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Home My WebLink AboutStaff Report 222-10TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DEPARTMENT: ADMINISTRATIVE SERVICES DATE: May 3,2010 CMR: 222:10 REPORT TYPE: Consent SUBJECT: Adoption of Ordinance Amending Section 2.30.360(k) of Title 2 of the Palo Alto Municipal Code Covering Exemptions from Competitive Solicitation Requirements RECOMMENDATION Staff recommends that the Council approve an ordinance amending Section 2.30.360 of Chapter 2.30 of Title 2 the Palo Alto Municipal Code covering exemptions from competitive solicitation requirements (Attachment A.). DISCUSSION The Palo Alto Municipal Code (PAMC) Chapter 2.30 contains the City's contracting and purchasing procedures. Staff proposes that the Council approve changes to the procedure covering the use of another govemmental or public agency's contract in Section 2.30.360 (exemptions from competitive solicitation requirements) of the PAMC .. This exemption, commonly referred to as a "piggyback" exemption, currently allows the City to rely on another agency's solicitation provided the agency used a method similar to Palo Alto's and provided the solicitation was pClfOlU1ed in the past 12 months. As recently discovered in connection with the AT&T CalNet solicitation, this twelve month requirement is overly restrictive. Accordingly, the proposed changes remove the requirement that the contract from another agency be awarded within twelve months of the date of the City contract. In addition, the new language emphasizes the pUlpose of the policy is to maximize value while ensuring a competitive process was used. RESOURCE IMPACT There is no expense impact as a result of adopting these changes. POLICY IMPLICATIONS This recommendation is consistent with existing City policies. ENVIRONMENTAL REVIEW Ibis is not a project under the California Environmental Quality Act. CMR:222:10 Page 1 of2 ATTACHMENT Attachment A: Proposed Ordinance PREPARED BY: DEPARTMENT APPROVAL: Director, Administrative Services CITY MANAGER AFPROV AL: Ordinance No. :::--c::-. Ordinance of the Council of the City of Palo Alto Amending Section 2.30.360 (Exemptions from Competitive Solicitation Requirements) of Title 2 (Administrative Code) of the Palo Alto Municipal Code Regarding Contracts and Purchasing Procedures The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. Section 2.30.360 of Chapter 2.30 of Title 2 of the Palo Alto Municipal Code is hereby amended to read, as follows: 2.30.360 Exemptions from competitive solicitation requirements. The following are exemptions from the informal and formal competitive solicitation requirements of this chapter. It is expected that the exemptions will be narrowly applied. The department requesting an exemption shall provide all relevant information supporting the application of the exemption to the purchasing manager. Based on this information, the purchasing manager shall make a recommendation to the city manager and the city manager shall determine whether an exemption from competitive solicitation requirements applies. Nothing herein is intended to preclude use of competitive solicitations where possible. (a) Emergency contracts as defined in Section 2.30.21 O(i). (b) Situations where solicitations of bids or proposals would for any reason be impractical, unavailing or impossible provided that in the case of a public works project, the project is not otherwise required by the Charter to be formally bid. These situations are those where solicitations of bids or proposals would not be useful or produce any advantage for the city. Situations where solicitations of bids or proposals would be impractical, unavailing or impossible, include, but are not limited to, the following: (1) Specifications carmot be drawn in a way that would enable more than one vendor or contractor to meet them; (2) Dne to circumstances beyond the control of the city, the time necessary to use the competitive solicitation process procedures and requirements would result in a substantial economic loss to the city, or the substantial interference with a required city operation; and (3) Special conditions attached to a grant, donation or gift requires the use of particular goods and/or services. All requests for exemptions under this subsection shall be supported by written documentation (facsimile or electronic mail may be used), approved by the department head and forwarded to purchasing. J00210jb 0130564 (c) Where competitive bids or requests for proposals have been solicited and no bid or proposal has been received or no bid or proposal meeting the requirements of the invitation to bid or request for proposal has been received, provided that, in the case of a public works project, the project is not otherwise required by the Charter