HomeMy WebLinkAboutStaff Report 2608-6629CITY OF PALO ALTO
CITY COUNCIL
Special Meeting
Monday, August 24, 2026
Council Chambers & Hybrid
5:30 PM
Agenda Item
8.SECOND READING: Ordinance of the Council of the City of Palo Alto Amending Section
2.28.240 [Settlement of Claims and Actions] and Chapter 2.30 [Contracts and Purchasing
Procedures] of the Palo Alto Municipal Code to increase the thresholds for solicitation of
goods and services, increase contract approval and settlement authority, and to make
other technical changes. (FIRST READING: August 10, 2026; PASSED: 7-0)
City Council
Staff Report
Report Type: CONSENT CALENDAR
Lead Department: City Clerk
Meeting Date: August 24, 2026
Report #:2608-6629
TITLE
SECOND READING: Ordinance of the Council of the City of Palo Alto Amending Section 2.28.240
[Settlement of Claims and Actions] and Chapter 2.30 [Contracts and Purchasing Procedures] of
the Palo Alto Municipal Code to increase the thresholds for solicitation of goods and services,
increase contract approval and settlement authority, and to make other technical changes.
(FIRST READING: August 10, 2026; PASSED: 7-0)
BACKGROUND
The City Council heard this item on August 10, 2026, for a first reading and approved it on a 7-0
vote. No changes were made to the ordinance, and it is now before the City Council for a
second reading.
ATTACHMENTS
Attachment A: Ordinance Amending PAMC Section 2.28.240 and Chapter 2.30
APPROVED BY:
Mahealani Ah Yun, City Clerk
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Ordinance No. _____
Ordinance of the Council of the City of Palo Alto Amending Section
2.28.240 [Settlement of Claims and Actions] and Chapter 2.30 [Contracts
and Purchasing Procedures] of the Palo Alto Municipal Code to increase
the thresholds for solicitation of goods and services, increase contract
approval and settlement authority, and to make other technical changes.
The Council of the City of Palo Alto ORDAINS as follows:
SECTION 1. Section 2.28.240 (Settlement of claims and actions) of Chapter 2.28 (Fiscal
Procedures*) of Title 2 (Administrative Code*) of the Palo Alto Municipal Code is amended to
read as follows (additions underlined; deletions struck-through; unchanged text omitted by
bracketed ellipses):
2.28.240 Settlement of claims and actions.
As provided in Section 935.4 of the Government Code of California, the city attorney is
designated to perform the functions of the city council relative to claims and actions against the
city or any of its officers or employees under the provisions of Division 3.6 of the Government
Code, as follows:
(a) Where the city has insured itself against liability for the claimed injury, the city attorney
shall forward to the insurance carrier without prior council approval a written
recommendation as to acceptance, settlement, or rejection of such claim, provided
that the amount of any recommended allowance, compromise or settlement does not
exceed $35,000.00;
(b) Where the city is uninsured, the city attorney shall be authorized to accept, settle or
reject without prior approval of the council, claims against the city, provided that no
allowance, compromise or settlement shall exceed $35,000.0050,000.00. Upon the
written order from the city attorney, the director of administrative services shall cause
to be issued a warrant upon the treasury of the city in the amount for which a claim
has been allowed, compromised or settled;
(c) The city attorney is further authorized to compromise or settle, without prior approval
of the council, except on a matter of policy, any actions which the city is either plaintiff
or defendant and which are not covered by insurance, provided that the amount of
such compromise or settlement shall not exceed $35,000.0050,000.00;
(d) The city attorney shall make biannual reports to the council on action taken on claims
and actions against the city;
(e) A recommendation under subsection (a) above shall constitute "action" upon such
claim within the meaning of Government Code Section 945.4.
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SECTION 2. Chapter 2.30 (Contracts and Purchasing Procedures*) of Title 2
(Administrative Code*) of the Palo Alto Municipal Code is amended to read as follows (additions
underlined; deletions struck-through; unchanged text omitted by bracketed ellipses):
Chapter 2.30
CONTRACTS AND PURCHASING PROCEDURES*
Sections:
[…]
PART 2 -- CONTRACT TYPES
2.30.100 Public works contract.
2.30.110 Contract for goods.
2.30.120 General services contract.
2.30.130 Professional services contract.
2.30.140 Contracts for wholesale utility commodities and services.
2.30.150 Contracts for dark fiber optics licensing services.
2.30.155 Information Technology services contracts.
2.30.160 Emergency contracts.
PART 3 -- CONTRACTING AUTHORITY
2.30.200 Procurement officer contract award authority.
2.30.210 City Manager contract award authority.
2.30.220 City Attorney contract award authority.
2.30.221 Periodic automatic adjustments to contract award authority.
2.30.225 Wholesale utility commodity transactions.
2.30.230 Designated employee purchases of $10,000.0015,000.00 or less.
2.30.240 Designated employees’ use of petty cash, P-card or other credit card.
2.30.250 Council approval or award of contracts.
2.30.260 Contracts with terms exceeding one year — Appropriation.
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2.30.270 Delegations of authority to contract.
