City of Webster Groves
PURCHASING POLICY
December 2011
SECTION I - GUIDELINES 5
1.1 BASIC GOALS 5
1.2 PLANNING 5
1.3 OVERDRAFTS PROHIBITED 6
1.4 BUYING PROPER QUALITY 6
1.5 BRIBERY 6
1.6 SALES TAX 6
1.7 PUBLIC ACCESS 6
1.8 ENDORSEMENTS 6
1.9 PERSONAL PURCHASES 7
1.10 LOCAL BUYING 7
1.11 PURCHASING AGENT 7
1.12 CONFLICTS OF INTEREST 7
SECTION II - DEFINITIONS 8
2.1 CONSTRUCTION 8
2.2 CONTRACT 8
2.3 FINANCIAL INTEREST 8
2.4 INVITATION TO BID 8
2.5 MINOR INFORMALITY 8
2.6 PROFESSIONAL SERVICES 8
2.7 PUBLIC NOTICE 8
2.8 REQUEST FOR PROPOSALS 9
2.9 RESPONSIBLE BIDDER 9
2.10 RESPONSIVE BIDDER 9
2.11 SERVICES 9
2.12 SPECIFICATION 9
2.13 SUPPLIES 9
2.14 SURPLUS SUPPLIES 9
2.15 WRITTEN OR IN WRITING 9
SECTION III - PURCHASING PROCEDURES 10
3.1 PURCHASE ORDERS 10
3.2 PURCHASES UNDER $1,500 10
3.3 PURCHASES FROM $1,500 TO $5,000 11
3.4 PURCHASES FROM $5,000 TO $15,000 11
3.5 PURCHASES IN EXCESS OF $15,000 11
3.6 BIDDING PROCEDURES 12
3.7 DETERMINING THE LOWEST RESPONSIBLE AND RESPONSIVE BIDDER ………………………………………………………………………………………. 12
3.8 UNREASONABLE AND ACCEPTABLE BIDS 13
SECTION IV - SPECIAL PROCUREMENT PROCEDURES 14
4.1 SOLE SOURCE 14
4.2 COOPERATIVE PROCUREMENT PROGRAMS 14
4.3 PROFESSIONAL SERVICES 15
4.4 BLANKET PURCHASE CONTRACTS 15
4.5 EMERGENCY PURCHASES 15
4.6 PETTY CASH ACCOUNTS 15
4.7 PURCHASE OF USED EQUIPMENT 16
4.8 CHANGE ORDERS 16
4.9 CITY CREDIT CARDS PURCHASE CARDS 16
4.10 GREEN PROCUREMENT 17
SECTION V - SPECIFICATIONS 18
5.1 FORMAL COMPETITIVE BIDDING 18
5.2 GENERAL GUIDELINES 18
5.3 TYPES OF SPECIFICATIONS 19
SECTION VI - LEGAL AND CONTRACTUAL REMEDIES 21
6.1 RIGHT TO PROTEST 21
6.2 AUTHORITY TO RESOLVE PROTEST 21
6.3 DECISION 21
6.4 FINALITY 21
6.5 STAY OF PROCUREMENT DURING PROTESTS 21
6.6 DEBARMENT OF SUPPLIERS 21
SECTION VII - TRAVEL REGULATIONS AND REIMBURSEMENTS 23
7.1 GENERAL REGULATIONS 23
7.2 TRAVEL ADVANCE 23
7.3 TRAVEL EXPENSE REPORT 23
7.4 USE OF COMMERCIAL CARRIER 23
7.5 USE OF PERSONAL VEHICLES 24
7.6 TRAVEL TIME EXCEEDING ONE DAY 24
7.7 VEHICLE RENTAL 24
7.8 LODGING 24
7.9 MEALS AND INCIDENTAL EXPENSES 25
7.10 REGISTRATION FEES 25
SECTION VIII - DELIVERY AND PERFORMANCE 26
8.1 FOLLOW-UP AND EXPEDITING 26
8.2 DELINQUENT DELIVERIES 27
8.3 PARTIAL DELIVERIES 27
8.4 SUBSTITUTION 27
8.5 BID DEPOSITS AND PERFORMANCE BONDS 28
8.6 NON-PERFORMANCE 28
SECTION IX - INSPECTION AND TESTING 29
9.1 REPORTS, REJECTION, AND RETURN AUTHORIZATION 29
9.2 DAMAGE DURING SHIPMENT 29
9.3 LATENT DEFECTS 30
SECTION X - DISPOSAL OF SURPLUS SUPPLIES 31
10.1 AVOIDANCE OF CONFLICTS 31
10.2 AUCTIONS 31
SECTION XI - PURCHASE OF AMERICAN PRODUCTS 32
SECTION XII - PURCHASE OF CONSTRUCTION SERVICES AND MATERIALS 33
12.1 TAX EXEMPTION 33
12.2 PREVAILING WAGE 33
12.3 IMMIGRATION LAW REQUIREMENT 33
SECTION I - GUIDELINES
This manual sets forth the procurement policies established by the City Council and procedures for compliance with those policies. If these policies are adhered to, the city is expected to receive the maximum value for each public dollar spent. (Purchasing Ordinance - Appendix A). Reference should also be made to Section 3.110 through Section 3.145 of the City Code for more information.
