HomeMy WebLinkAbout2003-02-18 City Council (2)TO:
FROM:
of Palo Alto
Manager’s Repor
HONORABLE CITY COUNCIL 3
CITY MANAGER DEPARTMENT: ADMI~IST ~RATIVE
SERVICES
DATE:
SUBJECT:
FEBRUARY 18, 2002 CMR: 141:03
APPROVAL OF THE CITY OF PALO ALTO’S 2002-03
DISADVANTAGED BUSINESS ENTERPRISE (DBE) PROGRAM
AND ADOPTION OF A RESOLUTION IMPLEMENTING THE
PROGRAM
RECOMMENDATION
Staff recommends that Council:
1.Approve Palo Alto’s Disadvantaged Business Enterprise (DBE) Progrmn for federal
fiscal year 2002-03.
2.Adopt a resolution establishing an overall DBE participation goal of three percent for
work performed on federally funded transportation projects (Attaclvnent 1).
BACKGROUND
Federal regulations require recipients of federal funds to establish a DBE Program and
participation goals. The purpose of the DBE Program is to implement a policy supporting
the participation of finns owned and controlled by minorities and women in federally
funded projects. The California Department of Transportation (Caltrans) is responsible
for overseeing compliance with DBE participation requirements. Amaually, the City must
reaffirm its DBE Program and establish DBE participation goals in order to remain
eligible to receive federal funds from Caltrans or the Federal Highway Administration
(~HWA).
141:03 Page 1 of 4
DISCUSSION
Staff recommends Council reaffirm the City’s DBE Program (Attachment 1) for federal
fiscal year 2002-03, beginning October 1, 2002 and ending September 30, 2003. The
proposed DBE Program includes: 1) a DBE policy statement; 2) the designation and
duties of the City’s DBE Liaison Officer; 3) DBE contract procedures, reports, and
records; and 4) an updated DBE participation goal.
Staff has proposed an overall DBE participation goal of three percent for federal fiscal
year 2002-03. This goal was developed utilizing the number and types of contracts to be
awarded during the year and the availability of DBE firms in the area. The following
projects were used in the goal setting process:
Estimated
Pro_iects Federal Funding
Homer Avenue Undercrossing
Citywide Traffic Signal Upgrade
Embarcadero Road Pedestrian/Bike Bridge &
Bike Path
$2,701,000
885,000
800.000
Total Funding Estimate $4,386,000
Using these projects, staff defined the main categories of contract work and identified the
total number of DBE firms statewide willing to take on this work. Based upon the City’s
past experience, .staff limited the DBE firms to a seven-county geographical area (Santa
Clara, San Mateo, San Francisco, Alameda, Contra Costa, Santa Cruz and Solano
counties). The total number of DBE firms in these seven counties was then compared to
the total available contractors. The analysis resulted in the establishment of an overall
goal of three percent for the fiscal year. This goal represents a substantial reduction of
the prior year goal of 25 percent. Given the limited availability of DBE contractors and
the specialty nature of the work, staff believes three percent is the level of DBE
participation that can reasonably be expected.
In December 2002, the proposed three percent participation goal was submitted to
Caltrans for review and comment. Following this review, the goai was published in local
newspapers, inviting public comment for 45 days. The comment period ended February
15, 2003. No comments have been receiYed to date, nor have any been received in the
last several years.
141:03 Page 2 of 4
RESOURCE IMPACT
The City currently has three transportation projects with federal financial support,
estimated to total $4,386,000. Council approval of the 2002-03 DBE Program will allow
the City to remain eligible to receive federal funds for these and any new transportation
projects.
POLICY IMPLICATIONS
The renewal of the resolution is consistent with existing City policies.
TIMELINE
Following Council approval of the DBE Program, staff will submit the Council-approved
resolution to Caltrans for approval. Upon approval by Caltrans, the City is eligible to
receive federal funds from Caltrans or FHWA through the end of Federal fiscal year
2002-03.
ENVIRONMENTAL REVIEW
Adoption of a resolution to implement a DBE Program is not considered a project under
California Environmental Quality Act. No environmental assessment is required.
ATTACHMENTS
Attachment 1: Resolution with 2002-03 Disadvantaged Business Enterprise Program
PREPARED BY:/
ier, Purchasing and Contract Administration and DBE
Liaison Officer
141:03 Page 3 of 4
DEPARTMENT HEAD APPROVAL:
CARL/~ATS
DirecJior, Administrative Services
CITY MANAGER APPROVAL:
HARRISON
Assistant City Manager
cc: Arthur Duffy, DBE Coordinator, Caltrans
141:03 Page 4 of 4
ATTACHMENT 1
RESOLUT!ON NO.
RESOLUTION OF THE COUNCIL OF THE CITY OF PALO
ALTO ADOPTING A DISADVANTAGED BUSINESS
ENTERPRISE (DBE) PROGKhM FOR FEDER_hLLY FLINDED
CITY TRANSPORTATION PROJECTS
WHEREAS, in order to comply with federal requirements to
obtain federal funds for City transportation projects, the City
of Palo Alto must approve and implement a Disadvantaged Business
Enterprise ("DBE") program prior to approva! by Caltrans and the
United States Department of Transportation ("DOT") of any
request for Federa! funds;
WHEREAS, the overal! goa! established by the DBE program
for DBE participation in the performance of contracts financed
in whole or in part with DOT funds shal! be three percent and
shal! cover the period from October i, 2002 to September 30,
2003; and
WHEREAS, the City Manager has caused newspaper notice to
be published for a forty-five (45) day period, setting forth the
goal established by the City for Federal fiscal year 2002-2003
for DBE participation in the performance of contracts financed
in whole or in part with DOT funds.
NOW, THEREFORE, the Council of the City of Palo Alto
does RESOLVE as follows:
SECTION i. The Council hereby adopts the "City of Palo
Alto 2002-03 Disadvantaged Business Enterprise (DBE) Program", a
copy of which is attached hereto and incorporated herein by
reference.