2.30.280 Authority to modify and terminate contracts not approved or awarded by the
Council.
2.30.290 Authority to modify contracts awarded by the Council.
2.30.295 Limitations on contract authority; authority otherwise conferred.
PART 4 — COMPETITIVE SOLICITATION REQUIREMENTS
2.30.300 Public works contracts.
2.30.310 Contracts for goods.
2.30.320 General services contracts.
2.30.330 Professional services contracts.
2.30.335 Information Technology services contracts.
2.30.340 Contracts for wholesale utility commodities and services.
2.30.345 Periodic automatic adjustments to solicitation thresholds.
2.30.350 Contract splitting prohibited.
2.30.360 Exemptions from competitive solicitation requirements.
PART 5 – COMPETITIVE SOLICITATION PROCEDURES
2.30.400 Informal invitation for bids, request for quotes or requests for proposals.
2.30.410 Formal request for proposals.
2.30.420 Formal invitation for bids or request for quotes – Notice, submittal, opening.
2.30.430 Combined request for proposals and invitation for bids.
2.30.440 Determination of lowest responsive/responsible bidder.
2.30.450 Tie bids.
2.30.460 Correction or withdrawal of bids or proposals.
2.30.470 Cancellation of solicitations -- Rejections of bids/proposals.
2.30.480 Waiver of minor irregularities, defects and informalities.
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2.30.485 Delegation of awarding authority determinations.
2.30.490 Design-build contract procurement procedures.
[…]
PART 1 — GENERAL
[…]
2.30.040 Centralized purchasing.
All acquisitions and purchases shall be made by and through the Procurement Officer,
except:
(a) Purchases of goods and services made from petty cash funds made in conformance with
this chapter and pursuant to control procedures approved by the City Manager and
contained in the administrative policies and procedures manual maintained by the City
Manager;
(b) Emergency purchases made in conformance with this chapter and Federal Emergency
Management Agency (“FEMA”) Public Assistance Program’s procurement orders, or
other similar rules, regulations, guidelines and control procedures for cost
reimbursement purposes approved by the City Manager and contained in the
purchasing manual;
(c) Contracts for legal services;
(d) Purchases of goods and services, and payment of public works services, by city
procurement card (“P-card”) or other credit card, made in conformance with this
chapter and pursuant to control procedures approved by the City Manager and
contained in the purchasing manual;
(e) Purchases where the total expenditure by the city does not exceed
$10,000.0015,000.00, made in conformance with this chapter and pursuant to control
procedures approved by the City Manager and contained in the purchasing manual;
(f) Transactions negotiated under master contracts for wholesale utility commodities and
services, as described in Section 2.30.140 made in conformance with Section 2.30.340;
(g) Mutual aid agreements; and
(h) Delegations made according to Section 2.30.230.
[…]
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2.30.110 Contract for goods.
(a) A contract for goods includes a contract or purchase order for the purchase of supplies,
materials or equipment, including, without limitation, office supplies, janitorial supplies,
furnishings, equipment, machinery, tools, vehicles, computer hardware and software and other
personal property, materials, or goods. A contract for goods includes a blanket purchase order
contract, where a specified quantity of units to be purchased is not established at the time the
contract is executed. A blanket purchase order contract must establish a maximum dollar amount
of expenditure for the contract and set forth pricing terms for the items to be purchased. A
contract for goods may include labor incidental to the purchase of goods, including any set-up,
installation, and testing services.
(b) A contract for goods includes a contract or purchase order for the purchase of information
technology equipment and computer hardware including, without limitation, desktop
computers, laptops, mobile devices, tablets, peripherals, servers, and physical data storage
infrastructure. This definition includes bundled service contracts that provide for the installation,
support, and maintenance with the acquisition of computer hardware. Standalone maintenance
and service agreements for computer hardware are excluded under this definition and are
governed under Section 2.30.155.