1.1 BASIC GOALS
The basic goals of the city's procurement program are:
a. To comply with the legal requirements of public purchasing.
b. To assure vendors that impartial and equal treatment will be afforded all who wish to do business with the city.
c. To receive maximum value for each public dollar spent.
d. To provide city departments needed supplies and services at the time and place needed in the proper quantity and quality.
e. To purchase only supplies and services for which funds have been approved and not previously encumbered.
If the procedures and guidelines established in this manual are followed, each department will efficiently manage, control, and plan their available resources to meet present and future departmental needs and help the city meet these goals.
These general guidelines should be considered Administrative Rules and Regulations and are to be adhered to as closely as possible by all departments in the procurement of supplies and services.
The City Manager or his designee will act as the city’s Purchasing Agent per the City Charter.
1.2 PLANNING
Planning for purchases should be done on both a short term and a long-term basis. Small orders and last minute purchases should be minimized, increasing the opportunity for the city, as well as each department, to purchase in larger quantities in order to obtain the maximum discounts possible. Planning will also reduce the number of trips required to obtain materials and minimize the amount of staff time spent on documenting purchases. Procurement begins with the preparation of the Capital Improvement Plan and the Annual Budget.
1.3 OVERDRAFTS PROHIBITED
No purchase will be authorized that would overdraw a budgetary account. Department heads contemplating a purchase that will exceed a budgetary account should contact the City Manager or Finance Director to insure that provision is made for the necessary budget adjustment prior to initiating the purchase.
1.4 BUYING PROPER QUALITY
Quality and service are just as important as price and it is the responsibility of the requisitioning department to secure the best quality for the purpose intended. Quality buying is the buying of supplies or services that will meet but not exceed the requirements for which they are intended. In some instances, the primary consideration is durability. With other purchases, it may be a question of immediate availability, ease of installation, frequency of repair, or efficiency of operation that must be given primary consideration. In the case of motor vehicles and other capital expenditures, departments may want to investigate life cycle costs or EPA mileage ratings to compare bids as opposed to utilizing price as the sole criterion for determining the lowest responsible bidder. It is the responsibility of each department head to become familiar enough with available equipment to determine the appropriate quality required when developing specifications.
1.5 BRIBERY
Bribery, in any form, represents malfeasance in office and means that public funds are being mismanaged. Bribery by vendors in order to secure favorable consideration is seldom attempted. Vendors may attempt to secure favoritism by offering gifts or providing entertainment to city officials. Attempts to influence decisions regarding the expenditures of public funds may be directed towards any employee who has influence over the selection of vendors. The penalty for accepting a bribe will be immediate disciplinary action and may include termination.
1.6 SALES TAX
The city is exempt from most local and state sales taxes or Federal excise taxes. The Finance Department will provide the necessary exemption documents to any vendor, upon request.
1.7 PUBLIC ACCESS
All specifications, bid documents, purchase orders, and supporting documents that are public records will be made available to citizens, vendors, or the media, upon request.
1.8 ENDORSEMENTS
It is city policy not to endorse or in any way permit an employee's name or position, or the city's name to be used and advertised as supporting a product or vendor without the expressed approval of the council.
1.9 PERSONAL PURCHASES
Personal purchases for employees by the city generally are prohibited. Exceptions may be made where the City Manager has determined that the purchase benefits the city, such as allowing employees to purchase clothing with the city's logo from the city's approved vendor. City employees are also prohibited from using the city's name or the employee's position to obtain special consideration in personal purchases.
1.10 LOCAL BUYING
It is the desire of the city to purchase from Webster Groves vendors whenever possible. This can be accomplished by insuring that local vendors who have supplies or services that are needed by the city are included in the competitive procurement process that will precede most purchases. The city has a responsibility to its residents, however, to insure that the maximum value is obtained for each public dollar spent. It is assumed that local vendors who wish to do business with the city will offer the lowest possible price for the item being purchased.
1.11 PURCHASING AGENT
The City Manager serves as the city’s purchasing agent and is authorized to sign contracts on the city’s behalf. The City Finance Director’s office coordinates the purchasing function, much of which has been delegated to the city’s operating departments.
1.12 CONFLICTS OF INTEREST
No officer or employee of the city shall participate in a contract for supplies or services when that person knows:
(1) the officer or employee or any member of the officer’s or employee’s immediate family has a financial interest pertaining to the contract; or
(2) a business or organization in which the officer or employee, or any member of the officer’s or employee’s immediate family, has a financial interest pertaining to the contract; or
(3) any contract in which any officer or employee of the city has a financial interest, directly or indirectly, shall be void, except when said contract is awarded as a result of open bidding.
Every officer and employee of the city shall not directly or indirectly solicit any gift or accept or receive any gift, whether in the form of money, services, loans, promises or any other form, under circumstances in which it could reasonably be inferred that the gift was intended to influence them, or could reasonably be expected to influence them, in the performance of their official duties or was intended as a reward for any official action on their part. Gifts of food and other de minimus items are excluded.
