HomeMy WebLinkAbout2021-01-11-D01A Purchasing PolicyD1A
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Standard Administrative Policy
and Procedures Manual
Title: FINANCIAL POLICY
Section: PURCHASING POLICY
Date of Version: January 11, 2021
Resolution No.: #2021-005
SECTION 1 - PURCHASING POLICY
A. It shall be the responsibility of the Department Director to ensure that his/her
department follows all policies and procedures.
B. Only the purchasing methods described herein are available for purchasing goods and
services on behalf of the City.
C. The City’s purchasing system is considered decentralized (each departments’
responsibility) except for those goods, services, and equipment that qualify or are
designated for centralized purchasing.
D. All applicable paperwork should be forwarded to the Finance Department as
promptly as possible to expedite processing.
E. No purchase made by an employee shall bind the City to receive and/or pay for the
goods or services procured, unless authorized by the methods described herein.
F. Noncompliance with these policies and procedures may result in the return of
improperly authorized or prepared documents, nonpayment of vendor invoices,
cancellation of purchase orders or purchasing privileges, or other sanctions as
determined necessary after consultation with the Department Director and/or City
Administrator.
G. Transactions should not be split into smaller parts in order to circumvent the dollar
limitations and requirements of this policy.
H. The City does not prepay for goods or services or utilize prepaid devices such as gift
cards. If a vendor requires prep ayment for goods or services, authorization must be
obtained from the City Administrator’s Office or the Finance Department.
I. Employee reimbursements should be kept to a minimum (i.e. emergencies and
travel/training).
J. Every effort shall be made to purchase supplies and services from vendors who have
businesses within the City of Waukee, provided pricing is competitive, products are
readily available and exceptions during emergency situations.
K. Local preference for equipment purchases shall be considered if pricing is within 5% of
the non- local bids.
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SECTION 2 – PURCHASING LIMITATIONS
A. Informal Quotation Process (Informal)
1. The purchase of any goods or services with a total value between $2,500 and
$4,999 requires at least three quotations. These quotations can be either
telephone quotations or from a suppliers catalog. These quotations need to be
documented and retained by the department gathering the quotations.
2. The purchase of any goods or services whose total value is between $5,000 and
$39,999 shall require written quotations from at least three suppliers. Quotations
should be retained by the department gathering the quotations, with other related
paperwork and be documented on the purchase invoice.
3. Purchases for public improvements qualifying under Chapter 26.3 of the Code of
Iowa that are less than $49,000 for highway, bridge, or culvert work, less than
$50,000 for buildings, utilities, sidewalks, trails, etc. or have been declared
emergency repair work qualify for informal quotations. These purchases shall
adhere to the following requirements:
a. The contractor must provide a performance and payment bond for a
public improvement project of more than $25,000 (Chapter 573.3 of the Code
of Iowa).
b. The City Administrator shall solicit City Council affirmation of contracts over
$25,000 at the next regularly scheduled or special called meeting.
B. Competitive Quotation Process (Semi-Formal)
1. The purchase of any goods or services with an estimated value in excess of
$40,000 shall require the taking of competitive bids based on written bid
specifications.
All bid documents shall receive prior approval from the City Administrator or his/her
designee. All amendments to bid specifications shall be made in writing. In the
event it is deemed necessary to verbally inform a vendor of a bid specification
change, such verbal communications shall be immediately followed up with written
confirmation of the change. A notice to bidders may be published in an authorized
publication, but is not required.
The written bid documents will include the time, place, and manner for filing
quotations, which may be received by mail, fax, or e -mail. A report outlining all bids
received, including the vendor names and the amount of the bids shall be
submitted. If the bid is being awarded to a vendor other than the
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low bidder, the report shall also state why the bid is not being awarded to the low
bidder. The report shall also include the amount budgeted for this purchase. The
City Administrator or his/her designee may award the contract bid, execute the
contract, authorize work to proceed under the contract, and/or approve
performance and payment bonds. The City Administrator shall solicit City Council
affirmation of all semi-formal bids, contracts, and purchases at the next regularly
scheduled or special meeting.
2. Purchases for public improvements qualifying under Chapter 26.3 of the Code of
Iowa that are between $50,000 and $130,000 and have not been declared
emergency repair work and are not for highway, bridge, or culvert work qualify for
competitive bidding (semi-formal) and shall adhere to part B.1 of this section. The
contractor must provide a performance and payment bond.
C. Competitive Bidding (Formal)
1. Purchases for public improvements qualifying under Chapter 26.3 of the Code of Iowa
that are in excess of $130,000 or are for highway, bridge, or culvert work in excess
of $49,000 must use formal bidding as defined by Chapter 26 of the Code of Iowa,
unless the improvements are declared emergency repair work.
