CC - Item 5C - Second Reading of Ordinance No. 988 - Amending Chapter 3.24 - Purchasing System - Adding Chapter 3.28 - Public Works Bidding Procedure - and Adopting other Conforming Amendments to the Municipal Code E MF
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STAFF REPORT
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TO: THE HONORABLE MAYOR LY AND CITY COUNCIL
FROM: GLORIA MOLLEDA, CITY MANAGER J,
DATE: JUNE 25, 2019
SUBJECT: ORDINANCE NO. 988 - SECOND READING AND ADOPTION:
AMENDING CHAPTER 3.24 (PURCHASING SYSTEM), ADDING
CHAPTER 3.28 (PUBLIC WORKS BIDDING PROCEDURE), AND
ADOPTING OTHER CONFORMING AMENDMENTS, TO THE
ROSEMEAD MUNICIPAL CODE
SUMMARY
On June 11, 2019, the City Council introduced for first reading, by title only, Ordinance No. 988,
amending sections of the Rosemead Municipal Code and restating Chapter 3.24 (Purchasing
System), adding Chapter 3.28 (Public Works Bidding Procedure), and adopting other conforming
amendments.
STAFF RECOMMENDATION
It is recommended that the City Council approve the second reading and adoption of Ordinance
No. 988 by title only, entitled:
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
ROSEMEAD, CALIFORNIA, AMENDING AND RESTATING
ROSEMEAD MUNICIPAL CHAPTER 3.24 (PURCHASING SYSTEM),
AND ADDING CHAPTER 3.28 (PUBLIC PROJECT BIDDING
PROCEDURES)
FISCAL IMPACT - None
PUBLIC NOTICE PROCESS
This item has been noticed through the regular agenda notification process.
Submitt d by:
Ericka Hernandez, City Clerk
Attachment A: Ordinance No. 988 with Exhibits A and B
AGENDA ITEM NO. 5.0
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Attachment A
Ordinance No. 988
ORDINANCE NO. 988
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ROSEMEAD,
CALIFORNIA,AMENDING AND RESTATING ROSEMEAD MUNICIPAL
CHAPTER 3.24 (PURCHASING SYSTEM),AND ADDING CHAPTER 3.28
(PUBLIC PROJECT BIDDING PROCEDURES)
The City Council of the City of Rosemead ordains as follows:
SECTION 1. Findings. The City Council of the City of Rosemead finds as follows:
A. The City's purchasing regulations are currently codified in Chapter 3.24 of the
Rosemead Municipal Code ("RMC").
B. The City wishes to clarify its purchasing procedures by separating the procedures
applicable to public projects, which are governed by the procedures outlined in the Uniform
Construction Costs Accounting Act, as a new Chapter 3.28, and amending and restating its
procedures for purchasing supplies, equipment, or services in Chapter 3.24.
C. The City Council held a duly noticed public meeting on June 11, 2019, at which
time all persons interested in the proposed ordinance had the opportunity to address the City
Council.
SECTION 2. Environmental Findings. The City Council exercises its independent
judgment and finds that this Ordinance is not subject to California Environmental Quality Act
(CEQA) pursuant to the following sections of the State CEQA Guidelines, California Code of
Regulations, Title 14, Chapter 3: (1) Section 15060(c)(2) (the activity will not result in a direct or
reasonably foreseeable indirect physical change in the environment); (2) Section 15060(c)(3) (the
activity is not a project as defined in Section 15378); and 15061(b)(3), because the activity is
covered by the general rule that CEQA applies only to projects which have the potential for causing
a significant effect on the environment.This ordinance outlines a mechanism for purchasing and its
approval will not involve any commitment to any specific project. As such,there is no possibility
that this ordinance may have a significant adverse effect on the environment,and the adoption of this
ordinance is exempt from CEQA.
SECTION 3. Amendment and Restatement of Chapter 3.24 (Purchasing System for
Non-Public Works Projects). Chapter 3.24 of the RMC is amended and restated in its entirety,as
set forth in the attached Exhibit A.
SECTION 4. Adoption of Chapter 3.28 (Public Project Bidding Procedures). Title 3
(Revenue and Finance) of the Rosemead Municipal Code is amended to add Chapter 3.28, as set
forth in the attached Exhibit B.