SECTION II - DEFINITIONS
The following are definitions of words, terms, and phrases used in the city’s procurement of supplies and services:
2.1 CONSTRUCTION
Means the process of building, altering, repairing, improving, or demolishing any public infrastructure facility, including any public structure, public building, or other public improvement of any kind to real property. It does not mean the routine operation, routine repair, or routine maintenance of any existing public infrastructure facility, including structures, buildings, or real property.
2.2 CONTRACT
Means all types of agreements, regardless of what they may be called, for the procurement or disposal of supplies, services, or construction.
2.3 FINANCIAL INTEREST
Means ownership of any interest or involvement in any relationship from which, or as a result of which, a person within the past 12 months has received, or is presently or in the future entitled to receive, more than $500 per year, or its equivalent.
2.4 INVITATION TO BID
Means all documents, whether attached or incorporated by reference, utilized for soliciting bids.
2.5 MINOR INFORMALITY
Means a mistake, excluding judgmental errors that have negligible material effect on price, quantity, delivery or contractual terms and waiver or correction of such mistake does not prejudice other bidders or offerors.
2.6 PROFESSIONAL SERVICES
Means those services requiring specialized knowledge, education or skill and where the qualifications of the person(s) rendering the services are of primary importance. Professional services shall include but not be limited to appraisers, land surveyors, attorneys, architects, engineers, psychologists, physicians, health practitioners, auditors, systems and software analysts and professional consultants.
2.7 PUBLIC NOTICE
Means the distribution or dissemination of information to interested and relevant parties using methods that are reasonably available. Such methods may include publication in newspapers of general circulation, electronic or paper mailing lists, and web sites designated and maintained for that purpose.
2.8 REQUEST FOR PROPOSALS
Means all documents, whether attached or incorporated by reference, utilized for soliciting proposals.
2.9 RESPONSIBLE BIDDER
Means a person who has the capability in all respects to perform fully the contract requirements, and the integrity and reliability that will assure good faith performance.
2.10 RESPONSIVE BIDDER
Means a person who has submitted a bid that conforms in all material respects to the invitation to bid.
2.11 SERVICES
Means the furnishing of labor, time, or effort by a contractor, not involving the delivery of a specific end product other than reports or drawings.
2.12 SPECIFICATION
Means any description of the physical or functional characteristics, or of the nature of a supply, service, or construction item. It may include a description of any requirement for inspecting, testing, or preparing a supply, service, or construction item for delivery.
2.13 SUPPLIES
Means all property, including but not limited to commodities, equipment, materials, printing, insurance, and leases of real property, excluding land or a permanent interest in land.
2.14 SURPLUS SUPPLIES
Means any supplies other than expendable supplies no longer having any use to the city. This includes obsolete supplies, scrap materials, and nonexpendable supplies that have completed their useful life cycle.
2.15 WRITTEN OR IN WRITING
Means the product of any method of forming characters on paper, other materials, or viewable screens, that can be read, retrieved, and reproduced, including information that is electronically transmitted and stored.
SECTION III - PURCHASING PROCEDURES
The City Council has established policies regulating the degree of formality to be followed in the purchase of supplies and services, depending on the cost of the items to be purchased. The splitting of purchases into smaller orders to avoid these requirements is prohibited.
3.1 PURCHASE ORDERS
The city’s purchase order system is administered electronically. The purchase order form (Appendix E) must be completed by entering necessary data via computer terminal and be approved by the Department Head, the Finance Manager and the Director of Finance under the procedures established in this manual. In order to ensure expeditious processing of purchase orders, it is important that the requisitioning department complete all forms accurately.
A purchase order is a contract between the city and a vendor. The contract is not binding until the vendor accepts it. The city will not recognize the issuance of purchase orders by unauthorized individuals and payment of these obligations will not be approved. Unauthorized purchases will be treated as violations of city policy subject to disciplinary action, including possible termination.
Verbal purchase order numbers are given out by Finance for purchases up to $500 and a log of these numbers is maintained. Electronic purchase orders are required for all purchases greater than $500. In these instances, a purchase requisition is prepared by the department. Any employee in the department may request a purchase and have the requisition approved by their dept manager. Departments are responsible for establishing the specification for purchase orders and verifying whether an appropriation has been budgeted. Each department administrative assistant enters the purchase order in to the New World software procurement module. Each dept manager must then approve the PO through the software system. Purchases greater than $15,000 must also be approved by the City Council. The resolution approving the expenditure is then sent to the Purchasing Coordinator. She then signs off on all POs through the software system, where it is then also approved by the Finance Manager. Amounts over $5,000 are also approved by the Director of Finance. Blanket purchase orders are only used for contract services (uniform rental, janitorial services, etc.) They follow the same procedures as described above. When all approvals have been made, the Purchasing Coordinator will print out the PO and distribute it to the requesting department so that they may then place their order. The PO is then posted so that future invoices may be paid against it.