2. Formal bids must be taken with the cooperation of the City Administrator and the
City Clerk using the following steps:
a. Detailed and written plans and specificat ions and a detailed cost estimate must
be prepared for the public improvement project, approved by the City
Administrator, and placed on file with the City Clerk’s office.
b. A notice to bidders must be published by the City Clerk not less than four days
and not more than forty-five days before the date for filing bids. Notices must
include:
i. Time and place for filing sealed proposals
ii. Time and place sealed proposals will be opened and considered on
behalf of the governing body
iii. The general nature of the public improvements on which bids are being
requested
iv. In general terms, when the work must be commenced and when it must
be completed
v. Bid security and bid bond requirements
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c. A notice of public hearing on plans, specifications, form of contract, and cost
estimate must be published by the City Clerk not less than four days and not
more than twenty days before the public hearing.
d. A formal opening and announcement of sealed bids on published date by the City
Administrator; review, consideration, and recommendation of bid award by City
Administrator; City Administrator prepares report of bids received
e. A public hearing on plans, specifications, form of contract, and cost estimate on
published date by the City Council
f. City Council receives City Administrator report of bids received.
g. City Council passes or rejects resolutions to adopt plans, specifications, form
of contract, and estimate of cost, to award construction contract, and to
approve construction contract and bond with the lowest responsive, responsible
bidder who has met all bid security and bid bond requirements following the
public hearing.
D. Miscellaneous
1. Contracting for professional services (legal, engineering, etc.) or for ongoing
technical services (maintenance, utilities, etc.) may be done on a negotiated basis.
Where practical, however, those vendors providing such services should be asked
to submit formal proposals to provide the services requested. Such proposals
shall be evaluated on the basis of the vendor’s reputation, experience, and
understanding of the work t o be done. Price, while being a factor, should not be
the primary factor. City Administrator and City Council authorization or affirmation
is still required at the same dollar limitations as semi-formal or formally bid
contracts.
2. All purchases involving a sole source bid (no competitive bids) where competitive
bids are required shall be accompanied by written justification from the
Department Director detailing the reason for a sole source purchase.
3. Bids solicited by the United States of America or an agency t hereof, the State of Iowa,
Dallas County, or another governmental unit may be used as a replacement to the
bidding requirements unless bidding is required by the Code of Iowa, the City
Council, or the City Administrator. The availability of a bid from another government
agency does not preclude the City from seeking and obtaining bids in a manner
provided through this policy.
4. All purchases funded through a State or Federal grant must follow all additional
procedures required by the grantor. All bid specifications for a purchase that is
funded through a State or a Federal grant must list all additional specifications
for the goods or services that are required by the grantor. Contractors must be
evaluated when the bids are received on their ability to meet these State or Federal
requirements. In addition, no purchases to be covered by the grant can be made
prior to the execution of the grant agreement unless approved by the grantor.
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5. Purchase transactions for goods or services with a City employee (the employee,
employee’s spouse, or employee’s business) are limited to $1,500 per fiscal year, per
employee in total, as per State law. Any transactions with an employee that will
exceed this limit are required to go through formal bidding requirements.
6. For any given purchase, due to the nature of the contract, the competitiveness of
the vendors, or for other reasons, the department may choose to use the bidding
procedures for a higher dollar threshold than which the purchase falls under. The
department may not, however, select bidding procedures for a lower dollar
threshold than what is prescribed.
7. Emergency repair work is declared via resolution by the City Council and a
certificate from an external, registered, professional engineer certifying that the
emergency repairs are necessary.
E. Contract Administration
1. The City Administrator or his/her designee will advertise and bid all contracts
qualifying for formal bidding procedures. The City Administrator or his/her designee
will oversee receiving, opening, and announcing all formal bids. Bid s received late
will be immediately returned to the late bidder unopened.
2. Formally bid contracts will be executed by the Mayor and attested to by the City
Clerk. The City Administrator or his/her designee shall execute all other contracts on
behalf of the City as permitted by State law. Copies of all contracts should be
forwarded to the Finance Department.
3. The City Administrator or his/her designee will administer all contracts on the
authority of the City Council.
4. The City Administrator or his/her designee will approve all change o rders to
contracts. City Council must approve all change orders for contracts that were bid
using formal bidding procedures.
5. Contractual payments on formally bid contracts must be approved, individually, by
City Council action. Other contractual payments must be approved by the City
Administrator or his designee and listed on the formal claims list presented to City
Council.
6. Where appropriate, retainage shall be withheld on contracts for public
improvements as provided for by State law or on other contracts as deemed
appropriate or necessary. Retainage on a contract may not exceed 5% of the cost of
the public improvement. An application by a contractor for early release of a
retainage requires City Council consideration and approval.
7. The final acceptance (certificate of completion), the final contractor payment, and
the release of retainage authorization (unless early release applied for) of a
formally bid contract shall be approved by City Council action.
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SECTION 3 – CENTRALIZED PURCHASING
A. Goods, services, and equipment, (such as business forms printing, cell phones,
office/operational/janitorial supplies) that are determined to qualify under any of the
following criteria will be purchased and bid by the Finance Department:
1. When bulk purchasing or exclusiveness can save the City money
2. When consistency across departments creates organizational efficiency
3. When no department is directly responsible for a good or service that affects
many departments
4. When the City Administrator determines it beneficial for the City to do so
B. The Finance Department will create bid specifications, solicit bids, and manage
contracts for goods, services, and equipment that are deemed to qualify.
C. For the goods, services, or equipment qualifying under this section, departments must
contact the Finance Department for vendor issues, complaints or other related
activities.