SECTION 5. Amendment to Section 2.20.20.K. Section 2.20.020.K of Chapter 2.20
(Director of Finance/Treasurer) is amended as follows:
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"K. To act as Purchasing Officer as set forth in Chapter 3.24,if so designated by the City
Manager."
SECTION 6. Severability. If any section, subsection, sentence, clause, or phrase of this
ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of
competent jurisdiction, such decision will not affect the validity of the remaining portions of this
ordinance. The City Council hereby declares that it would have passed this ordinance and each and
every section,subsection,sentence,clause,or phrase not declared invalid or unconstitutional without
regard to whether any portion of the ordinance would be subsequently declared invalid or
unconstitutional.
SECTION 7. Publication. The City Clerk is directed to cause this ordinance to be
published in the manner required by law.
PASSED,APPROVED,AND ADOPTED by the City Council of the City of Rosemead,
County of Los Angeles of the State of California on June 25, 2019.
MAGARET CLARK, MAYOR
ATTEST:
ERICKA HERNANDEZ, CITY CLERK
APPROVED AS TO FORM:
RACHEL H. RICHMAN, CITY ATTORNEY
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EXHIBIT A
Chapter 3.24 - PURCHASING SYSTEM FOR NON-PUBLIC WORKS CONTRACTS
3.24.010 - Definitions.
Unless otherwise indicated, the following definitions shall apply to all provisions of this
chapter:
"Authorized contracting party" means the city official or body provided with authority
under this chapter to approve a contract or to make a purchase.
"City Manager" means the City Manager or person designated by the City Manager to
act on behalf of the City Manager.
"Formal competitive purchasing procedure" means a procedure which meets the
requirements of state and local law, including this chapter and any policies and procedures
approved by the City Manager consistent with this chapter.
"Negotiated contract" means a letter of agreement, vendor agreement, contract,
professional services agreement, maintenance services/public works projects agreement or
written documentation which details terms and conditions of the purchase.
"Professional services" means all services performed by persons in a professional
occupation, including, but not limited to, consulting and performance services for accounting,
auditing, computer hardware and software support, engineering, architectural, planning,
redevelopment, financial, economic, personnel, social services, animal control, legal,
management, environmental, cable television, communication and other similar professional
functions which may be necessary for the operation of the city.
"Rosemead vendor" means a local business enterprise whose business address at the
point of sale is located within the geographical boundaries of the city and who maintains a valid
license or permit to do business in the city.
3.24.015– Purchasing Methods.
Value of Purchase Purchase method Method of Approval
$5,000 or less Direct competitive purchasing Approval by director of
procedure, unless subject to department responsible for
an alternative purchasing the project, using a vendor or
procedure. letter of agreement.
$5,000.01 to $30,000.00 Informal competitive Approval by City Manager.
purchasing procedure, unless
subject to an alternative
purchasing procedure.
$30,000.01 or More Formal competitive Approval by the City Council
purchasing procedure, unless
subject to an alternative
purchasing procedure.
3.24.020 - Purchasing Officer—Position created—Appointment.
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EXHIBIT A
There is established in the office of the City Manager the role of a Purchasing Officer.
The Purchasing Officer shall be the City Manager or his or her designee(s). If the City Manager
designates one or more persons to act in this role, the Purchasing Officer(s) shall serve at the
pleasure of the City Manager. The duties of the Purchasing Officer may be combined with those
of any other officer(s) or position(s).
3.24.030 - Purchasing Officer—Powers and duties.
The Purchasing Officer, in accordance with the policies set forth in this chapter and in
any written procedures approved by the City Manager that are consistent with this chapter, shall
have the power to:
A. Purchase or contract for supplies, services and equipment required by the city;
B. Negotiate and recommend to the City Council execution of contracts for the
purchase of supplies, services and equipment;
C. Prepare and implement policies and procedures governing the bidding,
contracting, purchasing, storing, distribution and disposal of supplies, services
and equipment for the city;
D. Prescribe and maintain such forms as may be reasonably necessary to the
implementation of this chapter and any other policies and procedures approved
by the City Manager consistent with this chapter;
E. Review the working details, drawings, plans and specifications for any projects or
purchases requiring such review in this chapter;
F. Inspect or supervise the inspection of purchased supplies, services and
equipment to ensure conformity with any specifications established or required
by the city;
G. Transfer among departments any supplies, services and equipment not needed
by one such department, but which are necessary for the operation of one or
more other departments;
H. Sell any supplies and equipment not needed for public use or that may become
unsuitable for their intended use;
I. Develop and maintain any bidder's list, service provider's list or vendor's catalog
file necessary to the operation of this chapter and any other policies and
procedures approved by the City Manager consistent with this chapter.