SECTION 2. The Council hereby establishes the overall
goal of three percent for DBE participation in the performance
of contracts financed in whole or in part with DOT funds during
the period of October i, 2002 to September 30, 2003.
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030212 sm 0053200
SECTION 3.
under the California Environmenta! Quality Act and,
no environmenta! impact assessment is necessary.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
The Council finds that this is not a project
therefore,
City Clerk
APPROVED AS TO FORM:
Mayor
APPROVED:
City Attorney City Manager
Director of Administrative
Services
Disadvantaged Business
Enterprise Liaison Officer
030212 sm 0053200 2
Disadvantaged
usiness
Enterprise
(D E) Program
DISADVANTAGED BUSINESS ENTERPRISE (DBE) PROGRAM 2002-2003
CITY OF PALO ALTO
Policy Statement
It is the policy of the City or Palo Alto to provide to Disadvantaged Business Enterprises
(DBE), as defined in Title 49, Code of Federal Regulations (CFR) Part §26.5, a
maximum practicable opportunity to compete for the award of contracts, which receive
financial assistance from the U.S. Department of Transportation (DOT). This policy,
which is fully described herein, constitutes the City’s policy and commitment to take all
reasonable steps to utilize DBE firms in all program activities funded in whole or in part
by the U.S. Department of Transportation.
The City of Palo Alto, its contractors and subcontractors, which are the recipients of
Federal aid funds, agree to ensure that DBE firms have the maximum opportunity to
compete for and participate in the performance of Federally funded contracts and
subcontracts.
Mayor, City of Palo Alto
S:asd/a-alt!dbe/disadvantageci business enterprise 1
I. Definition of Terms
The terms used in this program have the meanings defined in 49 CFR §26.5.
II. Objectives/Policy Statement (§§26.1,26.23)
The City of Palo Alto has established a Disadvantaged Business Enterprise (DBE)
Program in accordance with regulations of the U.S. Department of Transportation
(DOT), 49 CFR Part 26. The City of Palo Alto has received Federal financial assistance
from the DOT, and as a condition of receiving this assistance, the City of Palo Alto will
sign an assurance that it will comply with 49 CFR Part 26.
It is the policy of the City of Palo Alto to ensure that DBEs, as defined in Part 26, have
an equal opportunity to receive and participate in DOT-assisted contracts. It is also our
policy:
To ensure non-discrimination in the award and administration of DOT-assisted
contracts;
To create a level playing field on which DBEs can compete fairly for DOT-
assisted contracts;
To ensure that the DBE Program is narrowly tailored in accordance with
applicable law;
To ensure that only firms that fully meet 49 CFR Part 26 eligibility standards are
permitted to participate as DBEs;
To help remove barriers to the participation of DBEs in DOT-assisted
contracts; and
To assist the development of firms than can compete successfully in the
marketplace outside the DBE Program.
The Manager Purchasing and Contract Administration, has been delegated as the DBE
Liaison Officer (DBELO). In-that capacity, the Manager Purchasing and Contract
Administration, is responsible for implementing all aspects of the DBE program.
Implementation of the DBE program is accorded the same priority as compliance with
all other legal obligations incurred by the City of Palo Alto in its financial assistance
agreements with the California Department of Transportation (Caltrans).
The City of Palo Alto has disseminated this policy statement to the City Council and all
the components of its organization. It has also distributed this statement to DBE and
non-DBE business communities that perform work on DOT-assisted contracts by
publishing this statement in general circulation, minority-focused and trade association
publications.
i!1. Nondiscrimination (§26.7)
The City of Palo Alto will never exclude any person from participation in, deny any
person the benefits of, or otherwise discriminate against anyone in connection with the
S:asd/a-al!ldbeldisadvantaged business enterprise 2
award and performance of any contract covered by 49 CFR Part 26 on the basis of
race, color, sex, or national origin.
In administering its DBE program, the City of Palo Alto will not, directly or through
contractual or other arrangements, use criteria or methods of administration that have
the effect of defeating or substantially impairing accomplishment of the objectives of the
DBE program with respect to individuals of a particular race, color, sex, or national
origin.
IV. DBE Program Updates (§26.21)
The City of Palo Alto will continue to carry out this program until the City of Palo Alto
has established a new goal setting methodology or until significant changes to DBE
Program are adopted. The City of Palo Alto will provide to Caltrans a proposed overall
goal and goal setting methodology and other program updates by June 1 of every year.
V. Quotas (§26.43)
The City of Palo Alto will not use quotas or set-asides in any way in the administration of
this DBE program.
Vl. DBE Liaison Officer (DBELO) (§26.25)
The City of Palo Alto has designated the following individual as the DBELO:
Johnella Walker
Manager, Purchasing and Contract Administration
City of Palo Alto
250 Hamilton Avenue
Palo Alto, California 94301
650-329-2300
johnella.walker@cityofpaloalto.orq
In that capacity, Johnella Walker is responsible for implementing all aspects of the DBE
program and ensuring that the City of Palo Alto complies with all provisions of 49 CFR
Part 26. This is available on the Internet at www.osdbuweb.dot.qovlmain.cfm. Johnella
Walker has direct, independent access to the City Manager concerning DBE program
matters. The DBELO allocates a portion of her time to the program, designating roles to
other staff members as required. An organization chart displaying the DBELO’s position
in the organization is found in Exhibit 1 to this program.
The DBELO is responsible for developing, implementing and monitoring the DBE
program, in coordination with other appropriate officials. ’ Duties and responsibilities
include the following:
1.Gathers and reports statistical data and other information as required.
2.Reviews third party contracts and purchase requisitions for compliance with this
program.
S:asd/a-allldbe!disadvantaged business enterprise 3
3.Works with all departments to set overall annual goals.
4.Ensures that bid notices and requests for proposals are available to DBEs in a
timely manner.
5.Identifies contracts and procurements so that DBE goals are included .in
solicitations (both race-neutral methods and contract specific goals) and monitors
results.