D. Qualification for centralized purchasing will be determined by the City Administrator and
the Finance Department.
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APPENDIX A
FEDERAL PROGRAM FUNDING – 2 CFR; PART 200
This appendix applies to the purchase of all supplies, equipment and construction and services of
and for the City of Waukee that include any federal program funding. In regards to any such
federal programs, all procurement will be done in accordance with 2 CFR: Part 200. Chapter 26
and Section 331.341 of the Iowa Code will be followed on all applicable purchases. When federal
requirements conflict with local or state requirements, the most restrictive requirements will be
followed.
The City of Waukee must conduct procurements in a manner that prohibits the use of statutorily
or administratively imposed state, local, or tribal geographical preferences, in the evaluation of
bids or proposals under 2 CFR; Part 200.319.
METHODS OF PURCHASING
Purchasing under federal program funding will be made in accordance with the City’s Purchasing
Policy, which is below the thresholds for 2CFR; part 200.320 (a-e).
CONTRACTING WITH SMALL AND MINORITY BUSINESSES, WOMEN’S BUSINESS
ENTERPRISES, AND LABOR SURPLUS AREA FIRMS
Purchasing under federal program funding will be made in accordance with 2 CFR; Part 200.321.
This includes:
1. Assuring that small and minority businesses, and women’s business enterprises are
solicited whenever there are potential sources;
2. Placing qualified small and minority businesses and women’s business enterprises on
solicitation lists;
3. Dividing total requirements, when economically feasible, into smaller tasks or quantities to
permit maximum participation by small and minority businesses, and women’s business
enterprises;
4. Establishing delivery schedules, where the requirement permits, which encourage
participation by small and minority owned businesses, and women’s business enterprises;
5. Using the services and assistance, as appropriate, of such organizations as the Small
Business Administration and the Minority Business Development Agency of the
Department of Commerce; and
6. Requiring the prime contractor, if subcontractors are to be let, to take the affirmative
steps listed in 1 and 2 above.
CONTRACT PRICING
1. The cost plus a percentage of cost and percentage of construction cost method of
contracting shall not be used.
2. The City shall perform some form of cost/price analysis for every purchase, including
contract modifications, amendments, or change orders. And, the City shall make an
independent estimate prior to receiving a bid or proposal.
3. The City shall negotiate profit as a spate element of price for each contract in which there
is not price competition and in all cases where cost analysis is performed. In determining
a fair and reasonable profit, the City must consider the complexity of the work to be
performed, the rise borne by the contractor, the contractor’s investment, the amount of
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subcontracting, the quality of its record of past performance and the industry profit rates
in the surrounding geographical area.
RECORDS
The city shall maintain records sufficient to detail the significant history of a purchase including the
rationale for the method of purchase, selection of contract type, contractor selection or rejection,
and the basis for the contract price. In accordance with 2 CFR; Part 200.324:
1. The City must make available, upon request of the Federal awarding agency or pass-
through entity, technical specifications on proposed purchases where the Federal
awarding agency or pass-through entity believes such review is needed to ensure that the
item or service specified is the one being proposed for acquisition.
2. The City must make available upon request, for the Federal awarding agency or pass-
through entity pre-purchase review,, purchase documents, such as requests for proposals
or invitations for bids, or independent cost estimates, when:
a) The City’s purchasing procedures or operation fails to comply with the purchasing
standards in this Part;
b) The purchase is expected to exceed the Simplified Acquisition Threshold and is to
be awarded without competition or only one bid or offer is received in response to
a solicitation;
c) The purchase, which is expected to exceed the Simplified Acquisition Threshold,
specifies a “brand name” product;
d) The proposed contract is more than the Simplified Acquisition Threshold and is to
be awarded to other than the apparent low bidder under a sealed bid
procurement; or
e) A proposed contract modification changes the scope of a contract or increases the
contract amount by more than the Simplified Acquisition Threshold.
3. The City is exempt from the pre-purchase review in paragraph (2) of this section if the
Federal awarding agency or pass-through entity determines that its purchasing systems
comply with the standards of this Part.
a) The City may request that its purchasing system be reviewed by the Federal
awarding agency or pass-through entity to determine whether its system meets
these standards in order for its system to be certified. Generally, these reviews
must occur where there is continuous high-dollar funding, and third party
contracts are awarded on a regular basis;
b) The City may self-certify its purchasing system. Such self-certification must not
limit the Federal awarding agency’s right to survey the system. Under a self-
certification procedure, the Federal awarding agency may rely on written
assurances from the City that it is complying with these standards. The City must
cite specific policies, procedures, regulations, or standards as being in compliance
with these requirements and have its system available for review.
AWARDED CONTRACTS
1. The City will not award a contract to a party listed as debarred, suspended, or
otherwise excluded in the System for Award Management (SAM). www.sam.gov
2. Contracts awarded shall contain the applicable contract provisions described in 2 CFS
200.326 and Appendix II to Part 200.
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3. The City’s Conflict of Interest, Code of Ethics and Gifts Policy must meet standards set
forth in 2 CFR; Part 200.318 (c) (1).