3.24.040 - Purchasing policies and procedures.
A. The city shall secure supplies, services and equipment at the lowest total cost
commensurate with the quality and scope needed, and subject to any limitations
imposed by state law. Notwithstanding the foregoing, the city shall secure
professional services based upon demonstrated competence, professional
qualifications and suitability for the project in general. The city may consider cost
of professional services if the authorized contracting party determines it to be a
relevant factor under the circumstances.
In order to promote the economic health and development of the city, to
recognize the amount of sales tax that is returned to the city as a result of the
award of a purchase contract for supplies and equipment to a Rosemead vendor,
to encourage local participation in the procurement process, and to exercise the
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EXHIBIT A
prudent use of public funds, the City Council may, by minute action, award a bid
to a Rosemead vendor provided the local bid does not exceed the lowest bid by
more than five percent or $10,000.00, whichever is less.
B. The Purchasing Officer shall develop, for approval by the City Manager, such
policies and procedures as are necessary to implement the provisions of this
chapter. The policies and procedures shall be written and implemented in such a
way to encourage open and competitive bidding, provide equal opportunity based
on merit, make each selection process free of invidious discrimination, provide
for efficient and timely acquisition of needed supplies, services and equipment,
and provide effective fiscal controls.
C. In purchasing, supplies, services and equipment, the city shall make use of
competitive bidding, either direct, formal or informal, whenever required by law,
this chapter, or any policies and procedures approved by the City Manager
consistent with this chapter.
D. Direct, formal or informal competitive bidding is not required if there is an
alternative procedure set forth in this chapter.
3.24.050 - Bidding, purchasing and contracting.
A. $5,000.00 or Less. Any purchase of $5,000.00 or less may be awarded by the
director of the department responsible for the project by any direct competitive
purchasing procedure as defined herein.
B. $5,000.01 to $30,000.00. Any purchase of more than $5,000.00 and not greater
than $30,000.00 may be awarded by the City Manager by any informal
competitive purchasing procedure as defined herein.
C. $30,000.01 or More. Any purchase of more than $30,000.00 shall, except as
otherwise provided in this chapter, be awarded by the City Council pursuant to
the formal competitive purchasing procedure set forth below.
D. Purchasing Officer Approval. The Purchasing Officer, or his or her designee,
shall review and approve all contracts of $5,000.01 or more before the contract is
effective.
E. Five-Year Term Limitation. No agreement or contract shall extend for a period of
more than five years, including any authorized extensions.
3.24.060 - Direct competitive purchasing procedure.
Direct purchasing procedure shall be used for purchases between $1,000.00 and
$5,000.00, which includes contacting at least three vendors from a predetermined vendor list
for informal quotes. The city is responsible for updating and maintaining a list of predetermined
vendors. Once the quotes are obtained and a pricing sheet is completed, the city may use a
vendor agreement or letter of agreement to complete the purchase.
3.24.070 - Informal competitive purchasing procedure.
A. Uses of Informal Competitive Purchasing Procedure. This informal purchasing
procedure shall be used for purchases between $5,000.01 and $30,000.00.
B. Service providerNendor List. The department shall maintain a list of qualified
service providers or vendors.
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EXHIBIT A
C. Distribution of Notice Inviting Informal Bids. At least three vendors or service
providers shall be asked to submit informal bids, and the city shall endeavor to
receive informal bids from at least three vendors or service providers. Notices
inviting informal bids shall be mailed to the list of qualified service providers,
vendors, and/or trade journals not less than ten (10) days before bids are due.
D. Contents of Notice Inviting Informal Bids. When soliciting informal bids, staff
shall:
1. Describe to the vendor in general terms the project, service or item;
2. Advise vendors how to obtain additional information about the project;
3. State the date, time and place for the submission of bids; and
4. Include any other information required by state or local law, as
determined by the City Attorney.
E. Proprietary Projects or Products. If the director of the using department certifies
that, to the best of his or her knowledge, the product or service is proprietary in
nature and can be obtained only from a limited number of service providers or
vendors, and that no equivalent products or services are available, the notice
inviting informal bids may be sent exclusively to such vendor(s) or service
provider(s).
