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PURCHASING RESOLUTION
REVISIONS
City Council
March 19, 2024
FINANCE DEPARTMENT
RiversideCA.gov
2 • Centralized Purchasing Requirement: City Charter Section 1105 and Municipal Code Chapter 3.16 mandate a Centralized Purchasing System for the City.
• City Manager's Role: Section 601(d) of the City Charter outlines the City Manager's responsibility to develop rules and regulations for contracting and purchasing, pending City Council's approval.
• Board of Public Utilities Authority: Section 1202(b) empowers the Board of Public Utilities to sanction and award public works contracts as per Section 1109. This includes purchases or acquisitions related to the Department of Public Utilities exceeding $50,000, with authorization for the City Manager or designated representative to finalize contracts or issue purchase orders accordingly.
Legislative History
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3 1991: 1% local preference for goods purchases.
2003: Local preference increased to 5% for goods.
2012: Community Benefit Program template for Design-Build contracts.
2020: Overview presented to Committee.
2021: Organizational plan received and filed.
2023: Finance Department outlines existing policies and recommendations.
2024: Economic Development, Placemaking and
Branding/Marketing Committee Recommendation Received
Background – Local Vendor Preference
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4 • Maintain Current LVP for Goods:
– Keep existing criteria; vendors qualify via city-based sales tax returns. – Ensures city gains sales tax revenue; vendors need a City Business License. • Extend LVP to Services and Professional Services:
– Proposal based on positive data; extend LVP to include Services and Professional Services.
– Inspired by Design-Build sector; requires proposers' commitment through specific actions.
• Enhancements to LVP:
– Level One (Up to $10K): Single quote with Good-Faith Effort Affidavit. – Level Two ($10K - $50K): Three quotes, 5% Local Vendor Preference. – Level Three (Over $50K): Formal bidding, 5% Local Vendor Preference.
Discussion – Local Vendor Preference
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5 • Overview of Signing Authority
– Authorized by City Charter Section 601 and Chapter 3.16 of the Riverside Municipal Code.
– Delegated authority allows contract signing without City Council approval:
• Up to $50,000 by the City Manager.
• Up to $25,000 by Department Heads.
• Reason for last increase (2005)
– Aimed to bring consistency across procurement regulations. – Established a uniform threshold of $50,000.
– Emphasized the need for alignment in signature authorities across all City departments.
Background – City Manager Signature Authority
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6 • The Purchasing Division has launched a comprehensive initiative aimed at enhancing operational efficiency by strategically streamlining processes.
• This initiative involves a statistical analysis based on:
– Internal process reviews
– Comparative assessments of Local Agency City Manager Signature Authority Limits
• The goal is to identify and resolve bottlenecks in the City Manager's signature authority to improve the efficiency of City processes.
Discussion – City Manager Signature Authority
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7 • Key components supporting the enhancement of the City Manager's signature authority include:
– Purchasing Resolution No. 23914: Establishes a structured procurement approach, emphasizing competitive bidding and ethical standards, and sets fiscal responsibility limits for the City Manager's acquisitions. – City’s Administrative Manuals: Detail operational procedures for purchasing and contracting, promoting transparency and accountability, and serving as guides for City staff to ensure consistent application of procurement processes.
– Adopted Budget: Provides a biennial structure and five-year planning horizon, laying the groundwork for a strategic and long-term financial outlook with internal controls that align spending with strategic priorities. – City Attorney Contract Review: Offers an additional oversight layer by ensuring all contracts and agreements undergo thorough legal evaluation before execution, confirming compliance with city policies and regulations.
Internal Controls
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8 Internal Process Review (Procurement)
• Purchasing Resolution No. 23914
– Create a detailed framework for managing City fund expenditures, focusing on transparency, fairness, and accountability.
– Consolidates procurement rules into a single document for clarity and consistent policy application, requiring competitive procurement processes except as specified. – Enforces strict internal controls and ethical standards, including adherence to the Conflict-of-Interest Code and promoting unbiased, fair, and honest interactions with vendors.
– Prohibits personal gifts from contractors to ensure impartial procurement decisions and encourages dispute resolution and positive relationships. • Administrative Manuals
– Details procedures for purchasing and contracting, covering a broad spectrum of procurement activities to support the resolution’s objectives. • These documents together offer a comprehensive approach to City fund expenditure spending, promoting competitive procurement, ethical conduct, and professional excellence to protect public interest and maintain city resident trust. 7 8
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9 Internal Process Review (Budget)
• The budget serves as a critical policy instrument, financial plan, operations guide, and communication tool for the City, emphasizing strategic priorities, fiscal decision-making, daily management, and public dialogue. • The City of Riverside employs a biennial budget and a five-year planning process, enhancing financial oversight and aligning spending with strategic objectives and priorities.
