ORDINANCE
NO. 180535, AS FURTHER FURTHER AMENDED
Amending Chapter 3, Code of
Ordinances, by repealing sections 3-421 through 3-500 and enacting in lieu
thereof new sections of like numbers and subject matters that authorizes
updates to Minority & Women’s Business Enterprise Program based on the 2016
Disparity Study.
BE IT ORDAINED BY THE COUNCIL OF
KANSAS CITY:
Section 1. That
Chapter 3, Code of Ordinances of the City of Kansas City, Missouri, is hereby
amended by repealing Division 2, Minority and Women’s Business Enterprises
(M/WBE), Sections 3-421 through 3-500, and enacting in lieu thereof new
sections of like numbers and subject matters, to read as follows:
DIVISION 2.
MINORITY AND
WOMEN'S BUSINESS ENTERPRISES (M/WBE)
Sec. 3-421. Definitions.
(a) The
following definitions apply to this division 2, except where an alternate
definition has specifically been made applicable:
(1) Affidavit
of intended utilization: An affidavit, in a form prescribed by the
director, stating the bidder's intent to meet the MBE/WBE goals or to timely
request a waiver of the MBE/WBE goals.
(2) Award
of contract: Execution of a contract and, if necessary, city council or
park board authorization.
(3) Bid:
An offer to enter into a contract submitted pursuant to an invitation for bid.
(4) Bidder:
Any person who submits a bid to the city or an incentive agency in response to
an invitation for bid.
(5) Bid
opening: The event whereby bids are opened and read aloud at the place,
date and time specified in the invitation for bid and any subsequent amendment
thereto.
(6) Bid
shopping: The practice whereby a person divulges or requires another to
divulge a subcontractors bid or proposal for the purpose of securing a lower
bid or proposal.
(7) Board
or Boards: Fairness in construction board, fairness in professional
services and goods board, or both, as applicable.
(8) Budget:
The total costs reflected within a contract for which MBE/WBE goals are to be
set pursuant to this division.
(9) City: City of Kansas
City, Missouri.
(10) City
department: Department of the city or the division of procurement services
when acting on behalf of a department director.
(11) Commercially
useful function: Real and actual services that are a distinct and
verifiable element of the contracted work based upon private sector trade or
industry standards. Determination that an enterprise performs a commercially
useful function will be made based on the following considerations:
a. An
MBE or WBE performs a commercially useful function when it is responsible for
execution of the ordinary and necessary work of the contract and is carrying
out its responsibilities by actually performing, managing, and supervising the
work involved. To perform a commercially useful function, the MBE or WBE must
also be responsible, with respect to materials and supplies used on the
contract, for negotiating price, determining the quality and quantity, ordering
the material, installing (where applicable) and paying for the material itself.
To determine whether an MBE or WBE is performing a commercially useful
function, one must evaluate the following:
1. The
amount of work subcontracted; and
2. Industry
practices; and
3. Whether
the amount the enterprise is to be paid under the contract is commensurate with
the work it is actually performing; and
4. Whether
the MBE or WBE has the skill and expertise to perform work for which it is
being utilized; and
5. The
credit claimed for its performance of the work; and
6. Other
relevant factors.
b. An
MBE or WBE does not perform a commercially useful function if its role is
limited to that of an extra participant in a transaction, contract, or project
through which funds are passed in order to obtain the appearance of MBE or WBE
participation. In determining whether an MBE or WBE is such an extra
participant, one must examine similar transactions, particularly those in which
MBEs or WBEs do not participate.
c. An
MBE or WBE firm is not performing a commercially useful function if the MBE or
WBE subcontracts a greater portion of the work on a contract or purchases a
greater amount of material than would be expected on the basis of normal
industry practice for the type of work involved.
d. Whether
the MBE or WBE is participating in the contract as a middle person or broker in
the normal course of that business or trade by purchasing the goods and/or
services from another business, thereby qualifying expenditures for such goods and/or
services to be counted toward utilization requirements for MBEs and WBEs.
e. Whether
the MBE or WBE is responsible for the purchase and quality of, and payment for,
materials used to perform its work under the contract.
There shall be a
rebuttable presumption that, when the MBE or WBE subcontracts a greater portion
of the contract work than normal industry practice, the MBE or WBE is not
performing a commercially useful function.
(12) Construction
contract: A contract for the construction, reconstruction, improvement,
enlargement or alteration of any fixed work or construction site preparation,
of which any amount is paid for out of city or agency funds.
(13) Contract:
Any contract more than $300,000.00, and all other city or agency contracts more
than $160,000.00 the majority of either of which is paid for out of city funds
or in which an incentive agency is a party, except the following:
a. Personal
services contracts; and
b. Emergency
contracts; and
c. Imprest
accounts in the nature of petty cash funds.