F. Contents of Remaining Bid and Contract Documents. The contents and form of
the remaining bid and contract documents shall be approved by the director of
the using department, as well as the City Attorney.
G. City's Authority. The city may reject any or all bids received, and may waive any
minor irregularities in each bid received.
H. Proposal Submittal. Service providers or vendors shall submit their proposals in
writing.
I. No Bids Received. If no bids are received, the authorized contracting party may
award the contract by any alternative purchasing procedure.
3.24.080 - Formal competitive purchasing procedure.
A. Use of Formal Competitive Purchasing Procedure. This formal purchasing
procedure shall be used for purchases greater than $30,000.00 or whenever
formal competitive purchasing is otherwise required by this chapter.
B. Required Process. The formal competitive purchasing procedure shall comply
with all aspects of state and local law governing formal competitive bidding,
including, but not limited to, the Public Contract Code, Government Code, Labor
Code, resolutions of the City Council as may be adopted from time to time, and
policies and procedures as the City Manager may approve from time to time.
C. Distribution of Notice Inviting Formal Bids. The notice inviting formal bids shall
substantially comply with procedures set forth in Chapter 3.28.
D. Contents of Notice Inviting Formal Bids. At a minimum, the notice inviting formal
bids shall:
1. Describe the project in general terms;
2. State how to obtain more detailed information about the project;
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EXHIBIT A
3. State the date, time and place for the submission of sealed bids; and
4. Include any other information required by state or local law, as
determined by the City Attorney.
E. Contents of Remaining Bid and Contract Documents. The contents and form of
the remaining bid and contract documents shall be approved by the director of
the using department, as well as the City Attorney.
F. City's Authority. The city may reject any or all bids received, and may waive any
minor irregularities in each bid received.
G. Proposal Submittal. Service providers or vendors shall submit their proposals in
writing.
H. No Bids Received. If no bids are received, the authorized contracting party may
award the contract by any alternative purchasing procedure.
3.24.090 - Using alternative purchasing procedures.
For situations provided in this section, an alternative purchasing procedure which results
in a negotiated contract, force account, purchase order or any other procedure determined by
the authorized contracting party to be in the best interests of the city and in compliance with the
city's policies and procedures may be used.
A. Emergencies. For situations determined by the City Manager to constitute an
emergency, the city may use the emergency procedures set forth in Chapter
3.28.
B. Professional Services. When purchasing professional services.
C. Computers. When purchasing computer software, hardware maintenance
services or software maintenance services.
D. Competitive Bidding Already Completed. When the authorized contracting party
determines that a competitive bid procedure has been conducted by another
public agency (e.g. through CMAS or GSA) and the price to the city is equal to or
better than the price to that public agency.
E. State Purchase. When the purchase is made on behalf of the city by the State
Department of General Services.
F. No Bids Received. When no bids are received pursuant to either the informal
competitive purchasing procedure or the formal competitive purchasing
procedure.
G. No Competitive Market. When the authorized contracting party determines that a
competitive market does not exist, such as, but not limited to, with memberships
in certain professional organizations, meetings, conventions, some forms of
travel, legal advertising and when the needed supplies, services and equipment
are proprietary and can only be provided by one source.
H. Best Interests of the city. When the City Council, on recommendation of the City
Manager, determines that an alternative procedure will be in the best interests of
the city and the policies set forth in this chapter.
3.24.100 - Inspection and testing.
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EXHIBIT A
The Purchasing Officer shall inspect supplies and equipment delivered, and contractual
services performed, to determine their conformance with the specifications set forth in the order
or contract. The Purchasing Officer shall have authority to require chemical and physical tests of
samples submitted with bids and samples of deliveries which are necessary to determine their
quality and conformance with specifications.
3.24.110 - Surplus supplies and equipment.
All using agencies shall submit to the Purchasing Officer at such times and in such form
as he or she shall prescribe, reports showing all supplies and equipment which are no longer
used or which have become obsolete or worn out. The Purchasing Officer 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.
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EXHIBIT B
Chapter 3.28— PUBLIC PROJECT BIDDING PROCEDURES
3.28.010— Purpose.
This chapter is enacted for the purpose of implementing procedures for contracts related
to certain public projects in accordance with Public Contract Code Section 20160 et seq.,
including but not limited to notice and publication of the bids and the award of the contract to the
lowest responsible bidder. A "public project" is as defined in Public Contract Code Section
20161.
