,” 40 U.S.C. sections 1101-1104.

2. State and Local- if only state and local funds are involved with the contract for “Architectural and Engineering” services, the procurement must comply with “Mini Brooks Act,” California Government Code sections 4525-4529.5.

B. ARCHITECTURAL AND ENGINEERING SERVICES

25 1. Federal-Under the “Brooks Act” architectural and engineering services are defined as:

 Professional services of an architectural or engineering nature, as defined by state law, if applicable, that are required to be performed or approved by a person licensed, registered, or certified to provide the services

 Professional services of an architectural or engineering nature performed by contract that are associated with research, planning, development, design, construction, alteration, or repair of real property; and

 Other professional services of an architectural or engineering nature or incidental service, which members of the architectural and engineering professions (and individuals they employ) may logically or justifiably perform, including studies, investigations, surveying and mapping, tests, evaluations, consultations, comprehensive planning, program management, conceptual designs, plans and specifications, value engineering, construction phase services, soils engineering, drawing reviews, preparation or operating and maintenance manuals and other related services.

2. State and Local-Under the “Mini Brooks Act” architectural and engineering services are defined as:

 Those professional services of an architectural, landscape architectural, engineering, environmental, or land surveying nature as well as incidental services that members of those professions and those in their employment may logically or justifiably perform.

 Those services provided by a licensed architect, registered engineer, or licensed general contractor which meet the requirements of Government Code section 4529.5 for management and supervision work performed on construction projects.

 Those services performed in connection with project development and permit processing in order to comply with federal and state environmental laws.

C. PROHIBITIONS

The “Mini Brooks Act’ includes a prohibition that local agencies “shall specifically prohibit practices which might result in unlawful activity including, but limited to, rebates, kickbacks, or other unlawful consideration, and shall specifically prohibit government agency employees from participating in the selection process when these employees have a relationship with a person or business entity seeking a contract under this section.

D. SELECTION PROCESS

26 The goal of the Qualifications Based Selection (QBS) is to assure that the services are engaged on the basis of demonstrated competence and qualifications for the types of services to be performed. Price is not considered until after the most qualified firm has been selected by the agency. Once the most qualified firm is selected, the agency negotiates for services to be supplied at a fair and reasonable price. The process includes the following:

1. Determine if QBS must be utilized-determine what types of services are required and whether they are “Architectural and Engineering” services.

2. Determine Funding Source-determine if federal monies are involved. If so, “Brooks Act” must be followed. If only state and local monies, then the “Mini Brooks Act” must be applied.

3. Establish Evaluation Criteria-establish evaluation criteria to be utilized in selection process to include categories judged and corresponding weights.

4. Solicit Statements of Qualifications/Request for Qualifications-solicit for interested parties using Request for Proposal (RFP) or Request for Qualifications (RFQ). Use agency standard process but ensure price is not a factor to be considered. When pricing is a requirement in the RFQ or RFP, any price proposal must be submitted under a separate sealed envelope and marked as such, and cannot be opened until after selection of the most qualified firm.

5. Develop Short List of Firms-based on a review by selection committee; develop a short list of firms to move on to the interview process. Items to consider are proposal responsiveness and categories set forth in RFP/RFQ.

6. Interview Short List Firms-selection committee interviews firms on short list.

Interviews are optional at the discretion of the project manager.

7. Rank Firms-based on the initial review of the proposals and information gathered in the interview process, the selection committee, utilizing the selection criteria set forth in RFP/RFQ, ranks the short listed firms from 1-X.

8. Define the Scope of Work/Contract Terms-the agency, if required, can utilize the top ranked firms in further defining the scope of work, level of effort and contract terms. If agreement cannot be reached on the scope of work, level of effort or contractual terms, the agency must cease negotiations with top ranked firm and begin negotiations with the next ranked firm on the list.

9. Negotiate Price-once the scope of work if fully defined and the contract terms are negotiated, the agency asks the firm for a price proposal. The price proposal, if submitted earlier in a sealed envelope, can be opened at this stage. Utilizing the price proposal, the agency and the firm negotiate a price for the scope of work. If an agreement cannot be reached, the agency must cease negotiations with the firm and move on to the next ranked firm on the list.

27 10.Present recommendations to the City Council-once a fair and reasonable price has been reached, the agency must present the award for City Council approval if the contract amount exceeds $75,000.

28 CHAPTER 7:

PURCHASE ORDERS FOR MATERIALS, SUPPLIES, EQUIPMENT

AND OTHER COMMODITIES

Dollar Threshold Requirements Requisition
Approval/Authority
$1–$15,000
Requisition/PO and one (1) informal
quotation required for amount over
$1,000

*Purchases under $1,001 do not
require a Requisition/PO

Requisition Approval:

Department Head/Designee
approval required

Authority: Department
Head/Designee approval
required
$15,001–$75,000
Obtain three (3) informal quotations

Requisition/PO Required
Requisition Approval:

Department Head/Designee
approval required

Authority: City
Manager/Designee approval
required up from $15,001 to
$75,000

Note: All vehicles require
City Council approval
regardless of dollar amount
per Section 5.7: Vehicle
Purchase.

$75,001 and
greater
Formal Bid (IFB) Process
Required

Requisition/PO Required
Requisition Approval:

Department Head/Designee
approval required

Authority: City Council
approval required for purchases
greater than $75,000

Note: All vehicles require
City Council approval
regardless of dollar amount
per Section 5.7: Vehicle
Purchase.
* A purchase order will be required once cumulative fiscal year spending with any vendor exceeds $1,000.

29 7.1 REQUIREMENTS FOR PURCHASES UP TO $15,000

Purchases that do not exceed the $15,000 purchasing threshold have no competitive bidding requirements. Staff must obtain approval from the Department Head or his/her designee before making the purchase. All purchases in the amount of $1,001 or greater require a requisition and purchase order, until cumulative fiscal year spending with the vendor has exceeded $1,000.

7.2 REQUIREMENTS FOR PURCHASES OF $15,001-$75,000

Purchases between the amounts of $15,001-$75,000 require three written informal quotations and City Manager/Designee approval. Staff must obtain approval from the Department Head or his/her designee prior to making the purchase. The requesting department shall obtain the quotes and attach them to the requisition. The Purchasing Division will place the order with the supplier providing the lowest price.

7.3 REQUIREMENTS FOR PURCHASES OF $75,001 and greater

Purchases of $75,001 and greater require a formal bid process and City Council approval.

7.4 ENVIRONMENTALLY FRIENDLY PURCHASING

Beginning January 1, 2022, SB 1383 requires jurisdictions (cities, counties, cities and counties, or special districts that provide solid waste collection services) to purchase recycled-content products, including paper products, compost and mulch. Specifically, per the regulations, "all paper purchases must contain 30 percent post-consumer recycled content when available at no greater cost."

This builds upon existing laws to purchase products that contain minimum recycled content, and adds requirements on product recyclability and recordkeeping.

Please reference Administrative Regulation 2.10 (Use and Procurement of Recycled Products) for more information.

7.5 VEHICLE PURCHASES

All vehicles purchases, regardless of cost, require City Council approval. A vehicle is defined as a wheeled vessel used to carry people, things, or materials and requires registration and a license plate from the Department of Motor Vehicles. Items such as pumps or pressure washers with built in wheels and hitches fall under "equipment" and require City Council approval only when the total purchase amount exceeds the City Manager's authority to approve contracts or purchases of services, supplies and equipment of up to $75,000 under Resolution 9212-14_______ and this Manual.

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30 7.6 CHANGE ORDERS TO PURCHASE ORDERS

Changes to purchase orders require the department to submit a change order request and attach all supporting documentation to process the change.

The Department Head or his/her designee may authorize a change (or cumulative changes) of 10% of the initial purchase order amount or a maximum cumulative increase of $7,500.

If the cumulative change to a purchase order will result in an amount that exceeds the 10% or the $7,500 maximum cumulative increase, City Manager or City Council approval will be required.

Minor variances in purchase order amounts can be processed by the Accounting Division (the lesser of $100 250 or 10% overpayment) without a Change Order. Minor changes to purchase orders include minor variations in price, fees or taxes.

31 CHAPTER 8:

PROFESSIONAL SERVICES/CONSULTANT AGREEMENTS
The purchasing process differs when services rather than supplies or equipment are required. Professional services are those services provided by an educated or licensed specialist or a consultant. Consultant services include services that are of an advisory nature, that provide a recommended course of action or personal expertise, and that have an end product, which is basically a transmittal of information.

Examples of purchases in this category are service contracts for technical support, staff assistance, environmental impact and feasibility studies, project design and administration, production and broadcasting, financial advisory and banking services, tax auditing, legal services, architectural and engineering, and educational or instructional services.

32 Dollar
Threshold Requirements Requisition
Approval/Authority
$1–$15,000
Requisition/PO and one (1) written
proposal required for all services that
exceed $1,000
Contract and Insurance validation are not
required unless deemed necessary by Risk
Management
Requisition Approval:

Department Head/Designee
approval required

Authority: City
Manager/Designee signature
required on all contracts
(when contract is required by
Risk Management)
$15,001–
$75,000
Requisition/PO, one (1) written proposal
and contract required

Mini Brooks Act may apply

Insurance required as per contract and
Risk Management Recommendations
Requisition Approval:

Department Head/Designee
approval required

Authority: City
Manager/Designee signature
required on all contracts
$75,001 and
greater
Formal Request for Proposal (RFP)
Process Required

Mini Brooks Act may apply

Requisition/PO, scope of work and
contract required
Insurance required as per contract and
Risk Management Recommendations
Requisition Approval:

Department Head/Designee
approval required

Authority: City Council
approval required for
contracts greater than
$75,000

8.1 PROFESSIONAL SERVICE/CONSULTANT AGREEMENTS UP TO $15,000

Professional/Consultant services that fall under the purchasing threshold ($1,001- $15,000) do not require contract and insurance validation, unless it is deemed necessary by Risk Management. A requisition or purchase order are not required for professional/consultant services in the amount under $1,001, until cumulative fiscal year spending with the vendor has exceeded $1,000.

8.2 PROFESSIONAL SERVICE/CONSULTANT AGREEMENTS OF $15,001- $75,000

Professional/Consultant services in the amount of $15,001-$75,000 are exempt from the competitive bidding process. A Professional Services Agreement and insurance coverage are required for all services in the amount of $15,001 or greater. If the total

33 value of the contract falls under $15,001, a professional service agreement and insurance are not required unless it is deemed necessary by Risk Management.

