HomeMy WebLinkAbout2016-07-26; City Council; 22373; Introduction of ordinance amending Municipal Code Title 3 Chapter 3.28Item #18 - AB #22,373 July 26, 2016 Page 1 of 10
CITY OF CARLSBAD-AGENDA BILL
AB# 22,373 INTRODUCTION OF AN ORDINANCE AMENDING DEPT. DIRECTOR
DATE 07/26/16 CARLSBAD MUNICIPAL CODE TITLE 3, CHAPTER 3.28 CITY ATTY. If<.
(PURCHASING) TO AUTHORIZE JOB ORDER CONTRACTS,
CLARIFY THE DOLLAR THRESHOLD WHERE FORMAL ~ BIDDING IS REQUIRED, REDUCE THE NOTICE PERIOD
INVITING FORMAL BIDS FOR CONSTRUCTION PROJECTS
TO 15 DAYS, AND CLARIFY THE CITY MANAGER MAY
DEPT. PW/ATIY DELEGATE AUTHORITY TO EXECUTE CHANGE ORDERS CITY MGR.
RECOMMENDED ACTION:
Conduct first reading of an ordinance amending Carlsbad Municipal Code Title 3, Chapter 3.28
(Purchasing), to add Section 3.28.087 (Job order contracts), amend Sections 3.28.050 (Procurement of
Goods), and 3.28.060 (Procurement of professional services and services) to clarify the dollar threshold
where formal bidding is required, amend Section 3.28.080 (Construction projects) to reduce the notice
period inviting formal bids to 15 days, and amend Section 3.28.090 (Execution of change orders and
amendments) to clarify the city manager may delegate authority to execute change orders; and schedule
the second reading and adoption of ordinance for a future City Council meeting.
ITEM EXPLANATION:
Four changes are proposed to Carlsbad Municipal Code Title 3, Chapter 3.28 (Purchasing):
(1) The addition of Section 3.28.087 to allow the city to enter into job order contracts. Job order
contracting is a procurement method designed to streamline the process of awarding small, repetitive
construction contracts. Job order contracts may be used for minor or recurring tasks, such as repair and
renovations involving minimum design requirements. Job order contracts are competitively bid based on
a fixed unit price with indefinite quantity, so that the contractor who is awarded the contract is available
on an on-call basis as projects arise. City staff anticipates using job order contracts for repair work to city
facilities such as heating, ventilation, and air conditioning systems, generators, and traffic signals and
street lights.
Section 404 of the Carlsbad City Charter provides City Council with authority to establish procedures and
regulations for contracts for construction of public improvements that differ from those in the California
Public Contract Code, which does not authorize cities to use job order contracts. Other charter cities
using job order contracting include San Diego and Vista.
DEPARTMENT CONTACTS: Craddock Stropes 760-602-2726 craddock.stropes@carslbadca.gov
Heather Stroud 760-434-2946 heather.stroud@carlsbadca.gov
FOR CLERK USE. ~ COUNCIL ACTION: APPROVED CONTINUED TO DATE SPECIFIC D
DENIED CONTINUED TO DATE UNKNOWN D
CONTINUED D RETURNED TO STAFF D
WITHDRAWN D OTHER-SEE MINUTES D
AMENDED D REPORT RECEIVED D
Item #18 - AB #22,373 July 26, 2016 Page 2 of 10
The proposed amendment would limit each job order contract to a dollar amount not to exceed $1
million total over a maximum five-year term. The city manager or designee would be authorized to issue
task orders under a job order contract up to the formal bid threshold in the Public Contract Code, which
is currently set at $175,000.
{2) Amendments to Sections 3.28.050 (Procurement of goods) and 3.28.060 (Procurement of professional
services and services) to clarify the dollar threshold where formal bidding is required. The proposed
amendments would clarify that the $30,000 threshold for formal bidding for goods, services, and
professional services is per agreement year, not the total contract amount. These amendments would
ensure that the Carlsbad Municipal Code is consistent with past practice of requiring formal bidding only
when the contract amount exceeds $30,000 per agreement year.
