Ordinance 03-071 Establishes Purchasing Policy / \
CITY OF SPOKANE VALLEY
SPOKANE COUNTY WASHINGTON
ORDINANCE NO.03-07.1
AN ORDINANCE OF THE CITY OF SPOKANE VALLEY,WASHINGTON,ESTABLISHING A
COMPREHENSIVE POLICY FOR THE PURCHASE AND DISPOSITION OF GOODS,
SERVICES,EQUIPMENT, SUPPLIES,AND PROPERTY FOR THE CITY OF SPOKANE
VALLEY.
WHEREAS, Washington law and City Ordinance govern the procurement of public goods,
services and works; and
WHEREAS, the City Council desires to comply with state law and to engage in best management
practices in all aspects of bidding and purchasing; and
WHEREAS, the City Council desires to establish purchasing policies to guide the procurement
of goods and services for the City;
NOW THEREFORE, the City Council of the City of Spokane Valley, Washington, do ordain as
follows:
Section 1. Definitions. Unless the context requires otherwise, the terms used in this ordinance
shall have the following meaning:
A. Contractual Services: Professional and general service contracts to accomplish a
particular project or service.
B. Bidding; Procedure used to solicit quotations on price and delivery from prospective
suppliers of materials, goods, equipment, and other City property.
C. Bid: An offer,submitted by a bidder to furnish supplies, materials, goods, equipment and
other property in conformity with the specifications, delivery terms and conditions, and other
requirements included in the invitation for bids or otherwise required by the City.
D. Bidder: A firm or individual who regularly maintains a place of business, transacts
business, solicits business or maintains an inventory of merchandise for sale in, and is registered or
licensed by the City of Spokane Valley.
E. Responsible Bidder: A bidder who has proven by experience or information furnished to
the satisfaction of the City Manager or his designee that current financial resources, production or service
facilities, service reputation and experience are adequate to make satisfactory delivery of supplies of
acceptable quality, equipment, or contractual services and who has not violated or attempted to violate
any provisions of this policy.
F. Purchasing Agent: The Finance Director or any City employee designated by the
Manager to serve as a Purchasing Agent.
G. Requisition: A standard form providing detailed information as to quantity, description,
estimated price, possible vendors, fund account, signature and other information necessary to make
purchasing decisions.
Page 1
C:\Documents and Settineskbainbridge\Local Settings\Temporary Internet Files\Content.lE5145MLYI SB\PurchasingOrdinancc7[1].I0.03.doc
H. Purchase Order: Document used to authorize the encumbrance of City funds toward the
purchase of supplies, materials, equipment and other property.
I. Adequate Appropriation Balance: Sufficient fund balance existing in the appropriation
item against which the purchase order is to be charged.
J. Public Property Any item of real or personal property owned by the City.
K. Capital Equipment. Any equipment of the City having an initial value of five hundred
dollars($500)or more and an estimated useful life of three(3)or more years.
Section 2. Administration. Under direction of the Finance Director, the purchasing
procedure shall be administered in accordance with this ordinance and other applicable laws. The
Finance Director or designee(s) shall have the responsibility to:
A. Administer and maintain the purchasing system according to the rules and regulations
established or authorized by applicable ordinances and statutes.
B. Coordinate the negotiation, purchase and disposition of all City supplies, materials and
equipment in consultation with City staff.
C. Seek to obtain competition by bidding or negotiation on all City purchases.
D. Prescribe and maintain such administrative policies, procedures and forms as are
•
reasonably necessary to implement this ordinance.
E. Coordinate the inspection of all City purchased equipment to assure conformance with
specifications.
F. Ensure that bidders' lists, vendors' catalog files and other records needed for the efficient
operation of the purchasing system arc maintained.
G. Maintain the property inventory and fixed asset systems of the City.
H. Determine with appropriate City staff the need for any routine preventive maintenance
contracts on various pieces of equipment, and to establish and maintain said maintenance contracts.
