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HomeMy Public PortalAbout06) 7D Authority to Waive Certain Insurance RequirementsAGENDA ITEM 7.0. ADMINISTRATIVE SERVICES DEPARTMENT MEMORANDUM DATE: January 16 , 2018 TO: The Honorab le City Council FROM : Bryan Cook, City Manager By : Tracey L. Hause , Administrative Services Di rector SUBJECT: AUTHORITY TO WAIVE CERTAIN INSURANCE REQUIREMENTS RECOMMENDATION: It is recommended that the City Council authorize the City Manager to wa ive certain insurance requirements for informal contracts in the amount of less than $25 ,000 on a case by case basis , after consultation w ith the City Attorney 's Office and Ca li forn ia Joint Powers Insurance Authority (JPIA). BACKGROUND: On September 7 , 2010 , the City Council adopted Ordinance No . 10-937 , ad opt i ng a Purchasing System (Attachment "A "). ANALYSIS: When entering into contracts for services and supplies , the City, upon recommendation from the City Attorney's Office and the JPIA, ensures the appropriate insurance cove rage and related endorsements are in place to mitigate any potential liab ility to the City. The current Purchasing System adopted by the City Council requ ires the City Council to take action awarding all formal contracts of greater value than $25 ,000 . With that approval , the City Council is approving all required insurances and respective endorsements in that contract as recommended by staff. For contracts under $25 ,000 (informal contracts), the City Manager currently has the authority to execute on behalf of the City. Staff is recommending that the City Manager have the discretion to waive certain insura nce requirements if the coverage recommended by the City Attorney's Office and /or JPIA is not City Counci l January 16 , 2018 Page 2 of 2 applicable or reasonable for the specific situation. All informal contracts are carefully reviewed and consideration is given to the type of services that are contracted , i n order to be as reasonable and efficient as possible in requiring insurances as part of the contracting process . The City Manager will consult with both the City Attorney's Office and JPIA when considering waiving existing insurance requirements . In addition , the C ity Manager will report back to the City Council on which waivers have been made. CITY STRATEGIC GOALS: Approval to authorize the City Manager to waive certain insurance requirements for informal contracts in the amount of less than $25 ,000 on a case by case basis w ill further City's Strategic Goal to promote Good Governance. FISCAL IMPACT: There is no fiscal impact on this action . ATTACHMENTS: A. City of Temple City's Municipal Code-Purchasing System 1/9/2018 Sterling Codifiers , In c . Chapter 5 PURCHASING SYSTEM 2-5-0: ADOPTION OF PURCHASING SYSTEM: ATTACHMENT A In order to establish efficient procedures for the purchase of supp lies , services and eq uipment , to secure for the c ity suppl ies , services and equipment at the lowest poss ible cost commensurate with quality needed , to exercise positi ve financial control over purchases , to clearly de fin e au thority for the purchasing function and to assu re th e quality of purchases , a purchasi ng system is hereby adopted. All purchases or services or suppl ies fo r "public projects" as defined in section 20 161 of t he Public Contract Code (or any successor to that section) shall be made in accordance with the Publ ic Contract Code and with sections 2-5-15 and 2-5-17 , as applicable , of this chapter. All other purchases of supplies , services and equipment shall be made in accordance with this c hapter. (Ord . 1 0-937 ) 2-5-1: CENTRALIZED PURCHASING DEPARTMENT: There is hereby created a centralized purchasing department in which is vested authority fo r the purchase of supplies , services and equ i pment. (Ord. 1 0-937) 2-5-2: PURCHASING OFFICER: There is hereby created the office of purchasing officer, who shall be appointed by the c ity manager. The purchasing officer shall be the head and have general supervision of the purchasing department. The purchasing officer shall have au thority to: A. Purchase or con tract for suppl ies , service and equ ipment requ ired by any using department in accordance w it h purchasing procedures prescribed by th is chapter, such admin istrative regulatio ns as the purchasing officer shall adopt for the internal management and operation of the purchas ing department and such other rules and regulations as shall be prescribed by the c ity council ; B . Negotiate and recommend execution of contracts for t he purchase of supplies , services and equipment; C. Act to procure for the city the needed quality in supp lies , services and equipment at l east expense to