(3) An amendment to Section 3.28.080 (Construction projects) to reduce the notice period inviting formal
bids from 30 days to 15 days. California Public Contract Code section 22037 was amended in 2010 to
require only 15-day notice of advertisement of formal bids. The proposed amendment would be
consistent with state law and result in streamlined contract award timeframes.
(4) An amendment to Section 3.28.090 (Execution of change orders and amendments) to clarify that the
City Manager may delegate his or her authority to execute change orders. The proposed amendment is
desirable because it would result in a streamlined change order process.
FISCAL IMPACT:
There is no direct fiscal impact.
ENVIRONMENTAL IMPACT:
Pursuant to Public Resources Code Section 21065, this action does not constitute a "project" within the
meaning of CEQA in that it has no potential to cause either a direct physical change in the environment,
or a reasonably foreseeable indirect physical change in the environment, and therefore does not require
environmental review.
EXHIBITS:
1. Ordinance of the City Council of the City of Carlsbad, California, to amend Title 3, Chapter 3.28 of the
Carlsbad Municipal Code to: Add Section 3.28.087 (Job Order Contracts); Amend Sections 3.28.050
(Procurement of Goods) and 3.28.060 (Procurement of Professional Services and Services) to Clarify
the Dollar Threshold Where Formal Bidding is Required; Amend Section 3.28.080 (Construction
Projects) to Reduce the Notice Period Inviting Formal Bids to 15 Days; and Amend Section 3.28.090
(Execution of Change Orders and Amendments) to Clarify the City Manager May Delegate Authority
to Execute Change Orders.
2. Redline/strikeout version of Ordinance.
2
Item #18 - AB #22,373 July 26, 2016 Page 3 of 10
1
2
3
4
5
6
7
8
9
10
11
ORDINANCE NO. CS-307
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD, CALIFORNIA, AMENDING CARSLBAD
MUNICIPAL CODE TITLE 3, CHAPTER 3.28 (PURCHASING)
TO: ADD SECTION 3.28.087 (JOB ORDER CONTRACTS);
AMEND SECTIONS 3.28.050 (PROCUREMENT OF GOODS)
AND 3.28.060 (PROCUREMENT OF PROFESSIONAL
SERVICES AND SERVICES) TO CLARIFY THE DOLLAR
THRESHOLD WHERE FORMAL BIDDING IS REQUIRED;
AMEND SECTION 3.28.080 (CONSTRUCTION PROJECTS)
TO REDUCE THE NOTICE PERIOD INVITING FORMAL BIDS
TO 15 DAYS; AND AMEND SECTION 3.28.090
(EXECUTION OF CHANGE ORDERS AND AMENDMENTS)
TO CLARIFY THE CITY MANAGER MAY DELEGATE
AUTHORITY TO EXECUTE CHANGE ORDERS
12 WHEREAS, the City of Carlsbad, as a charter city, has plenary authority to
13 legislate matters of local concern notwithstanding general laws to the contrary; and
14 WHEREAS, Carlsbad City Charter section 404 provides City Council with
15 authority to establish procedures and regulations for contracts including contracts for
16 construction of public improvements; and
17 WHEREAS, job order contracts are a procurement method designed to
18 streamline the process of awarding small, repetitive construction contracts for minor or
19 recurring tasks, such as repair or renovations involving minimum design requirements, that
20 the California Public Contract Code does not authorize cities to use; and
21 WHEREAS, clarifications to the dollar thresholds where formal bidding is
22 required for procurement of goods, professional services, and services, are desirable; and
23 WHEREAS, reducing the notice period for invitation of formal bids from 30
24 days to 15 days is desirable to maintain consistency with Public Contract Code section 22037
25 and to streamline construction contract award timeframes; and
26 WHEREAS, clarifying that the City Manager may delegate his or her authority
27 to execute change orders is desirable; and
28 WHEREAS, the City Council of the City of Carlsbad has determined that it is in
Item #18 - AB #22,373 July 26, 2016 Page 4 of 10
the best interests of the City of Carlsbad to adopt an alternative procurement method
2 allowing job order contracts, to clarify that the dollar threshold where formal bidding is
3 required for procurement of goods, professional services, and services is $30,000 per
4 agreement year, to reduce the notice period for invitation of formal bids from 30 to 15 days,
5 and to clarify that the City Manager's designee may execute change orders.