6.Analyzes the City of Palo Alto’s progress toward goal attainment and identifies
ways to improve progress.
7.Participates in pre-bid meetings.
8.Advises the City Manager/City Council on DBE matters and achievement.
9.Participates with the legal counsel and project managers to determine contractor
compliance with good faith efforts.
10. Provides DBEs with information and assistance in preparing bids, obtaining bonding
and insurance.
11.Provides outreach to DBEs and community organizations to advise them of
opportunities.
VII. Federal Financial Assistance Agreement Assurance (§26.13)
The City of Palo Alto will sign the following assurance, applicable to all Federal Highway
Administration (FHWA) assisted contracts and their administration a part of the program
supplement agreement for each project.
The recipient shall not discriminate on the basis of race, color, national origin, or sex in
the award and performance of any DOT-assisted contract or in the administration of its
DBE Program or the requirement of 49 CFR Part 26. The recipient shall take all
necessary and reasonable steps under 49 CFR Part 26 to ensure nondiscrimination in
the award and administration of DOT-assisted contracts. The recipient’s DBE Program,
as required by 49 CFR Part 26 and as approved by DOT, is incorporated by reference
in this agreement. Implementation of this program is a legal obligation and failure to
carry out its terms shall be treated as a violation of this agreement. Upon notification to
the recipient of its failure to carry out its approved program, the Department may impose
sanctions as provided for under Part 26 and may, in appropriate cases, refer the matter
for enforcement under 18 U.S.C. 1001 and/or the Program Fraud Civil Remedies Act of
1986 (31 U.S.C. 3801 et seq.).
VIII. DBE Financial Institutions
It is the policy of the City of Palo Alto to investigate the full extent of services offered by
financial institutions owned and controlled by socially and economically disadvantaged
individuals in the community, to make reasonable efforts to use these institutions, and to
encourage prime contractors on DOT-assisted contracts to make use of these
institutions.
Information on the availability of such institutions can be obtained from the DBELO.
The Caltrans DBE Program may offer assistance to the DBELO.
S:asd!a-altldbe/disadvantaged business enterprise 4
IX. Directory (§26.31)
The City of Palo Alto will refer interested persons to the DBE directory available from
the Caltrans DBE Program website at www.dot.ca.qov/hq/bep.
X. Overconcentration (§26.33)
The City of Palo Alto has not identified any types of work in DOT-assisted contracts that
have an overconcentration of DBE participation. If in the future the City of Pal Alto
identified the need to address overconcentration, measures for addressing
overconcentration will be submitted to the Caltrans District Local Assistance Engineer
(DLAE) for approval.
XI. Business Development Programs (§26.35)
The City of Palo Alto does not have a business development or mentor-prot6g6
program. If the City of Palo Alto identifies the need for such a program in the future, the
rationale for adopting such a program and a comprehensive description of it will be
submitted to the DLAE for approval.
XII. Required Contract Clauses (§§26.13, 26.29)
Contract Assurance
The City of Palo Alto ensures that the following clause is placed in every DOT-assisted
contract and subcontract:
The contractor or subcontractor shall not discriminate on the basis of race, color,
national origin, or sex in the performance of this contract. The contractor shall carry out
applicable requirements of 49 CFR Part 26 in the award and administration of DOT-
assisted contracts. Failure by the contractor to carry out these requirements is a
material breach of this contract, which may result in the termination of this contract or
such other remedy, as recipient deems appropriate.
Prompt Payment
The City of Palo Alto ensures that the following clauses or equivalent will be included in
each DOT-assisted prime contract:
The prime contractor agrees to pay each subcontractor under this prime contract for
satisfactory performance of its contract no later than I0 days from the receipt of each
payment the prime contractor receives from the City of Palo Alto. The prime contractor
agrees further to release retainage payments to each subcontractor within 30 days after
the subcontractor’s work is satisfactorily completed.
Any delay or postponement of payment from the above-referenced time frame may
occur only for good cause following written approval of the City of Palo Alto. This
clause applies to both DBE and non-DBE subcontractors.
S:asd/a-allidbe/disadvantaged business enterprise 5
XIIl. Monitoring and Enforcement Mechanism (§26.3/)
The City of Palo Alto will assign a Resident Engineer (RE) or Contract Manager (CM) to
monitor and track actual DBE participation through contractor and subcontractor reports
of payments in accordance with the following:
After Contract Award
After the contract award, the City of Palo Alto will review the award documents for the
portion of items each DBE and first tier subcontractors will be performing and the dollar
value of that work. With these documents the RE/CM will be able to determine the work
to be performed by the DBEs or subcontractors listed.
Preconstruction Conference
A preconstruction conference will be scheduled between the RE/CM and the contractor
or their representation, to discuss the work each DBE subcontractor will perform.
Before work can begin on a subcontract, the local agency will require the contractor to
submit a completed "Subcontracting Request". When the RE/CM receives the
completed form, it will be checked for agreement of the first tier subcontractors and
DBEs. The RE/CM will not approve the request when it identifies someone other than
the DBE or first tier subcontractor listed in the previously completed "Local Agency
Bidder - DBE Information". The "Subcontracting Request" will not be approved until any
discrepancies are resolved. If an issue cannot be resolved, or there is some other
concern, the RE/CM will require the contractor to eliminate the subcontractor in question
before signing the "Subcontracting Request". A change in the DBE or first tier
subcontractor may be addressed during a substitution process at a later date.
Substitutions will be subject to the Subletting and Subcontracting Fair Practices Act
(FPA). Local agencies will require contractors to adhere to. the provisions within
Subletting and Subcontracting Fair Practices Act (State Law) Sections 4100-4144. FPA
requires the contractor to list all subcontractors in excess of one half of one percent
(0.5%) of the contractor’s total bid or $10,000, whichever is greater. The statute is
designed to prevent bid shopping by contractors. The FPA explains that a contractor
may not substitute a subcontractor listed in the original bid except with the approval of
the awarding authority.
