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HomeMy WebLinkAbout2023-38, repealing Resolution 2016-04 and establishing a formal procurement policy for the City of East Wenatchee - 6/20/2023City of East Wenatchee Resolution 2023-38 with Exhibit A Retain Resolution until no longer needed for City-business, then transfer to Washington State Archives (GS50-05A-16 Rev. 1) Page 1 of 2 City of East Wenatchee, Washington Resolution No. 2023-38 A Resolution of the City of East Wenatchee, Washington repealing Resolution No. 2016-04 and establishing a formal procurement policy for the City of East Wenatchee. 1. Alternate format. 1.1. Para leer este documento en otro formato (español, Braille, leer en voz alta, etc.), póngase en contacto con la administradora municipal de la ciudad al alternateformat@eastwenatcheewa.gov, al (509) 884-9515 o al 711 (TTY). 1.2. To read this document in an alternate format (Spanish, Braille, read aloud, etc.), please contact the City Clerk at alternateformat@eastwenatcheewa.gov, at (509) 884-9515, or at 711 (TTY). 2. Authority. 2.1. RCW 35A.11.020 and RCW 35A.12.190 authorize the City Council to organize and regulate its internal affairs and to define the powers, functions and duties of its officers and employees. THE CITY COUNCIL OF THE CITY OF EAST WENATCHEE DO RESOLVE AS FOLLOWS: 3. Repeal. The City Council repeals Resolution 2016-04. 4. Authorization. The City Council hereby adopts the City of East Wenatchee Procurement Policy as attached in Exhibit A. 5. Severability. If a court of competent jurisdiction declares any provision in this resolution to be contrary to law, such declaration shall not affect the validity of the other provisions of this Resolution. 6. Effective date. This Resolution becomes effective immediately. 1 Procurement Policy Exhibit A 2 1. Introduction 1.1.01 Purpose of the Policy The main purpose of this policy is to assist and guide City staff on basic procurement and purchasing requirements set forth by the State of Washington. 1.1.02 Conflicts of Interest Employees of the City shall become aware of the ethics and conflicts of interest provisions of the City of East Wenatchee Personnel Policies and Procedures Section 102.4.2. To the extent that this procurement policy conflicts with any provision of the City of East Wenatchee Personnel Policies and Procedures, the provisions of the City of East Wenatchee Personnel Policies and Procedures shall control. In addition, Title 2 CFR 200.318 provides that no employee, officer, or agent may participate in the selection, award, or administration of a contract supported by a Federal award if he or she has a real or apparent conflict of interest. Such a conflict of interest would arise when the employee, officer, or agent, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in or a tangible personal benefit from a firm considered for the contract. The officers, employees, and agents of the non-Federal entities may neither solicit nor accept gratuities, favors, or anything of monetary value from contractors or parties to subcontracts. If a potential conflict of interest exists, employees shall notify their supervisor, Mayor and/or City Attorney to determine any action that should be taken. 1.1.03 Proper authorization Only authorized employees acting within the scope of their authority may obligate the City in the acquisition of goods or services. Any employee purchasing goods without proper authorization may be personally liable to the vendor and the City, and subject to disciplinary action. Using public funds or public mechanisms or processes for purchases for personal use is prohibited. Persons performing such activities are personally liable for costs associated with the purchases and may be subject to disciplinary action. The chart below is intended as a guide and describes common types of contracts, and summarizes the requirements associated with those contracts. Further details regarding particular situations may be found at the referenced paragraphs of this document. Exhibit A 3 Category Limit Process Ref. Purchases for materials, supplies, & equipment, including installation and taxes <$7,500 No formal bid requirements. Verbal quotes, State contract, or use of purchasing cooperatives are encouraged 1.3.2 >$7,500 3 written quotes, State contract, or qualifying purchasing cooperative 1.3.2 General Service Contracts RCW’s do not require bids for services. Excluding Architecture and Engineering. Encouraged to obtain 3 quotes but use reasonable judgment whether bids should be obtained. 