If the department elects to use a contract, which is drafted by the contractor, which is not approved by Risk Management or the City Attorney, then it must be reviewed by them prior to obtaining the required signatures per Section 3.4 of this purchasing manual.

Resolution number 9212-14________, by the Garden Grove City Council, authorizes the City Manager, or his designee, the authority to execute all Professional Services Agreements up to total sum of seventy fiveseventy-five thousand dollars ($75,000) per individual person or entity in any fiscal year.

To ensure enhancement of full and open competition, contracts are limited to $75,000 per fiscal year with any given contractor for the same type of services. If the City wishes to enter into multiple contracts with the same contractor in the same fiscal year, the City may do so if the contract is for a different type of service. Contracts with the same contractor, for the same type of service who have reached the $75,000 fiscal year limit require City Council approval. City staff are encouraged to collaborate with other City departments to enter into one contract for the same type of services.

8.3 REQUIREMENTS FOR PROFESSIONAL/CONSULTANT SERVICES
AGREEMENTS OF $15,001-$75,000

The following items must be submitted to the Purchasing Division:

A. Requisition for review and approval

B. Scope of Work from the Contractor- This should be on company letter head, attached to requisition and include the following:

1. Scope of the Services/Work signed by the Contractor

2. Cost of the Service/Work to be performed

3. Contact Information: Name, Title, Phone Number, Cell Phone Number, and email address (Insurance Review Request Form located on the Intranet under Risk Management)

Upon receipt of all of the items above, the Purchasing Division will draft the agreement and obtain the required signatures. The contract with all required signatures, insurance compliance report, and any other required documents, such as bonds, are then forwarded to City Clerk so the contract can be executed. The City Clerk’s office will forward a copy of the executed agreement to Purchasing, the Project Manager and Contractor. The purchase order will be issued once the executed agreement is received.

8.4 PROFESSIONAL/CONSULTANT SERVICE AGREEMENTS OF $75,001-and greater

All Professional/Consultant Services Agreements of $75,001 and greater require a formal RFP (Request for Proposal) process and City Council approval.

Formatted: Highlight

34 For multi-year agreements, City Council approval is required if the amount exceeds $75,000 for the total contract term. Optional terms are not included in the total contract calculation.

Example: If the term of an agreement is one year in the amount of $75,000, with optional renewal years of $75,000, City Council approval is not required. If the term of the contract is four years in the amount of $75,000 per year, resulting in a $300,000 contract, City Council approval is required.

Insurance is required for all services in an amount of $15,001 and greater or when if it can be determined that a significant amount of risk is involved with the work.

If the Department elects to use a vendor contract, which is not approved by Risk Management or the City Attorney, then the vendor contract must be reviewed and approved prior to obtaining the required signatures per Section 3.4 of this purchasing manual.

8.5 AMENDMENTS TO PROFESSIONAL/CONSULTANT SERVICES AGREEMENTS

A change or cumulative changes to a Professional Services/Consultant Agreement within a given fiscal year, up to the City Manager’s authority of $75,000, must be amended and approved at the discretion of the City Manager and when in the best interest of the City. Any changes that cause the contract price to exceed the City Manager’s authority must be amended and processed for City Council approval, and work created by such changes shall not commence until City Council approval is obtained.

A change or cumulative changes to a Professional Services/Consultant Agreement that has already been approved by the City Council, up to a maximum of 10% of the awarded contract amount, must be amended and approved by the City Manager.

Changes that exceed the 10% of the annual or fiscal year awarded contract amount must be amended and require City Council approval. For example, a five year contract with option years of $100,000 per annual/fiscal year requires City Council approval if the annual/fiscal year amount increase exceeds 10% ($10,000). Any work created by such change shall not commence until City Council approval is obtained.

The available balances on contracts must be used within the term specified. Once the contract expires, purchasing staff will verify with the department that there are no pending payments before closing out the purchase order. Once the purchase order is closed, any remaining balances will be automatically disencumbered, and cannot be carried over into future purchase orders.

8.6 ASSEMBLY BILL 339 (AB 339): CONTRACTING NOTIFICATIONS AND LABOR

RELATIONS

Effective January 1, 2026, Assembly Bill 339 (AB 339) adds Section 3504.1 to the Government Code, and requires local public agencies in California to provide 45 days’ notice to labor organizations representing public employees about contracts for services Formatted: Indent: Left: 0", Hanging: 0.3"
Formatted: Space After: 6 pt

35 that are the same as or similar to work performed by employees the labor organization represents — before a local public agency issues:
 A Request for Proposal (RFP)
 A Request for Quotes (RFQ), or
 A renewal of or extension to a contract that covers services within the scope of job classifications represented by a labor organization of the public agency.

The bill is intended to increase transparency related to the contracting of public services and adds an extra procedural step for public agencies to discharge prior to making a contracting decision.

Some contracts are exempt from this new notice requirement, including (1) public works contracts for construction, alteration, demolition, installation, repair, or maintenance as defined by Labor Code section 1720, and (2) contracts for services that are related to the planning, design, administration, oversight, review, or delivery of public works, residential, commercial, or industrial buildings, or other infrastructure projects, as defined by Government Code Sections 4525 and 4529.10. Such contracts are for specialized services provided by architects, engineers, land surveyors, construction project management firms, and other professionals, and typically cover individual construction or repair projects as opposed to ongoing work.

For all other RFPs, RFQs and contract renewals and extensions that implicate bargaining unit work, the notice to the affected union must include the following information:
 The anticipated duration of the contract,
 The scope of work under the contract,
 The anticipated cost of the contract,
 The draft solicitation (or, if not yet drafted, the information that would normally go into one), and
 The reason the agency believes the contract is necessary.

If an emergency or other exigent circumstance prevents the full notice period, the public agency contracting for such work is required to provide as much advance notice as is practicable under the circumstances.

Please reference Appendix A for the AB 339 Implementation Guidelines.

8.7 LOW DOLLAR/HIGH RISK SERVICES

Many of the professional service agreements arranged by staff amount to $1,000 or less, and are therefore not required to use a standard City contract. Many of these services have potentially high risk exposures that could otherwise be transferred by indemnification language in the standard City contract. Examples of these services include but are not limited to rock climbing walls, train rides, and reptile shows.

36 To ensure that the City is covered for these types of services, the requesting Department will be responsible for the following when there is a need for a low dollar/high risk service:

1. Consult with Risk Management for the insurance requirements

2. Collect the required insurance, create a requisition and attach the insurance to the requisition. The requisition would should be noted with the requisition code for a low dollar/high risk service so that purchasing staff is aware that it falls under this category

Once these requirements have been met, the purchase order will be issued to the contractor prior to the event. The purchase order will include the insurance requirements from Risk Management and the City’s indemnification language.

Please consult with Risk Management on all low dollar but high risk exposure services.

37 CHAPTER 9:

PUBLIC WORKS/CONSTRUCTION AGREEMENTS

Note that the definition of “public project” for bidding purposes differs from the definition of “public project” for prevailing wages purposes. PCC 22002 defines a “public project” subject to public bidding as any of the following:

 Construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operated facility.

 Painting or repainting of any publicly owned, leased, or operated facility.

 “Public project” does not include maintenance work. “Maintenance work” includes (1) Routine, recurring, and usual work for the preservation or protection of any publicly owned or publicly operated facility for its intended purposes; (2) Minor repainting; (3) Resurfacing of streets and highways at less than one inch; (4) Landscape maintenance, including mowing, watering, trimming, pruning, planting, replacement of plants, and servicing of irrigation and sprinkler systems.

 In certain circumstances, it may be difficult to determine whether a project should be considered a public works project or maintenance work. In such cases, the project manager may request a determination from the City Attorney.

38 Examples of projects in this category are contracts for new street construction, major street resurfacing, intersection improvements, construction or renovation of a public facility, parking lot construction, sidewalk construction, and traffic signal installation.

39 Dollar Threshold Requirements Requisition Approval/Authority $1 –$15,000
Provide a detailed scope of work to
potential contractors and obtain one
(1) written quotation which includes
prevailing wage rates

Prevailing Wage rates required for
work of $1,000 and greater

Requisition/PO and one (1) written
quotation required for amount over
$1,000

Department Head/Designee
approval required

Authority: City Manager/Designee
signature required on all contracts
when required by Risk Management

DIR: Notice of contract award
through DIR’s PWC-100 NOT

REQUIRED

$15,001-$75,000
Provide detailed scope of work to
potential contractors and obtain
three (3) written quotations which
include prevailing wage rates

Requisition/PO, scope of work and
contract required

Valid Contactor License required

Must provide proof of registration
(prime and all sub-contractors) with
the DIR unless under the small
project exemption

Labor/Material and Performance
Bonds required for all contracts
greater than $25,000

Insurance required as per contract
and Risk Mgmt. recommendations

Prevailing Wage rates required
Requisition Approval:

Department Head/Designee
approval required

Authority: City Manager/Designee
signature required on all contracts

DIR: Contracts AND Purchase
Orders for all public works projects
that fall outside of the small project
exemption must be reported to the
DIR by the Project Manager within
30 days of the award/approval
date, or before beginning any work.

See sections 9.8 and 9.9 for DIR
requirements

40 Dollar Threshold Requirements Requisition Approval/Authority $75,001-$220,000

Informal Bid Process Required
per GGMC § 2.52.030

Requisition/PO, detailed scope of
work/plans and contract required

Notice Inviting Informal Bids
Required

Valid Contractor License required

Must provide proof of registration
(prime and all sub-contractors) with
the DIR: Department of Industrial
Relations

Labor/Material and Performance
Bonds required

Insurance required as per contract
and Risk Management
recommendations

Prevailing Wage rates required

Requisition Approval:

Department Head/Designee
approval required

Authority: City Council approval
required

See sections 9.8 and 9.9 for DIR
requirements
$220,001 and
greater
Formal Bid Process Required per
PCC 22037

Requisition/PO, Scope of Work/Plans
and Contract required

Notice Inviting Bids and Newspaper
Publication Required

Valid Contractor License required

Must provide proof of registration
(prime and all sub-contractors) with
the DIR: Department of Industrial
Relations

Labor/Material and Performance
Bonds required

Insurance required as per contract
and Risk Management
recommendations

Prevailing Wage rates required
Requisition Approval:

Department Head/Designee
approval required

Authority: City Council approval
required

See sections 9.8 and 9.9 for DIR
requirements

41 9.1 UNIFORM PUBLIC CONSTRUCTION COST ACCOUNTING ACT

The City of Garden Grove has adopted the following bid procedures for public works construction contracts pursuant to the Uniform Public Construction Cost Accounting Act, Public Contract Code Section 22000 et seq. The Uniform Public Construction Cost Accounting Act is a program that was created in 1983 which allows local agencies to perform public project work up to $75,000 with its own work force if the agency elects to follow the cost accounting procedures set forth in the Cost Accounting Policies and Procedures Manual of the California Uniform Construction Cost Accounting Commission.