2.30.120 General services contract.
A general services contract includes a contract providing for work, labor or services not
requiring specialized experience, knowledge or training with or without the furnishing of goods,
materials, supplies or equipment, including, without limitation:
(a) Maintenance of public buildings, streets, parks and playgrounds and other public
improvements;
(b) Repair, modification and maintenance of equipment or other goods;
(c) Licensing, installation and maintenance of or relating to information technology property,
goods and services, including, without limitation, computer hardware and software, and
data storage services, unless the information technology services would require
specialized certification, knowledge, expertise, or training are needed and provided;
(dc) Janitorial services, uniform cleaning, tree trimming, street sweeping, power washing and
landscape maintenance;
(ed) Leasing or licensing of goods and other personal property for use by the city; and
(fe) General class instruction, including, without limitation, recreation class instruction
services.
2.30.130 Professional services contract.
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A professional services contract includes a contract for services which involves the exercise
of professional discretion and independent judgment based on specialized certification,
knowledge, expertise or training. These services may include, without limitation, those provided
by accountants, actuaries, auditors, appraisers, architects, attorneys, engineers, financial
advisors, information technology experts, instructors, and environmental and land use planners.
[…]
2.30.155 Information technology services contracts.
(a) An information technology services contract includes a contract for information
technology experts and the acquisition, licensing, installation, maintenance, or support of
computer software.
(b) For the purposes of this Section, computer software includes, without limitation:
(1) cloud-based, hosted, or managed subscription software;
(2) electronic data storage and processing services;
(3) telecommunications and network services;
(4) vendor-provided standard-form agreements for software purchase or licensing; and
(5) standalone computer hardware maintenance or service contracts.
(c) This Section does not apply to the purchase of computer hardware as defined under
Section 2.30.110(b) or public works contract as defined under Section 2.30.100.
(d) The contracts referred to herein shall be subject to the City's information security policies,
terms, conditions and other requirements established by the chief information officer
with the concurrence and approval of the City Attorney.
[…]
PART 3 – CONTRACTING AUTHORITY
2.30.200 Procurement officer contract award authority.
The Procurement Officer may award and sign the following contracts:
(a) Public Works Contracts. Public works contracts, where the term does not exceed three
years, and the contract price and any price contingency established for change orders, but
excluding sales tax or use tax, do not exceed $85,000.00150,000.00 in the first contract
year, and do not exceed the sum of $85,000.00150,000.00 and any unexpended monies
carried forward from a prior contract year, in any subsequent contract year.
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(b) Contracts for Goods. Contracts to purchase goods, where the term does not exceed three
years, and the contract price and any price contingency established for change orders, but
excluding sales tax or use tax, do not exceed $85,000.00150,000.00 in the first year, and
do not exceed the sum of $85,000.00150,000.00 and any unexpended monies carried
forward from a prior contract year, in any subsequent contract year.
(c) General Services Contracts. General services contracts, where the term does not exceed
three years, and the contract price and any price contingency established for change
orders or additional services, but excluding sales tax or use tax, do not exceed
$85,000.00150,000.00 in the first contract year, and do not exceed $85,000.00150,000.00
and any unexpended monies carried forward from a prior contract year, in any
subsequent contract year.
(d) Professional Services Contracts. Professional services contracts, where the term does not
exceed three years, and the contract price, and any price contingency established for
additional services, but excluding sales tax or use tax, do not exceed the sum of
$85,000.00150,000.00 in the first contract year, and do not exceed the sum of
$85,000.00150,000.00 and any unexpended monies carried forward from a prior contract
year, in any subsequent contract year.
(e) Software and Hardware Purchase, Licensing, Maintenance and Support Information
Technology Services Contracts. Notwithstanding Subsection 2.30.200(c), the. The
Procurement Officer may award and sign Information Technology services contracts other
than general services agreements, including, without limitation, vendor-based standard
form hardware and software purchase and licensing contracts, for the purchase of
hardware and software, the licensing of software, and the maintenance and support of
hardware and software where the term of licensing or maintenance and support services
does not exceed five years and the contract price, excluding sales tax or use tax, does not
exceed $85,000.00150,000.00 per year in the first contract year and does not exceed the
sum of $85,000.00150,000.00 and any unexpended monies carried forward from a prior
contract year, in any subsequent contract year. The contracts referred to herein may
include contracts for data storage services, which shall be subject to the city's information
security policies, terms, conditions and other requirements established by the chief
information officer with the concurrence and approval of the City Attorney.
2.30.210 City Manager contract award authority.
The City Manager may award and sign the following contracts:
(a) Public Works Contracts. Public works contracts, where the term does not exceed three
years, and the contract price and any price contingency established for change orders, but
excluding sales tax or use tax, do not exceed $250,000.00350,000.00 in the first contract
year, and do not exceed the sum of $250,000.00350,000.00 and any unexpended monies
carried forward from a prior contract year, in any subsequent contract year.