The RE/CM will give the contractor a blank, "Final Report - Utilization of Disadvantaged
Business Enterprises," and explain to them that the document will be required at the
end of the project, for which payment can be withheld, in conformance with the contract.
Construction Contract Monitorinq
The RE/CM wil! ensure that the RE!CM’s sfaff (in.~ne~fr~m~ know.~ wh~f tems nf wr~rk
each DBE is responsible for performing. Inspectors will notify the RE immediately of
apparent violations.
S:asd/a-all/dbe/disadvantaged business enterprise 6
When a firm other than the listed DBE subcontractor is found performing the work, the
RE/CM will notify the contractor of the apparent discrepancy and potential loss of
payment. Based on the contractor’s response, the RE/CM will take appropriate action:
The DBELO will perform a preliminary investigation to identify any potential issues
related to the DBE subcontractor performing a commercially useful function. Any
substantive issues will be forwarded to the Caltrans DBE Program. If the contractor
fails to adequately explain why there is a discrepancy, payment for the work will be
withheld and a letter will be sent to the contractor referencing the applicable
specification violation and the required withholding of payment.
If the contract requires the submittal of a monthly truck document, the contractor will be
required to submit documentation to the RE/CM showing the owner’s name; California
Highway Patrol CA number; and the DBE certification number of the owner of the truck
for each truck used during that month for which DBE participation will be claimed. The
trucks will be listed by California Highway Patrol CA number in the daily diary or on a
separate piece of paper for documentation. The numbers are checked by inspectors
regularly to confirm compliance.
Providing evidence of DBE payment is the responsibility of the contractor.
Substitution
When a DBE substitution is requested, the RE/CM will request a letter from the
contractor explaining why substitution is needed. The RE/CM must review the letter to
be sure names and addresses are shown, dollar values are included, and the reason for
the request is explained. If the RE/CM agrees to the substitution, the RE/CM will notify,
in writing, the DBE subcontractor regarding the proposed substitution and procedure for
written objection form the DBE subcontractor in accordance with the Subletting and
Subcontracting Fair Practices Act. If the contractor is not meeting the contract goat with
this substitution, the contractor must provide the required good faith effort to the RE/CM
for consideration.
If there is any doubt in the RE/CM’s mind regarding the requested substitution, the
RE/CM may contact DLAE for assistance and direction.
Recordkeepin.q and Final Report Utilization of DBEs
The contractor shall maintain records showing the name and address of each first-tier
subcontractor. The records shall also show:
1.The name and business address, regardless of tier, of every DBE subcontractor,
DBE vendor of materials and DBE trucking company.
2.The date of payment and the total dollar figure paid to each of the firms.
3.The DBE prime contractor shall also show the date of work performed by their
own forces along with the corresponding dollar value of the work claimed toward
DBE goals.
S:asd/a-all/dbe/disadvantaged business enterprise 7
When a contract has been completed, the contractor will provide a summary of the
records stated above. The DBE utilization information will be documented on the form
"Final Report Utilization of Disadvantaged Business Enterprises, First Tier
Subcontractors" and will be submitted to the DLAE attached to the Report of
Expenditures. The RE/CM will compare the completed form "Final Report - Utilization
of Disadvantaged Business Enterprises, First Tier Subcontractors" form to the
contractor’s completed "Local Agency Bidder - DBE Information" form and, if applicable,
to the completed "Subcontracting Request" form. The DBEs shown on the completed
form "Final Report - Utilization of Disadvantaged Business Enterprises, First Tier
Subcontractors" should be the same as those originally listed unless an authorized
substitution was allowed, or the contractor used more DBEs and they were added. The
dollar amount should reflect any changes made in planned work done by the DBE. The
contractor will be required to explain in writing why the names of the subcontractors, the
work items or dollar figures are different from what was originally on the completed
"Local Agency Bidder- DBE Information" form when:
1. There have been no changes made by the RE/CM.
2. The contractor has not provided a sufficient explanation in the comment section
of the completed form "Final Report- Utilization of Disadvantaged Business
Enterprises, First Tier Subcontractors."
The explanation will be attached to the completed form "Final Report- Utilization of
Disadvantaged Business Enterprises (DBE), First Tier Subcontractors" for submittal.
The RE/CM will file this in the project records.
The City of Palo Alto DBELO will keep track of the DBE certification status on the
lnternet at www.dot.ca.,qov/hq/bep and keep the RE/CM informed of changes that affect
the contract. The RE/CM will require the contractor to act in accordance with existing
contractual commitments regardless of decertification.
The DLAE will use the PS&E checklist to monitor the City of Palo AIto’s commitment to
require bidders list information to be submitted to the City of Palo Alto from the awarded
prime and subcontractors as a means to develop a bidders list. This monitoring will only
take place if the bidders list information is required to be submitted as stipulated in the
special provisions.
The City of Palo Alto will bring to the attention of the DOT through the DLAE, any false,
fraudulent, or dishonest conduct in connection with the program, so that DOT can take
the steps (e.g., referral to the Department of Justice for criminal prosecution, referral to
the DOT Inspector General, action under suspension and debarment of Program Fraud
and Civil Penalties rules) provided in §26.109. The City of Palo Alto also will consider
similar action under its own authorities, including responsibility determinations in future
contracts.
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XIV. Overall Goals (§26.45)
Amount of Goal
The City of Palo Alto’s overall DBE goal for the Federal Fiscal Year 2002-03 is three
percent. The City of Palo Alto projects meeting 100 percent of the goal utilizing race-
conscious measures. This City of Palo Alto will further use race-neutral methods to
further encourage DBE participation.
