Ordinance No. 1200ORDINANCE NO. 1200
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
VERNON AMENDING THE CODE OF THE CITY OF VERNON BY
AMENDING ARTICLE IV OF CHAPTER 2, SECTIONS 2.17
THROUGH 2.31 AND REPEALING ALL ORDINANCES OR PARTS
OF ORDINANCES IN CONFLICT THEREWITH
WHEREAS, the City of Vernon (the "City") is a municipal
corporation and a chartered city of the State of California organized
and existing under its Charter and the Constitution of the State
California; and
WHEREAS, on November 5, 1958, the City Council of the City
of Vernon adopted Ordinance No. 722, as amended by Ordinance Nos. 804,
848, 939, 1035, 1047, 1107 and 1121, for the Purchase and Sale of
Supplies, Services and Equipment; and
WHEREAS, an open and transparent, competitive bidding and
purchasing process serves the interests of all of Vernon's
stakeholders and constituencies, including its citizen, corporate and
business residents, as well labor organizations and workers within
Vernon, all of whom deserve the highest quality of municipal services;
and
WHEREAS, the City is committed to ensuring that all goods,
equipment, material and services are secured through a process that
eliminates any form or favoritism or otherwise excludes qualified
providers from competing for contracts; and
WHEREAS, the City Council of the City of Vernon finds and
declares that the purpose and intent of this Ordinance is, (a) to
establish processes which guard against favoritism and corruption in
the expenditure of public funds; (b) to ensure that the City receives
optimum value for all taxpayer funds when securing goods, material,
equipment and services; (c) to ensure that the City obtains goods,
material, services and equipment from a variety of qualified sources;
(d) to ensure that all City utility and municipal services function at
the highest level possible and without any interruption, and (e) to
promote and protect the efficiency, quality and integrity of the
purchasing system; and .
WHEREAS, the City Council of the City of Vernon desires to
amend Article IV of Chapter 2 in its entirety to make necessary
changes regarding the purchasing system, as set forth in this
Ordinance.
THE CITY COUNCIL OF THE CITY OF VERNON HEREBY ORDAINS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the above recitals are true and correct.
SECTION 2: Article IV of Chapter 2 of the Vernon
Municipal Code is hereby repealed in its entirety, but shall remain in
existence to and through June 30, 2013, for transitional purposes as
set forth in Section 2.17.50 of the Ordinance.
SECTION 3: A new Article IV of Chapter 2 of the Vernon
Municipal Code is hereby enacted to read as follows:
"Article 2V Competitive Bidding and Purchasing Ordinance
Table of Contents
2.17.00 DEFINITIONS
2.17.02 CONTRACTS REQUIRING CITY COUNCIL APPROVAL
2.17.03 CONTRACTS WHICH MAY BE APPROVED BY THE CITY
ADMINISTRATOR; OTHER,_SIGNATORY AUTHORITY
2.17.04 THE PURCHASING SYSTEM
2.17.05 PURCHASE ORDER CONTRACTS
2.17.06 COMPETITIVE BIDDING
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2.17.07
COMPETITIVE SELECTION
2.17.08
ARCHITECTURAL AND RELATED PROFESSIONAL SERVICES
2.17.10
INFORMAL SELECTION
2.17.12
EXEMPTIONS
2.17.14
NOTICE INVITING BIDS
2.17.16
APPROVAL OF SPECIFICATIONS
2.17.18
SPECIFICATIONS FOR PUBLIC WORKS CONSTRUCTION
2.17.20
BIDDING — SECURITY. REQUIREMENT
2.17.22
BID OPENING
2.17.24
CONTRACT AWARD
2.17.26
LOWEST RESPONSIVE AND RESPONSIBLE BIDDER
2.17.28
BIDDER RESPONSIBILITY AND DEBARMENT
2.17.30
SPECIAL REFORM CONTRACT TERMS AND PROCEDURES
2.17.32
NON COLLUSION
2.17.34
FORM OF DOCUMENTS
2.17.36
EMERGENCY PURCHASES
2.17.38
ENCUMBRANCE OF DEPARTMENT FUNDS
2.17.40
FEDERAL DISADVANTAGED BUSINESS ENTERPRISE PROGRAM
2.17.42
EQUAL EMPLOYMENT AND LOCAL CONTRACTING POLICY
2.17.43
PUBLIC CONTRACT CODE
2.17.50
TRANSITION OF PURCHASING PROCEDURES
TITLE
This Chapter
shall be known and may be cited as the, "Competitive
Bidding and Purchasing
Ordinance," and is referred to in this Chapter
as the "Ordinance."
2.17.00 DEFINITIONS.
For the purposes
of this Chapter, the following definitions
apply:
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(A) "City" means the City of Vernon.
(B) "City Administrator" means the City Administrator or any
individual designated in a written policy adopted by the City
Administrator to carry out any duty set forth in this Ordinance
(C) "City Council" means the City Council of the City of Vernon.
(D) "Competitive bidding" means the procurement process described
in this Ordinance awarding a contract based on the lowest price bid by
a responsive and responsible bidder.