The Act was codified at Public Contracts Code Sections 22000 through 22045.

A governing body must elect by resolution to become subject to the Act and file a copy of the resolution with the State Controller's Office (PCC 22030). The City of Garden Grove, by Resolution No. 8677-05, elected to become subject to the Uniform Cost Accounting Procedures. Public contracts are subject to the Public Contract code Sections 22000-22045 and the “Public Works Construction Bid Procedure” of Chapter 2.52 of the City of Garden Grove Municipal Code.

In addition, the Act provides for alternative bidding procedures when an agency performs public project work by contract.

A. Public projects of $75,000 or less may be performed by its own forces, negotiated contract, or by purchase order (PCC 22032(a)).

B. Public projects of $220,000 or less may be processed via contract by the informal procedures set forth in the Act (PCC 22032(b)). These informal procedures are codified at Section 2.52.030 of the Garden Grove Municipal Code.

C. Public projects of more than $220,000 shall be processed via contract by formal bidding procedures (PCC 22032(c)). The formal bidding procedures are specified in PCC 22037.

9.2 PUBLIC WORKS PROJECTS up to $15,000
One (1) informal quote, containing prevailing wage, shall be obtained for Public Works projects in the amount of $1,001-$15,000. A requisition or purchase order is not required for public works projects in the amount of $1,000 or less, however prevailing wages apply to work of $1,000 and greater. Contract and insurance are not required for projects in the amount of $1,001-$15,000 unless deemed necessary by Risk Management. Risk Management must review the Scope of Work to make this determination before proceeding. Contract and insurance validation is required for contracts of $15,001 and greater. Notice of contract award through DIR’s PWC-100 is not required only when the contract scope falls under the small project exemption.

9.3 PUBLIC WORKS PROJECTS of $15,001-$75,000

Public Works projects in the amount of $75,000 or less may be performed by the employees of the City of Garden Grove in accordance with section 22032 of the Public Contract Code.

42 At least three (3) quotes/estimates, containing prevailing wage, shall be obtained for Public Works projects that range from $15,001 to $75,000. The contract will be awarded to the lowest bidder. A contract, insurance, and bonds for contracts that exceed $25,000, and City Manager approval are required. In the event that the lowest bidder is unable to meet the City’s requirements, a fourth informal bid may be required to meet the three informal bid requirement. Contracts and purchase orders for all public works projects that fall outside of the small project exemption must be reported to the DIR by the Project Manager within 30 days of the award/approval date, or before beginning any work. PWC-100 form is required.

9.4 PUBLIC WORKS PROJECTS of $75,001-$220,000 (INFORMAL BID

PROCEDURE)
Public Works projects in an amount of $75,001 to $220,000 must follow the requirements of the Public Contract Code Section 22034 and Section 2.52.030 of the Garden Grove Municipal Code. The Purchasing division shall complete an informal bid procedure and City Council approval is required.

Section 22033 of the Public Contract Code states, “It shall be unlawful to split or separate into smaller work orders or projects any project for the purpose of evading the provisions of this article requiring work to be done by contract after competitive bidding.”

The Purchasing Division shall maintain a list of qualified contractors, identified according to categories of work in accordance with Section 22034 (a) of the Public Contract Code. All contractors in the category of qualified contractors list shall be mailed a notice inviting bids.

The notice shall:

A. Describe the project in general terms.

B. Describe how to obtain more detailed information about the project.

C. State the time and place for the submission of bids.

Pursuant to California Public Contracting Code section 22034(a)(1), notice inviting bids shall be mailed to contractors and construction trade journals no less than 10 days prior to bid opening.

All contracts that do not fall under the Small Project Exemption must be registered with the Department of Industrial Relations. PWC-100 form is required.

9.5 PUBLIC WORKS/CONSTRUCTION PROJECTS of $200,001 and greater (FORMAL BID PROCEDURE)
Public Works projects in the amount of $220,001 and greater are subject to a formal bidding process as required by sections 22032(c) and 22037 of the Public Contract Code and Section 2.52.010 of the Garden Grove Municipal Code. Plans and Specifications are required. Award shall be made by the City Council.

43 Notifications of the formal bid, in accordance with Section 22037 of the Public Contract Code, shall be published twice once in a local newspaper at least 14 calendar days before the opening of the bids.

The formal bid notification shall include:

A. State the time and place for receiving and opening of sealed bids.

B. Distinctly describe the project (plans, specifications, etc.).

The notice inviting formal bids should be mailed to construction trade journals at least 10 15 days prior to the bid opening. When time permits, it is recommended that 30 days prior notice inviting formal bids be mailed to construction trade journals in order to foster more competition.

Notifications to trade journals shall include:

A. Project title and contract number
B. Date, time, and place for receiving bids
C. City’s address and contact information
D. Brief description of work to be done
E. Bond requirements
F. Where plans may be obtained
G. Deposit information if one is required and whether or not the deposit is refundable
In accordance with Section 22038(c) of the Public Contract Code, if no bids are received through the formal or informal procedure, the project may be performed by the employees of the City or by negotiated contract.

In accordance with Section 22038(a) of the Public Contract Code, the City may reject all bids presented if the City, prior to rejecting all bids and declaring that the project can be more economically performed by employees of the agency, furnishes a written notice to the apparent low bidder. If bids are to be rejected, notification to the bidders informing them of the agency’s intention to reject the bids shall be mailed at least two business days prior to the hearing at which the agency intends to reject the bid.

If after the first invitation of bids where all bids were rejected, after reevaluating its cost estimates or scope of the project, the City shall have the option of either of the following:

A. Abandon the project or re-advertise
B. Declare that the project can be performed by employees. This requires a Resolution approved by four-fifths of the City Council.

In accordance with Section 22038(b) of the Public Contract Code, if the contract is awarded, it shall be awarded to the lowest responsible bidder. If two or more bids are the same and the lowest, the City may accept the one of its choice.

All contracts that do not fall under the Small Project Exemption must be registered with the Department of Industrial Relations. PWC-100 form is required.

44 9.6 CHANGE ORDERS
Prior to submitting a Change Order request, the administering department is responsible for ensuring that adequate budget appropriations are available to accommodate the additional expenditure.

If sufficient funds are not available to accommodate the additional expenditure, the Change Order request will be rejected. The requisitioning department is responsible for requesting budget transfers if applicable and/or seeking approval for additional appropriations from City Council when necessary.

The City Manager or his/her designee may authorize a change or cumulative changes to a Public Works contract within the approved scope of work, as long as the resultant cost does not exceed 10% of the awarded contract amount. Approved changes to the project include any emergency work or additional work that is directly related to the completion of the original project. Public Works contracts, such as those for on-call work which include options to renew annually, require an amendment.

A change or cumulative changes to a Public Works contract greater than 10% of the awarded contract amount must be approved by the City Council, provided that the progress of a public project shall not be interrupted if it would create an emergency situation.

9.7 PREVAILING WAGE RATES AND PUBLIC WORKS PROJECTS

Labor Code 1771 requires the payment of prevailing wages for all public works projects greater than $1,000. The definition of “public works” under the Labor Code differs from the definition “public works” under the bidding statutes. For purposes of the payment of prevailing wages under Labor Code 1771 and 1720, “public works projects” include construction, re-construction, alteration, renovation, erection, demolition, improvements, installation, or repair work done under contract and paid for in whole or in part out of public funds, to a publicly owned, leased, or operated facility. "Construction" includes work performed during the design and pre-construction phases of construction, including, but not limited to, inspection and land surveying work, and work performed during the post-construction phases of construction, including, but not limited to, all cleanup work at the jobsite. "Installation" includes, but is not limited to, the assembly and disassembly of freestanding and affixed modular office systems.

Under Labor Code 1771, prevailing wages applies to contracts let for maintenance work.

The Prevailing wage rate is the basic hourly rate paid on public works projects to a majority of workers engaged in a particular craft, classification or type of work within locality and in the nearest labor market area. California prevailing wage laws ensure

45 that the ability to get a public works contract is not based on paying lower wage rates than a competitor.

In accordance with Labor Code Sections 1770-1773, prevailing wages must be paid to all workers on a “public works” project when the project is over $1,000 or when government monies are used as the source of funding.

A. When submitting quotes or proposals for public projects, the contractor must note that the quotation is based on prevailing wages.

B. Certified payroll will be required to confirm that prevailing wages are being paid by City contractors.

C. For current prevailing wage rates and information, please refer to the DIR’s website: http://www.dir.ca.gov/DLSR/PWD/

9.8 REGISTRATION OF PROJECTS WITH THE CALIFORNIA DEPARTMENT OF

INDUSTRIAL RELATIONS (DIR)

The public works reforms brought about by Senate Bill 854 (Stat. 2014, chapter 28) and Senate Bill 96 (Stat. 2017, chapter 28), made several changes to the laws governing how the Department of Industrial Relations (DIR) monitors compliance with prevailing wage requirements on public works projects.

For up to date DIR vendor and City reporting and registration requirements, please refer to the DIR’s website: https://www.dir.ca.gov/public-works/contractors.html

Each department is responsible for determining if a project is subject to the DIR registration and reporting requirements. As of December 2018, the following key elements apply:
 Public Works projects include construction, alteration, demolition, installation, or repair. Public works projects also include routine, recurring, and usual maintenance work on anything affixed to City real property  Paid with public funds
 Over $1,000-Prevailing Wages apply
 Small project exemptions up to $25,000 for construction and up to $15,000 for maintenance. These small projects are exempt from registration by the contractor, subcontractors, and the City. Prevailing wages are still required for any public works project over $1,000. Small project exemption is applied based on the amount of the entire project, not a contractor’s subcontracted amount of the project
 Contractors are still required to maintain certified payroll records on a continuous basis, and provide those records to the Labor Commissioner’s Office upon request
 Contractors and subcontractors are required to be registered before submitting bids or proposals and remain registered through project completion.  Contract registration within 30 days of contract award, or prior to the first work day for projects lasting less than 30 days
 Penalties for City noncompliance include fines and/or loss of state funding for one year

46 9.9 DEPARTMENT OF INDUSTRIAL RELATIONS (DIR) PWC-100 SYSTEM

Per California Labor Code 1773.3, awarding agencies are required to submit notice of contract award through DIR’s PWC-100 system on projects that fall outside of the Small Project Exemption, within 30 days of the award, but in no event later than the first day in which a contractor has workers employed upon the public work. The small project exemption applies for all public works projects that do not exceed $25,000 for new construction, alteration, installation, demolition or repair and $15,000 for maintenance.