Methodolo.qv
Breakout of Estimated Race-Neutral and Race-Conscious Participation
Process
Starting with Federal fiscal year 2002-03, the amount of overall goal, the method to
calculate the goal and the breakout of estimated race-neutral and race-conscious
participation will be required annually by June 1 in advance of the Federal fiscal year
beginning October 1 for DOT-assisted contracts. Submittals will be to the DLAE. An
exception to this will be if FTA or FAA recipients are required by FTA or FAA to submit
the annual information to them or a designee by another date. FHWA recipients will
follow this process:
Once the DLAE has responded with preliminary comments and the comments
have been incorporated into the draft overall goal information, the City of Palo
Alto will publish a notice of the proposed overall goal, informing the public that
the proposed goal and its rationale are available for inspection during normal
business hours at the City of Palo Alto’s principal office for 30 days following the
date of the notice, and informing the public that the City of Palo Alto will accept
comments on the goals for 45 days following the date of the notice. The notice
must be published in general circulation media and available minority-focused
media and trade association publications. The notice will include addresses to
which comments may be sent and addresses (including offices and websites)
where the proposal may be reviewed.
The overall goal resubmission to the Caltrans’ DLAE, will include a summary of
information and comments received during this public participation process and,
the City of Palo Alto’s responses. This will be due by September 1 to the
Caltrans"DLAE. The DLAE will have a month to make a final review so the City
of Palo Alto may begin using the overall goal on October 1 of each year.
XV. Contract Goals (§26.51)
The City of Palo Alto will use contract goals to meet any portion of the overall goal the
City of Palo Alto does not project being able to meet by the use of race-neutral means.
Contract goals are established so that, over the period to which the overall goal applies,
they wil! cJmu~atively result in meeting any portion of the overa!! goa! that is not
projected to be met through the use of race-neutral means.
S:asd/a-all!dbe/disadvantaged business enterprise 9
Contract goals will be established only on those DOT-assisted contracts that have
subcontracting possibilities. Contract goals need .not be established on every such
contract, and the size of contract goals will be adapted to the circumstances of each
such contract (e.g., type and location of work, availability of DBEs to perform the
particular type of work). The contract work items will be compared with eligible DBE
contractors willing to work on the project. A determination will also be made to decide
which items are likely to be performed by the prime contractor and which ones are likely
to be performed by subcontractor(s). The goal will then be incorporated into the
contract documents. Contract goals will be expressed as a percentage of the total
amount of a DOT-assisted contract.
XVl. Transit Vehicle Manufacturers (§26.49)
If DOT-assisted contracts will include transit vehicle procurements,the City of Palo Alto
will require each transit vehicle manufacturer, as a condition of being authorized to bid
or propose on transit vehicle procurements, to certify that it has complied with the
requirements of 49 CFR Part 26, Section 49. The City of Palo Alto will direct the transit
vehicle manufacturer to the subject requirements located on the Internet at
http:/losdbuweb.dot..qov/pro.qramsldbe/dbe.htm.
XVll. Good Faith Efforts (§26.53)
Information to be Submitted
The City of Palo Alto treats bidders’/offerors’ compliance with good faith effort
requirements as a matter of responsiveness. A responsive proposal is meeting all the
requirements of the advertisement and solicitation.
Each solicitation for which a construction contract goal has been established will require
the bidders/offerors to submit the following information to:
City of Palo Alto
Manager, Purchasing and Contract Administration
250 Hamilton Avenue, MS-Mb
Palo Alto, CA 94301
RE:
Project:
IFB or RFP #:
No later than 4:00 p.m. on or before the fourth day, not including Saturdays, Sundays
and legal holidays, following bid opening day:
1.The names and addresses of DBE firms that will participate in the contract;
2.A description of the work that each DBE will perform;
3.The dollar amount of the participatio.n of each DBE firm participating;
4.Written and signed documentation of commitment to use a DBE subcontractor
whose participation it submits to meet a contract goal;
S:asd/a-all/dbe/disadvantaged business enterprise 10
5.Written and signed confirmation from the DBE that it is participating in the
contract as provided in the prime contractor’s commitment; and
6.If the contract goal is not met, evidence of good faith efforts.
Demonstration of Good Faith Efforts
The obligation of the bidder/offeror is to make good faith efforts. The bidder/offeror can
demonstrate that is has done so either by meeting the contract goal or documenting
good faith efforts. Examples of good faith efforts are found in Appendix A to Part 26
which is attached.
The following is responsible for determining whether a bidder/offeror who has not met
the contract goat has documented sufficient good faith efforts to be regarded as
responsive: Manager, Purchasing and Contract Administration.
The City of Palo Alto will ensure that all information is complete and accurate and
adequately documents the bidder/offeror’s good faith efforts before a commitment to the
performance of the contract by the bidder/offeror is made.
Administrative Reconsideration
Within 10 days of being informed by the City of Palo Alto that it is not responsive
because it has not documented sufficient good faith efforts, a bidder/offeror may request
administrative reconsideration. Bidder/offerors should make this request in writing to
the following reconsideration official:
Carl Yeats
Director, Administrative Services Department
City of Palo Alto
250 Hamilton Avenue, MS-4A
Palo Alto, CA 94301
650-329-2450
carl.yeats@cityofpaloalto.orq
The reconsideration official will not have played any role in the original determination
that the bidder/offeror did not make sufficient good faith efforts.
As part of this reconsideration, the bidder/offeror will have the opportunity to provide
written documentation or argument concerning the issue of whether it met the goal or
made adequate good faith efforts to do so. The bidder/offeror will have the opportunity
to meet in person with the reconsideration official to discuss the issue of whether it met
the goal or made adequate good faith efforts to do so. The City of Palo Alto will send
the bidder/offeror a written decision on reconsideration, explaining the basis for finding
that the bidder did or did not meet the goal or make adequate good faith efforts to do so.
The result of the reconsideration process is not administratively appealable to Caltrans,
FHWA or the DOT.
S:asd/a-211/dbe/disadvantaged business enterprise 1 1
Good Faith Efforts when a DBE is Replaced on a Contract
The City of Palo Alto will require a contractor to make good faith efforts to replace a
DBE that is terminated or has otherwise failed to complete its work on a contract with
another certified DBE, to the extent needed to meet the contract goal. The prime
contractor is required to notify the RE/CM immediately on the DBE’s inability or
unwillingness to perform and provide reasonable documentation.