– This approach promotes transparency, accountability to taxpayers, and overall fiscal health, positioning the budget as a cornerstone of the City's financial management strategy.
– Emphasis on robust internal controls within the budgeting process ensures financial integrity and responsible expenditure of City funds.
• The Finance Department plays a key role in safeguarding financial integrity through contract review processes, which include reviewing and certifying available funds to comply with budgetary constraints, ensuring fiscal responsibility.
RiversideCA.gov
10 Internal Process Review (City Attorney)
The agreement process within City departments varies based on the need for City Council approval.
Without City Council Approval:
– Process starts with the department collaborating with the Purchasing Department for necessary RFPs, RFQs, bids, or exceptions. – Involves submitting a purchasing concurrence request and a draft report into the Purchasing Portal.
– The City Attorney is requested to prepare the document, which, once finalized, is sent for external signatures and insurance, then to Risk Management. – Department Head completes an approval form, which, along with the agreement, goes through the Finance Department for approvals. – The City Attorney gives final approval before sending it to the City Clerk for verification and attestation by the City Manager. The department receives an electronic copy, and the original is retained by the City Clerk. – The department forwards a copy to the external party post-Purchase Order issuance.
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11 Internal Process Review (City Attorney)
With City Council Approval:
– Initial steps are similar to the non-Council approval process until document preparation by the City Attorney.
– Divergence begins with the department submitting the purchasing approval and City Council report into Legistar, followed by obtaining external signatures and insurance.
– After Department Head approval, documents go through the Finance Department for directorial approvals, then the City Clerk attaches them to the City Council report for public meeting approval.
– Following City Council approval, the process aligns back with the non-Council approval steps for finalization and distribution.
• Both processes require detailed preparation and internal approvals, but City Council-required approvals involve additional legislative steps, including submission into Legistar and public meeting approval, differentiating it from the more straightforward non-Council approval process.
RiversideCA.gov
12 Internal Process Review (Legistar)
City Clerk’s OfficeDepartment Responsibilities
Loads Agenda Items and Updates CalendarProactive Review of Tentative Agendas and Master Calendar
Uploads documents and Assigns Signature RouteDocument updates and revisions Standardizes submission processes and provides
training
Oversee Agenda item progression
Publishes AgendaDeadline Adherence
Obtain necessary approvals from impacted
departments
Requests late submittal approvals for missed
deadlines
Final document retrievals once approved
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13 City Data Chart Survey Results (CAPPO)
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14 Recommended ModificationsExisting LanguageSection
‐ Contracts and purchase orders for
$100,000 or less
‐ Includes Goods, Services, Professional
Services, Construction, and Design‐Build
Services
‐ Maintains approval for other contracts as
existing
‐ Contracts and purchase orders for $50,000 or less
‐ Other contracts as approved by City Council, Board of Public Utilities, and Board of
Library Trustees
203. Authorization
‐ Contracts up to $100,000 for the same
range of services
‐ Contracts up to $50,000 for expert and consultant services related to litigation, claim defense/prosecution, and related matters
205. City Attorney
Authorization
‐Add: Except that a local Proposer may be
given preference pursuant to Section 704
“Preference Policy”, where the difference
in price proposal between the local
Proposal and the lowest price proposal
does not exceed five percent (5%) of the
lowest price proposal.