All contracts that do not fall under the Small Project Exemption must be registered with the Department of Industrial Relations. The PWC 100 form online application can be found online on the DIR service portal. Public Works Projects Registration (PWC 100) must be filed within 30 days of the award, or before beginning any work, whichever is first. The PWC 100 form must be completed by the City’s Project Manager.

The City is still responsible for administering its project and ensuring that public funds are used appropriately. As partners with DIR’s Public Works Enforcement team, the City must also ensure that all public works contractors are in compliance with all labor laws.

A. Changes to the Labor law are listed below:

1. Duty to notify the DIR when awarding a contract for a public works project, using the online PWC-100 form.

2. Elimination of the obligation to pay the DIR for compliance monitoring on state bond-funded projects and other projects that required use of the DIR's Compliance Monitoring Unit (CMU).

3. All contractors and subcontractors who bid or work on a public works project must register with, and pay a fee to the DIR.

4. The City may not accept a bid or enter into a contract for public work with an unregistered contractor, except for work that qualifies under the small project exemption.

B. Notice Requirements:

Effective January 1, 2015: The call for bids and contract documents must include the following information:

1. No contractor or subcontractor may be listed on a bid proposal for a public works project unless registered with the DIR pursuant to Labor Code section 1725.5 [with limited exceptions from this requirement for bid purposes only under Labor Code section 1771.1(a), and the small project exemption under Labor Code 1725.5(f)].

2. No contractor or subcontractor may be awarded a contract for public work on a public works project unless registered with the DIR pursuant to Labor Code section 1725.5, unless the work comes under the small project exemption under Labor Code 1725.5(f).

47 3. The contract must contain the statement that, “This project is subject to compliance monitoring and enforcement by the Department of Industrial Relations.”
C. Furnishing of Electronic Certified Payroll Records to Labor Commissioner:

All contractors and subcontractors must furnish electronic certified payroll records directly to the Labor Commissioner (aka Division of Labor Standards Enforcement).

48 CHAPTER 10:

FEDERAL PURCHASING REQUIREMENTS

Dollar Threshold Requirements Requisition Approval/Authority Micro-purchase:
$1 – $15,000
(NOTE: The Davis-
Bacon Act generally
applies to contracts in
excess of $2,000 and
includes construction,
alteration or repair of
public buildings and
public works)
No bid or quote required if
price is considered to be
reasonable. Reasonableness
could be determined by
comparing the price to past
purchases or other published
prices and/or requesting
prices from more than one
vendor.

Distributed equitably among a
range of qualified vendors
when practical
Requisition/PO required for all
purchases/contracts over
$1,000
Contract and Insurance
Validation is not required for
services between $1,001-
$15,000 unless deemed as
necessary by Risk
Management

Prevailing Wage rates required
for work greater than $1,000
Requisition Approval/Authority:

Department Head/Designee approval
required

City Manager/Designee signature
required on all contracts

Small
purchase/Simplified
acquisition
procedure:
$15,001 – $350,000

Price or rate quotes must be
obtained from adequate
number of sources (at least
two)
Can be informal, e.g., phone
call or web search
All quotes, including phone
calls, web searches, etc., must
be documented and kept on
file
Price does not need to be
deciding factor, but all quotes
need to be kept in
procurement records
Requisition Approval: Department
Head/Designee approval required

Authority:

Material/Supplies/Commodities
City Manager approval required for
material, supplies and commodity
purchases up to $75,000

City Council approval required for
material ,supplies and commodity
purchases greater than $75,000

Contracts
City Manager/Designee approval
required on all contracts up to
75,000

49 Dollar Threshold Requirements Requisition Approval/Authority

Small
purchase/Simplified
acquisition
procedure:
$15,001 – $350,000
(Continued)

Requisition/PO required for all
purchases/contracts over
$1,000

Contract and Insurance
Validation is required for
services $15,001 and greater

Prevailing Wage rates required
for work greater than $1,000

City Council approval required for
contracts greater than $75,000

Sealed Bid-Public
Works/Construction
Related Projects:
$350,001 and greater

Used when selection of
successful bidder can be made
principally on the basis of
price
Bids must be solicited from
two (2) or more qualified
bidders, providing sufficient
response time
Local governments must
publicly advertise bids
Invitation for bids must define
the items or services in order
for bidders to properly
respond
All bids will be opened at time
and place prescribed in
invitation. Local governments
must open bids publicly.

Firm fixed price contract must
be made in writing to the
lowest responsive and
responsible bidder
Any or all bids may be
rejected if there is a sound
documented reason.

Requisition Approval: Department
Head/Designee approval required

Authority: City Council approval
required

Contracts
City Manager/Designee signature
required on all contracts

Formatted: Font: Bold

50 Dollar Threshold Requirements Requisition Approval/Authority

Sealed Bid-Public
Works/Construction
Related Projects:
$350,001 and greater
(Continued)
Requisition/PO, scope of work
and contract required

Valid Contractor License
required

Must provide proof of
registration (prime and all
sub-contractors) with the DIR:

Department of Industrial
Relations unless under the
small project exemption

Labor/Material and
Performance Bonds required
for contracts greater than
$25,000

Insurance required as per
contract and Risk
Management
recommendations

Prevailing Wage rates required

51 Dollar Threshold Requirements Requisition Approval/Authority Competitive Proposal:

Professional/
Consultant Services:
$350,001 and greater
Must be publicized and
identify all evaluation factors
and their relative importance
Must be solicited from an
adequate number of qualified
sources
Must have a written method
for conducting technical
evaluations of the proposals
and selecting recipients
Contracts must be awarded to
the responsible firm whose
proposal is most
advantageous to the program,
with price and other factors
considered

Brooks Act may apply

Requisition/PO, scope of work
and contract required

Insurance required as per
contract and Risk
Management
Recommendations
Requisition Approval: Department
Head/Designee approval required

Authority: City Council approval
required

Contracts
City Manager/Designee signature
required on all contracts

52 Dollar Threshold Requirements Requisition Approval/Authority Noncompetitive
proposal (Sole
Source):
$15,001 and greater
May be used only when the
item is available only from a
single source, the public
exigency or emergency will
not permit a delay resulting
from competitive solicitation,
federal awarding agency or
pass-through entity expressly
authorizes its use in response
to a written request, or after
solicitation of a number of
sources competition is
determined inadequate
Justification of the use of
noncompetitive proposal must
be documented
Any research on availability
from multiple sources must be
documented
Documentation of
authorization must be retained
Any initial solicitations from
multiple sources which are
concluded to be inadequate,
and such reasoning, must be
documented

Requisition/PO, scope of work
and contract required

Insurance required for
contracts as per contract and
Risk Management
Recommendations

Requisition Approval: Department
Head/Designee approval required

Authority:

Sole Source Memo must be
approved in advance by the Finance
Director/ Designee

Material/Supplies/Commodities
City Manager approval required for
material and commodity purchases
up to $75,000

City Council approval required for
material/commodities purchases
greater than $75,000

Contracts
City Manager/Designee signature
required on all contracts up to
$75,000

City Council approval required for
contracts greater than $75,000

53 10.1 BACKGROUND

A. This chapter summarizes the Federal Purchasing requirements published by the Office of Management and Budget (OMB) on December 26, 2013. The OMB issued the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Final Rule (aka Uniform Guidance) which applies to all non-federal entities receiving Federal awards, and to all new federal awards and existing awards that receive additional funding (or funding increments) after December 12, 2014.

B. The Uniform Guidance requirements for sub-award and sub-recipient is based on the pass-through agency. If the pass-thru agency is subject to the Uniform Guidance (i.e. if the source of funds are federal and the pass-through agency is subject to Uniform Guidance), then the sub-award or sub-recipient is also subject to the Uniform Guidance.

C. The requirement for a sub-award, no matter when the sub-award was made, flows from the requirements of the original federal award from the federal awarding agency.

10.2. MICRO PURCHASES

A. The maximum aggregated amount for micro purchases is $15,000. The maximum amount for construction projects is $2,000 and are subject to the Davis-Bacon Act (Prevailing Wages).

B. There are no requirements for multiple quotations, and to the extent practical the City must distribute micro-purchases equitably among qualified suppliers.

10.3. SMALL PURCHASES

A. Small purchases utilize simple and informal procurement procedures. The acquisition threshold is currently $15,001-$350,000. The Uniform Guidance states quotes for small purchases must be obtained from an “adequate” number of qualified sources. There is no specific number of sources required by the Uniform Guidance, thus one quote can be sufficient as long as there is proper documentation.

B. Quotes can be obtained from suppliers or from public websites (i.e., City may use internet searches as documentation).

10.4. SEALED BIDS

A. Sealed bids are required for contracts in excess of $350,000 and is the preferred method for construction contracts. Sealed bids are also appropriate for fixed price contracts where bidders are provided complete and adequate specifications.

B. Additionally, sealed bids must come from two or more qualified bidders, must be publicallypublicly advertised and solicited from an adequate number of suppliers.

C. The contract is awarded to the lowest responsive and responsible bidder.

54 10.5. COMPETITIVE PROPOSALS

A. Competitive proposals are required for contracts in excess of $350,000 and is the preferred method for architectural, engineering and professional services. Request for Proposals must be publicized and proposals solicited from an adequate number of qualified sources.

B. Competitive proposals are awarded to the most advantageous bid which considers both price and other factors. The City does not have to select the lowest bid.

C. The Brooks Act may apply (qualifications basedqualifications-based procurement).

10.6. SOLE SOURCE

A. Sole source must meet at least one of the following criteria:

1. Goods or services are only available from a single source

2. There is a public emergency

3. After soliciting a number of sources, the competition is deemed inadequate

4. Written request has been made and approved by the Federal Agency

B. The City must have written pre-approval from the federal awarding agency.

Additionally, the City must have proper documentation as to why a sole source vendor was required in these circumstances. The sole source must be properly documented and the City’s Project Manager must maintain the documentation.