(E) "Competitive selection" means the procurement process
described in this Ordinance, generally through a request for proposal
process, awarding a contract based upon weighted selection factors
which include qualifications and price.
(F) "Contract" means a written order for labor, material,
supplies or services entered into by the City.
(G) "Informal selection" means the procurement process described
in this Ordinance awarding a contract on factors which include price
and does not require award to the lowest price bidder if there are
other identified factors which outweigh the price differential.
(H) "Material" means supplies, equipment, stores, provisions and
other personal property.
(I) "Public works" means all fixed works constructed for public
use or protection, including but not limited to, bridges, waterworks,
sewers, natural gas works, fiber optics works, electric works, public
buildings and street improvements.
(J) "Purchase order contract" means a pre-printed form contract
issued by the Department of Finance, through its purchasing
administration, for the recipient to provide labor, materials or
services. The City Council shall approve the general terms and
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conditions of the purchase order contract by Resolution upon
recommendation of the City Administrator, and the City Attorney shall
approve the general form and any special terms and condition.
(K) "Qualifications based selection" means the procurement
process described in this Ordinance for architectural, construction
management and related services, required by state law,_ generally
through a request for proposal process, awarding a contract based upon
weighted selection factors which include qualifications and not price.
.(L) "Signatory Authority" means 'the authority to sign contracts
and any other document which binds the City of Vernon, as explicitly
granted or delegated either by a Resolution of the City Council or by
the Ordinance.
(M) "Written administrative procedures" means the rules and
regulations specified by the Ordinance, adopted by the City
Administrator, approved as to legality by the City Attorney, and set
forth on the'City's website.
2.17.02 CONTRACTS REQUIRING CITY COUNCIL APPROVAL.
All contracts shall be approved by the City Council except
contracts under $75,000. The City Council approval of any contract may
be made by duly made motion, entered upon the minutes of any properly
noticed meeting. After the City Council has approved a contract, the
contract and bonds, if any, shall be prepared and submitted to the
contractor for execution. When the contract and bonds have been
executed by the contractor and approved as to form by the City
Attorney, the City Administrator is authorized to execute such
contract on behalf of the City.
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2.17.03 CONTRACTS WHICH MAY BE APPROVED BY THE CITY
ADMINISTRATOR; OTHER SIGNATORY AUTHORITY.
(A) The City Administrator may approve and sign contracts under
$75,000, which conform to the requirements of this Ordinance, to the
standard contract terms and conditions set forth in a Resolution of
the City Council, which are approved as to form by the City Attorney,
and which are reflected in the then current City budget approved by
City Council.
(B) Other than as set forth in this Ordinance, signatory
authority to bind the City.in contract shall be granted or delegated
to City employees or officials only by other or further Ordinance or
by Resolution of the City Council, stating the title of the position
and the amount of the authority. The City Clerk shall maintain
signature exemplars of all such approved signatories. Any contract
signed by an officer or employee of the City without a proper grant or
delegation of signatory authority is void.
2.17.04 THE PURCHASING SYSTEM.
The City Administrator shall adopt written administrative
procedures for the operation of a purchasing system and otherwise
consistent with this Ordinance which shall include procedures for
informal selection for issuing purchase order contracts and which may
include a process for bid protests. The written administrative
procedures will maximize the use of the City's website to publicize
contracting opportunities as well as to inform the public about
contract awards and proposed awards.
2.17.05 PURCHASE ORDER CONTRACTS.
The Department of Finance, through its purchasing administration,
may award and issue purchase order contracts up to $25,000, where the
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process of award conforms with written administrative procedures
adopted by the City Administrator
2.17.06 COMPETITIVE BIDDING.
(A) A competitive bidding process, requiring a notice inviting
bids, specifications, security, bid opening and contract award, all as
specified in this Ordinance, shall be required for all contracts of
$25,000 or more for supplies, material, labor or other valuable
consideration, to be furnished to the City, except for contracts
otherwise excluded or exempt from competitive bidding requirements by
the City Council, or by a provision of state law, by the City Charter
or by this Ordinance., Bid specifications shall be approved by the
City Administrator and approved as to form by the City Attorney.
Where not otherwise provided by this Ordinance, the City Administrator
shall adopt written administrative procedures for bid opening and for
the preparation and execution of bids, purchase order contracts and
contracts.
(B) The bidding procedure for a public works or construction
project may be completed in a two part bidding process, including a
published request for qualifications process, which determines
responsive and responsible bidders, and a sealed price bid submittal
among responsive and responsible bidders to determine the lowest
bidder and according to additional procedures that may be adopted in a
Resolution by the City Council.
2.17.01 COMPETITIVE SELECTION.
For contracts of $25,000 or more that are not required to be
competitively bid and not otherwise exempt from competitive selection,
a competitive selection process shall be provided which will be open
to all persons qualified to perform such service. Requests for
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Proposals shall be approved by the City Administrator and approved as
to form by the City Attorney. Requests for Proposals shall be issued,
received and evaluated according to the written administrative
procedures adopted by the City Administrator. Except as otherwise
provided in this Ordinance, competitive selection of professional
service firms shall be based upon weighted selection factors including
demonstrated competence, the professional qualifications necessary
for the satisfactory performance of the services required, and on the
cost of providing the services.