3.28.020—Competitive bidding requirement.
Competitive bidding for public works contracts, for public projects over $5,000.00, is
required and will be conducted in accordance with the Public Contract Code and this chapter.
3.28.030— Bid procedure.
A. Notice inviting bids. Notices inviting bids shall be advertised by the city clerk, and
shall include a general description of the work to be done, state where bid forms and
specifications may be secured, and the time and place for opening bids.
1. Published notice. The city clerk shall cause notices inviting bids to be published
twice in a newspaper of general circulation at least ten days before the date of opening of the
bids, or posted for five days in three public places in the city designated by the City Council, in
accordance with Public Contract Code Section 20164.
B. Bidder's security.
1. Application. Unless otherwise provided by the City Manager before the letting of
public notice inviting bids, each bid shall be accompanied by bidder's security.
2. Return. Bidders shall be entitled to return of bid security; provided, however, that
a successful bidder shall forfeit his or her bid security upon his or her refusal or failure to
execute the contract within ten days after the preparation and mailing of the contract, unless in
the latter event the city is solely responsible for the delay in executing the contract. On refusal or
failure of the successful bidder to execute the contract, the contract may be awarded to the next
lowest responsible bidder. In such event, the amount of the lowest bidder's security shall be
applied by the city to the contract price differential between the lowest bid and the second
lowest bid, and the surplus, if any, shall be returned to the lowest bidder.
C. Bid opening procedure. Sealed bids shall be submitted to the city and shall be
identified as "BID" on the envelope. Bids shall be opened in public at the time and place stated
in the public notices. A tabulation of all bids received shall be available for public inspection
during regular business hours for a period of not less than 30 calendar days after the bid
opening. Once opened, the bids shall be public records. Notwithstanding the foregoing, any bid
deemed non-responsive at the time of bid opening shall not be kept by the city, and once
deemed non-responsive, shall be returned to the bidder. Grounds for determining a bid is non-
responsive include, but are not limited to, failure to provide the required bid bond and failure to
attend any mandatory walk through or pre-bid meeting.
D. Rejection of bids. At its discretion, the City Council may reject any and all bids
presented and readvertise for bids pursuant to the procedure prescribed in this chapter.
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EXHIBIT B
E. Award of contracts. Except as otherwise provided herein, contracts shall be
awarded to the lowest responsible bidder.
F. Tie bids. If two or more bids received are for the same total amount or unit price,
quality and service being equal, and if the public interest will not permit the delay or
readvertising for bids, the city, at its discretion, may accept the one it chooses.
G. Performance bonds. The City Manager shall have the authority to require a
performance bond or materials and labor bond or bonds before entering a contract in such
amounts as the City Manager finds reasonably necessary to protect the best interests of the
city. If the City Manager requires such bond or bonds, the form and amount of same shall be
described in the notice inviting bids.
H. Insurance. All contracts for public projects shall require the contractor to furnish
evidence, in a form satisfactory to the city, that the contractor has taken out and has in force
liability and worker's compensation insurance in such amounts and form as may be required by
the city, in addition to any other insurance required by the city's risk manager.
I. Contract Retention. No contract for a public project shall provide for, authorize or
permit the payment of more than 90% of the contract price before the completion of the work
done under the contract, and acceptance thereof by the city, and the expiration of the stop
notice claim period and the resolution of any such claims filed thereunder.
3.28.040— Emergencies.
The City Manager is delegated the power to declare a public emergency and take any
directly related and immediate action required by the emergency, up to a total of $100,000.00,
pursuant to Public Contract Code Section 22050. Emergency expenditures of more than
$100,000.00 must first be approved by the City Council. Work maybe performed without the
benefit of competitive purchasing, either formal or informal, only so long as necessary under
Section 22050.
3.28.050 - Delegation of authority to award contracts.
Public works contracts $5,000.00 or less may be approved and executed at the director
level without formal bidding. Public works contracts between $5,000.01 and $30,000.00 may be
approved and executed by the City Manager. A table summarizing the methods of approval and
bidding requirement is provided below.
Value of Public Project Method of Approval Bidding Requirement
Up to $5,000.00 Approval by director of Bidding not required.
department responsible for
the project, using a vendor or
letter of agreement.
$5,000.01 to $30,000.00 Approval by the City Bidding required.
Manager.
$30,000.01 or more. Approval by the City Council. Bidding required.
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