10.7. DEBARMENT AND SUSPENSION

A. The City is prohibited from contracting with or making sub awards under covered transactions to parties that are suspended, debarred or whose principals are suspended or debarred by the federal government. The General Service Administration’s (GSA) lists the names of parties debarred, suspended, or otherwise excluded by agencies, and contractors declared ineligible under statutory or regulatory authority on the System for Award Management (SAM).

B. Project Managers are required to complete and document a Debarment and Suspension check on https://www.sam.gov/SAM/ before any purchase is made.

55 CHAPTER 11

PURCHASING DURING PROCLAIMED EMERGENCY OR DISASTER

11. 1 PURPOSE AND DEFINITION
A. Purpose. This Policy modifies the City’s normal purchasing practices to assure that, in exigent circumstances caused by a proclaimed disaster or emergency, the City is able to acquire the goods and services required to address an immediate threat to life, public health, or safety or an immediate threat of significant damage to improved public and private property while still maintaining an effective purchasing process and complying with applicable local and state purchasing laws. Where the City is included in a major disaster or emergency declared by the President of the United States, this Policy also assures that City procurements comply with federal regulations applicable to FEMA disaster grant reimbursement. In the event of an emergency declaration it is important to keep accurate records for FEMA reimbursement and this shall be the responsibility of the departments.

B. Definitions. For purposes of this Policy, (a) a proclaimed disaster or emergency exists if (i) the Governor has declared a state of emergency for an area which includes the geographic territory of the City; or (ii) the City Manager has declared an emergency in the City. (b) “Emergencies” are situations in which (i) a disaster or emergency has been proclaimed, and (ii) the public exigency for goods and services required to address an immediate threat to health, safety, or improved property will not permit competitive solicitation.

11.2 DELEGATION OF PURCHASING AUTHORITY IN EMERGENCIES

A. If the City Manager determines that goods and services in excess of his/her purchasing authority must be procured before the City Council is able to assemble and approve purchases, the City Manager has authority, subject to the limitations set forth in subparagraphs (1) and (2), to approve the immediate rental or purchase of any equipment, supplies, services or other items necessary to respond to an immediate threat to health, safety or improved property.

(1) Limits of Single Purchase Authority. The City Manager, shall have the authority to make individual purchases up to $250,000 on his or her signature alone. The City Manager shall have the authority to make purchases in excess of $250,000 up to a maximum of $500,000 when countersigned by the Finance Director or in the Finance Director’s absence countersigned by the Police Chief. Emergency purchases in excess of $500,000 will require the Mayor’s signature, or in the Mayor’s absence, two council members.

(2) Limits of Aggregate Purchase Authority. The City Manager shall have the authority to make aggregate purchases up to $500,000 on his or her signature alone.

56 B. Sub-delegation to EOC Director. The EOC Director shall be a designee of the City Manager at any time that the City Manager is not available to approve emergency purchases.

C. Sub-delegation of Purchasing Authority to Department Heads. If neither the City Manager nor the EOC Director is available, the police department watch commander, division chief, and/or public works director shall have authority to rent or purchase from the nearest available source any equipment, supplies, services, or other items necessary for his or her department to respond to an immediate threat to health, safety, or improved property, up to a maximum of $150,000.

11.3 REPORTING REQUIREMENTS

A. As soon as possible after purchases are made under Section 11.2, the City Manager, EOC Director, or department head shall submit to the Purchasing Division Manager a requisition and a notation that the commodity has been ordered on an emergency basis from the vendor designated.

B. The City Manager will report to the City Council within 48 hours any purchase made under Section 11.2 exceeding $75,000, individually or in the aggregate.

C. Department Heads will inform the City Manager of any individual purchase with a contract amount greater than $75,000, and also whenever the aggregate of purchases are greater than $75,000.

11.4 PROCUREMENT PROCEDURES IN EMERGENCIES

A. The regulations in Title 2 of the Code of Federal Regulations, Part 200, as it may be amended from time to time, are incorporated herein by reference.

B. Upon receipt of requisitions under Section 11.2, the Purchasing Agent shall prepare purchase orders for the emergency equipment, supplies, services or other items in accordance with this section. All purchases or rentals made during a proclaimed emergency or disaster shall require separate invoicing from routine (non-emergency related) purchases. All invoices shall state the goods, services or equipment provided and shall specify where the goods or services were delivered.

C. Noncompetitive Procurements during Emergencies.

(1) Noncompetitive procurements may be used when one or more of the following circumstances exist:

a. The Emergency circumstances will not permit a delay resulting from competitive procurement;

b. The item is available only from a single source;

c. After solicitation of a number of sources, competition is determined inadequate; or

57 d. The Federal awarding agency or pass-through entity expressly authorizes noncompetitive proposals in response to a written request from the City, County, or State.

(2) The Department requesting the emergency purchase shall document the justification for noncompetitive procurement and provide a copy to the City Manager.

(3) When a noncompetitive procurement is used due to an emergency, the procurement shall be limited to that portion of the work that must be performed immediately. Procurement for any additional work shall be conducted through competitive procurement procedures.

(4) Noncompetitive procurement shall be necessary for one of the following reasons: placement of emergency protective measures; procurement of a scarce commodities, goods, or services; acquisition or rental of emergency equipment, emergency consulting services, emergency road clearance or other emergency requirements.

D. Alternate Competitive Procurements During Emergencies.

(1) Competitive procurements for Purchases below the Federal Simplified Acquisition Threshold (currently $350,000) shall not be required to be formally bid.

(2) Competitive procurements for Purchases equal to or exceeding the Federal Simplified Acquisition Threshold shall be conducted in accordance with the following alternate purchasing procedures:

(a) The City's normal requirements for sealed bids shall not apply to acquisitions under Section 11.2. However, the Purchasing Agent shall conduct telephonic or other electronic bid solicitation from potential vendors or suppliers, in lieu of written and/or sealed bids, in an effort to obtain multiple competitive proposals when and if time allows in light of the emergency.

(b) Locations of Postings for Requests for Proposals or Solicitation of Bids. The Purchasing Agent may waive normal requirements for public posting of requests for proposals or solicitation of bids. Notices soliciting bids or requests for proposals shall be posted at the Emergency Operations Center or Alternate Emergency Operations Center, if the Primary Emergency Operations Center is not being used.

The Purchasing Agent may shorten the normal bid period and response period to expedite the award of contracts for emergency equipment, goods, or services, but such period shall be no less than 24 hours. The Purchasing Agent should seek to assure that the shortened bid period allows multiple suppliers or contractors to submit responses.

58 (d) Number of Bids Required. A minimum of three (3) bids or proposals from qualified sources shall be obtained. Bids and proposals that are non- responsive shall count towards the minimum numbers of bids required.

11.5 RATIFICATION, NOTIFICATION AND POST AWARD PROCEDURES

A. Ratification and Posting of Contract Awards. All contracts awarded that exceed $75,000 shall be presented to the City Council for ratification at its next available meeting and thereafter shall be publicly posted within 60 days of the award.

B. Authority to Cancel Emergency Procurements. The City Manager or designee shall have the authority to rescind a purchase or contract for non-performance within 24 hours when a contractor or vendor, once awarded a contract, is unable to immediately perform the terms of the contract.

C. Auditing of Invoices for Debris Clearance Prior to Payment. All invoices for debris clearance and removal shall be audited by the City prior to payment to the vendor.

Vendors shall be notified of this requirement prior to the awarding of any contract for debris clearance and/or removal. Audits shall be in accordance with procedures for debris removal monitoring specified in FEMA’s Publication 325, Debris Management Guide.

59 CHAPTER 12:

INSURANCE AND CONTRACTUAL RISK TRANSFER

12.1 INCLUSION IN BID MATERIALS

Risk Management shall be consulted to determine appropriate insurance requirements before formal bids are advertised to ensure that those requirements are included in the solicitation documents. It is important that contractors are made aware of the insurance requirements in advance to ensure they have considered any additional costs to obtain the proper coverage before they submit a bid or sign a contract, and to avoid unnecessary delays to City projects.

The Contractor Statement in which the contractor acknowledges they have or can obtain the required insurance should also be included in all formal bid documents. This document can be found under Risk Management on the Intranet for your reference.

12.2 DETERMINATION OF INSURANCE REQUIREMENTS

The process for establishing a contract’s insurance requirements is as follows:

1. PROVIDE RISK MANAGEMENT WITH SCOPE OF WORK
A clear scope of work that sufficiently describes the work to be performed and which parties are responsible for certain duties is necessary to determine the appropriate insurance requirements.

2. ANALYZE RISKS AND RELATIONSHIPS
A critical analysis of potential risk exposures will be undertaken by Risk Management and the project manager on a case-by-case basis to determine the appropriate insurance requirements. Keep in mind, the amount of the contract is not necessarily commensurate with the risk exposure. Even the smallest job has the potential for large losses. Considerations in determining amounts of insurance include:

 The extent to which the activity presents a risk of personal injury, bodily injury or death.
 The extent to which the activity presents a risk of property damage.  The frequency of claims, occurrences, or incidents associated with the activity.
 The ability of contractor to obtain the desired insurance coverages and limits.

3. INSURANCE LANGUAGE PROVIDED BY RISK MANAGEMENT
After the appropriate insurance requirements are determined, Risk Management will provide the project manager with the proper insurance language and coverage amounts that should be included in the bid documents and contracts.

60 12.3 CONTRACT INDEMNIFICATION AGREEMENT AND INSURANCE

The City’s standard contracts contain an Indemnity/Hold Harmless agreement that includes an obligation for the contractor to defend the City, its officers, officials, agents, employees and volunteers, and is meant to be interpreted as broadly as possible in the City’s favor. Hold Harmless agreements are language that shifts responsibility for loss or damage arising from the activities of a contract from one party (the City) to the other (the contractor). The contractor acts as the City’s representative while performing services for the City, provided they are within the scope of their agreement. Any damages caused to a third party on the City’s behalf can result in a claim against the City. “Hold Harmless” language allows the City to tender the claim to the contractor for defense and indemnity by the contractor or their insurer.

Because the contract’s indemnification language is vital to the transfer or recovery of losses, project managers should:

A. USE THE CITY’S STANDARD CONTRACT
The City’s standard contracts have been drafted and reviewed by the City Attorney. No changes should be made to indemnification section of the contract without prior approval by the City Attorney.