2.17.08 ARCHITECTURAL AND RELATED PROFESSIONAL SERVICES.
Procurement of architecture, landscape architecture, engineering,
environmental services, land surveying and construction management
services shall be made on the basis of demonstrated competence and on
the professional qualifications necessary for the satisfactory
performance of the services required and according to the
qualifications based selection process set forth in Government Code
Sections, 4255, et seq. and this Section. A Request for Proposals,
approved by the City Administrator and approved as to form by the City
Attorney, shall be issued to determine the most qualified service
provider. Price may not be a factor in the determination of most
qualified although each proposer may be asked to submit a sealed price
bid with their proposal for consideration after the selection. The City
shall negotiate a contract with the most qualified firm for the.
services at compensation which is fair and reasonable to the City.
Should the City be unable to negotiate a satisfactory contract with the
.firm considered most qualified at a fair and reasonable price, then
negotiations with that firm shall be formally terminated, and the City
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shall negotiate a contract with the second most qualified firm for
services at compensation which is fair and reasonable, and so on.
2.17.10 INFORMAL SELECTION.
For contracts less than $25,000, an informal selection process
shall be provided. Where appropriate, the informal selection process
may consider factors other than cost. The informal selection process
shall operate according to written administrative procedures adopted by
the City Administrator for the operation of a purchasing system and
otherwise consistent with this Ordinance and which are designed to
publicize the contracting opportunity and to allow qualified persons to
participate. The informal selection process for purchases in excess of
$3,000 shall include the solicitation of no fewer than 3 vendor quotes
unless otherwise exempted by this Ordinance or by adopted procedures.
2.17.12 EXEMPTIONS.
(A) Competitive bidding shall not be required for the following:
(1) Labor or services rendered by any City officer or employee
or furnished by one City department to another City department.
(2) Contracts for labor, material, supplies, or services
available from only one vendor or for unique services.
(3) Contracts for the acquisition of real property or relating to
the acquisition of real property.
(4) Contracts for labor, material, or supplies for actual
emergency work.
(5) Contracts with other governmental entities or their
contractors for labor, materials or supplies.
(6) Contracts for the acquisition, sale or transmission of
electrical power, gas, water, or telecommunications, and for
commodities and services of or for the water and power utilities
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operated by the City, where it is not commercially reasonable to
procure them through standard bidding or request for proposal
procedures. All such procurements shall be made pursuant to
Resolution of City Council which establishes a process for procurement .
which is commercially reasonable and furthers the objectives of this
Ordinance, including but without limitation, to prevent fraud and
collusion and to ensure that the City .receives optimum value in its
procurements.
(7) Any contract authorized by Sections 5920, et seq., of the
California Government Code and any successor provisions thereof, and
for which a competitive financing process has been established by
Resolution of the City Council establishing, at a minimum, a published
request for quotations and firm quotations in a manner designed to
foster competition, to prevent fraud and collusion and to secure the
most favorable price for the City.
(8) Contracts for insurance, bonds, advertising, membership
dues, travel, travel related expenses and for training, except that
brokers and agents for same shall be procured through a competitive
selection process unless not commercially reasonable to do so.
(9) Contracts for labor, material, supplies or services under
$25,000.
(10) Contracts for professional services.
(B) Competitive selection shall not be required for the following:
(1) Any of the types of contracts exempted from competitive
bidding under paragraphs 1 through 9, inclusive, of subsection ('A) of
this section.
(2) Specific contracts as may be exempted from the competitive
selection process, where a determination is made that the best
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interests of the city are served by a direct award of the contract
without a competitive selection process. The City Administrator shall
have the authority to make such an exemption for all contracts of less
than $75,000, and the City Council shall have the authority for all
contracts of $75,000, or more.
2.17.14 NOTICE INVITING BIDS.
A notice inviting bids shall be published for at least one day in
a newspaper of general circulation in the City and posted on the
City's website and shall fix a period during which such bids will be
received, which shall be for at least 10 calendar days after the first
publication of the notice. The notice shall include a general
description of the material, services or public works to be purchased
or contracted for, and shall state where bid forms and specifications
may be obtained and shall specify the time and place for receiving and
opening of bids.
2.17.16 APPROVAL OF SPECIFICATIONS.
All specifications shall be approved by the City Administrator
and as to form by the City Attorney prior to publication. The City
Council shall approve, by Resolution, the general form of bid,
including the form of notice inviting bids, the general terms and
conditions of the specifications and the general form of contract
which shall be attached to the specifications.
2.17.18 SPECIFICATIONS FOR PUBLIC WORKS CONSTRUCTION.
Except as may otherwise be provided herein, the provisions of the
then current edition of the "Standard Specifications for Public Works
Construction," prepared and promulgated by the Southern California
Chapter of the American Public Works Association and the Southern
California Districts of the Associated General Contractors of
California and any supplements thereto issued or approved by the City
Administrator, are adopted and shall be applicable to all public works
construction undertaken by the City.