6 NOW, THEREFORE, the City Council of the City of Carlsbad ordains as follows
7 that:
8 1. The above recitations are true and correct.
9 2. That Section 3.28.087 is added to the Carlsbad Municipal Code to read as follows:
10 3.28.087 Job order contracts.
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Section 100 of the Charter of the City of Carlsbad provides that the city council shall have
full power and authority to adopt laws with respect to municipal affairs. Section 404
provides that the city council shall have the power to establish procedures and
regulations for contracts for the construction of public improvements. As an alternative
to the bidding process set forth in this chapter and the California Public Contract Code,
and when recommended by the city manager in writing, there is hereby established a job
order procurement and contracting approach.
A. Purpose and Intent. The purpose of this section is to provide definitions and
guidelines for the award, use, and evaluation of job order contracts.
B. Definitions. For the purposes of this section, the following definitions apply:
"Job order contract" means a construction contract for minor or recurring
construction tasks, including repair, with a firm, fixed price, and indefinite quantity
awarded on a unit price basis for all necessary labor, materials, and equipment.
"Task order" means an authorization to perform construction work under a job
order contract.
C. Job Order Procurement.
1. Except as specifically set forth in this section, job order contracts are
subject to Section 3.28.080.
2. Job order contracts shall have a term no longer than five years, including
all modifications.
3. The advertisement for bids and specifications shall contain a maximum
dollar amount of the job order contract not to exceed $1,000,000. Any
cumulative change orders to a job order contract shall not result in a
contract exceeding $1,000,000.
4. The advertisement for bids and specifications shall include unit prices and
detailed technical specifications for each construction task to be
performed under the job order contract.
Item #18 - AB #22,373 July 26, 2016 Page 5 of 10
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
5. Contractors submitting bids on a job order contract shall state in their bids
an adjustment on a percentage basis either increasing or decreasing the
unit prices for all construction tasks set forth in the bid documents.
D. Issuance of Task Orders.
1. Each task order shall include a detailed scope of work and time certain for
completion of work. The task order price shall be no more than the sum of
the applicable unit prices with the bid adjustment factor.
2. The city manager or designee shall have authority to issue task orders less
than the dollar amount specified in Section 3.28.080(8).
3. That Title 3, Chapter 3.28, Section 3.28.050(C)(1) is amended to read as follows:
Formal bidding procedures shall be utilized when the anticipated cost of the goods is
greater than $30,000.00 per agreement year. The bid limit shall be reviewed annually and
adjusted in response to the San Diego-All Urban Consumers Consumer Price Index. The
purchasing officer shall calculate the effect of the cumulative change in the index to
$30,000.00 beginning in fiscal year 2009. Adjustment to the bid limit will be made in
$5,000.00 increments whenever the calculated value exceeds a previously set bid limit by.
more than $2,500.00. The bid limit adjustment will be made effective at the beginning of
a fiscal year by memorandum from the purchasing officer.
4. That Title 3, Chapter 3.28, Section 3.28.050(D)(3) is amended to read as follows:
The city manager shall be the awarding authority for procurement of goods for which the
cost to the city is $100,000.00 per agreement year or less.
5. That Title 3, Chapter 3.28, Section 3.28.050(D)(4) is amended to read as follows:
The city council shall be the awarding authority for procurement of goods for which the
cost to the city is more than $100,000.00 per agreement year and have not been
previously approved as capital outlay items in the budget process.
6. That Title 3, Chapter 3.28, Section 3.28.060{A)(2) is amended to read as follows:
Procurements of professional services where the total cost of services are $30,000.00 or
less per agreement year shall be made using simplified and cost effective operational
procedures and forms approved by the city manager. If the cost of needed professional
services is expected to exceed $30,000.00 per agreement year, at least three proposals
should be solicited for the professional service needed whenever possible. The
purchasing officer may waive the requirements for solicitation of multiple proposals if
only one individual or firm can reasonably provide the professional services, and it is in
the best interest of the city to waive the requirement.