B. GET CITY ATTORNEY APPROVAL FOR ALL OTHER CONTRACTS OR CHANGES At times you may have to accept a contractor’s form or negotiate the terms of the City’s indemnity language with a prospective contractor. If you do have to make changes or accept another form, always have the City Attorney review and approve before you send out for signature.

12.4 MINIMUM INSURANCE SPECIFICATIONS

The following are the City’s minimum insurance specifications as required in the City’s standard contracts.

COMMENCEMENT OF WORK
Contractor shall not commence work under this Agreement until all certificates and endorsements have been received and approved by the City. All insurance required by this Agreement shall contain a Statement of Obligation on the part of the carrier to notify the City of any material change, cancellation, or termination at least thirty (30) days in advance and provide a Waiver of Subrogation in favor of the City.

WORKERS COMPENSATION INSURANCE
For the duration of this Agreement, Contractor and all subcontractors shall maintain Workers Compensation Insurance in the amount and type required by law, if applicable.

Insurers shall waive subrogation against the City of Garden Grove its officers, officials, agents, employees and volunteers.

COMMERCIAL GENERAL LIABILITY INSURANCE
Commercial General Liability in an amount not less than $1,000,000 per occurrence (claims made and modified occurrence policies are not acceptable). Insurance

61 companies must be acceptable to the City and have an AM Best’s Rating of A-, Class VII or better, as approved by the City.

COMMERCIAL AUTOMOBILE LIABILITY COVERAGE
Automobile liability, for any/all autos, in an amount not less than $1,000,000 combined single limit; (claims made and modified occurrence policies are not acceptable); Insurance companies must be acceptable to City and have an AM Best’s Guide Rating of A-, Class VII or better, as approved by the City.

PROFESSIONAL LIABILITY/ERRORS AND OMISSIONS (If professional services are provided)
Professional liability (Errors and Omissions) Professional liability in an amount not less than $1,000,000. Insurance companies must be admitted and licensed In California and have an AM Best’s Guide Rating of A-, Class VII or better, as approved by the City.

If the policy is written on a “claims made” basis, the policy shall be continued in full force and effect at all times during the term of the agreement, and for a period of three (3) years from the date of the completion of services provided. In the event of termination, cancellation, or material change in the policy, professional/consultant shall obtain continuing insurance coverage for the prior acts or omissions of professional/consultant during the course of performing services under the term of the agreement. The coverage shall be evidenced either by a new policy evidencing no gap in coverage, or by obtaining separate extended “tail” coverage with the present or new carrier.

ADDITIONAL INSURED ENDORSEMENT
An Additional Insured Endorsement, ongoing and completed operations, for the Commercial General Liability policy, shall designate City, its officers, officials, employees, agents, and volunteers as additional insureds for liability arising out of work or operations performed by or on behalf of the Contractor. Contractor shall provide to City proof of insurance and endorsement forms that conform to city’s requirements, as approved by the City.

PRIMARY ENDORSEMENT OR POLICY LANGUAGE
For any claims related to this Agreement, Contractor’s insurance coverage shall be primary insurance as respects to City, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers shall by excess of the Contractor’s insurance and shall not contribute with it.

12.5 HIGH-RISK CONTRACTS

Higher-risk services may require special types of insurance coverages and/or higher commercial general liability per occurrence limits.

Examples of high-risk services include but are not limited to the following:

 Asbestos Abatement Contractors
 Ambulance Services
 Construction Projects

62  Elevator Maintenance and Repair
 Festivals and City Events
 Jail Management Services
 Medical Services
 Refuse Transportation and Disposal
 Towing Services
 Transportation Services
Insurance limits may be reached by combining a commercial general liability policy limit with an umbrella/excess policy limit. For example, a contractor may have a general liability policy with a $1,000,000 limit and a $1,000,000 umbrella/excess policy. By combining both coverage amounts, the total meets the $2,000,000 general liability coverage required by the City.

12.6 ADDITIONAL TYPES OF INSURANCE COVERAGES

Different types of insurance or higher limits may be necessary based on the Scope of Work. The following are examples of additional types of coverage that may be required, but are not limited to the following:

 Tow truck drivers will be required to provide proof of cargo, on hook, and garage liability coverage.
 Moving companies will be required to provide cargo coverage.  Contractors handling hazardous material will be required to provide environmental/pollution or asbestos liability insurance.  Transporters of hazardous wastes will be required to provide an automobile liability policy to be endorsed to delete the Pollution and/or the Asbestos exclusion and add the Motor Carrier Act endorsement (MCS-90), TL 1005, TL 1007 and/or other endorsements required by federal or state authorities.  Construction contracts may require course of construction insurance (Builders All Risk) and employer’s liability insurance.
 Contractors who work with children or the elderly will be required to have legal liability coverage for sexual abuse and molestation.
 Financial institutions or other contractors handling financial transactions or that have access to other City assets will be required to provide crime coverage.  Service providers that keep City or public data will be required to provide cyber liability insurance.

63 12.7 SURETY BONDS

Per Civil Code section 9550, a public works contract in excess of $25,000 requires the contractor to provide a material and labor/payment bond prior to starting the work.

A. PERFORMANCE BONDS
(100% of the total bid amount) Guarantees the City that if the contractor fails to complete the work as quoted, the surety will assume the contractor’s financial responsibility to have the work completed.

B. MATERIAL AND LABOR BONDS
(100% of the total bid amount) Guarantees the City that laborers, subcontractors and suppliers will be paid the monies they are due from the contractor. Also called payment bonds.

All bonds submitted require that the Surety Company have an AM Best rating of A- VII or better and must be on the City approved bond forms. Proper language for bond rating requirements should be stated within the contract and all bid documents so that potential contractors are properly notified of these requirements. The contract shall not become effective until such bonds are submitted and in compliance with the City’s requirements.

Bonds should not be requested from the Contractor until final approval of the project has been granted by the City Manager or City Council, based on level of authority.

12.8 VERIFICATION OF INSURANCE COVERAGE

Risk Management shall verify that the evidence of insurance provided by the contractor meets the requirements as outlined in the contract and shall provide project manager with documentation of the verification.

The project manager is responsible for ensuring that contractors’ insurance coverage is kept current and maintained for the full term of the contract. Current and valid insurance coverage will be required to amend existing contracts and insurance compliance must be verified by Risk Management prior to the City’s execution of the amendment.

The City reserves the right to suspend and cease all operations during such a period of time the required insurance coverage is not in compliance.

64 12.9 CITY OF GARDEN GROVE INSURANCE POLICIES/COVERAGE

The City has a Self-Insurance Retention (deductible) of $2,000,000 per occurrence for General Liability and $1,000,000 for Worker’s Compensation. The City also carries property insurance for all its buildings, vehicles and equipment. Any requests for proof of insurance or letters of self-insurance for the City of Garden Grove should be directed to the Risk Management Division.

Except as required by contract, the City does not cover vendors/contractors under its insurance policies.

12.10 DEFINITIONS

Additional Insured for Ongoing Operations: Affords the City direct coverage under the contractor's policy, including defense, should the City be sued for injuries or damages occur while the contractor is on the job.

Additional Insured for Products-Completed Operations Hazard: Affords the City direct coverage under the contractor's policy, including defense, should the City be sued for damages that arise from defects in the contractor’s product or work.

AM Best: Agency that provides credit rating and financial size categories of insurance companies.

Annual Aggregate Limit: The maximum amount the insurance will pay for all covered claims combined in a single policy year.

Certificate of Insurance: Proof of insurance coverage, usually provided by the contractor or contractor’s insurance agent or broker, listing types of coverage, insurers, insurance agency, insured, policy numbers, effective dates, limits, certificate holder, cancellation procedure and special provisions.

Claims Made Coverage: Will only respond to a claim that is presented while the policy is in force or during an extended reporting provision.

Per Occurrence Limit: The maximum amount the insurance will pay for one or more covered claims resulting from each accident or out of any one event.

65 CHAPTER 13:

CENTRAL STORES WAREHOUSE

13.1 SERVICES PROVIDED

The Central Stores Warehouse operates under the Purchasing Division and provides the following services:

A. Receiving and Acceptance of Material:

The receiving and acceptance function is the final phase of the purchasing cycle.

At this point, the final determination is made as to whether requirements specified in the purchase documents have been met. The following outline describes this process:

1. Materials and supplies that are inventoried in the warehouse are received into the financial system. All non-inventoried items that are delivered to the warehouse are not received into the financial system but are delivered to the requesting department unopened. The requesting department must sign for receipt of the items.

2. The requesting department is responsible for the initial inspection of the goods.

Any apparent damage or shortages observed at the time of delivery should be noted on the shipping documents and reported to the Purchasing Division so the issues can be resolved.

3. Changes in quantity or dollar amounts from the original purchase order at the time of delivery must be handled through the submission of a “Change Order.”

B. Warehouse Operation and Inventory Control:

The warehouse operation maintains an inventory of approximately 1,500 commonly used items for City departments. It is recommended that staff check the warehouse inventory prior to purchasing common items that may already be stocked in the warehouse inventory. Materials and supplies may be requested in one of two ways:

1. City staff enters a requisition to order items from the warehouse and the order will be sent to the warehouse to fill. The requested items can be picked up from the warehouse or will be delivered on the next scheduled delivery day by warehouse staff.

2. City departments may also fill out a paper requisition at the warehouse, which will be filled upon request for urgent needs or emergencies only. For large orders, staff may require additional time to fill the order and will advise staff when the order will be ready for pick up or delivery.

66 C. Delivery of Materials and Supplies that are shipped to the warehouse:

1. Departments may elect to have items shipped directly to their location or to the Central Stores Warehouse. If delivery to the warehouse is the preferred method, all packages should be marked as follows:

City of Garden Grove, Central Receiving
13802 Newhope Street
Garden Grove, CA, 92843
Attn: Requesting Person/Department

2. To avoid any delays in delivery, the department should provide the vendor with their contact name and City department/division and ask that they clearly mark this information on the outside of the package.

3. Large and heavy items should be shipped directly to the department or location where the item is required for use.

13.2 SURPLUS PROPERTY AND EQUIPMENT
The Central Stores Warehouse is responsible for the storage and disposition of approved surplus property. Surplus property is tangible property that is no longer of use to the City because it is obsolete, too costly to repair, or valued only for its base content.

Surplus property includes items such as vehicles and certain equipment and furniture that is in good resalable condition.

Before any items are considered to be surplus property, the City will make its best effort to reuse, recycle, or reassign the items to another department within the City.