In this situation, the prime contractor will be required to obtain City of Palo Alto prior
approval of the substitute DBE and to provide copies of new or amended subcontracts,
or documentation of good faith efforts. If the contractor fails or refuses to comply in the
time specified, the City of Palo Alto contracting office will issue an order stopping all or
part of payment/work until satisfactory action has been taken. If the contractor still fails
to comply, t/he contracting officer may issue a termination for default proceedings.
XVII!. Counting DBE Participation (§26.55)
The City of Palo Alto wil! count DBE participation toward overall and contract goals as
provided in the contract specifications for the prime contractor, subcontractor, joint
venture partner with prime or subcontractor, or vendor of material or supplies.
XIX. Certification (§26.83(a))
The City of Palo Alto ensures that only DBE firms currently certified on the Caltrans’
directory will participate as DBEs in its program.
XX. Information Collection and Reporting
Bidders List
The City of Palo Alto will create a bidders list, consisting of information about all DBE
and non-DBE firms that bid or quote on DOT-assisted contracts. The bidders list will
include the name, address, DBE/non-DBE status, age, and annual gross receipts of
firms.
Monitoring Payments to DBEs
Prime contractors are required to maintain records and documents of payments to
DBEs for three years following the performance of the contract. These records will be
made available for inspection upon request by any authorized representative of the City
of Palo Alto, Caltrans, FHWA or DOT. This reporting requirement also extends to any
certified DBE subcontractor.
Payments to DBE subcontractors will be reviewed by the City of Palo Alto to ensure that
the actual amount paid to DBE subcontractors equals or exceeds the dollar amounts
stated in the schedule of DBE participation.
S:asd!a-all/dbe/disadvantaged business enterprise 12
Reportin.q to Caltrans
The City of Palo Alto - Final Utilization of DBE participation will be reported to the
DLAE.
Confidentiality
The City of Palo Alto will safeguard from disclosure to third parties, information that may
reasonably be regarded as confidential business information, consistent with federal,
state, and local laws.
City Manager Date
The Disadvantaged Business Enterprise Program is accepted by:
DLAE Date
S :~d/a-all/dbe/disadvantagexl business enterprise 13
APPENDIX A TO 49 CFR PART 26 -
GUIDANCE CONCERNING GOOD FAITH
EFFORTS
When, as a recipient, you establish a contract goal on a DOT-assisted contract, a
bidder must, in order to be responsible andlor responsive, make good faith
efforts to meet the goal. The bidder can meet this requirement in either of two
ways. First, the bidder can meet the goal, documenting commitments for
participation by DBE firms sufficient for this purpose. Second, even if it doesn’t
meet the goal, the bidder can document adequate good faith efforts. This means
that the bidder must show that it took all necessary and reasonable steps to
achieve a DBE goal or other requirement of this part, which by their scope,
intensity, and appropriateness to the objective, could reasonably be expected to
obtain sufficient DBE participation, even if they were not fully successful.
In any situation in which you have established a contract goal, Part 26 requires
you to use the good faith efforts mechanism of this part. As a recipient, it is up to
you to make a fair and reasonable judgment whether bidder that did not meet the
goal made adequate good faith efforts. It is important for you to consider the
quality, quantity, and intensity of the different kinds of efforts that the bidder has
made. The efforts employed by the bidder should be those that one could
reasonably expect a bidder to take if the bidder were actively and aggressively
trying to obtain DBE participation sufficient to meet the DBE contract goal. Mere
pro forma efforts are not good faith efforts to meet the DBE contract
requirements. We emphasize, however, that your determination concerning the
sufficiency of the firm;s good faith efforts is a judgment call: meeting quantitative
formulas is not required.
Ill.The Department also strongly cautions you against requiring that a bidder meet a
contract goal (i.e., obtain a specified amount of DBE participation) in order to be
awarded a contract, even though the bidder makes an adequate good faith
efforts showing. This rule specifically prohibits you from ignoring bona fide good
faith efforts.
IV.The following is a list of types of actions, which you should consider as part of the
bidder’s good faith efforts to obtain DBE participation. It is not intended to be a
mandatory checklist, nor is it intended to be exclusive or exhaustive. Other
factors or types of efforts may be relevant in appropriate cases.
Ao Soliciting through all reasonable and available means (e.g. attendance at pre-
bid meetings, advertising and/or written nptice) the interest of all certified
DBEs who have the capability to perform the work of the contract. The bidder
must solicit this interest within sufficient time to allow the DBEs to respond to
the solicitation. The bidder must determine with certainty if the DBEs are
interested by taking appropriate steps to follow up initial solicitations.
B.Selecting portions of the work to be performed by DBEs in order to increase
the likelihood that the DBE goals will be achieved. This includes, where
14S:asdJa-allidbe/disadvanta~_ed business enterprise -
Co
appropriate, breaking out contract work items into economically feasible units
to facilitate DBE participation, even when the prime contractor might
otherwise prefer to perform these work items with its own forces.
Providing interested DBEs with adequate information about the plans,
specifications, and requirements of the contract in a timely manner to assist
them in responding to a solicitation.
Do (1) Negotiating in good faith with interested DBEs. It is the bidder’s
responsibility to make a portion of the work available to DBE subcontractors
and suppliers and to select those portions of the work or material needs
consistent with the available DBE subcontractors and suppliers, so as to
facilitate DBE participation. Evidence of such negotiation includes the names,
addresses, and telephone numbers of DBEs that were considered; a
description of the information provided regarding the plans and specifications
for the work selected for subcontracting; and evidence as to why additional
agreements could not be reached for DBEs to perform the work.
(2) A bidder using good business judgment would consider a number of
factors in negotiating with subcontractors, including DBE subcontractors, and
would take a firm’s price and capabilities as well as contract goals into
consideration. However, the fact that there may be some additional costs
involved in finding and using DBEs is not in itself sufficient reason for a
bidder’s failure to meet the contract DBE goal, as long as such costs are
reasonable. Also, the ability or desire of prime contractor to perform the work
of a contract with its own organization does not relieve the bidder of the
responsibility to make good faith efforts. Prime contractors are not, however,
required to accept higher quotes from DBEs if the price difference is
excessive or unreasonable.