2.17.20 BIDDING - SECURITY REQUIREMENT.
Unless waived by the City Administrator, bidder's security shall
be required by the notice inviting bids for every competitive bidding
process in excess of $25,000. All bids submitted pursuant thereto
shall be accompanied by cash or bond, in an amount equal to five
percent (50) of .the bid. If the bidder to whom the contract is awarded
shall for 15 days after the award, fail or neglect to enter into the
contract and to file the required bond, the City may deposit the bid
security into its treasury. When so deposited, under no circumstances
shall it be returned to the defaulting bidder. In lieu of the
foregoing, any bid may accompanied by a surety bond in said amount
furnished by a surety authorized to do a surety business in the state
guaranteeing that the bidder will enter into the contract and file the
required bond or bonds within said period. Any person may file with the
City an annual bid bond, which shall"be a surety bond in the amount of
five percent (50) of the highest amount bid during that period of the
bond. The City shall promptly return the bid security to the
unsuccessful bidders. The City shall retain the bid security of the
successful bidder until after signing and delivery of the contract and
approval of the bonds or other security furnished by the bidder for the
faithful performance of the contract, and then shall return such bid
security to the successful bidder.
2.17.22 BID OPENING.
All bids shall be placed in a sealed envelope and delivered to the
City as specified in the notice inviting bids. Bids shall be opened at
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the time stated in said notice. Any bid that does not conform
materially to the requirements of this Ordinance, the specifications,
or notice inviting bids shall be rejected. The City Administrator may
waive minor, non -material defects, in his sole discretion, for
contracts under $75,000, and the City Council for contracts of $75,000
and greater.
2.17.24 CONTRACT AWARD.
The contract shall be awarded by the City to the _lowest responsive
and responsible bidder. The City Council may reject any and all bids.
If a successful bidder fails to enter into a contract awarded to them,
or if a contract is not commenced by the contractor or their surety,
the City Council may abandon the matter or may re -advertise the
original bid or a modification thereof, or may award the contract to
the next lowest responsive and responsible bidder, with the consent of
such bidder.
2.17.26 LOWEST RESPONSIVE AND RESPONSIBLE BIDDER.
In determining responsiveness and responsibility of a bidder, the
following shall be considered:
(A)
The
quality
of the material offered.
(B)
The
ability,
capacity and skill of the bidder to perform the
contract or to provide the material or services
(C) Whether the bidder can perform the contract or provide the
service promptly, or within the time.specified, without delay or
interference.
(D) The sufficiency of the bidder's financial resources and the
effect thereon on the ability to perform the contract or provide the
material or services.
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(E) The character, integrity, reputation, judgment, experience
and efficiency of the bidder.
(F) The quality and timeliness of the bidder's performance on
previous work for the City.
(G) Litigation by the bidder on previous work with the City.
(H) The ability of the bidder to provide future maintenance and
service where such maintenance and service is essential.
2.17.28 BIDDER RESPONSIBILITY AND DEBA U-ZENT.
(A) Prior to any contract award, the City Council may find any
bidder or proposer to be non -responsible to perform the specific
contract to be awarded. The City Council may do so on its own
motion or on recommendation of the City Administrator.
(B) In conjunction with any contract award or with any action on a
contract, the City Council may debar a contractor from bidding
on future contracts by finding, upon substantial evidence, non -
responsibility which arises from any one of the following: (1)
commission of fraud or a criminal offense in connection with
soliciting, obtaining or preparing a public .contract; (2)
violation of federal or state antitrust statutes in relation to
a bid on a public contract; (3) commission of embezzlement,
theft, forgery, bribery, falsification or destruction of
records, making false statements or receiving stolen property;
(4) commission of any other offense that indicates lack of
business integrity or business honesty; (5) present debarment
by another public entity; (6) breach of a statutory or contract
provision which specifies or requires debarment as a remedy; or
(7) any other cause so serious it substantially affects the
contractor's present responsibility.
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(C) Before a finding of non -responsibility is made, and before a
contract requiring competitive bidding is awarded to other than
the lowest bidder, a bidder must have been notified of any
evidence of its non -responsibility, must have been afforded an
opportunity to rebut such evidence and must have been permitted
the opportunity to present evidence of responsibility to perform
the contract. A quasi-judicial proceeding shall not be required
for the City Council to take action under this section. Any
finding of non -responsibility shall focus on present non -
responsibility, shall be for the purpose of protecting the
interests of the public and not intended to punish a bidder.
The duration of debarment shall be for the period specified by
any contract or statutory provision or, if none, for the period
which the City Council finds shall best protect the interests of
the public but shall not exceed two years.
2.17.30 SPECIAL GOOD GOVERNANCE REFORM CONTRACT TERMS AND PROCEDURES
The provisions of this section shall apply to all procurements,
contracts and purchases by the City, and, without limitation, shall be
incorporated into all written administrative procedures.