Items that have no value such as old office chairs, old worn out furniture, and small office supplies are not considered surplus property and will not be handled by the Central Stores Warehouse. The department will be responsible for the disposition of any City property that the Central Stores Warehouse staff has advised will not be accepted as surplus property.

Large furniture replacements shall also be handled by the individual department due to the large volume of items. It is recommended that the department schedule an appointment with the City’s surplus vendor so that they can come to the location of the property and advise the department of which items they will accept for surplus property. All other items must be reassigned to another department, recycled or disposed of by the department and will not be handled the Central Stores Warehouse.

All surplus property to be stored at the Central Stores Warehouse must be approved by the Central Warehouse staff. It is not acceptable for any department to place any City property in the Central Stores Warehouse without prior authorization from Central Stores Warehouse staff.

Prior to any disposition of City property, it is recommended that City departments contact Central Stores Warehouse staff. Staff can assist with any questions regarding surplus property or provide recommendations for the disposition of any potential surplus property.

67 Section 2.50.130 (Surplus Supplies and Equipment) of the Garden Grove Municipal Code states: All using agencies shall submit to the Purchasing Division, at such times and in such form as prescribed, reports showing all supplies and equipment which are no longer used or which have become obsolete and/or worn out. The Purchasing Division shall have authority to sell all supplies and equipment which cannot be used by any agency or which have become unsuitable for City use, or to exchange the same for, or trade in the same on, new supplies and equipment. Such sales shall be made pursuant to Sections 2.50.100 (Formal Contract Procedure) and 2.50.110 (Open Market Procedure) of the Municipal Code, whichever is applicable.

Departments having City-owned property which is surplus to their needs shall:

1. Contact the Central Stores Warehouse for review and recommendation of potential surplus property.

2. Complete the Property Disposition Form for any approved surplus property.

3. Place a work order on the City’s Intranet or make arrangements with Central Stores Warehouse staff to pick up the approved surplus property. The Property Disposition Form must accompany the surplus property. Once approved by Central Stores staff, surplus property must be taken to the Central Stores Warehouse since property cannot be declared surplus and remain in the department.

4. When the Purchasing Manager determines the property is no longer suitable for use by the City, the items will be disposed of by utilizing one of the following methods per Administrative Regulation 1.8 (Surplus Property).

 Sell by auction or sealed bid (including vehicles-handled by Public Works Department)
 Trade in on new equipment
 Sell as scrap
 Dispose of in trash (for items with no salvage value)  Donate surplus items with City Council approval
 Purchase by City employee at fair market value determined by the Purchasing Manager as approved by the City Manager. The Purchasing Manager and the City Manager cannot purchase such surplus property per Government Code 1090.

5. City employees wishing to keep their cell phones upon retirement shall be treated as surplus equipment subject to a $1.00 value if the phone is two years or older, half of the sales tax price the City paid for it if it is 1-2 years old, and the full amount of the sales tax paid by the City if the phone is less than 1 year old.

6. Public Safety service weapons transferred to retiring police officers shall be treated as surplus property and are subject to a $1.00 value upon the execution of a release of liability and compliance with Penal Code 27065. Retiring canines may be transferred to its handler and are subject to a $1.00 value upon the execution of a release of liability.

68 Unless otherwise provided, all proceeds from the sale of surplus property will be deposited into the City's general fund.

All IT related surplus items such as desktop computers, laptop computers and iPads are handled by the Information Technology department. All surplus pricing and purchases must be reviewed and approved by the Information Technology Department.

13.3 CITY RECORD STORAGE
The City record storage is located in the Central Stores Warehouse but is coordinated by the City Clerk’s office. Central Stores staff assists the City Clerk’s office in the pick- up of records from the various departments. Each department is responsible for labeling, loading and arranging their boxes on the shelves at the warehouse.

The Purchasing Division will determine if documents or records that are not part of the City record storage can be stored at the Central Stores Warehouse. Warehouse inventory will be given priority of storage space. Requests to store items in the warehouse will be based on available space and reviewed on a case by case basis.

Please reference Administrative Regulation 1.7 (Storage and Destruction of Records and Other Materials) that must be followed for storing records at the Central Stores warehouse at the City’s Municipal Services Center, and for destroying on-site and off- site records.

69 CHAPTER 14:

CELLULAR PHONES AND OTHER DEVICES

The Purchasing Division processes all requests and changes for cellular phones, Wi-Fi devices, and tablets for those positions that are authorized by the Department Director.

The authorized position list should be updated by all Department Directors in the department budget.

Please reference Administrative Regulation 2.14 (Cellular, Smartphones, Tablets and Telecommunication Devices) for more information.

70 APPENDIX

REFERENCE DOCUMENTS

71 EXCEPTIONS TO THE BIDDING REQUIREMENTS include emergencies, sole source and piggyback/cooperative agreements which must be reviewed and approved by the Purchasing Division prior to purchasing or entering into agreements * A purchase order will be required once cumulative fiscal year spending with any vendor exceeds $1,000.

Bid Threshold $1-$15,000 $15,001-$75,000 $75,001 and greaterMaterials, Supplies and Equipment (no labor)One (1) informal quote Three (3) informal quotes Formal Bid Process RequiredProfessional/Consultant ServicesOne (1) written proposal and contract/insurance may not be needed if approved by Risk ManagementOne (1) written proposal and contract and insurance required as per Risk ManagementFormal Bid Process/Contract and insurance requiredBid Threshold$1-$15,000 $15,001-$75,000 $75,001-$220,000 $220,001 and greaterPublic Works/Construction ProjectsOne (1) written quotation with prevailing wage if over $1,000; contract/insurance may not be needed if under $15,001 and approved by Risk ManagementThree (3) written quotations with prevailing wage; contract/insurance required as per Risk Management; bonds required for >$25k.Informal Bid Process Required per GGMC 2.52.030;contract/insurance/bonds required as per Risk ManagementFormal Bid Process Required per PC22037;contract/insurance required as per Risk ManagementBid Threshold $1-$15,000 $15,001-$350,000 $15,001 and greater $350,001 and greater $350,001 and greaterFederal Purchasing Requirements(MICRO PURCHASE) No bid or quote required for reasonable pricing(SMALL PURCHASE/SIMPLIFIED ACQUISITION) Minimum of Two (2) informal quotes required(SOLE SOURCE) May only be used when properly justified and research is document (SEALED BID-PUBLIC WORKS CONSTRUCTION) Bids must be solicited from at least two (2) or more qualified bidders with prevailing wage(COMPETITIVE PROFESSIONAL/CONSULTANT SERVICES) Bids must be solicited from an adequate amount of qualified sourcesGENERAL PURCHASING REQUIREMENTS1. PO always required for amount of $1,001 and greater2. City Manager's Authority-up to $75,0003. City Council Authority-$75,001 and greater

BID THRESHOLD REFERENCE GUIDE

72 Department of Industrial Relations (DIR) Guidelines

These are NOT a public works projects. Prevailing wages and DIR registration are not required. Repairs and maintenance to equipment not attached to realty. Janitorial or custodial services of a routine, recurring, or usual nature. Landscape maintenance work done by a “sheltered workshop.” Example: California Conservation Corps. Protection provided by guards, watchmen, or other security forces. Services up to $1,000. Work done under contract and paid for in whole or in part with public funds? •Alteration •Demolition •Installation •Repair •Construction (including design, inspection, or surveying) Maintenance that is: •"Routine, recurring, and usual work for the preservation, protection, and keeping of any publicly owned or publicly operated facility for its intended purposes in a safe and continually usable condition for which it has been designed, improved, constructed, altered, or repaired" OR •"Carpentry, electrical, plumbing, glazing, (touchup painting), or other craft work designed to preserve the publicly owned or publicly operated facility in a safe, efficient, and continuously usable condition for which it was intended, including repairs, cleaning, and other operations on machinery and other equipment permanently attached to the building or realty." •Landscape and tree trimming.

These are public works projects. DIR registration by vendor and subcontractors is required before bidding. Project registration required the sooner of the first day of work or 30 days following award. Prevailing wages required, when over $1,000. Include DIR language on City PO/contract.

Construction under $25,000 and Maintenance under $15,000 are exempt from DIR PWC-100. Prevailing wages apply. DIR language is included in City contracts. Register public works projects with DIR. Require proof of contractor/subcontractor registration before accepting a bid. Ensure posting of jobsite notices. Ensure payment of prevailing wages. Awarding body (City) responsibilities Awarding body (City) penalties for noncompliance Fines of $100 per day up to $10,000 for: oFailure to comply with award notification requirements oPermitting an unregistered contractor or subcontractor to work on a project Potential loss of state funding for one year for willful violation for two or more projects.

73 Assembly Bill 339 (AB 339) Implementation Guidelines

Step 1: Initial Screening for Applicability Responsible Department: Finance/Purchasing

• Review all requests for RFP's, RFQ's and service contracts renewals or extensions submitted to Purchasing to determine whether AB 339 may apply. • If the Scope of Work appears to involve services that could be subject to AB 339 requirements, notify the requesting department and the Human Resources Department via email. The Scope of Work shall be included in the email notification for further review and evaluation.

Step 2: Determination of Applicability Responsible Department: Requesting Department • Review the scope of work to determine whether the services involved duties that are performed by, or are reasonably related to, classifications represented by a recognized bargaining unit. • Consult with HR to confirm the contracted services overlap with bargaining unit duties. • If no overlap is identified, document the review and determination that the proposed services do not involve bargaining unit work subject to AB 339 requirements. • Notify Purchasing whether the procurement may proceed or whether compliance with AB 339 is required before moving forward.

Step 3: Notification to Bargaining Units Responsible Department: Human Resources

• Provide notification template to requesting department to complete necessary information and provide solicitation document.
• Once completed notification template is received from the requesting department, provide written notice to the applicable bargaining unit(s) to initiate the 45-day review period required under AB 339. • Coordinate correspondence between requesting department and the bargaining unit(s) as required by law and document compliance with notification requirements.

