COMMITTEE SUBSTITUTE FOR ORDINANCE NO. 010461

Amending Chapter 2, Code of Ordinances, by repealing Sections 2-1751 and 2-1753 through 2-1756, and enacting in lieu thereof new sections 2-1751 and 2-1753 through 2-1755 that impose new standards for purchasing.

BE IT ORDAINED BY THE COUNCIL OF KANSAS CITY:

Section 1. That Chapter 2, Code of Ordinances of the City of Kansas City, Missouri, is hereby amended by repealing Sections 2-1751 and 2-1753 through 2-1756, and enacting in lieu thereof new sections 2-1751 and 2-1753 through 2-1755, to read as follows:

Sec. 2_1751. Storerooms.

(a) Authority of commissioner of purchases and supplies. The commissioner of purchases and supplies, with the approval of the director of finance and the city manager, may establish and maintain one or more storerooms or warehouses for the keeping of city supplies purchased through the division of purchases and supplies. The commissioner is authorized to increase or diminish the number or capacity of storerooms and warehouses, with the approval in each case of the director of finance and of the city manager.

(b) Records of stock; annual inventory. The commissioner shall keep stock records which shall at all times show the number or amount and the value of all items carried in such storerooms and warehouses, the receipt of all items by such storerooms and warehouses, and the cost of all such items, the issuance of all items from such storerooms and warehouses to the city departments and offices upon requisition therefor, and the charges made thereupon.

Sec. 2_1753. Making purchases and term_supply and service contracts.

(a) Generally. Unless otherwise provided in this code or by law, all purchases of articles, commodities, supplies, materials and common services for the city including lease and rental of personal property and all term contracts for the acquisition of like items and services shall be made by the commissioner of purchases and supplies, who shall solicit, receive and open bids and proposals, and make all awards thereof, under such rules and regulations as the director of finance shall approve. The use of the Model Procurement Code and Recommended Regulations of the American Bar Association, as appropriately modified, is encouraged as the general guidelines for developing rules and regulations.

(b) Services. When it is in the best interest of the city, the commissioner is authorized to solicit bids or proposals and award term contracts for contractual services which are required by one or more office, department, agency or other unit of the city.

(c) Formal bids and formal proposals. Formal competitive sealed bids and formal competitive sealed proposals will be used for making purchases and for awarding term-supply and service contracts when the estimated cost thereof exceeds $100,000.00. Formal bids or formal

proposals shall be sealed and addressed in the manner prescribed by the commissioner in the bid or proposal solicitation. Formal bids and formal proposals shall be posted on the world wide web for a reasonable time prior to the closing date of the solicitation. The commissioner is authorized to accept formal bids or formal proposals in an electronic format and to solicit competitive sealed proposals when competitive sealed bidding is either not practical or not advantageous to the city.

(d) Informal bids or proposals. Informal competitive bids or proposals may be used for purchases and for awarding term-supply and service contracts when the estimated cost thereof does not exceed the threshold for formal bids or formal proposals. Quotations shall be solicited from a reasonable number of qualified sources to ensure that the proposed purchase, term-supply or service contract is advantageous to the city, price and other factors considered. Simplified procedures for purchases and services may be used when the aggregate amount of the expenditure does not exceed $1,000.00, fair and reasonable prices can be obtained and the administrative and other costs of making the purchase or obtaining the service by other procedures exceed any probable price reductions.

(e) Emergency contracts. Emergency purchases and contracts may be made if there exists a threat to public health, welfare, safety or essential operations of the city. Emergency procurements shall be made utilizing procedures recommended by the director of finance and approved by the city manager with such competition and observation of qualifying regulations as practical under the circumstances. Periodic reports of emergency purchases will be made to the director of finance.

(f) Sole source. A contract may be awarded without competition when the commissioner determines in writing, after conducting a good faith review of available sources, that there is only one source for the required good, supply, material, equipment or service. The commissioner shall conduct negotiations, as appropriate, for price, delivery and terms. When only one response is received to any solicitation, an award may be made by negotiation with the available source.

(g) Sole Brand Procurement. A contract may be awarded for supplies or services limiting competition to a sole brand or service provider if the necessity for this brand or service provider is certified in writing by the commissioner. The commissioner shall seek such competition as possible under the circumstances and the award may be made by negotiation if there is only one bid, proposal or available source.

(h) Government Procurement. The commissioner is authorized to enter into contracts with persons who have been awarded contracts through a competitive solicitation for supplies, materials, equipment or service by the federal government, any state or local government, any other tax supported public entity or any cooperative or pooling arrangement in which such entities participate, without seeking bids or proposals if the person will provide the supplies, materials, equipment or service under equivalent contractual terms and conditions subject to acceptance of the citys contractual terms and conditions.

(i) Purchasing Pools. The commissioner is authorized to participate in any purchasing pool or cooperative and any contract derived from a purchasing pool or cooperative when it is determined by the commissioner that the citys participation should result in cost savings to the city. The commissioner shall incorporate city code requirements in any purchasing pool contract, cooperative agreement or any contract derived from such. For purposes of this subsection, a purchasing pool or cooperative is any arrangement whereby entities aggregate purchasing needs for the purpose of obtaining discounted pricing or better terms and conditions or both.