Not rejecting DBEs as being unqualified without sound reasons based on a
thorough investigation of their capabilities. The contractor’s standing within
its industry, membership in specific groups, organizations, or associations
and political or social affiliations (for example union vs. non-union employee
status) are not legitimate causes for the rejection or non-solicitation of bids in
the contractor’s efforts to meet the project goal.
F.Making efforts to assist interested DBEs in obtaining bonding, lines of credit,
or insurance as required by the recipient or contractor.
G.Making efforts to assist interested DBEs in obtaining necessary equipment,
supplies, materials, or related assistance or services.
Effectively using the services of available minority/women community
organizations; minoritylwomen contractors’ groups; local, state, and federal
minoritylwomen business assistance offices; and other organizations as
allowed on a case-by-case basis to provide assistance in the recruitment and
placement of DBEs.
S:asdJa-all/dbe/disadvantaged business enterprise 15
Vo In determining whether a bidder has made good faith effort, you may take into
account the performance of other bidders in meeting the contract. For example,
when the apparent successful bidder fails to meet the contract goal, but others
meet it, you may reasonably raise the question of whether, with additional
reasonable efforts, the apparent successful bidder could have met the goal. If
the apparent successful bidder fails to meet the goal, but meets or exceeds the
average DBE participation obtained by other bidders, you may view this, in
conjunction with other factors, as evidence of apparent successful bidder having
made good faith efforts.
S:asd!a-all!dbe/disadvantaged business enterprise 16
APPENDIX B
TO BE USED FOR DESIGN-BUILD CONTRACTS
The following are hereby incorporated in to the City of Palo Alto’s Disadvantaged
Business Enterprise (DBE) Program:
il Objectives/Policy Statement (§§26.1, 26.23)
At the end of the first paragraph, add the following:
The City of Palo Alto recognizes that certain modifications are necessary to adapt the
program for the use in connection with design-build contracts, and has therefore
established certain procedures appficable to design-build DBE contracts under the DBE
Program. Pubfic Contract Code Section 4109 requires subcontractors to be identified
by the prime contractor for the subletting or subcontracting of any portion of the work in
excess of one-half of 1 percent of the prime contractor’s total bid. Exceptions are only
in the cases of public emergency or necessity, and then only after a finding reduced to
writing as a pubfic record of the awarding authority setting forth the facts constituting the
emergency or necessity.
Xlll Monitoring and Enforcement Mechanisms (§26.37)
At the end of the first paragraph below "After Contract Award", add the following
paragraph:
After Design-Build Contract Award
As described in the Section entitled "GOOD FAITH EFFORTS" below, each proposer
for a City of Palo Alto design-build contract will be required to submit a DBE
Performance Plan as part of a responsive proposal Following award of a design-build
contract and during both the design and construction portions of the project, the design-
build contractor will be required to submit documentation, in the form of progress reports
described below, to show that the design-build contractor is meeting the contract goal
for the project, or ff the goal is not being met, the design-build contractor must submit
satisfactory evidence that it has made good faith efforts, in accordance with Section
XVII, to meet the goal. Evidence of good faith efforts, as described in 49 CFR Part 26,
Section 26.53 and Appendix A, will be monitored by the agency throughout the duration
of the design-build project.
At the end of the first paragraph below, "Preconstruction Conference", add the following
sentence:
The contractor will promptly provide the City of Palo Alto with the information required
by the form entitled "Local Agency DBE information" upon selection of any DBE or other
subcontractor not previously identified by the design-build contractor. During the course
S:asd/a-all!dbe/disadvantaged business enterprise 17
of the contract, differences must be explained and resolved by either making corrections
or requesting substitution.
At the end of the fourth paragraph below "Construction Contract Monitoring", add the
following paragraph:
The contractor will provide DBE Progress Reports to the City of Palo Alto with each
invoice and will provide an annual report on or before August 1 of each Year of the
design-build contract. Each report must also include a narrative summary stating
whether the contractor is on target with respect to the DBE goal set forth in the design-
build contract, whether the goal has been exceeded (stating the amount of the excess),
or whether the contractor is behind target (stating the amount of the deficit).
XVll Good Faith Efforts (26.53)
At the end of the third paragraph below "Information to be Submitted", add the following
items:
A DBE Performance Plan containing a detailed description of the design-build
contractor’s planned methodology for achieving the DBE goal stated in the
contract, including a description of the good faith efforts the design-build
contractor intends to undertake to achieve that goal.
A design-build proposal must also include an affidavit that the proposer will either
attain the DBE goals for the design-build contract or will exercise good faith
efforts to do so.
At the end of the first paragraph below "Demonstration of Good Faith Efforts", add the
following sentence"
If it is a design-build contract, each contractor proposing will be required to submit a
DBE Performance Plan as part of a responsive proposal and good faith effort.
City Manager Date
This Disadvantaged Business Enterprise Program for design-build contracts is accepted
by:
DLAE Date
S:asd/a-all/dbe/disadvantaged business enterprise 18
City of Palo Alto
DBE Goal Development
Comparision of DBEs to All Available Contractors within 7 County Area
FY 2002/2003
Project Description
% of work Work Federal Funds NAICSFederal Funds relating to Category per specific codeWCCCodes (WCC)WCC
Embarcadero Road - Bike Extension $800,000
VVCC/NAICS Code- Description
Landscaping and Nursery
Concrete & Cement
Fencing
Construction Area Signs
Traffic Contraol System
Reset, Adjust Roadway Items
Clearing and Grubbing
Roadway Excavation
Structure Excavation
Structure Backfill
Imported Borrow
Irrigation System
Aggregate Base
Asphalt Concrete
Recycle, Reclaim Asphalt Concrete
Furnish & Drive Piling
Concrete Structure
Furnish Precast Concrete Deck Unit
Erect Precast Concrete
Joint Seal - Water Stop
Reinforcing Steel
Waterproofing
Stee} Structures
Railroad Work
Concrete Curb & Sidewalk -’ Misc.