to be formally bid. (d) Contracts for goods, wholesale commodities and related services, general services or professional services available from only one source where there is no adequate substitute or equivalent provider. Examples of acceptable sole source purchases are: equipment for which there is no comparable competitive product, proprietary products sold directly from the manufacturer, a component or replacement part for which there is no commercially available substitute and which can be obtained only from the manufacturer, items where there is only one authorized distributor in the area, and items where compatibility with items in use by the city is an overriding consideration. All requests for sole source purchases shall be supported by written documentation (facsimile or electronic mail may be used), approved by the office or department head and forwarded to purchasing. (e) Contracts for goods where, pursuant to Section 2.30.900, the city manager has determined that standardization of the supplies, materials or equipment is permissible. (f) Placement of insurance coverage and bonds. (g) Legal services contracts, including outside counsel and experts for litigation or other legal proceedings. (h) Professional services contracts for private development related studies and services when funded wholly by private developers, (i) Professional services contracts where the estimated total expenditure by the city, regardless of term, does not exceed $25,000.00. G) Csntraets witH any ]3uelie ageney sr gsvernmental bsey ts sbtain gsses an8fer serviees tHat meet eitHer sf the fullsvling eriteria: (I) Cooperative purchases where the city participates with one or more other governmental or public agencies in a cooperative agreement, provided tlleat least sne sf tHe ageneies has usee solicitation process used ismethses _substantially similar te-to the processthese required by this chapter; or (;!k) The use of another governmental or public agency's contract provided;Ji) the snginal ]3arties ts the esntraet agree, the esntraet was awareee within twelve msnths sf the date tHe eity eentraets fur tHe gsses ane/sr serviees, ane the esntraet resultee frem esntraet resnltee fmm agency used a solicitation methods substantially similar to the method these-required by this chapter;Jiil antI-the contract allows other agencies to utilize or the vendor authorizes the city to utilize; (iii) the contract is consistent with requirements specified in this Code; and (iv) there is an overall value to the City's utilizing the contract versus the city performing it's own solicitation. (I<D Contracts with Northern California Power Agency, Transmission Agency of Northern California, and Western Area Power Administration to procure wholesale utility commodities and related services that meet the requirements of Section 2.30.340(d). 100210 jb 0130564 2 (lm) Contracts with Pacific Gas and Electric Company and the California Independent Service Operator Corporation 'for energy transmission services to the extent necessary and expedient to provide for the general health, safety and welfare of its citizens. (1*11) Contracts with any public agency or governmental body to construct a public work where the public agency or governmental body has used methods similar to those required by this chapter to contract for the work. (flQ) Contracts with any public utility holding a certificate of public convenience and necessity or any cntity holding a cable communications system franchise pursuant to ~i1apter 2.10 to construct a public work whcre such work involves property of such public utility or cable communications system franchisee and is otherwise of direct concern to both the city and such public utility or cable communications system franchisee, provided that the project is not othcrwise required by thc Charter to be formally bid. (en) Contracts with private dcvelopers to construct public improvements in connection with their development project evcn if the city contributes funds to the improvement project, provided that the project is not otherwise required by the Charter to be formally bid. 1/ 1/ 1/ 1/ 1/ // // /I II /I 1/ 1/ II II (fig) (EI[) Projects where the public work is performed by the city with its own employees. Contracts wherc the estimated total expenditure by the city does not exceed $5,000.00. 100210 jb 0130564 3 SECTION 2. The Couneil finds that this is not a projeet under the California Environmental Quality Act and, therefore, no environmental impaet assessment is neeessary. SBCTION3. date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk APPROVED AS TO FORM: Senior Asst. City Attorney 100210 jn 0130564 This ordinance shall be effective on the thirty,first day after the 4 Mayor APPROVED: City Manager Director of Administrative Services