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(b) Contracts for Goods. Contracts to purchase goods, where the term does not exceed three
years and the contract price and any contingency established for change orders, but
excluding sales tax or use tax, do not exceed $250,000.00350,000.00 in the first contact
year, and do not exceed the sum of $250,000.00350,000.00 and any unexpended monies
carried forward from a prior contract year, in any subsequent contract year.
(c) General Services Contracts. Contracts for services associated with the leasing or licensing
of personal property other than hardware or software, where the term does not exceed
seven years, and the contract price and any price contingency established for change
orders, but excluding sales tax or use tax, do not exceed $85,000.00150,000.00 in the first
contract year, and do not exceed the sum of $85,000.00150,000.00 plus any unexpended
monies carried forward from a prior contract year, in any subsequent contract year.
[…]
(g) Contracts to Rent, Lease, License, Acquire, Transfer or Purchase Interests in Real Property
from Other Parties. Contracts for the rental, leasing, licensing, or purchase by installment
interests in real property from other parties for a term of seven years or less, where the
contract price does not exceed $85,000.00150,000.00 per year, or to encumber or
transfer any interest in real property from other parties for any term of years. The City
Manager may enter into and sign a contract to acquire or purchase an interest in real
property, where the contract price does not exceed $85,000.00150,000.00.
[…]
(l) Software and Hardware Purchase, Licensing, Maintenance and Support Information
Technology Contracts Services Contracts. Notwithstanding Subsection 2.30.210(c),
Information Technology service contracts the City Manager may award and sign contracts
other than general services agreements, including, without limitation, vendor-based
standard form hardware and software purchase and licensing contracts, for the purchase
of hardware and software, the licensing of software, and the maintenance and support of
hardware and software, where the term of licensing or maintenance and support services
does not exceed seven years and the contract price, excluding sales tax or use tax, does
not exceed $85,000.00150,000.00 per year in the first contract or fiscal year and does not
exceed the sum of $85,000.00150,000.00 and any unexpended monies carried forward
from a prior fiscal year, in any subsequent contract or fiscal year. The contracts referred
to herein may include contracts for data storage services, which shall be subject to the
city's information security policies, terms, conditions and other requirements established
by the chief information officer with the concurrence and approval of the City Attorney.
(m) Contracts with a business operator implementing business tax offsets under Section
2.37.080.
(n) Other Contracts. All other types of contracts for which the contract term does not exceed
three years and the total expenditure by the city does not exceed $85,000.00150,000.00
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in the first contract or fiscal year, and does not exceed the sum of $85,000.00150,000.00
and any unexpended monies carried forward from a prior fiscal year, in any subsequent
contract or fiscal year.
(o) Fleet Vehicles. Contracts for the purchase or retrofitting of fleet vehicles within the
amount appropriated for such purchases by the Council.
2.30.220 City Attorney contract award authority.
The City Attorney may award and sign contracts for legal services, including, without
limitation, services provided by outside counsel, investigators, consultants and other experts
needed for litigation or other administrative and legal proceedings, to be provided to the city
for any time period, where the contract price and any contingency established for additional
services, but excluding sales tax or use tax, do not exceed the sum of $85,000.00150,000.00 in
the first contract or fiscal year, and do not exceed the sum of $85,000.00150,000.00 and any
unexpended monies carried forward from a prior fiscal year, in any subsequent contract or
fiscal year. In addition to the authority described herein, the City Attorney may sign contracts,
where the contract price exceeds the amounts set forth above, provided the Council has first
approved the use of such services.
(a) Notwithstanding the foregoing, the City Attorney may use any funds under a legal services
contract when necessary to pay for services related to active litigation or administrative
proceedings.
(b) The City Attorney is authorized to enter into and execute on behalf of the city, without
the prior approval of the Council, any amendment or change order to a contract,
previously approved by the Council, that does not increase the compensation payable
under the contract and to accomplish the following:
(1) To extend the term of the contract for a period not to exceed twelve consecutive
months from the last Council-approved contract expiration date;
(2) To make minor revisions to the scope of services or delivery schedule;
(3) To reduce the scope of services, the term, or the compensation of a contract; or
(4) To make clerical corrections.
2.30.221. Periodic automatic adjustments to contract award authority.
(a) For the purposes of this Section, "CPI" means the Consumer Price Index, All Urban
Consumers, published by the U.S. Department of Labor, Bureau of Labor Statistics for the
San Francisco-Oakland-Hayward area, with all items included. In the event the CPI is no
longer published, the Procurement Officer shall use another index published by either the
State of California or a federal department or agency that is charged with the
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responsibility of measuring the cost of living in the geographical area that includes the
City of Palo Alto.
(b) For the purposes of this Section, “Contract Award Authority Thresholds” means the
monetary amounts set forth in Sections 2.30.200, 2.30.210, and 2.30.220.