(14) Contractor:
Any person who enters into a contract with the city or an incentive agency.
(15) Contractor
utilization plan or CUP: The statement, in a form prescribed by the
director, that must be submitted by a bidder or proposer pursuant to section
3-433 and that states its plan to utilize qualified MBEs and/or WBEs in the
performance of a contract.
(16) Day:
A calendar day, except as otherwise indicated.
(17) Department
or HRD: The human relations department or the division within the city
manager's office that is assigned to perform the tasks delegated to the human
relations department by this division.
(18) Department
director: Person appointed by the city manager to be responsible for a city
department or the manager of procurement services when acting on behalf of a
department director or the city.
(19) Developer:
Entity seeking tax increment financing or city tax abatement incentives from an
incentive agency described in Section 3-425(b) or 3-425(c).
(20) Director:
The director of the human relations department or his authorized
representative, or the person designated by the city manager to perform the
tasks delegated to the director of the human relations department by this
article.
(21) Disadvantaged
business enterprise (DBE): A business concern that meets the federal
requirements for certification as a DBE.
(22) Economic
Disadvantage: A diminished ability to compete in the free enterprise system
due to diminished capital and credit opportunities as compared to others in the
same or similar line of business who are found to be socially disadvantaged. In
determining whether an individual is economically disadvantaged, the director
shall follow the guidance provided in Appendix E to 49 CFR Part 26.
(23) Expertise:
Experience or training in a specialized field that is critical to the firm's
operations, indispensable to the firm's potential success, and specific to the
type of work the firm performs.
(24) Goal:
A numerical objective stated as a percentage of contract dollars for
participation by qualified MBEs and WBEs in contracts.
(25) Incentive
Agency or Agency: Each of the commissions, agencies and authorities
described in Section 3-425(b) or 3-425(c), or any entity with the authority to
recommend to the city tax increment financing or tax abatement.
(26) Incentive
Agency head: Person authorized to act on behalf of an incentive agency.
(27) Incentive
Project: A project receiving tax increment financing or tax abatement or
exemption from an incentive agency pursuant to contracts described in sections
3-425(b) and 3-425(c).
(28) Invitation
for bid:
A request or invitation for submission of an offer to enter into a contract
pursuant to a competitive bidding process.
(29) Kansas
City metropolitan area: The Missouri counties of Cass, Clay, Jackson and
Platte and the Kansas counties of Johnson, Leavenworth and Wyandotte.
(30) Letter
of intent to subcontract: A document, in a form prescribed by the director
that demonstrates the prime contractor or developer's intent to enter a
contractual agreement with a selected MBE/WBE.
(31) M/W/DBE
Kansas City Mo. Online Directory or Directory: A source list compiled,
maintained and updated by the human relations department containing (when
provided) the names, mailing addresses, e-mail addresses and facsimiles of
certified MBE/WBE/DBEs and the NAICS codes denoting scopes of work for which
each such MBE/WBE/DBE is certified, which MBE/WBE/DBEs are in the business of
providing construction, professional services and other services and goods from
whom bids and proposals can be solicited. The directory is to facilitate
identifying MBE/WBE/DBE subcontractors with capabilities relevant to general
contracting requirements and to particular solicitations.
(32) Mentor/protégé:
A relationship between an MBE or WBE (protégé) and a person in the same trade
or industry (mentor). The mentor/protégé relationship is to provide technical,
financial, bonding, equipment and personnel assistance. The purpose of the
relationship is to increase the capacity of MBE/WBEs to perform contracts.
(33) Minority:
A person who is a citizen or lawful permanent resident of the United States and
who is:
a. African
American, a person whose origins are in any of the Black racial groups of
Africa, and who has historically and consistently identified himself or herself
as being such a person; or
b. Hispanic
American and/or Latino American, a person whose origins are in Mexico, Central
or South America, or any of the Spanish speaking islands of the Caribbean, (for
example Cuba and Puerto Rico) regardless of race, and who has historically and
consistently identified himself or herself as being such a person; or
c. Asian
and/or Pacific Islander American, a person whose origins are in any of the
original peoples of the Far East, Southeast Asia, the islands of the Pacific or
the Northern Marianas, or the Indian Subcontinent, and who has historically and
consistently identified himself or herself as being such a person; or
d. Native
American, a person having origins in any of the original peoples of North
America, and who maintains tribal affiliation or demonstrates at least
one-quarter descent from such groups, and who has historically and consistently
identified himself or herself as being such a person; or
e. On a
case-by-case basis, an individual found by the director to have been subjected
to individualized prejudice or cultural bias within American society within the
city's marketplace and has demonstrated economic disadvantage and social
disadvantage as defined in this section.