I. Periodically prepare a comprehensive list of surplus, worn out or obsolete City-owned
equipment. Items, which cannot be used, or re-assigned to another department shall be
recommended for disposal at a public auction.
Section 3. Local Vendors. Bids and price quotations will be obtained from City of Spokane
Valley vendors whenever reasonable.
Section 4. Competitive Bidding. When the price of supplies, materials,goods or equipment
is estimated to exceed twenty-five thousand dollars ($25,000.00), the following competitive bid process
shall be used.
Page 2
C:\Documents and Settings\cbainbridgc\Local Settings\Ternporary Internet FileslContent.lES\45MLYISQ\PurchasingOrdinancc7[11.I0.03.doc
A. Publication of Notice. For non-public works projects, scaled bids may be invited by a
single publication in the official newspaper at least seven (7) days prior to bid opening and by mailing
invitations to interested bidders who have requested their names be included on a bidder's list for the type
of purchase to be made. The City Clerk shall also post notice of the request in a public place. The notice
shall generally state the items to be purchased that plans/specifications may be obtained from the City,
and the manner, place, date and time for submitting a hid to the City.
B. Rejection of Bids. The Finance Director may reject, without cause, any and all bids and
may re-advertise for bids pursuant to the procedures herein described. If no bids are received, the Finance
Director, with approval of the City Council, may negotiate the purchase with a vendor at the lowest cost
possible to the City.
C. Performance Bonds. Before entering into a contract, the City Manager may require a
performance bond in such amount as is reasonably necessary to protect the best interests of the City and
to ensure complete, proper, and full performance of the contract. A performance bond shall be required
on all public works construction projects.
D. Bid Bonds. The Finance Director may require as a condition of bidding a bid bond or a
cashier's check in lieu thereof in the amount of 5 percent(5%) of the amount bid. Such bid bond shall be
required on all formally bid public works construction projects. When the contract is let, all bid bonds
shall be returned to the bidders except that of the successful bidder which shall be retained until a
contract is entered into and a bond to perform the work furnished as provided above. If the successful
bidder fails to enter into the contract in accordance with the bid and furnish such bond within ten (10)
days from the date at which the bidder is notified of bid award, the bid bond shall be forfeited.
E. Award of Bid. Except as otherwise provided herein, the City will accept the bid of the
lowest responsible bidder.
F. Award to Other Than Low bidder. When the bid award is not given to the lowest bidder,
a full and complete statement of the reasons shall be prepared by the Finance Director and placed in the
City file relating to the transaction.
Section 5. Exemptions To Competitive Bidding Requirements. The following types of
purchases are exempt from competitive bidding requirements:
A. Sole Source. Purchases which by their nature are not adapted to competitive bidding,
such as purchases which are clearly and legitimately limited to a single source, and contracts to repair or
to equipment owned by the City which may be more efficiently accomplished to by a certain person or
firm, with previous experience on the equipment.
B. Special Facilities or Market Conditions. Purchases involving special facilities or market
conditions that generally relate to acquisition of unique facilities that may be specially manufactured or
not otherwise generally available. Special market conditions may require immediate acquisition based
upon a favorable offer, including but not limited to, liquidation sales, public or private party offers and
similar circumstances where the acquisition can be obtained at below market value.
Where the City waives the competitive bidding requirements for sole source, special
facilities/market conditions, the City Council shall pass a Resolution reciting the factual basis for the
exception.
Page 3
C:1Documents and Settingskbainbridee\Local SettingsVremparary Internet Files\COntenLI E514SMLYISB\PurchasineOrdinancc7[1].10.03.doc
C. Auction, Closeout. Bankruptcy Sales; if it is determined that supplies, material, or
equipment can be purchased through public auction,closeout sale,bankruptcy sale or other similar sale at
a cost below the market cost,the Finance Director may authorize said purchase(s).
D. Exchanges. The City may by agreement exchange supplies, materials or equipment with
other public agencies.
E. inter-local Agreements in Letting of Contracts for Commodities or Services. The City
Manager may enter into joint purchase agreements with any and all other public agencies within the state
for the purchase of any commodity or service as permitted by state law, where it is determined by the
Manager to be in the best interest of the City.