Step 4: Documentation and Record Retention Responsible Department: Requesting Department and Human Resources • Maintain copies of notices, responses received, and determinations made under AB 339. • Coordinate with City Clerk's Office on record retention requirements Formatted: Indent: Left: 0.25", First line: 0", Right:

0.28", Space After: 6 pt

74 Purchase of Materials, Supplies, Equipment and other Commodities

***A purchase order will be required once cumulative fiscal year spending with any vendor exceeds $1,000.

Purchases
$15,001-$75,000
Department Head or
Designee
Approval Required
Department Head or
Designee approves
requisition
Purchases
$75,001 and
greater
Department Head or
Designee
Approval Required
Department enters
purchase requisition
and attaches bid
specifications
Formal Bid Process
Required (IFB)
Department Head or
Designee approves
requisition
Formal Bid Process
Is conducted and
awarded to lowest
responsible bidder
City Manager/Designee
Approval Required for
$15,001-$75,000
City Council Approval
Required for $75,000
and above
*(All vehicles require
City Council approval)
Purchase
order
issued
Department enters
purchase requisition
Purchase
order
issued
Requisition and
Three (3) Informal
Quotes Required
Purchases
$1,001-$15,000
Department Head or
Designee
Approval Required
Requisition and
One (1) Informal
Quote Required
Purchase
order
issued
Purchases up to
$1,000
Department Head or
Designee
Approval Required
Use Petty
Cash
Use
P-Card

Or
Or
PO
Not
Required

Department Head or
Designee approves
requisition
Department enters
purchase requisition

75 Professional Services and Consultant Agreements

Services $15,001-$75,000 Department Head or Designee Approval Required Department Head or Designee approves requisition Department enters purchase requisition and attaches proposal, and insurance form Consult with Risk Management for insurance requirements Contract is drafted and signatures are obtained Contractor provides required insurance for review and compliance Signed contract, insurance compliance report and bonds to the City Clerk’s office City Manager/Designee signature required on all contracts up to $75,000 Services $1,001-$15,000 Department Head or Designee Approval Required Requisition and One (1) written Proposal Required Department enters purchase requisition and attaches proposal Contract and insurance validation not required unless deemed necessary by Risk Management Department Head or Designee approves requisition Requisition and One (1) written Proposal Required Services up to $1,000 Department Head or Designee Approval Required Verify with Risk Management for Insurance if High Risk PO, contract and insurance validation not required unless deemed necessary by Risk Management Invoice can be paid Services $75,001 and greater Department Head or Designee Approval Required Formal Bid Process Required (RFP) Department enters purchase requisition and attaches bid specifications and insurance requirements Department Head or Designee approves requisition RFP process is required and awarded based on RFP Contract is drafted and signatures are obtained Contractor provides required insurance for review and compliance Consult with Risk Management for insurance requirements Signed contract, insurance compliance report and bonds to the City Clerk’s office City Manager/Designee approval required up to $75,000 and City Council approval required for $75,001 and greater Department drafts Staff Report when City Council approval is required City Manager signs contract per City Council approval City Clerk’s office forwards executed contract to Purchasing, Project Manager and Contractor City Manager/Designee signature required on all contracts up to $75,000 City Clerk’s office forwards executed contract to Purchasing, Project Manager and Contractor City Clerk’s office forwards executed contract to Purchasing, Project Manager and Contractor *A purchase order will be
required once cumulative
fiscal year spending with any
vendor exceeds $1,000.

76 Public Works/Construction Contracts
DIR and Prevailing Wage Requirements Apply

Public Works Contacts up to $15,000 Department Head or Designee Approval Required Requisition and One (1) Written Quote Required Department enters purchase requisition and attaches quote and insurance form Purchase Order is issued and Terms and Conditions are attached for insurance requirements Contract and insurance validation is not required for services between $1,001-$15,000 unless deemed as necessary by Risk Management Public Works Contacts
up to $15,001-$75,000
Department Head or
Designee
Approval Required
Requisition and
Three (3) Written
Quotes Required
Department enters purchase
requisition and attaches
quotes and insurance form
Contract and insurance required
for projects greater than $15,000
as per contract and Risk
Management recommendations
Department Head or Designee
approves requisition
Contract is drafted and
signatures are obtained
Contractor provides required
insurance for review and
compliance
Signed contract, insurance
compliance report and bonds to
the City Clerk’s office

City Manager/Designee
approval required up to
$75,000 and City Council
approval required for
$75,001 and greater

City Clerk’s office forwards
executed contract to
Purchasing, Project
Manager and Contractor
*A purchase order will be
required once cumulative
fiscal year spending with
any vendor exceeds $1,000.

Department drafts Staff
Report when City Council
approval is required

77 Public Works/Construction Contracts
DIR and Prevailing Wage Requirements Apply, Cont.

Public Works Contracts $220,001 and greater Department Head or Designee Approval Required City Council Approval required for $75,000 and greater Department enters purchase requisition and attaches bid specifications Formal Bid Process Required (IFB) per PCC 22037 Formal Bid Process is conducted and awarded to lowest bidder Signed contract, insurance compliance report and bonds to the City Clerk’s office Contract is drafted and signatures are obtained Contractor forwards required insurance/bonds for review and compliance Confer with Risk Management for Insurance Requirements City Clerk’s office forwards executed contract to Purchasing, Project Manager and Contractor Public Works Contracts $75,001-$220,000 Department Head or Designee Approval Required Department enters purchase requisition and attaches bid specifications Confer with Risk Management for Insurance Requirements Contract is drafted and signatures are obtained Contractor forwards required insurance/bonds for review and compliance Informal Bid Process (IFB) required per GGMC 2.52.030 Informal Bid Process is conducted and awarded to lowest bidder Signed contract, insurance compliance report and bonds to the City Clerk’s office City Clerk’s office forwards executed contract to Purchasing, Project Manager and Contractor Department drafts Staff Report City Council Approval required for $75,000 and greater Department drafts Staff
Report

78 Informal Bidding Procedures

Purchasing or City Clerk Publicly opens all bids at the time and place stated in public notices Project Manager Reviews bids received and confirms lowest responsible bidder Drafts staff report Uploads staff report and contract Reviews bids received and confirms lowest responsible bidder City Council Awards contracts over $75,000 City Clerk Prepares letter of contract award Forwards executed contract to Purchasing, Project Manager and Contractor Purchasing Advertises in trade journals at least 14 10 calendar days prior to bid opening Posts the bids to Planet Bids Pre-Bid Meetings/Job Walks Project Manager Drafts the Scope of Work and plans and specifications Public Project Contracts $75,001 - $220,000 Purchasing Maintains list of qualified contractors Prepares notice inviting informal bid Notice Inviting Informal Bids shall: Describe the project in general terms Describe how to obtain more detailed information State the time and place for submission of bids (at least 10 days) Purchasing Drafts contract, obtains contract signatures, and requests insurance from Contractor for review Forwards signed contract, insurance compliance report and bonds to the City Clerk’s office Supplies, Materials & Equipment Public Works Contracts Professional/Consultant Services Up to $75,000 Project Manager Solicits Informal quotes for materials and supplies Minimum of one proposal for professional services Project Manager Recommends successful bidder or contractor for Purchasing review City Manager/Designee Awards all contracts up to $75,000 Purchasing Drafts contract, obtains contract signatures, and requests insurance from Contractor Forwards signed contract, insurance compliance report and bonds to the City Clerk’s office City Clerk Prepares letter of contract award Forwards executed contract to Purchasing, Project Manager and Contractor Public Project Contracts $15,001- $75,000 Purchasing Department Maintains list of qualified contractors Project Manager Recommends successful bidder or contractor for Purchasing review Drafts Staff Report when required Uploads Staff Report and Contract Presents to City Council as required City Manager/Designee Awards contracts up to $75,000 City Council Awards contracts over $75,000 City Clerk Prepares letter of contract award Forwards executed contract to Purchasing, Project Manager and Contractor Project Manager Solicits Informal quotes for public works projects as required Purchasing Drafts contract, obtains contract signatures, and requests insurance from Contractor for review Forwards signed contract, insurance compliance report and bonds to the City Clerk’s office 

79 Formal Bidding Procedures

Contractor Provides Bonds and insurance within 10 days of contract award City Clerk Prepares letter of contract award Forwards executed contract to Purchasing, Project Manager and Contractor Professional/Consultant Services Contracts over $75,000 Project Manager Tasks Reviews Proposals Received Interviews qualified consultants Checks References Recommends and selects qualified contractor Purchasing Tasks Notice inviting formal bids Solicits requests for proposals Posts addenda to RFP’s Project Manager Provides 1. Scope of Work 2. Scoring Criteria 3. Evaluation Team for Proposals 4.List of Potential Proposers Contracts over $75,000 RFP (Request for Proposal) process required City Manager/Designee Awards all contract up to $75,000 Purchasing Tasks Schedules meetings with Evaluation Team Reviews scoring of proposals Drafts contract, obtains contract signatures, and requests insurance from Contractor Forwards signed contract, insurance compliance report and bonds to the City Clerk’s office Department Tasks Drafts staff report to award Purchase Order and uploads documents City Manager/Designee Awards Purchase Orders up to $75,000 City Council Awards Purchase Orders over $75,000 Supplies, Materials & Equipment over $75,000 Project Manager Tasks Reviews Bids Received Checks References Recommends/selects qualified contractor Purchasing Tasks Notice inviting formal bids Solicits requests for bids Posts addenda to IFB’s Project Manager Provides 1. Product Specifications 2. List of Potential Vendors Purchases over $75,000 IFB (Invitation for Bid) process required Department Submits Drafts staff report to award Purchase Order and uploads documents City Clerk Prepares letter of contract award Forwards executed contract to Purchasing, Project Manager and Contractor Purchasing or City Clerk Publicly opens all bids at the time and place stated in the public City Council Approval required for all contracts over $75,000 Contractor Provides Bonds and insurance within 10 days of contract award City Clerk Prepares letter of contract award Forwards executed contract to Purchasing, Project Manager and Contractor  Public Project Contracts In Excess of $220,000 Purchasing Tasks Advertises in trade journalsnewspaper at least 14 calendar days prior to bid opening and (15 days for trade journals) Posts the bids on Planet Bids Pre-Bid Meetings/Job Walks Posts addenda to IFB’s Purchasing Maintains list of qualified contractors Prepares notice inviting formal bids Notice Inviting Formal Bids shall:Describe the project in general terms Describe how to obtain more detailed information State the time and place for submission of bids Project Manager Tasks Reviews bids received and confirms lowest responsible bidder Reviews bids received and confirms lowest responsible bidder Project Manager Provides 1. Scope of Work 2.Plans and Specifications Purchasing Tasks Drafts contract, obtains contract signatures, and requests insurance from Contractor Forwards signed contract, insurance compliance report and bonds to the City Clerk’s office Department Tasks Drafts staff report to award Contract and uploads documents

Garden Grove City CouncilSeptember 8, 2026

Garden Grove City Council
September 8, 2026