(A) All contracts, including professional service contracts, shall
include ending dates and/or expenditure caps unless commercially
unreasonable to do so.
(B) All professional services contracts shall be rebid every three
years unless commercially unreasonable to do so.
(C) Compensation rates to be paid by the City shall not be increased
during the term of'a contract except where external factors are
going to significantly affect costs and rates during the term of
the contract, and any such increase is directly tied to the most
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appropriate index or cost -of -living rate or a pass through of
increased costs charged to the contractor.
(D). All contracts shall be at rates of compensation similar to, or
more favorable than the rates charged to other governmental
entities
(E) All contracting opportunities not otherwise subject to a
published notice requirement shall be publicized on the City's
website at least 7 days prior to contract award except where the
specific contract is otherwise exempt both from competitive
processes and, by written administrative procedure, from
informal selection.
2.17.32 NON COLLUSION.
The City shall reject any bid involving any unlawful or unethical
activity including, but not limited to, rebates, kickbacks, or other.
unlawful consideration. No city employee shall participate in the
selection process if participation might constitute a violation of the
Political Reform Act, Government Code Sections 1090, et seq., or other
State or local law or regulation pertaining to conflicts of interest.
2.17.34 FORM OF DOCUMENTS,
The City Council shall approve, by Resolution, the general forms
of contract, purchase order contracts, notices inviting bids, and the
general provisions of bid specifications and requests for proposals
for use in City purchasing.
2.17.36 EMERGENCY PURCHASES.
In case of an.actual emergency which requires immediate purchase
of material or services to address an immediate and unforeseen risk to
health, life, property or the environment, the City Administrator may
secure, without competitive bidding, at the lowest obtainable price,
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any material or services, regardless of the amount of the expenditure.
A full report of the circumstances of any such emergency purchase shall
be filed with the City Council within 30 days of the expenditure.
2.17.38 ENCUMBRANCE OF DEPARTMENT FUNDS.
Except for emergency purchases, and except where the amount of the
purchase is under $3,000, no contract shall be awarded and no purchase
order issued until the Director of Finance or his authorized
representative has certified after pre -audit that there is to the
credit of the department concerned a sufficient unencumbered
appropriated balance, in excess of all unpaid obligations, to defray
the amount of the proposed expenditure.
2.17.40 FEDERAL DISADVANTAGED BUSINESS ENTERPRISE PROGRAM.
The City Administrator shall adopt written administrative
procedures.to administer a disadvantaged business enterprise program
which shall be used when contracts lawfully require the contractor or
City to establish participation goals for disadvantaged business
enterprises. The written administrative procedures shall include
.implementation guidelines, including definitions and criteria for what
constitutes a disadvantaged.business enterprise and to encourage the
use of minority/women/disadvantaged business enterprises, consistent
with both state and federal disadvantaged business program criteria and
other applicable law.
2.17.42 EQUAL EMPLOYMENT AND LOCAL CONTRACTING POLICY.
It is the policy of the City to:
(A) Promote the principles of equal employment in its contracting
activities by assuring that those seeking to do business with
the City are treated equally and are not discriminated against
because of their race, religion, color, national origin,
17
ancestry, disability, sex, age, marital status, medical
condition, sexual orientation or any other protected class
status. To that end, all City contacts shall contain a non-
discrimination provision.
(B) Promote the local economy by encouraging local business
enterprise to make bids and proposals for city contracts and by
providing preference to local contractors in procurements other
than in sealed competitive bids, where all other factors are
equal or similar, as set forth in the written administrative
procedures adopted by the City Administrator.
2.17.43 PUBLIC CONTRACT CODE.
Except as provided in this code, or pursuant to agreement approved
by the City Council, or in a matter properly determined to be of
statewide importance, the City of Vernon, as a Charter City, is exempt
from the provisions of the California Public Contract Code.
2.17.50 TRANSITION OF PURCHASING PROCEDURES.
The Ordinance represents a significant enhancement to the City's
purchasing procedures, and it is in the public interest to insure that
the transition to those procedures is accomplished in a manner which
does not disrupt the essential and ongoing business operations of the
City. Therefore, Article IV of Section 2 of the Vernon Municipal Code
shall`remain in effect to and through June 30, 2013, and any specific
procurement may proceed under those provisions until then, on
recommendation of the City Administrator and City Attorney, or shall
otherwise comply with the Ordinance. All procurements of the City
shall comply with, the Ordinance as of July 1, 2013.
SECTION 4: Book of Ordinances. The Interim City Clerk
shall attest and certify to the adoption of this Ordinance and shall
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cause this Ordinance and the Interim City Clerk's certification to be
entered in the Book of Ordinances of the Council of this City. The
Interim City Clerk shall cause this ordinance to be published or posted
as required by law.
Section 5: This Ordinance shall go into effect and be in
full force and effect at 12:01 a.m. on the thirty-first (31st) day
after its passage.
APPROVED AND ADOPTED this 18th day of December, 2012.
1
Name: f" . _i1 am J . Davis
Title: Mayor
T.