(c) Beginning on July 1, 2031, and continuing every five years thereafter on July 1st, the
Contract Award Authority Thresholds will increase based on the percentage increase from
the CPI published most recently preceding July 1st of the applicable adjustment year. The
increase in the Contract Award Authority Thresholds shall be rounded to the nearest ten
thousand and this amount will serve as the Contract Award Authority Thresholds for the
next five years. If there is no increase in the CPI, then the Contract Award Authority
Thresholds are unchanged.
(d) The Procurement Officer shall perform the foregoing calculations and report the adjusted
Contract Award Authority Thresholds to the Council as soon as practical.
[…]
2.30.230 Designated employee purchases of $10,000.0015,000.00 or less.
Employees authorized, in writing, by their department heads may award and sign contracts
for the purchase of goods and the procurement of general services, where the contract price
does not exceed $10,000.0015,000.00 and the contract term does not exceed one year. All
purchases and procurements shall be made in accordance with the contracting procedures and
requirements contained in this chapter and in the purchasing manual. The written
authorizations of department heads shall be kept on file by the Procurement Officer.
[…]
2.30.270 Delegations of authority to contract.
This Section establishes the exclusive source of authority to delegate any authority to contract
granted by this chapter. The authority to delegate contracting authority shall not be implied
from any other provision of this municipal code.
(a) Procurement Officer Delegations. The Procurement Officer may delegate the authority
granted under Section 2.30.200, as follows: a city employee holding the position of
contract manager administrator or senior buyer may be authorized to award and sign any
contract in an amount of $50,000.0075,000.00 or less per year with a term not to exceed
three years; and a city employee holding the position of buyer may be authorized to
award and sign any contract in an amount of $25,000.00 or less per year with a term not
to exceed three years.
[…]
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2.30.280 Authority to modify and terminate contracts not approved or awarded by the
Council.
(a) Each employee with contracting authority conferred by this chapter may authorize and
sign amendments or change orders to contracts he or she they awarded under the
authority granted in this chapter subject to the following:
(1) All modifications to contracts, including, without limitation, changes to the scope of
work, quantity of goods, price or term shall be made in writing and accomplished
executed in accordance with the terms of the original contract;
(2) The amendment or change order to a contract shall not cause the contract, as
modified, to exceed the monetary or term limits of that city employee's contracting
authority, as described in this chapter, except that the city employee may extend the
term of a contract, with no increase in the compensation payable, for a period not to
exceed six twelve consecutive months beyond the term limits of his or her contracting
authority; and
[…]
2.30.290 Authority to modify contracts awarded by the Council.
[…]
(b) The City Manager is authorized to enter into and execute on behalf of the city, without the
prior approval of the Council, any amendment or change order to a contract, previously
approved by the Council, that does not increase the compensation payable under the
contract or and to accomplish the following:
(1) To extend the term of the contract for a period not to exceed six twelve consecutive
months from the last Council-approved contract expiration date;
(2) To make minor revisions to the scope of services or delivery schedule;
(3) To reduce the scope of services, the term, or the compensation of a contract; or
(3 4) To make clerical corrections.
(c) The City Manager may approve and sign assignments of contracts, including, without
limitation, leases and licenses, previously approved by the Council when he or she the City
Manager has determined that the proposed assignee has the ability, capacity, experience
and skill and is otherwise qualified to perform the contract.
(d) Notwithstanding any other provision in this Section, the City Manager is authorized to
enter into and execute on behalf of the city, without prior approval of the Council, a one-
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time amendment or change order to a professional services, information technology
services, or general services contract, previously approved by Council, provided that:
(1) The change does not to exceed ten percent (10%) of the amount of the original
contract amount or $100,000, whichever is lower;
(2) the change is reasonably related to the scope of the work authorized under the
original contract; and
(3) funding is available and appropriated for the work.
[…]
PART 4 – COMPETITIVE SOLICITATION REQUIREMENTS
2.30.300 Public works contracts.
Public works contracts that are not exempt from the competitive solicitation requirements
under Section 2.30.360 or by Council action shall be solicited, as follows:
(a) In addition to any exemption under Section 2.30.360, public works contracts providing
for an estimated expenditure less than the limit set forth in California Public Contract
Code Section 22032(a), as may be amended, and not otherwise required to be formally
bid by the Charter, may be performed without undergoing a competitive solicitation.
(ab) Public works contracts, providing for an estimated expenditure less than the limit set
forth in California Public Contract Code Section 22032(b), as may be amended of
$85,000.00 or less, and not otherwise required to be formally bid by the Charter, shall be
solicited by informal invitation for bids in accordance with Section 2.30.400.