F. Emergency Purchases. In the event that an emergency should arise after office hours,
which emergency requires immediate action on the part of the City department involved for the
protection of the best interests of the City, or should such a situation arise on a Saturday, Sunday or
holiday and where it is not possible or convenient to reach the City Manager, any necessary purchase
shall be made by the City department for which the purchase is necessary. The purchase shall be reported
to the Finance Director at the first of the next business day. Publication notices may be waived for
emergency purchases as provided by law. However, authorized employees must demonstrate a reasonable
effort to contact two or more vendors for price quotations.
G. Petty Cash. The Finance Department may maintain a petty cash fund of up to one
thousand dollars($I,000) to help eliminate the issuance of purchase orders and claims vouchers for small
items needed immediately from vendors not having open purchase orders. No single petty cash purchase
shall exceed fifty dollars ($50), except in emergencies. All requests for petty cash funds or
reimbursement of petty expenditures shall be reconciled by a receipt or paid invoice along with a
completed petty cash form. Reimbursements and reconciliations of petty cash funds shall be made within
30 days of the transaction.No personal checks shall be cashed out of the Petty Cash Fund.
H. Real Property. Acquisition of real property is exempt from the competitive bidding
requirements set forth in this Ordinance. Upon approval of the City Council, the City Manager may
proceed to acquire real property through negotiation. Such negotiations shall be based upon a fair market
value appraisal of the property. The City shall not pay more than fair market value for any real property
without prior City Council approval.
1. Small Purchases. The procurement of supplies, materials, goods and equipment under
$7,500 in value may be procured as the City Manager or designee(s) deems appropriate to secure the
most efficient and cost-effective purchase for the City.
1. Purchases Between $7,500 and $25,000. Material, equipment or contractual services
other than engineering and architectural services, the cost of which is between seven thousand five
hundred dollars ($7,500) and twenty-five thousand dollars($25,000), may be procured through telephone
and/or written quotations, proposals or bids on forms prescribed by the Finance Director. Three
documented quotations shall be sufficient to determine a competitive price for any such purchase except
for items that can only be obtained from a single source. Said purchases shall be awarded to the lowest
responsible bidder.
Section 6. Prohibited Practices. The following types of purchasing practices are hereby
prohibited and may result in disqualification of the bid.
Page 4
C:113ncuments and Settings\cbainbridge1Local Settirrgs\Tcmporrw, Internet Files\Content.IE.5145MLYi SuwurchasingOrdinance7f ll.10.03.doc
•
A. Collusion Among Bidders. Any agreement or collusion among bidders or prospective
bidders to either buy or sell or fix prices in restraint of free competition. Such bidders may be subject to
exclusion from future bidding with the City when determined by the Finance Director to be in the best
interest of the City.
B. Disclosure of Formal Bid Contents. Any disclosure of information contained in the
sealed bid prior to bid opening. Notwithstanding anything herein to the contrary, all bids submitted by
bidders taking advantage of any information revealed contrary to this section shall become null and void.
C. Gratuities. In accordance with high standards of behavior, the acceptance of any gift or
gratuity in the form of cash, merchandise or any other thing of significant value by an official or
employee of the City from any vendor or contractor,or prospective vendor or contractor.
D. Employee Owned Businesses. Obtaining City goods or services from businesses in
which City officials, employees or their immediate family members have a majority ownership interest or
otherwise exceed the"interests"described in RCW Chapter 42.23.
E. Sale of Materials and Supplies. The City acquiring goods or services for any private
party, or selling its materials or supplies to City officials, employees, or the public except when said
materials have been declared surplus and disposed of as provided herein.
Section 7. Disposition of Public Property. Public property shall be disposed of in the
following manner:
A. Definition. "Public Property" as defined herein means any property or equity interest in
real or personal property held or owned by the City.