Dana VReed, Inters City Clerk
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STATE OF CALIFORNIA )
ss
COUNTY OF LOS ANGELES )
I, DANA REED, Interim City Clerk of the City of Vernon,
do hereby certify that the foregoing Ordinance, being Ordinance
No. 1200, was duly and regularly introduced at a meeting of the
City Council of the City of Vernon, held in the City of Vernon on
Tuesday, December 4,, 2012, and thereafter adopted at a meeting of
said City Council held on Tuesday, December 18, 2012, by the
following vote:
AYES: Councilmembers: Mayor Davis, Mayor Pro
Tem McCormick, Maisano,
Martinez, Ybarra
NOES: Councilmembers: None
ABSENT: Councilmembers: None
And thereafter was duly signed by the Mayor or Mayor
Pro-Tem of the City of Vernon.
Executed this day of December, 2012, at Vernon,
'California.
Dana Reed
Interim City Clerk
(SEAL)
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CITY CLERK'S OFFICE
INTEROFFIC MEMORANDUM
DATE: December 19, 2012
TO: Rory Burnett, Finance Director/City Treasurer
Daniel Calleros, Police Chief
Kristen Enomoto, Assistant to the City Administrator
Carlos Fandino, Director of Light & Power
Leonard Grossberg, Director of Health & Environmental Control
Masami Higa, Assistant Finance Director
Alex Kung, Assistant to the City Administrator
Joaquin Leon, Deputy City Treasurer
Teresa McAllister, Director of Human Resources
Dana Reed, Interim City Clerk
James Rodino, Police Captain
Martha Valenzuela, Director of Personnel/Business Services
Mark Whitworth, City Administrator/Fire Chief
Kevin Wilson, Director of Community Services & Water
FROM: Deborah Juarez, Records Management Assistant
RE: Ordinance No. 1200 — An Ordinance of the City Council of the City of Vernon Amending
the Code of the City of Vernon by Amending Article IV of Chapter 2, Sections 2.17 through
2.31 and Repealing All Ordinances or Parts of Ordinances in Conflict Therewith
Transmitted herewith is a copy of Ordinance No. 1200 referenced above, which was approved by City
Council on December 18, 2012.
f
rrCEIVED
NOV 2 8 2012
CITY CLERK'S 4FFlCE
STAFF REPORT
COMMUNITY SERVICES & WATER DEPARTMENT
01
DATE: December 4, 2012
TO: Honorable Mayor and City Council
FROM: Mark Whitworth, City Administrator
Nicholas George Rodriguez, City Attorney
Samuel Kevin Wilson, Director of Community Services & WaterGy
Kristen Enomoto, Assistant to the City Administrator r-6
RE: Adoption of a Competitive Bidding and Purchasing Ordinance
Reepm=, at on
It is recommended that the City Council find that adoption of this Ordinance is exempt under the
California Environmental Quality Act (CEQA) in accordance with Section 15061(b)(3), the general rule
that CEQA only applies to projects that may have an effect on. the environment. The award of specific
contracts under the Ordinance will be the subject of specific CEQA review prior to award.
In addition, City Staff is recommending the adoption of a Competitive Bidding and Purchasing
Ordinance in order to carry out essential -recommendations of the good governance reform efforts. The
Ordinance establishes definitions for various types of procurement processes to create a common and
consistent nomenclature for procurement activities in Vernon. It sets forth defined paths and procedures
for Vernon's purchasing processes, requires that opportunities for vendors to participate in the
procurement process be publicized; establishes standards for awarding contracts through competitive
bidding and competitive selection processes, and recognizes specific and defined exemptions where
specific processes are not commercially reasonable:
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Senator Kevin De Leon's Critical Path Reforms and Independent Reform Monitor, John Van De
Kamp's Reports both made substantial and detailed recommendations for Vernon's procurement practices.
Among those recommendations are the following, all of which are set forth in some fashion in the proposed
ordinance: Establishingan open and competitive bidding process on service and personal services contracts that
is prominently posted on the City's web -site; requiring all contracts, including professional service contracts to
include ending dates and/or expenditure caps; reviewing and rebidding professional service contracts at least
once every three years; requiring best rates or rates comparable to other governmental entities for professional
service contracts, especially legal services; not allowing compensation rate increases during the term of a
contract.
Background
As part of the City's Good Governance Reform Measures, City Staff has reviewed the City's
purchasing and contracting processes and procedures as established in Chapter 2, Article IV of the City Code.
After review, it has been determined that, while present purchasing within Vernon is undertaken responsibly,
the Vernon Municipal Codes does not adequately support further progress toward best practices, and a restated
code can help to provide additional clarity as well as add some additional features and provisions that enhance
good governance and best practices.
Amendments to the City Code should be adopted to ensure an open and transparent process and to
eliminate any concern of favoritism in the City's procurement process of goods, equipment, materials and
services. As a baseline for "best practices", the California Public Contract Code was reviewed as were the
purchasing ordinances of Pasadena, Glendale, Burbank and Azusa as well as the Vernon Municipal Code.