Misc. iron & Steel Frame, Cover & Grate
Misc. Bridge Metal Pumping Plant Metal
Painted Traffice Stripe & Marking
Pavement Marking
Lighting
1.2%
0.3%
28.9%
0.1%
1.1%
0.5%
6.7%
2.4%
1.1%
0.7%
0.0%
0.8%
3.9%
3.3%
0.1%
2.4%
7.9%
9.7%
2.2%
0.2%
2.2%
1.2%
1.4%
4.4%
0.0%
0.0%
3.9%
0.5%
0.0%
13.2%
Subtotal 100.0%
Homer Avenue Undercrossing $2,701,000
WCC/NAICS Code. Description
Landscaping & Nursery
Concrete & Cement
Reinforcing Bar Section
Steel
Fencing
Electrical & Signals
Traffic Control System
Clearing & Grubbing
Roadway Excavation
Structure Excavation
2.6%
40.3%
2.9%
8.1%
0.1%
2.7%
O.7%
0.1%
3.9%
0.3%
Relative
Avilablilty of DBE
to Total Firms*
Total $ of work to
be possibly
subcontracted to
DBE
0620 $9,280 56173 0.2%$20
0651 $2,080 23571 2.1%$43
0680 $230,800 23599 1.8%$4,049
1200 $1,000 23411 3.4%$34
1201 $8,480 23411 4.0%$339
1522 $3,920 23411 2.3%$90
1601 $53,440 23411 6.3%$3,359
1901 $19,280 23593 8.7%$1,680
1920 $8,880 23593 6.1%$538
1930 $5,760 23593 4.5%$262
1980 $320 23411 3.4%$11
2065 $6,560 22131 12.9%$846
2602 $31,040 23’411 3.4%$1,064
3901 $26,400 23411 2.3%$603
3990 $640 23411 1.1 %$7
4901 $18,800 23499 2.5%$468
5100 $63,360 23571 2.8%$1,748
5120 $77,320 23571 0.9%$711
5124 $17,600 23571 0.7%$121
5190 $1,200 23571 0.9%$11
5201 $17,600 23591 3.0%$528
5620 $9,600 23599 1.0%$92
5701 $10,800 23551 0.3%$35
6101 $35,200 23499 0.0%$0
7301 $80 23571 3.0%$2
7500 $80 23591 9.0%$7
7505 $30,800 23591 5.0%$1,540
8406 $4,000 23599 1.6%$64
8501 $80 23599 4.0%$3
8604 $ 105,600 23531 0.5%$541
$800,000 $18,818
0620 $69,885 56173 0.2%$150
0651 $1,089,045 23571 2.1%$22,532
0652 $77,656 23591 1.0%$777
0655 $218,481 23591 4.0%$8,739
0680 $2,073 23599 1.8%$36
0686 $72,807 23531 0.6%$426
1201 $18,187 23411 3.4%$624
1601 $1,770 23411 2.3%$40
1901 $105,482 23593 6.3%$6,630
1920 $8,730 23593 8.7%$761
2003 DBE Goal Assumptions (R).xls Page 1 of 2
City of Palo Alto
DBE Goal Development
Comparision of DBEs to All Available Contractors within 7 County Area
FY 2002/2003
Project Description
Irrigation System
Aggregate Base
Asphalt Concrete
Concrete Structure
Minor Concrete Structure
Furnish Precast Concrete Deck Unit
Erect Precast Concrete
Waterproofing
Steel Structures
Reinforced Concrete Pipe
Subsurface Drain
Horizontal Drain
Concrete Curb & Sidewalk - Misc.
Drainage Pumping Equipment
Pumping Plant Electrical Equipment
Misc. iron & Steel Frame, Cover & Grate
Metal Railing
Painted Traffice Stripe & Marking
Subtotal
% of work Work Federal Funds NAICSFederal Funds relating to Category per specific codeWCCCodes (WCC)WCC
1.1 %2065 $30,796 22131
0.1%2602 $2,673 23411
0.0%3901 $364 23411
0.7%5100 $18,187 23571
0.6%5105 $16,732 23571
6.1%5120 $166,103 23571
2.8%5124 $75,171 23571
1 ~2%5401 $32,463 23599
14.1%5501 $380,553 23591
1.2%6500 $33,099 23571
0.4%6800 $12,124 23411
0.3%6815 $6,935 23411
0.5%7301 $13,864 23571
1.7%7405 $45,466 23491
1.2%7410 $32,614 23531
0.7%7500 $18,187 23591
1.6%8330 $43,648 23411
4.0%8604 $107,907 23531
100.0%$2,701,000
Relative
Avilablilty of DBE
to Total Firms*
3.4%
3.4%
2.3%
2.8%
3.4%
0.9%
0.7%
1.6%
8.0%
5.7%
5.7%
2.3%
3.0%
1.0%
0.3%
9.0%
0.6%
0.5%
Total $ of work to
be possibly
subcontracted to
DBE
$1,056
$92
$8
$502
$577
$1,527
$518
$5t8
$30,444
$1,891
$693
$159
$414
$459
$96
$1,637
$249
5553
$82,108
ATMS Implementation $885,000
WCC/NAICS Code. Description
Traffic Control System
Subtotal
Totals $4,386,000
100.0%1201 $885,000
100.0%885,000
$4,386,000
* No. DBE Firms / All Firms (See Step 1 Source Data worksheet)
WCC - Work Category Codes - Caltrans Civil Rights website
NAICS - North American Industrial Classification System codes - Census Bureau Data website
23411
DBE Base Goal:
3.4%$30,343
30,343
$131,269
3.0%
2003 DBE Goal Assumptions (R).xls Page 2 of 2
EXHIBIT 1
0 ~~E