Ill
Item #18 - AB #22,373 July 26, 2016 Page 6 of 10
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
7. That Title 3, Chapter 3.28, Section 3.28.060(D)(1) is amended to read as follows:
Formal bidding procedures shall be utilized when the anticipated cost of the services is
greater than $30,000.00 per agreement year. The bid limit shall be reviewed annually and
adjusted in response to the San Diego-All Urban Consumers Consumer Price Index. The
purchasing officer shall calculate the effect of the cumulative change in the index to
$30,000.00 beginning in fiscal year 2009. Adjustment to the bid limit will be made in
$5,000 increments whenever the calculated value exceeds a previously set bid limit by
more than $2,500.00. The bid limit adjustment will be made effective at the beginning of
a fiscal year by memorandum from the purchasing officer.
8. That Title 3, Chapter 3.28, Section 3.28.080(G)(1) is amended to read as follows:
The purchasing officer, or delegate, shall mail notice inviting formal bids for construction
projects to construction trade journals at least 15 calendar days before the bid opening
date. The notice inviting formal bids shall be published at least 14 calendar days before
the bid opening date in a newspaper of general circulation in the city. In addition to the
newspaper, the notice inviting formal bids may be advertised in any manner which will
permit the information to be widely disseminated.
9. That Title 3, Chapter 3.28, Section 3.28.090(B) is amended to read as follows:
The city council may by resolution authorize the city manager or designee to approve
change orders on a project to an amount it determines appropriate for a large, complex
project.
18 EFFECTIVE DATE: This ordinance shall be effective thirty days after its
19 adoption; and the city clerk shall certify the adoption of this ordinance and cause the full text
20 of the ordinance or a summary of the ordinance prepared by the City Attorney to be
21 published at least once in a newspaper of general circulation in the City of Carlsbad within
22 fifteen days after its adoption.
23 INTRODUCED AND FIRST READ at a regular meeting of the Carlsbad City
24 Council on the 26th day of July, 2016, and thereafter
25 I I I
26 I I I
27 I I I
28 I I I
Item #18 - AB #22,373 July 26, 2016 Page 7 of 10
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Carlsbad on the __ day of _____ , 2016, by the following vote, to wit:
AYES:
NOES:
ABSENT:
APPROVED AS TO FORM AND LEGALITY:
CELIA A. BREWER, City Attorney
MATT HALL, Mayor
ATTEST:
BARBARA ENGLESON, City Clerk
Item #18 - AB #22,373 July 26, 2016 Page 8 of 10
Chapter 3.28
PURCHASING
3.28.050 Procurement of goods.
A. -B. [No change]
C. Formal Bidding for Goods.
1. Formal bidding procedures shall be utilized when the anticipated cost of
the goods is greater than $30,000.00 per agreement year. The bid limit shall be
reviewed annually and adjusted in response to the San Diego-All Urban
Consumers Consumer Price Index. The purchasing officer shall calculate the
effect ofthe cumulative change in the index to $30,000.00 beginning in fiscal
year 2009. Adjustment to the bid limit will be made in $5,000.00 increments
whenever the calculated value exceeds a previously set bid limit by more than
$2,500.00. The bid limit adjustment will be made effective at the beginning of a
fiscal year by memorandum from the purchasing officer.
2.-7. [No change]
D. Additional Responsibilities and Authorities.
1.-2. [No change]
3. The city manager shall be the awarding authority for procurement of goods
for which the cost to the city is $100,000.00 per agreement year or less.
4. The city council shall be the awarding authority for procurement of goods
for which the cost to the city is more than $100,000.00 per agreement year and
have not been previously approved as capital outlay items in the budget
process.
E. [No change]
3.28.060 Procurement of professional services and services.
A. Professional Services Procurement.
1. {No change]
2. Procurements of professional services where the total cost of services are
$30,000.00 or less per agreement year shall be made using simplified and cost
effective operational procedures and forms approved by the city manager. If
the cost of needed professional services is expected to exceed $30,000.00~
agreement year, at least three proposals should be solicited for the professional
service needed whenever possible. The purchasing officer may waive the
requirements for solicitation of multiple proposals if only one individual or firm
Item #18 - AB #22,373 July 26, 2016 Page 9 of 10
can reasonably provide the professional services, and it is in the best interest of
the city to waive the requirement.