The City Attorney's Office, working in conjunction with the City's various Departments, has
developed an ordinance that repeals Article IV of Chapter 2 "Purchasing System" of the City Code and replaces
it with a new Article IV entitled "Competitive Bidding and Purchasing Ordinance."
The intent of this Ordinance is to:
1. Establish processes which guard against favoritism and corruption in the expenditure of public funds;
2. Ensure that the City receives optimum value for all taxpayer funds when securing goods, materials,
equipment and services;
3. Ensure that the City obtains goods, material, services and equipment from a variety of qualified
sources;
4. Ensure that all City utility and municipal services function at the highest level possible without any
interruption, and
5. Promote and protect the efficiency, quality and integrity of the purchasing system.
In the Ordinance, all contracts in excess of $25,000 must be subject to formal competitive bidding or
competitive selection unless they fall within an explicit exemption, such as "sole source" or contracts with
another governmental entity, as examples. Purchases of less than $25,000 will be made administratively by
purchase order. In this regard, there will be an informal selection process established by written administrative
procedures, and these procedures and purchasing opportunities will be set forth on the City website. This
informal selection process will have a general requirement of no fewer than three quotes, except where subject
to an explicit exemption.
The Ordinance requires the City Council to review and to adopt all of the general forms and terms and
conditions of contracts, bid specifications, requests for proposals and purchase order contracts. The City,
Council will approve all specific contracts in excess of $75,000. Contracts of less than $75,000 that comply
with the Ordinance and use City Council approved documents as the basis of the transaction will be approved
by the City Administrator. The rationale is that contracts of lesser amounts are administrative in nature and do
not require the attention of the City Council as a policy making body as long as they conform to the best
practices set forth in the Ordinance. The City Council could, of course, direct a lower or a higher dollar amount
for contracts to review than what is proposed. This level of City Council review compares with other Cities as
follows: Pasadena requires City Council approval of all contracts in excess of $75,000. Glendale requires City
Council approval of all contracts in excess of $50,000. Azusa requires City Council approval of all public
projects in excess of $100,000, all maintenance, general services and professional services contracts in excess of
$10,000. Burbank requires City Council approval of professional services contracts in excess of $75,000, and
of supplies, services and public works construction in excess of $100,000.
The Ordinance represents a significant enhancement to the City's purchasing procedures, and it is in the
public interest to insure that the transition of those procedures is accomplished in a manner which does not
disrupt the essential business operations of the City. Therefore, the present Vernon Municipal Code provisions
shall remain in effect to and through June 3 0, 2013, and any procurement may proceed under the existing
provisions until then, on recommendation of the City Administrator and City Attorney, or shall otherwise
comply with the proposed Ordinance. All procurements of the City shall comply with the proposed Ordinance
as of July 1, 2013.
The major differences between the existing procedures and the proposed procedures are outlined in the
table below:
Comparison of Existing Purchasing Code provisions with New Code Provisions
New Code Provisions
Existing Code Provisions
Establishes definitions, using recognized terms,
Definitions not provided, creating uncertainty over
for the various types of procurement processes,
the requirements for each particular purchasing
including "competitive bidding" (low price
transaction,
award), "competitive selection" (award on
qualifications and price), "qualifications based
selection" (qualifications only), and informal
selection (open, transparent process for
procurements under $25,000), so there is common
nomenclature, essential for an open and
transparent purchasing system.
Establishes that "competitive bidding," with
Establishes a formal contract procedure for
published notice inviting bids, sealed bids and
purchases over $25,000 to be awarded to the lowest
award to the lowest cost, responsive and
responsible bidder (but does not make the
responsible bidder is the mandatory process for all
competitive bid process mandatory).
contracts over $25,000, unless a specific
exemption stated in the code applies.
Establishes that "competitive selection", with
Establishes a request for proposal process, for
request for proposals, published notice of requests
supply, service, equipment, or public works
for proposals and with award based on both
contracts above $25,000, (but does not make the
qualifications and cost is the mandatory process
RFP process mandatory, does not provide a clear
for all procurements not subject to competitive
distinction as to when an UP process applies
bidding, especially professional services contracts
instead of competitive bidding, and does not
above $25,000, unless a specific exemption stated
provide a clear distinction as to the fact that
in the code applies.
selection under the RFP process is based on both
ualifications and cost).
Establishes "qualifications based selection," with
Does not provide specific qualification based
published notice of bids and award based on
selection criteria for architectural and related
qualifications alone for architectural and related
services.
services as required by state law.
Establishes specific exemptions from the bidding
Establishes specific exemptions from the formal
and competitive selection processes.
contract procedures.
Purchases of less than $25,000 will be made
Although not specific on purchase limits generally
administratively by purchase order. Requires that
requires Open Market Procedures, for purchases
the City Administrator adopt written
between $1,000 to $25,000 requiring whenever
administrative procedures for' informal selection"
possible to obtain at least 3 written bids.
for all purchase orders between $3,000 and
$25,000 which require quotes from no fewer than
3 vendors unless exempted. The written
administrative procedures shall be set forth on the
City's website.