(j) Term_supply and service contracts. In the purchase of supplies, materials, equipment or services needed continuously or repeatedly, including catalog or standard production items, the price of which is determined by published price lists, the commissioner may enter into term-supply and service contracts. Term-supply and service contracts will be made for a period not to exceed one year, but may contain unilateral options on the part of the city for renewal for a reasonable number of additional one_year periods. Term-supply and service contracts need not bear the certificate of the director of finance as regards certification of funds; but no financial obligation shall accrue against the city until a purchase order for the supply or service, on which funds are certified, is issued. Lease or rental of personal property shall be made by term contract and may exceed more than one year in length.

(k) Action on bids and making awards thereof.

(1) Awards shall be made with reasonable promptness to the lowest and best bidder or best proposer whose bid or proposal is determined to be most advantageous to the city, price and other factors considered. The commissioner of purchases and supplies or the commissioners designee may accept the bid or proposal which in his judgment is the lowest and best bid or best proposal, or he may reject any and all bids or proposals and seek new bids or proposals, or purchase the required supplies or service on the open market if they can be so purchased at a better price, or follow the procedure in this subsection (2).

(2) Where bids exceed available funds and time or other circumstances appear to preclude resolicitation, the commissioner may negotiate an adjustment of the bid price with the apparent lowest and best bidder in order to bring the bid within the amount of available funds. If the negotiation with the apparent lowest and best bidder is unsuccessful, the commissioner may reject any and all bids and solicit new bids from only those persons who submitted a response to the original solicitation or at his option resolicit bids with an expedited submission schedule.

(3) The commissioner is authorized to award a contract as a secondary source of a supply or service to the second lowest and best bidder or second best proposer to perform when the lowest and best bidder or best proposer cannot perform or supply the needed goods, supplies, materials, equipment or service.

(l) Group Insurance Policies. In any solicitation for group policies providing medical, hospitalization, dental or life insurance for city employees, the commissioner shall present all bids or proposals to the city council and the city council shall have the exclusive authority to award any contract to the lowest and best bidder or best proposer as determined by the council, to make multiple awards or to reject any and all bids or proposals.

(m) Tax clearance. Prior to making any payment under any contract that was awarded by a means of a formal bid or formal proposal, the contractor shall provide proof of compliance with the tax ordinances administered by the commissioner of revenue. If a contract is renewed by the city, contractor shall provide new proof of compliance dated not more than ninety days prior to the renewal date of the contract. Submission of this proof shall be a condition precedent to the city making the first payment under such renewal.

Sec. 2_1754. Bonds and Insurance.

(a) Authority to require security. The commissioner of purchases and supplies may require bidders or proposers to include with the bid or proposal security in the amount specified in the solicitation, such security to be forfeited to the city in the event the successful bidder or proposer fails or refuses to execute the contract. The commissioner may also require the person receiving the award to provide security in the amount specified in the solicitation to ensure performance of the contract, such security to be forfeited to the city in the event the person fails or refuses to perform the contract. Nothing in this section shall be construed to limit the authority of the commissioner to require other security. Upon request by the commissioner, the risk manager shall make recommendations to the commissioner regarding the types and amounts of security necessary for any given solicitation.

(b) Electronic Procurement. Bid bonds shall not be required for electronic procurement. If a person fails or refuses to execute a contract after submitting an electronic bid or proposal to the City, the person shall be subject to debarment or damages or both.

(c) Form of security. The form of security may be a surety bond or other security deemed acceptable by the director of finance and set forth in the solicitation. Surety bonds must be provided by surety companies licensed to do business in the state who also meet such other qualifications established by the director of finance.

(d) Annual bid and performance bond. A prospective bidder may file with the commissioner of purchases and supplies an annual surety bond for bidding and performance in a specified minimum amount, which shall remain in effect during the city's fiscal year. Where the surety bond is insufficient to meet the total security requirements of the vendor's outstanding bids and contracts, additional security shall be provided upon request of the commissioner.

(e) Insurance. The commissioner shall require insurance in such amounts and types as recommended by the risk manager. The risk manager will review, as requested, any potential bid for supplies and services and recommend insurance requirements.

Sec. 2_1755. Requisitions.

(a) Generally. Requisitions for articles, commodities, supplies, materials, equipment or services by any department or office shall be addressed to the commissioner of purchases and supplies, shall be approved by the director of the department or the head of the office, and shall be accompanied by such samples or by such specifications as the commissioner may require. If the department or office making the requisition has available a sufficient appropriation balance, the commissioner may either furnish the items requisitioned from existing inventory in city storerooms or warehouses, purchase the items or procure the services pursuant to an existing term-supply or service contract, or procure the items or services pursuant to the procedures provided by ordinance.

(b) Requisitions from other city agencies. Whenever any department, office or division of the city requires supplies or equipment which another department, office or division of the city is able to furnish, suitable requisition may be made and such supplies or equipment may be furnished. In such cases, bids need not be obtained. Appropriate charges and credits shall be made to accounts affected by such transactions.

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Approved as to form and legality:

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Assistant City Attorney