1.2.1 Federal Grant Guidelines Up to $10,000 No bids if prices are determined to be “reasonable”. Federal Grant Guidelines Public Works $10,000 - $250,000 3 written quotes or State contract Over $250,000 Formal sealed bids • Single Trade, Street signalization, or light Project <$75,500 • Multi-Trade Project <$116,155 (RCW 35.23.352) • Direct quotes allowed, but bond or retainage in lieu of bond required, or • Limited small works process (only <$50,000), or • Small works roster or, Formal bid process 1.2.05 Public Works Project costs <$350,000 • Small works roster, or • Formal bid process Project costs >$350,000 • Formal bid process Authorization Threshold Category Limit Authorized Signer Budgeted item $0-5,000 Department Head or Mayor $5,001-50,000 Mayor >$50,000 Mayor with City Council approval All Contracts will be inserted into Council’s consent agenda. Unbudgeted item $0 - $5,000 Department Head or Mayor $5,001 – 50,000 Mayor >$50,000 Mayor with City Council approval All unbudgeted items must be reviewed and approved by the Finance Committee – Agreements will be inserted into the Council’s consent agenda. Change Orders Above Lesser 5% or $20,000 Department Head or Mayor Lesser of $100,000, 10% of Bid Amount Mayor Exhibit A 4 1.1.04 Sustainable Purchasing The City shall acquire its goods and services in a manner that complies with all federal and state laws, City ordinances and resolutions, and interlocal agreements. The City shall purchase and use materials, products and services which are considered fiscally responsible. Consideration of such fiscal factors include but are not limited to: lowest total cost, impact on staff time and labor, long-term financial and market fluctuations, leverage of the City’s buying power, and advances in technology. 1.2.0 Procurement Analysis The following is a recommended flow for analyzing which requirements apply to which projects or situations. 1.2.1 Define the Need What type of procurement is involved? Public Works: (RCW 39.04.010) includes all work; construction; alteration; repair or improvement other than ordinary maintenance unless such maintenance is contracted out, executed at the cost of the City. • Examples of need for Public Works include, demolition, building, road, and utilities construction, and renovations. Ordinary maintenance is not specifically defined in this statute but is generally considered to include work not performed by contract and performed on a regular basis to service, check or replace items that are not broken. Materials, Supplies and Equipment: Materials, supplies and equipment are considered tangible items which are manufactured and are moveable at the time of purchase. It is important to distinguish between materials, supplies and equipment used in public works contracts as opposed to non-public works contracts as different bidding requirements apply to each. • Examples of need for Materials, Supplies and Equipment include office supplies, off the shelf software, hardware, copy machines, vehicles and replacement parts, gravel, and custodial supplies. Services: Services may also have bidding requirements and are distinguished from Public Works. Services include labor, time or effort of a human being. The three classifications of services are: • Professional services: services provided by independent consultants that require specialized knowledge, advanced education and experience, professional licensing or certification. Exhibit A 5 • Architectural and Engineering Services (A&E Services): Services are to be acquired under the authority and procedures outlined in RCW 39.80. • General Services: Further service work that is considered unrelated to public work. Often related to routine services regarding maintenance and/or training. 1.2.2 Determine the Cost The cost of the work or services being purchased, or the materials being purchased, will further help determine which processes are available to use for the project. Estimated cost of goods or services will determine which competitive selection process will need to be followed. Work project costs are not to be split. Instead, consider the project costs in totality, and consult legal if a question arises. Costs should not include donated materials, labor, supplies, etc. Estimated costs include all applicable sales and use taxes, freight, set up and tear down, all phases of construction related work, excluding engineering or architectural design fees. Exhibit A 6 1.2.3 Exceptions to the Competitive Process (RCW 39.04.280) The purpose of this section is to supplement and not to limit the current powers of any municipality to provide exceptions from competitive bidding requirement. Bid Exceptions: Type Examples Ref. Purchases that are clearly and legitimately limited to a single source of supply • Outfitting of the police vehicles • Meets specialty need of the City Purchases involving special facilities or market conditions • Items of special, individual design that fits with existing equipment, programs, or inventory. Purchases in the event of an emergency 1.2.4 Purchases of insurance or bonds Pollution control facilities and some neighborhood “self-help” projects. • Chamber of Commerce, Service Organizations, community, youth, or athletic associations. • Consideration received by the City must equal 3x the city or town’s payment to the association. • All payments made by a public entity shall not exceed $25,000 or $2 per resident within the boundaries of the public entity, whichever is greater. May hire the county to do road projects • By passing a resolution, a city council may authorize the county in which it is located to construct, repair, or maintain a city street. The City pays the actual cost of the work with a deposit into the county road fund. Auctions • Allowance of purchases through traditional and nontraditional auction services i.e., eBay (Nontraditional) or in-person (Traditional) if it is not a fixed-price marketplace. 