(1) In lieu of the solicitation requirements set forth in this subsection (b), public works
contracts may be awarded from a list of qualified contractors, identified according to
categories of work, to be created and maintained by the Procurement Officer, so long
as the list is created and the award of contract to a contractor on the list is in
compliance with procedures contained in this chapter and in the purchasing manual.
(b c) Public works contracts, providing for an estimated expenditure exceeding the limit set
forth in California Public Contract Code Section 22032(b), as may be amended
$85,000.00, shall be solicited by formal invitation for bids in accordance with Section
2.30.420.
(c d) Article VII, Section 6 of the City Charter requires formal bidding for public works
contracts funded by bonded indebtedness of the city or by assessment against particular
property in Palo Alto. Section 2.30.300 requires the formal bidding of all public works
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contracts exceeding $85,000.00, unless an exemption is provided by Section 2.30.360 or
is otherwise authorized by Council under Section 2.30.300(d).
(d e) Design-build contracts, to the extent debt financing limitations do not apply, that
provide for an expenditure of more than the limit set forth in California Public Contract
Code Section 22032(b), as may be amended $85,000.00, shall be solicited by requests for
proposals in accordance with Section 2.30.490. Despite any law to the contrary, the
design-build method of delivery may be used for any public works contract, including,
without limitation, any design-build-operate contracts, where the City Manager
determines, in writing, the delivery method will best fulfill the requirements of the public
works project.
(e f) The Council may determine that a particular public works project may be solicited and
contracted for by using alternate project delivery methods, including, without limitation,
construction manager at risk or competitive negotiation. Any Council action authorizing an
alternate project delivery method shall set forth the reasons and factual basis supporting
the use of the alternate project delivery method for the project and describe the
solicitation method to be used and the criteria for determining the successful bidder, to
whom the public works contract should be awarded.
2.30.310 Contracts for goods.
Contracts for goods, not exempt from the competitive solicitation requirements under Section
2.30.360 or by Council action, shall be solicited, as follows:
(a) Contracts for goods, providing for an estimated expenditure by the city of
$50,000.00100,000.00 or less, shall be solicited by informal request for quotes informal
invitation for bids in accordance with the provisions of Section 2.30.400; and
(b) Contracts for goods, providing for an estimated expenditure by the city exceeding
$50,000.00100,000.00, shall be solicited by formal request for quotes formal invitation
for bids in accordance with the provision of Section 2.30.420.
2.30.320 General services contracts.
General services contracts, not exempt from the competitive solicitation requirements under
Section 2.30.360 or by Council action, shall be solicited, as follows:
(a) General services contracts, providing for an estimated expenditure by the city not
exceeding $50,000.00100,000.00, shall be solicited by informal request for quotes
invitation for bids or informal request for proposals in accordance with Section
2.30.400.
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(b) General services contracts, providing for an estimated expenditure by the city exceeding
$50,000.00100,000.00 shall be solicited by formal invitation for bids request for quotes
in accordance with Section 2.30.420 or by formal request for proposals in accordance
with Section 2.30.410.
(c) The Procurement Officer shall determine, after consideration of whether the needs of
the city or the circumstances require that a contract should be awarded based on
significant factors in addition to price, whether the services subject to a general services
contract shall be solicited by request for quotes bid or request for proposals.
2.30.330 Professional services contracts.
Professional services contracts, not exempt from the competitive solicitation requirements
under Section 2.30.360 or by Council action, shall be solicited, as follows:
(a) Professional services contracts, providing for an estimated expenditure by the city not
exceeding $85,000.00150,000.00, shall be solicited by informal request for proposals in
accordance with Section 2.30.400.
(b) Professional services contracts, providing for an estimated expenditure by the city
exceeding $85,000.00150,000.00, shall be solicited by formal request for proposals in
accordance with Section 2.30.410.
[…]
2.30.335 Information Technology services contracts.
Information technology services contracts, not exempt from the competitive solicitation
requirements under Section 2.30.360 or by Council action, shall be solicited as follows:
(a) Information technology services contracts, providing for an estimated expenditure by
the city not exceeding $150,000.00, shall be solicited by informal request for proposals
in accordance with Section 2.30.400.
(b) Information technology services contracts, providing for an estimated expenditure by
the city exceeding $150,000.00, shall be solicited by formal request for proposals in
accordance with Section 2.30.410.
(c) In lieu of the solicitation requirements set forth in Subsections (a) and (b), Information
Technology services contracts in any amount may be awarded from a list of qualified
professionals to be created and maintained by the Procurement Officer, so long as the
list is created and the award of contract to an entity on the list is in compliance with
procedures contained in this chapter and in the purchasing manual.
2.30.340 Contracts for wholesale utility commodities and services.
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(a) Solicitation of Contracts.