B. Surplus Property_. Upon recommendation of a Department Director, the Finance Director
may declare property surplus upon one or more of the following criteria:
1. The City has or anticipates no practical, efficient, or appropriate use for the
property.
2. The purpose served by the property can be accomplished by use of a better, less
costly, or more efficient alternative.
3. The purpose served by the property no longer exists as determined by a change
of policy or practice.
4. The property is damaged, inoperable or obsolete and the cost of repairing the
same is uneconomical or impractical.
C. Sale of Property. The Finance Director is authorized to sell surplus property in the
follow manner:
1. Upon a finding by a Department Director that the property is surplus to City use,
the Finance Director shall provide notice of potential disposition to other City departments. If any
Department Director desires to acquire and use the proposed surplus property, the property may be
transferred to the requesting Department Director,or other authorized representative.
Page 5
C:\Documents and Sett.ineslebainbridgell..ocal Settings\Temporary Internet FilestContent.t E5145MLYISII\Purchasing0rdinancc7[Il,I0,03,doc.
•
2. If no request for use of proposed surplus property is received, the Finance
Director may proceed to dispose of the same by public auction, bid, or other method of sale on terms
deemed to he in the best interest of the City.
3. Surplus personal property which is unsellable because of obsolescence, wear and
tear, or other reasons may be dismantled, if necessary, and sold as scrap. Surplus personal property,
which has no marketable value or use, may be discarded as refuse.
4. If the proposed surplus property is real property, notice of the proposal to declare
the same surplus shall be given to the City Council.
5. The decision to declare surplus real property shall rest solely with the City
Council. If the City Council declares the real property as surplus, the Finance Director shall secure a
market value appraisal of the property and proceed to sell the same by public auction or through the
formal bidding procedures the City Manager deems to be in the best interest of the City.
D. Trade of Real Property. Real property may be traded under the following conditions.
I. If the Finance Director determines that the disposal of real property declared
surplus under this section could realize greater benefit to the City through consideration other than cash,
the Finance Director may invite prospective purchasers to tender consideration of cash and property.
Upon receipt of a bid tendering consideration in-kind, and prior to accepting such bid, the Finance
Director shall make a report setting forth for the benefits of such a transaction. This report shall be made
to the City Council at a regular Council meeting and the report shall be open to public inspection.
2. Before accepting any bid containing in-kind consideration, an adequate appraisal
must have been made by a qualified independent appraiser.
3. If the City Council finds that the bid containing the in-kind consideration has
more value or benefit to the City than any other bid submitted, the Finance Director may accept the bid
containing in-kind consideration.
E. Lease of Public Property. When specifically provided for in the City budget, the City
Manager or designee may authorize the lease or sublease of any property, including real property, under
such terms and conditions as the City Manager may deem desirable, fair and appropriate, either by use of
negotiations or bidding in the best interest of the City. Leases of real property shall not be granted for a
period of more than five(5)years, unless otherwise authorized by the City Council.
Section 8. Severability. If any section, sentence, clause, or phrase of this ordinance should
be held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of
any other section, sentence, clause, or phrase of this ordinance.
Section 9. Effective Date. This ordinance shall be in full force and effect on the official
date of incorporation provided publication of this ordinance or a summary thereof occurs in the official
newspaper of the City as provided by law.
•
•
Page 6
C:Illocumcnts and Scftings\chainbridgelLocal Settines\Tempomry lntcmct FilcslConicnt.I[15145MI.Y1SRIPurchasingOrdinance7lIi.I0.03.doc
Passed by the City Council of the City of Spokane Valley on ..2003.
�l I
Mayor, Michael eVI ming
A
Christine Bainbridge, City Clerk
Approved as to Form:
� Ar.A.A.tr.>,
nter'ir City y, Stanley . Schwartz
Date of Publication : 7-2 6-03
Effective Date: 7 • 3/-4_3
Page 7
C:\Docurnents and Settingslcbainbridge\i.ocal Settings\Temporary Internet FileslContcntlE.5145MLY1SB\PurchasingOrdintinceilli.10.03.doc