1.2.11 Exhibit A 7 Exemption Process: The reason the non-emergency purchase or contract is exempt from required procedures should be documented prior to the purchase or contract award. Explanation of features, knowledge, and qualification the vendor can provide that make them an appropriate choice. Exemptions in emergency situations must be approved by the Department Head and must be documented immediately after the purchase or contract award. The documentation must be kept in the purchase or contract file and is open for public inspection. 1.2.4 Emergency Public Works Procurements (RCW 39.26.130) As used in this section, “emergency” means a set of unforeseen circumstances beyond the control of the agency that either: 1) Present a real, immediate, and extreme threat to the proper performance of essential functions; or 2) May reasonably be expected to result in material loss or damage to property, bodily injury, or loss of life, if immediate actions are not taken. Steps that should be followed in the event of a need for emergency public works action include: Step 1 – Staff notifies the Public Works Manager of the emergency. If the Public Works Manager determines that an emergency situation exists and a contractor is required to minimize the effect of the emergency, the Public Works Manager notifies and briefs the Mayor of the situation. Step 2 – Upon concurrence of the Mayor that an emergency situation exists, and upon the Mayor’s authorization and written concurrence of the emergency provided by the City Engineer, contractors can be tasked by the Public Works Manager to make necessary repairs. Step 3 – Contractors to submit emergency time and material agreement to the Public Works Manager for execution by the appropriate signer. Step 4 – Details of the emergency situation and copies of any agreements executed shall be presented to the City Council for validation as soon as practical following the award of the emergency contracts. If the emergency has been declared by Federal or state Officials, the city council can pass a resolution validating that declaration of emergency as well. Importantly, emergency purchases and contracts must still include retainage, prevailing wages and performance and payment bonds requirements. It is advised, but not mandated, that the small works roster be consulted to determine whether there are contractors who could mobilize quickly who also already may have the required insurance and other certificates on file. Exhibit A 8 1.3 New Procurement 1.3.0 Small Purchases of Goods & Services Small purchases are typically goods (excluding Public Works) under $10,000 and include memberships, trainings, etc. These purchases can be made as follows: Process Allowed Uses Non-Allowed Uses Credit Card Business related purchases where an account can’t be established or would delay the purchase of a critical item. Alcohol, capital equipment, cash advance, consulting services, personal items, professional services, business where an account is established. Established Accounts Business related purchases as authorized by Department Head, or its designee Food/alcohol, personal items, cash advance, professional/consulting services 1.3.1 State Contracts The Washington State Department Enterprise Services (DES) offer existing contracts for goods and services that the City may use. The city has signed the Master Contracts Usage Agreement with DES for the ability to access their contracts and encourages the use of these contracts whenever possible. When using a state contract, the City, utilizing the State’s competitive process thus eliminating the need for the City to perform one. Purchases made with a State contract must follow the same guidelines as any other purchase. 