Establishes Good Governance provisions set forth
by Senator De Leon and Independent Reform
Monitor Van De Kamp as standard provisions.
None
Establishes a Non -Collusion provision. None
Establishes Equal Employment Opportunity None
Establishes a local preference provision.
Establishes City Council approval of all forms of
contracts, purchase orders and specifications
toward standardization Citywide.
Provides City Council approval of contracts and
other related purchasing matters by motion
instead of by resolution (as an efficiency)
Requires City Council approval of all contracts in
excess of $75,000, and allows approval by the
City Administrator, if approved as to form by the
City Attorney; of all contracts, less than $75,000
and of all RFP's and bid specifications as long as
they are in the form of document approved by
Resolution of the City Council and reflected in an
Although not specifically provided for, annual
contracts are generally recognized as part of the
competitive process in the purchasing procedures.
Exemptions from competitive bidding are stated
for the following: (1) Labor or services rendered
by any City officer or employee or furnished by
one City department to another City department,
(2) Contracts for labor, material, supplies, or
services available from only one vendor or for
unique services, (3) Contracts for the acquisition
of real property or relating to the acquisition of
real property, (4) Contracts for labor, material,
or supplies for actual emergency work,
(5) Contracts with other governmental entities or
their contractors for labor, materials or supplies,
(6) Contracts for the acquisition, sale or
transmission of electrical power, gas, water, or
telecommunications, and for commodities and
services of or for the water and power utilities
operated by the City, where it is not
commercially reasonable to procure them
None
Requires all purchases including those made by
contract to be made by purchase order.
Requires adoption of a resolution for the issuance of
a formal contract or request for proposal.
Requires City Council approval of essentially all
contracts, bid specifications and RFP's. City
resolution establishes the spending limits of a single
purchase by a Department. The limits are currently
set at $10,000 for departments, except for enterprise
funds departments which is set at $25,000. Any
purchases in excess of these limits require City
Council approval.
The current code contains a section on annual
contracts, wherein the purchasing agent could
arrange for an annual supply of goods,
commodities, or equipment by utilizing a formal bid
procedure for an annual contract, and purchases
subsequent to could be made by purchase order on
the basis of the prices received from the annual
contract bid.
The current Code allows for alternate procedures
when the purchasing agent finds that it is in the
public's best interest and necessity. In addition the
current Code provides exception from the contract
procedures for the following purchases:
(1) Contractual Services, insurance or other
agreements expressly authorized by City Council,
(2) Transactions made pursuant to sections 10324
and 10325 of the Public Contracts Code, (3)
Acquisition, sale or transmission of electrical
power, gas, water, or telecommunications, subject
to City Council approval, (4) When an emergency
requires that an order be placed, (5) When the
amount involved is less than $1,000, (6) When the
commodity can be obtained from only one vendor,
(7) For professional consulting services, (8) When
the work can be performed by City Employees in
a manner designed to foster competition, to
through standard bidding or request for proposal
prevent fraud and collusion and to secure the most
procedures. They may be procured pursuant to
favorable price for the City, (8) Contracts for
a Resolution of City Council which establishes a
insurance, bonds, advertising, membership dues,
process for procurement which is commercially
travel related expenses and for training, except that
reasonable and furthers the objectives of this
brokers and agents for same shall be procured
Ordinance, including but without limitation; to
through a competitive selection process unless not
prevent fraud and collusion and to ensure that
commercially reasonable to do so, (9) Contracts
the City receives optimum value in its
for labor, material, supplies or services under
procurements, (7) Any contract authorized by
$25,000, (10) Contracts for professional services,
Sections 5920, et seq., of the California
(11) Contracts as may be exempted from the.
Government Code and any successor provisions
competitive selection process where a
thereof, and for which a competitive financing
determination is made that the best interests of the
process has been established by Resolution of
City are served by a direct award of the contract
the City Council. City Council must approve all
without a competitive selection process. The City
exemptions over $75,000, and the City
Administrator shall have the authority to make
Administrator must approve all exemptions
such an exemption for all contracts of less than
under $75,000.
$75,000, and the City Council shall have the
authority for all contracts of $75,000, or more.
Allows for emergency purchases, and also
The Current Ordinances allows for emergency
requires that a full report of any emergency
purchases in the event of an actual emergency and
purchases be filed with the City Council within 30
no reporting specifically.
days of the expenditure.
Establishes that Vernon, as a Charter City, is
Silent on the Charter City issue.
otherwise exempt from the Public Contract Code
except in matters of statewide importance.
CEQA Analysis
The "Competitive Bidding and Purchasing" Ordinance will not have a significant effect on the
environment and therefore in accordance with Section 15061(b)(3) of Title 14, Chapter 3 (CEQA Guidelines),
is exempt from California Environmental Quality Act.
Conclusion
It is hereby recommended that the City Council adopt the ordinance attached herewith, which will repeal
Article IV of Chapter 2 "Purchasing System" of the City Code and replace it with a new Article IV of Chapter
2 entitled "Competitive Bidding and Purchasing."
SKW