(1) Contracts for the purchase or sale-incidental-to-purchase of wholesale utility
commodities and services, providing for an estimated expenditure not exceeding
$85,000.00150,000.00, shall be solicited by informal invitation for bids or informal
request for proposals in accordance with Section 2.30.400. Contracts for the
purchase or sale-incidental-to-purchase of wholesale utility commodities and
services, providing for an estimated expenditure exceeding $85,000.00150,000.00,
shall be solicited by formal invitation for bids, formal request for proposals or
combination thereof, in accordance with Section 2.30.410, 2.30.420 or 2.30.430 or
through solicitation of counterparties enabled to transact under a Council-approved
master agreement in accordance with Section 2.30.340(a)(3).
[…]
2.30.345 Periodic automatic adjustments to solicitation thresholds.
(a) For the purposes of this Section, "CPI" means the Consumer Price Index, All Urban
Consumers, published by the U.S. Department of Labor, Bureau of Labor Statistics for the
San Francisco-Oakland-Hayward area, with all items included. In the event the CPI is no
longer published, the Procurement Officer shall use another index published by either the
State of California or a federal department or agency that is charged with the
responsibility of measuring the cost of living in the geographical area that includes the
City of Palo Alto.
(b) For the purposes of this Section, “Solicitation Thresholds” means the monetary amounts
set forth in Sections 2.30.310, 2.30.320, 2.30.330, 2.30.335, and 2.30.340.
(c) Beginning on July 1, 2031 and continuing every five years thereafter on July 1st, the
Solicitation Thresholds will increase based on the percentage increase from the CPI
published most recently preceding July 1st of the applicable adjustment year. The
increase in the Solicitation Thresholds shall be rounded to the nearest ten thousand and
this amount will serve as the Solicitation Thresholds for the next five years. If there is no
increase in the CPI, then the Solicitation Thresholds are unchanged.
(d) The Procurement Officer shall perform the foregoing calculations and report the adjusted
Solicitation Thresholds to the Council as soon as practical.
[…]
2.30.360 Exemptions from competitive solicitation requirements.
[…]
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(b) Whenever solicitations of bids or proposals would for any reason be impracticable,
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 operational or financial
advantage for the city. Situations where solicitations of bids or proposals would be
impracticable, unavailing or impossible, include, without limitation, the following:
(1) Contract specifications cannot be drawn in a way that would enable more than one
vendor, consultant or contractor to meet them;
(2) Due 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;
(3) Special conditions attached to a grant, donation or gift requires the use of particular
goods and/or services.
(4) A vendor, consultant or contractor possesses specialized knowledge, experience or
familiarity with a city project, operation, or ongoing matter such that a competitive
solicitation would not produce a materially better result or would result in added
cost, delay, or disruption to city operations.
[…]
(e) Contracts for goods where, pursuant to Section 2.30.900, the City Manager has
determined that standardization of the supplies, materials, services, or equipment is
permissible.
[…]
(i) Professional services and Information Technology services contracts, where the estimated
total expenditure by the city, regardless of term, does not exceed $50,000.00100,000.00.
The dollar threshold in this subsection shall be adjusted in accordance with Section
2.30.345.
(j) Cooperative purchases, with one or more other public agencies or through a cooperative
purchasing agency, provided: (i) the services are solicited using methods substantially
similar to those required by this chapter, as determined by the Procurement Officer the
underlying purchase was made through a competitive solicitation; and (ii) the contract is
consistent with the requirements specified in this municipal code.
(k) The use of another governmental or public agency's contract or substantially the same
contract terms provided: (i) the agency uses a solicitation method substantially similar to
the method required by this chapter the underlying purchase was made through a
competitive solicitation ; (ii) the contract is consistent with the requirements specified in
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this municipal code; and (iii) the Procurement Officer determines that the city will realize
overall value to utilizing the other agency's contract or contract terms compared to the city
performing its own solicitation.
[…]
(r) Contracts, where the estimated total expenditure by the city does not exceed
$10,000.0050,000.00. The dollar threshold in this subsection shall be adjusted in
accordance with Section 2.30.345.
[…]
(u) Contracts for services where selection is based on a unique personal accomplishment or
characteristic such as guest speakers, performers, artists, recreation instructors, trainers,
and facilitators.
(v) Contracts with another government agency, including a joint powers authority, to
purchase goods or services.