1.3.2 Large Purchases for Materials, Supplies & Equipment Any purchase of material, supplies, and equipment, where the cost exceeds $7,500. - Identify grants funding requirements to follow, if applicable - Prepare product specifications – warranties, delivery, liquidated damages, etc. - Prepare documents – advertisements, equal opportunities, bid proposal sheet bidder’s checklist, bid bond, etc., as appropriate. - Prepare addenda if required and notify plan holders and post online, - Schedule and conduct bid openings, when appropriate - Award the bid after determining the lowest, responsible, responsive bidder and prepare Council materials, if required. The Purchase Agreement Documents: - Contact information for both contractor and City employee. - Bid/Specifications including successful vendor’s required forms submitted at time of bid. - City’s Insurance Requirements with successful vendor’s Certificate of Insurance, if applicable. Document Storage and Routings Exhibit A 9 - A copy of the Purchase Agreement documents should be available to the City’s authorized signer to review and in the City Council Agenda packet when City Council approval is required. - An electronic copy of the signed multi-year agreements to the City Clerk to record in the City’s records and an email notification of all new contracts to other impacted documents. - 1.3.3 Technology Purchases To purchase telecommunication and data processing equipment or software: - What is being purchased: a service, installation, supply, or equipment. If a major portion of the software cost is to customize the program for City needs then the purchase is a service. If the purchase involves installation of cable, conduits, and other devises the purchase may be public works. - Departments must work with the Information Systems Director/Manager to purchase both hardware and software, to allow that department to adequately support these technologies. All potential acquisitions of electronic computing systems, including workstations, peripherals, and software, must be approved by the Information Systems Director/Manager. This includes acquisitions using grant funds. Telecommunications Purchases over Bid Limit 1. A request for proposals (RFP) must be published in the newspaper of general circulation at least 13 days before the last date on which the proposals will be received. 2. The RFP must identify significant evaluation factors, including price, and their relative importance. 3. Provided procedures must be reasonable for technical evaluation of proposals, identification of qualified sources and selection for awarding the contract. 4. The award must be made to the qualified bidder whose proposal is “most advantageous” to the city. The City has the right to reject all proposals for good cause and request new proposals. 1.3.4 Public Works Public Works – RCW-39.04.010 – “Public Work” means all work, construction, alteration, repair, or improvement other than ordinary maintenance, executed at the cost of the state or of any municipality, or which is by law a lien or charge on any property therein. Limitations on work by public employees Day Labor Limit – RCW 35.23.352 – Any second-class City or Town may construct any public works as defined in RCW 39.04.010 by contract or day labor without calling for bids therefore whenever the estimated cost of the work or improvements, including cost of materials, supplies, and equipment will not exceed $116,155 if more than one craft or trade is involved with the public works, or $75,500 if a single craft or trade is involved with the public works, or the public works projects is street signalization or street lighting. Whenever the cost of the public work or improvement, including materials, supplies and equipment, will exceed these figures, the same shall be done by contract, in accordance with RCW 39.08.030. Exhibit A 10 Determining the Cost of a Public Work – The total construction cost of each project must be estimated in order to correctly apply bid limit dollar amounts to determine if a public works project must be competitively bid. The final cost must be validated by the City of East Wenatchee. The total construction cost is used to make that determination. The estimate shall include materials, supplies, equipment, and labor on the construction of that project and applicable sales and use taxes. The value of volunteer labor, material, or equipment need not be included in the cost estimate for a public works project, as they are not a cost to the agency. Bid Splitting – RCW 35.23.521(1) and RCW 39.04.155(4) prohibit the division of a project into units of work or phases of work to avoid the restriction on work that may be performed by day labor a single project. 1.3.5 Small Works – Limited Public Works Process (RCW 39.04.155) This section provides uniform small works roster provision to award. Public Works projects with costs less than $50,000 qualify as Limited Public Works. The procedures listed below are required. 