the city; http ://www.sterlingcodifiers .com/cod ebooklindex.php?book_id=889 1/9/2018 Sterling Codifie rs, Inc. D. Discourage uniform bidding and endeavor to obtain as full and open competition as possible on all purchases ; E. Prepare and recommend to the city council rules governing the purchase of supplies , services and equipment for the city ; F. Prepare and recommend to the c ity council revisions and amendments to the purchas ing rules; G. Keep informed of curre nt developments in the field of purchasing , prices, market conditions and new products ; H. Prescribe and maintain such forms as reasonably necessary to the operation of th is chapter and other rules and regulations; I. Supervise the inspection of all suppl ies, services and equipment purchased to ensure conformance with specifications ; J. Recommend the transfer of surplus or unused supplies and equipment between departments as needed and the sale of all supplies and equipment which cannot be used by any department or which have become unsuitable city use; and K. Maintain a bidder's list, vendor's catalog file and records needed for the efficient operation of the purchasing department. (Ord . 1 0-937) 2-5-3: ESTIMATES OF REQUIREMENTS: All departments using the purchasing department shall file detailed estimates of the ir requ irements in supplies, service and equipment in such manner, at such time, and for such future periods as the purchasing officer shall prescribe. (Ord. 1 0-937) 2-5-4: ENCUMBRANCE OF FUNDS: Except in cases of emergency, the purchasing officer shall not issue any purchase order for supplies , http://www.sterl in gcod ifiers.com/code booklindex.php?book_id=889 217 1/9/2018 Sterl ing Codifiers, Inc. services or equipment unless there exist s an un encumbered appropriation in the fund account against which said purchase is to be charged. (Ord. 1 0-937) 2-5-5: REQUISITIONS: Using departments shall submit requests for supplies , services and equ ipment to the purchasing officer by standard requis ition forms . (O rd. 1 0-937) 2-5-6: PURCHASE ORDERS: Purchases of supplies , services and equipment shall be made only by purchase order or, where appropriate, by form al written co ntract. (Ord. 1 0-937) 2-5-7: EXEMPTIONS FROM CENTRALIZED PURCHASING: The purchasing officer, with approval of the city cou ncil, may authorize in writing any department to purchase or contract for specified supplies, services and equipment independently of the purchasing department; but shall require that such purchases or contracts be made in conformity w ith the procedures established by this chapter and shall further requ ire periodic reports from the department on the purchases and con tra cts made under such written authorization . (Ord. 1 0-937 ) 2-5-8: COOPERATIVE PURCHASING AGREEMENTS: A. Without complying with the re q uirements of sections 2-5-10 an d 2-5-11 of this chapter, the purchasing officer may participate in a coop erative purchasing agreement for the procurement of any supplies or equipment with any federal , state , county or local government agency when that agency has made their purc hases in a co mpetit ive manner. The purchasing officer may participate in a cooperative purchasing agreement when the city can obta in supplies or equ ipment at a purchase price lower than that whic h the city can obtain through its normal purchasing procedures . In those instances where it is determined that purchasing through the fede ra l, state , county or local government agencies will result in savings to the city, the purchasing officer is authorized to make such purchases . B. T he purchasing officer ma y also buy directly from a vendor at a price establ is hed by competitive bidding by another federal , state , cou nty or local government agency in substantial compliance with sections 2-5-10 and 2-5-11 of th is c hapte r even if the city has not joined with that public agency in a cooperative purchase agree ment. (Ord . 1 0-937) http://www.sterl ingcodifiers.com/codebooklindex.php?book_id=889 3/7 1/9/201 8 Sterling Codifiers, Inc. 2-5-9: OPEN MARKET PROCEDURE: Purchases of supplies, equipment, or services and sales of personal property of an estimated value in an amount more than five thousand dollars ($5 ,000.00) but less than twenty five thousand dollars ($25 ,000.00) may be made by the purchasing officer in the open market without observing the procedure prescribed in section 2-5-11 of this chapter. Purchase orders shall, whenever possible , be based on at least three (3) informal quotes. (Ord. 1 0-937) 2-5-10: BIDDING: Purchases of supplies, services, or equipment and the sale of personal property of an esti mated value in excess of twenty five thousand dollars ($25,000.00) shall be by bid procedures pursuant to this section and section 2-5-11 of this chapter. Bidding shall be dispensed w ith only when an emergency requires that an order be placed with the nearest available source of supply, when the city council by a four-fifths (4 /5 ) majority determines after opening of bids that rejection of all bids and purchase on the open market will best serve the city, or when the commodity can be obtained from only one vendor. (O rd . 