B. -C. [No change]
D. Formal Bidding for Services.
1. Formal bidding procedures shall be utilized when the anticipated cost of
the services is greater than $30,000.00 per agreement year. The bid limit shall
be reviewed annually and adjusted in response to the San Diego-All Urban
Consumers Consumer Price Index. The purchasing officer shall calculate the
effect of the cumulative change in the index to $30,000.00 beginning in fiscal
year 2009. Adjustment to the bid limit will be made in $5,000 increments
whenever the calculated value exceeds a previously set bid limit by more than
$2,500.00. The bid limit adjustment will be made effective at the beginning of a
fiscal year by memorandum from the purchasing officer.
2.-5. [No change]
E. [No change]
3.28.080 Construction projects.
A.-F. [No change]
G. The formal bidding procedures for construction projects shall include the
following:
3.28.087
1. The purchasing officer, or delegate, shall mail notice inviting formal bids for
construction projects to construction trade journals at least :W 15 calendar days
before the bid opening date. The notice inviting formal bids shall be published
at least 14 calendar days before the bid opening date in a newspaper of general
circulation in the city. In addition to the newspaper, the notice inviting formal
bids may be advertised in any manner which will permit the information to be
widely disseminated.
2.-6. [No change]
Job order contracts.
Section 100 of the Charter of the City of Carlsbad provides that the city council shall have
full power and authority to adopt laws with respect to municipal affairs. Section 404
provides that the city council shall have the power to establish procedures and regulations
for contracts for the construction of public improvements. As an alternative to the bidding
process set forth in this chapter and the California Public Contract Code, and when
recommended by the city manager in writing, there is hereby established a job order
procurement and contracting approach.
A. Purpose and Intent. The purpose of this section is to provide definitions and
guidelines for the award, use, and evaluation of job order contracts.
Item #18 - AB #22,373 July 26, 2016 Page 10 of 10
B. Definitions. For the purposes of this section, the following definitions apply:
"Job order contract" means a construction contract for minor or recurring
construction tasks, including repair, with a firm, fixed price, and indefinite quantity
awarded on a unit price basis for all necessary labor, materials, and equipment.
"Task order" means an authorization to perform construction work under a job
order contract.
C. Job Order Procurement.
1. Except as specifically set forth in this section, job order contracts are subject
to Section 3.28.080.
2. Job order contracts shall have a term no longer than five years, including all
modifications.
3. The advertisement for bids and specifications shall contain a maximum
dollar amount of the job order contract not to exceed $1,000,000. Any
cumulative change orders to a job order contract shall not result in a
contract exceeding $1,000,000.
4. The advertisement for bids and specifications shall include unit prices and
detailed technical specifications for each construction task to be performed
under the job order contract.
5. Contractors submitting bids on a job order contract shall state in their bids
an adjustment on a percentage basis either increasing or decreasing the unit
prices for all construction tasks set forth in the bid documents.
D. Issuance of Task Orders.
3.28.090
1. Each task order shall include a detailed scope of work and time certain for
completion of work. The task order price shall be no more than the sum of
the applicable unit prices with the bid adjustment factor.
2. The city manager or designee shall have authority to issue task orders less
than the dollar amount specified in Section 3.28.080(B).
Execution of change orders and amendments.
A. [No change]
B. The city council may by resolution authorize the city manager or designee to
approve change orders on a project to an amount it determines appropriate for
a large, complex project.
Heather Stroud, Deputy City Attorney
July 26, 2016
Amendments to Purchasing
Ordinance
Four proposed changes
1.Job order contracts
2.Formal bidding for goods and services
3.Notice for construction contracts
4.Change order delegation
1. Job Order Contracts
•Carlsbad Charter sec. 404
•Fixed unit price, indefinite quantity
•Small, repetitive construction contracts
–Repair or renovation
•Limit: $1 million/5 years total
2. Formal Bidding for Goods and Services
•Clarification and consistency
•Formal bid threshold for goods, services, and
professional services
•$30,000 per year
3. Notice for Construction Contracts
•Reduce notice inviting formal bids from 30 to
15 days
•Consistent with Public Contract Code
4. Change Order Delegation
•Clarification and consistency
•City Manager may delegate authority to sign
change orders