PART 5 – COMPETITIVE SOLICITATION PROCEDURES
2.30.400 Informal invitation for bids, request for quotes or requests for proposals.
(a) An informal invitation for bids, request for quotes, or requests for proposals may be
solicited by any reasonable means, including, without limitation, mail, telephone,
facsimile transmission, e-mail or posting to the city's web site. Quotations shall be
solicited from a minimum of three bidders or proposers; if quotations from three bidders
or proposers cannot be obtained by the exercise of due diligence, quotations shall be
solicited from less than three bidders or proposers, as practicable. The Procurement
Officer shall maintain a record of all informal invitations for bids, informal request for
quotes, and informal requests for proposals received by the city for a period of time in
compliance with California law and the city's records retention schedule.
(b) An informal invitation for bids and informal request for quotes shall be awarded to the
lowest responsive and responsible bidders, as described in Section 2.30.440.
[…]
2.30.420 Formal invitation for bids or request for quotes – Notice, submittal, opening.
(a) Advertising. Contracts that must be solicited by formal invitation for bids or request for
quotes shall be solicited by notices inviting bids by advertising the notices inviting bids on
the City's website for no fewer than five days prior to the date set for receiving bids. As
practicable, bids shall be solicited from a minimum of three bidders.
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(b) Notice. The notices inviting bids shall generally describe the goods and/or services to be
purchased or acquired or the public works to be constructed, identify the place where
the bid proposal form, specifications and other contract documents may be obtained,
and specify the date, time and place when and where bids will be opened.
(c) Bid Submittal. All bids shall be sealed. All bids shall be submitted at the place, and at or
before the date and time, specified in the notice inviting bids. Bids received after the
specified date and time shall not be accepted and shall be returned to the bidder
unopened unless the opening is necessary for identification purposes.
(d) Bid Opening. Bids timely received shall be opened in public, at the date, time and place
specified in the notice inviting bids, and the aggregate bid of each bidder shall be
announced.
[…]
PART 6 – CONTRACT TERMS AND CONDITIONS
2.30.500 Bid security, bonds and insurance.
[…]
(b) Bid Security. Bid security shall be submitted with the bid and shall be in the form of a
certified check, cashier’s check or surety bond. Any surety bond shall be issued by an
admitted surety authorized to conduct business in the State of California and shall be in
a form acceptable to the City Attorney and as specified in the solicitation for bids
document. If a bidder fails to submit the required bid security with the bid, the bid shall
be deemed nonresponsive. After bids are opened, bid security shall be irrevocable for
the period specified in the invitation for bids. If the successful bidder fails to execute the
contract within the time specified, the total amount of the bid security shall be forfeited
to the city. The bid security of an unsuccessful bidder shall be returned to the bidder by
no later than sixty days from the date of contract award. Bids for public works projects
costing in excess of the limit set forth in California Public Contract Code Section
22032(b), as may be amended $85,000.00 shall require the submission of bid security in
an amount equal to at least ten percent of the bid. On public works projects costing less
than the limit set forth in California Public Contract Code Section 22032(b), as may be
amended $85,000.00, and all other procurements of goods and services without regard
to price, the Procurement Officer is authorized to determine whether any bid security in
any amount shall be required on a project-by-project basis.
[…]
PART 10 – STANDARDIZATION
2.30.900 Standardization.
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Where the City Manager has determined that it is required by the health, safety or welfare of
the people or employees of the city, or that significant costs savings have been demonstrated,
the standardization of supplies, materials, services, or equipment, including, without limitation,
information technology property or services, for purchase or to be used in a public works
project is permitted and the supplies, materials or equipment specifications may specify a
single brand or trade name. The City Manager may consider the following factors in
determining to standardize on a single brand or trade name:
(a) Repair and maintenance costs would be minimized;
(b) User personnel training would be facilitated thereby;
(c) Supplies or spare parts would be minimized;
(d) Modifications to existing equipment would not be necessary;
(e) Training of repair and maintenance personnel would be minimized; and
(f) Matching existing services, supplies, materials or equipment is required for proper
operation of a function or program.
SECTION 3. If any section, subsection, clause or phrase of this Ordinance is for any
reason held to be invalid, such decision shall not affect the validity of the remaining portion or
sections of the Ordinance. The Council hereby declares that it should have adopted the
Ordinance and each section, subsection, sentence, clause or phrase thereof irrespective of the
fact that any one or more sections, subsections, sentences, clauses or phrases be declared
invalid.
SECTION 4. The Council finds that this project is exempt from the provisions of the
California Environmental Quality Act (“CEQA”), pursuant to Section 15061 of the CEQA
Guidelines, because it can be seen with certainty that there is no possibility that the ordinance
will have a significant effect on the environment.
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SECTION 5. This ordinance shall be effective on the thirty-first day after the date of its
adoption.
INTRODUCED:
PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
____________________________ ____________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
____________________________ ____________________________
Assistant City Attorney City Manager
____________________________
Director of Administrative Services
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