1.3.6 Public Works – Small Works Roster When the estimated cost of a public works project is $350,000 or less, the City may follow Small Works Roster (SWR) process for construction of a public work or improvement in accordance with RCW 39.04.155. Small Works Roster Process: o Prepare the bid package. o Prepare an advertisement for bids that indicates the estimated project cost, bid opening and closing date and time, a brief explanation of the project, where bid documents can be located and where to send bids within the City. Send advertisement to all contractors listed on the MRSC Small Works Roster that have indicated they can perform the type of work being solicited. o The contract shall be awarded to the lowest responsible bidder and approved in accordance with the Purchasing Policy Matrix. o Send a copy of the signed agreement to the City Clerk to record in the City’s Records and send email notification to impacted departments. o 1.3.7 Public Works – Formal Bid Process Competitive bidding is designed to prevent favoritism in awarding public work contracts and to enable local government to obtain the best work or supplies at the most reasonable prices. Projects with estimated costs equal to or greater than $350,000 must be put out to bid. Formal Bid Process: 1. Department to compile bid package. 2. The notice to be is to be published in the official newspaper at least 13 days prior to the date bids are to be received. The notice shall state the nature of the work for which plans and specs will then be on file. Exhibit A 11 3. Bids must be sealed and filed within the time specified. 4. Each bid requires a bid proposal deposit of 5% or more in the form of a cashier’s check, postal money order or surety bond. 5. Prevailing Wage and Wage Certification form is required. 6. Public bid opening is required. 7. City Council approval is required. 8. Grant funded projects may have additional, or stricture bid requirements. 9. Send a copy of the signed agreement to the City Clerk to record in the City’s Records and an email notification to the impacted departments. Must Call for Bids. Reasoning Requirements Public Works • Cost of public work including cost of materials, supplies and equipment will exceed $116,155, • A single craft or trade is involved, • The project is one of street signalization or street lighting and cost exceeds $75,500 Materials, Supplies and Equipment • If the population is under 20,000 and the purchase cost exceeds $7,500 and will not be used in connection with any public work or improvement Architectural and Engineering Services • City must publish its need for A&E Services in advance, concisely stating general scope and nature of the project or work. • Notice must also provide the address of a representative of the City who can provide additional details. • Notice can be either (1) publishing an announcement each time the service is neede d, or (2) announcing generally to the public the City’s projected requirements for any category or type of A&E service. 1.3.8 Bid Splitting Municipalities may not break a public works project into separate phases or parts to avoid compliance with bidding statutes RCW 35.23.352(1). Instead, a city, while completing the actual project in phases, must total the cost of all phases of the public work or purchase. If the aggregate cost exceeds the applicable bid limit, the city must bid each phase of the project even though a given phase may cost less than the bid limit. 1.3.9 Purchasing from Other Governments and “Piggybacking” (RCW 39.32.070-090.) RCW 39.32.070 authorizes cities to purchase equipment, supplies, and other property without advertising, giving notice, or inviting bids. RCW 39.32.080 suspends any charter provisions, ordinances, or policies that require bidding when dealing with the federal government. RCW 39.32.090 requires that an ordinance or resolution be passed before any purchase is made from the federal government or through a federal government contract. Exhibit A 12 The city may acquire surplus property from another government entity without regard to bid laws. RCW 39.33.010 authorizes such purchases “on such terms and conditions as may be mutually agreed upon by the proper authorities.” An interlocal agreement must be in place before the city can piggyback or buy off another jurisdiction’s contract. (RCW 39.34.030(5)(b). Cities may also use the authority granted in RCW 39.34.030 to make purchases through state contracts. By signing a Master Contracts Usage Agreement with the Department of Enterprise Services. The Master Contracts Usage Agreement is a one-time agreement necessary to meet statutory requirement allowing organizations to use Washington State master contracts upon qualification. 1.3.10 Purchases from Auctions According to RCW 39.30.045 any municipality, as defined in RCW 39.04.010, may purchase any supplies, equipment, or materials at auctions conducted by the government of the United States or any agency thereof, any agency of the state of Washington, any municipality or other government agency, or any private party without being subject to public bidding requirements if the items can be obtained at a competitive price. Exhibit A