1 0-937) 2-5-11: FORMAL CONTRACT PROCEDURE : Except as otherwise provided here in , purchases and contracts for supplies , services, equipment and the sale of personal property of estimated value greater than twenty five thousand dollars ($25,000.00) shall be by purchase order or written contract with the lowest (o r for purposes of section 2-5-16 of this chapter, highest) responsible bidder, as the case may be , pursuant to the procedure prescribed; herein : A. Notice Inviting Bids : Notices inviting bids shall include a general description of the articles to be purchased or sold, shall state where bid blanks and specifications may be secured and the time and place for opening bids. 1. Published Notice : Notice inviting bids shall be published at least ten (1 0) days before the date of opening of the bids . Notice shall be published at least once in a newspaper of general circulation , printed and publ ished in the city, or if there is none, it shall be posted i n at least thre e (3) public places in the city that have been designated by ordinance as the places for posting notices. 2 . Bidder's List: The purchasing officer shall also solicit sealed b ids from all responsible prospective suppliers whose names are on the bidder's list or who have requested their names to be added thereto. 3 . Bulletin Board : The purchasing officer shall also advertise pending purchases or sa les by a notice posted on a public bulletin board in the city hall ; http://www.sterl ingcodifiers.com/code book/index.php?book_id=889 4/7 1/9/2018 Sterling Codifi ers, Inc. B. Bidder's Security : When deemed necessary by the purchasing officer, bidder's security may be prescribed in the public notices inviting bids . Bidders shall be entitled to return of bid security; provided that a successful bidder shall forfeit his bid security upon refusal or failure to execute the contract within ten (1 0) days after the notice of award of contract has been mailed , unless the city is responsible for the delay. The city counc il may, on refusa l or fa ilure of the successful bidder to execute the contract, award it to the next lowest responsible bidder. If the city council awards the contract to the next lowest bidder, the amount of the lowest bidder's security shall be app lied by the city to the difference between the low bid and the second lowest bid , and the surplus, if any, shall be returned to the lowest b idder; C. B id Opening Procedure: Seal ed bids shall be submitted to the purchasing officer and shall be identified as bids on the envelope. Bids shall be opened in public at t he time and place stated in the public notices. A tabulation of all bids re ceived shall be opened for public inspection during regular business hours for a period of not less than th irty (30) calendar days after the bid opening ; D. Rejection Of Bids : In its discretion , the city council may reject any and all bids presented and readvertise for bids ; E. Award Of Contracts : Contracts shall be awarded by the city council to the lowest responsible bidder who meets the quality requirements . The decision of the city counc il shall be final. For purchases of supplies and equipme nt, determination of the "lowest respons ible bidder" may i nclude the adjustment of the bid price of a qualifying local vendor (as defined in subsection 2-5-17 B 1 of this chapter) according to the local vendor preference procedures described in subsection 2-5-17 B3 of th is chapter. For purposes of this section , a "responsible bidder" means a bidder who has demonstrated the quality, fitness , capacity, and experience to satisfactorily perform the particular requirements of the city; F. Tie Bids: If two (2) or more bids received are for the same total amoun t or unit price , quality and service being equal and if the public interest will not permit the delay of readvertising for bids , the city council may accept the one it chooses or acce pt the lowest bid made by negotiat ion with the tie bidders at the time of the bid opening; G . Performance Bonds: The city council shall have authority to require a performance bond before entering into a contract in such amount as it shall find reasonably necessary to protect the best interests of the city. If the city council requires a performance bond , the form and amount of the bond shall be described in the notice inviting bids . (Ord. 10-937) 2-5-12: INSPECTION AND TESTING: The purchasing officer shall inspect supp lies and equipment delivered and con tra ctual services performed, to determine their conformance with the specifications set forth in the order or contract. http://www.sterlingcodifiers.com/codebooklindex.php?book_id=889 srr 1/9/2018 Sterling Codifiers , Inc. The purchasing officer shall have authority to require chemical and physical tests of sample submitted with bids and samples of deliveries wh ich are necessary to determine their quality and conforma nce with specifications. ( Ord. 1 0-937 ) 2-5-13: PROFESSIONAL SERVICES: The city manager shall sign all professional service contracts on behalf of the city. Professional services contracts will be prepared in accordance with the city's standard consultants services agreement. The process for securing professional services will be through negot iation or through request for proposal subject to the contract value limitations of sections 2-5-9 and 2-5-10 of this chapter. (Ord. 1 0-937) 2-5-14: EMERGENCY PURCHASES: During times of emergency, as concurred in by the city council or the city manager, mayor and city attorney, purchases necessary to meet such emergency may be made without comp li ance with this chapter. (Ord . 1 0-937) 2-5-15: DESIGN/BUILD CONTRACTS: Whenever the city seeks to construct any public work , other than transportation facilities , with design and construction costs in excess of one million dollars ($1 ,000 ,000.00), the city council may proceed to contract therefor as a design/build project in compliance with California Public Contract Code section 20175 .2 , as amended , or any later enacted statute regulating des ign /build contra cts. (Ord. 10- 937) 2-5-16: SURPLUS SUPPLIES AND EQUIPMENT: All using departments shall submit to the purchasing officer at such ti mes and in such form as he sha ll 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 department or which have become unsuitable for city use, or to exchange the same for, or trade in the same on , new supplies and equipment. Such sales shall be made pursuant to sections 2-5-9, 2-5-1 0 and 2-5-11 of this chapter, as applicable . (Ord . 1 0-937) 2-5-17: LOCAL VENDOR PREFERENCE PROGRAM: http://www.sterlingcodifiers .com/codebooklindex.php?book_id=889 617 1/9/20 18 Sterling Codifiers, Inc. A. The city has established a local vendor preference program to be applied in the procurement of supplies and equipment under section 2-5-11 of this chapter. B. The adjustment to bids provided for under the local vendor preferen ce program shall be implemented according to the followi ng: 1. Qualification For Local Vendor Preference: In the procurement of supplies and equ i pment for the city's requirements, preference shal l be given to those vendors who: a) qualify as a local vendor ("qualifying local vendor") under this subsection and b) submit a written statement in their bid package requesting to be considered a qualifying local vendor. In order to qua lify as a local vendor, the bidder must certify the following information as part of t he bid package: a. It has fixed facilities with employees located w ithin the city limits ; b. It has a business street address (post office box or resident i al address shall not suffice to establish a local presence); c . All sales ta x returns for the goods purchased must be reported to the state through a business within the geographic boundaries of the city ; and d. It has a c ity business license. 2. False Certifications: Fals e certifications shall be immediate grounds for rejection of any b id or if the bid is awarded , grounds for vo iding the bid , terminating any agreement, and seeking damages thereto . Failure to certify the above information shall result in the bid being considered by the city without any adjustment for a local v endor as descri bed in subsection 83 of th is section. 3. Application Of Local Vendor Preference: The bid of a qualifying local vendor shal l be adjusted according to the following procedures: a . In the tabulation of bids to determine the lowest respons ible b idder, the bid of eac h qual ifying local vendor shall be reduced by five percent (5 %). b. The reduced bid price of the qualifyi ng local vendor will then be compared to the other bids received by the city to determine the lowest responsible bidder under section 2-5-11 of this chapter. Notwithstanding this reduction for purposes of determining the lowest respons ible bidder, the contract amount with the lowest responsible bidder shall be at the bid price. (Ord . 10-937) http://www.sterli ngcodifiers.com/codebooklindex.php?book_id=889 m