‐Where the Using Agency seeks the procurement of Services or Professional Services through Request for Proposals or Request for Qualifications, the Informal Bid shall be awarded in accordance with the evaluation criteria set forth in the Request for Proposals or Request for Qualifications
408. Rejection of
Awards
Purchasing Resolution No. 23914 Recommendations
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15 Recommended ModificationsExisting LanguageSection
‐Add: if the Bid difference amount
between the local Responsive Bidder and
the Lowest Responsive Bidder does not
exceed five percent (5%) of the Lowest
Responsive Bid;
‐Add: except that a local Proposer may be
given preference pursuant to Section 704
“Preference Policy”, where the difference
in price proposal between the local
Proposal and the lowest price proposal
does not exceed five percent (5%) of the
lowest price proposal;
‐(b) A Contract for Goods may be awarded to a local Responsive Bidder who is not the Lowest Responsive Bidder pursuant to Section 604, “Preference Policy”
(c) Contracts procured through Formal Procurement for Services or Professional Services, where a Request for Proposals or Request for Qualifications was used to solicit Bids, shall be awarded by the Awarding Entity in accordance with the evaluation criteria set forth in the Request for Proposals or Request for Qualifications 508. Awards
Purchasing Resolution No. 23914 Recommendations
RiversideCA.gov
16 Recommended ModificationsExisting LanguageSection
‐Add: Preferences shall not be applicable in the following circumstances:
(a) Where the Procurement is funded by utility rates subject to Proposition 218 and/or Proposition 26, such as Water, Electric, Sewer, or Solid Waste Collection; (b) Where the Goods are procured under a cooperative purchasing agreement; (c) Where the Procurement is funded in whole or in part by another governmental entity or granting agency with laws, regulations, or policies prohibiting local preference; (d) Where the Procurement is let under emergency or noncompetitive situations pursuant to Section 403 and 602;
(e) When the Procurement involved is less than $10,000.00, except that the Using Agency shall make good faith efforts to obtain such Goods from a local vendor as defined in Section 605;
(f) Where the City Council has exercised discretion to waive the application of the local preference to a particular contract for which the Manager is the awarding authority; and (g) Where otherwise prohibited by law.
N/A607. Preference
Exceptions
Purchasing Resolution No. 23914 Recommendations
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17 Recommended ModificationsExisting LanguageSection
‐Add: In the Procurement of Services and Professional Services for the City’s requirements, preference shall be given to those vendors who have a local presence in the City of Riverside, provided that price, quality, terms, delivery and service reputation are determined to be equal by the Manager under the criteria set forth in Sections 408 and 508 hereof. To qualify as a local vendor, the Bidder/Proposer must certify to the following at the time of Bid submission:
(a) It has fixed facilities with employees located within the City limits; (b) It has a business street address within the City limits (Post Office box or residential address shall not suffice to establish a local presence); (c) It has a current City business license.
False certifications shall be immediate grounds for rejection of any Bid/Proposal or if the Bid/Proposal is awarded, grounds for voiding the Bid/Proposal, terminating any Contract, and seeking damages thereto.
N/A704. Local
Preference
Purchasing Resolution No. 23914 Recommendations
RiversideCA.gov
18 Recommended ModificationsExisting LanguageSection
‐Add: Preferences shall not be applicable in the following circumstances:
(h) Where the Procurement is funded by utility rates subject to Proposition 218 and/or Proposition 26, such as Water, Electric, Sewer, or Solid Waste Collection; (i) Where the Services are procured under a cooperative purchasing agreement; (j) Where the Procurement is funded in whole or in part by another governmental entity or granting agency with laws, regulations, or policies prohibiting local preference; (k) Where the Procurement is let under emergency or noncompetitive situations pursuant to Section 403 and 702;
(l) When the Procurement involved is less than $10,000.00, except that the Using Agency shall make good faith efforts to obtain such Services or Professional Services from a local vendor as defined in Section 704;
(m) Where the City Council has exercised discretion to waive the application of the local preference to a particular contract for which the Manager is the awarding authority; and (n) Where otherwise prohibited by law.
N/A705. Preference
Exceptions
Purchasing Resolution No. 23914 Recommendations
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19 Recommended ModificationsExisting LanguageSection
‐Add: Except that minor variances of $200
or less, where the variance is due to sales
tax or freight charges may be processed
without a Change Order.
‐ 10% of the original contract price up to
$100,000 for modifications
‐ Change Orders exceeding $100,000
require Awarding Entity approval
‐Modifications to a Purchase Order shall be
made only by Change Order
‐ 10% of the original contract price up to
$50,000 requires Awarding Entity approval
for modifications
‐ Change Orders exceeding $50,000 require
Awarding Entity approval
1104. Change Orders
Purchasing Resolution No. 23914 Recommendations
RiversideCA.gov
20 STRATEGIC PLAN ALIGNMENT
ECONOMIC OPPORTUNITY AND
HIGH PERFORMING GOVERNMENT
CROSS-CUTTING THREADS
Equity
Innovation
Community Trust
Fiscal
Responsibility
Sustainability
and Resiliency
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21 That the City Council:
1. Approve an amended Purchasing Resolution to implement recommended changes to the City’s Centralized
Purchasing system regarding Local Vendor Preference, City Manager Signature Authority, and making minor
corrections; and
2. Repeal Purchasing Resolution 23914.
Recommendations
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22 "Open Floor for Questions and Discussion"
Q&A
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