(34) Minority
Business Enterprise (MBE): A for-profit small business concern that:
a. Is at
least 51 percent owned, managed, and independently controlled by one or more
minorities; and
b. Has a
real and substantial presence in the Kansas City metropolitan area as defined
by section 3-461(c) and
c. Meets
the business size standards imposed by 13 CFR 121.201 as subsequently amended
and this division; and
d. Performs
a commercially useful function; and
e. Is
certified by the human relations department.
Beginning
October 1, 2019, a for-profit small business concern must meet the following
additional criteria to qualify as a MBE:
f. Whose
owner’s or, for businesses with multiple owners, each individual owner’s
personal net worth (as defined in this section) is equal to or less than the
permissible personal net worth amount determined by the U.S. Department of
Transportation to be applicable to its DBE program.
Only persons
meeting each of the above criteria shall be deemed an MBE for purposes of this
division. In order to be credited towards the goals on a particular
solicitation for a particular scope of work, the MBE shall be certified as of
or listedon the directory on the date a contractor utilization plan is
submitted.
(35) Person:
One or more individuals, corporations, partnerships, associations, labor
organizations, legal representatives, mutual companies, joint stock companies,
trusts, unincorporated organizations, trustees, trustees in bankruptcy,
receivers, fiduciaries and other organizations; except "person" does
not include any local, state or federal governmental entity.
(36) Personal
Net Worth: The net value of the assets of an individual after total
liabilities is deducted. An individual’s personal net worth does not include
the individual’s ownership interest in a certified M/WBE or applicant for such
certification or the individual’s equity, if any, in his or her primary place
of residence. An individual’s personal net worth includes only his or her share
of assets held individually or jointly with the individual’s spouse.
(37) Personal
services contract:
A contract or agreement of employment with an individual who is not acting as
an independent contractor and who is not part of the cities classified or
unclassified service.
(38) Principal
place of business: The location at which the business records of the
MBE/WBE applicant concern are maintained and the location at which the minority
or woman individual owner who manages and controls the day-to-day operations
spends the majority of his/her working hours.
(39) Proposal:
Any offer or list of qualifications submitted to the city in response to a
request for proposal.
(40) Proposer:
Any person who submits a proposal to enter into a contract, either in response
to a request for proposals, request for qualifications or otherwise, but not
pursuant to an invitation for bid.
(41) Qualified:
Possessing the demonstrated ability to perform the contracted task.
(42) Request
for proposals: An invitation for submission of an offer to enter into a
contract pursuant to a negotiated process and not a competitive bid, including
requests for qualifications.
(43) Social
Disadvantage: A diminished ability to compete in the free enterprise system
due to at least one (1) objective, distinguishing feature that has contributed
to social disadvantage, such as race, ethnic origin, gender, sexual
orientation, or disability. In determining whether an individual is socially
disadvantaged, the director shall follow the guidance in Appendix E to 49 CRF
Part 26.
(44) Supplier:
An enterprise that owns operates or maintains a store, warehouse or other
establishment in which materials, supplies, articles or equipment of the
general character described by the specifications and required under the
contract are bought, kept in stock and regularly sold or leased to the public
in the usual course of business.
(45) Supply
broker: An enterprise that acts as an agent in negotiating contracts for
the purchase of materials, supplies, articles or equipment but does not itself
own, operate or maintain a store, warehouse or other establishment where such
materials, supplies, articles or equipment are bought, kept in stock and
regularly sold or leased to the public in the usual course of business.
(46) Woman:
A person who is a citizen or lawful permanent resident of the United States and
who is a female.
(47) Women's
business enterprise (WBE): A for-profit small business concern that:
a. Is at
least 51 percent owned, managed, and independently controlled by one or more
women; and
b. Has a
real and substantial presence in the Kansas City Metropolitan Area as defined
by section 3-461(c); and
c. Meets
the business size standards imposed by 13 CFR 121.201 and as subsequently
amended and this division; and
d. Performs
a commercially useful function; and
e. Is
certified by the human relations department; and
Beginning
October 1, 2019, a for-profit small business concern must meet the following
additional criteria to qualify as a WBE:
f. The
owner’s or, for businesses with multiple owners, each individual owner’s
personal net worth is equal to or less than the permissible personal net worth
amount determined by the U.S. Department of Transportation to be applicable to
its DBE program.
Only persons
meeting each of the above criteria shall be deemed a WBE for purposes of this
division. In order to be credited towards the WBE goals on a particular
solicitation for a particular scope of work, the WBE shall be certified as of
or listed in the directory on the date a contractor utilization plan is
submitted.
Sec. 3-422. Reserved.
Sec. 3-423. Application of division.
(a) The
provisions of this division shall apply to all contracts, as defined in section
3-421, entered into by the city or incentive agency. Federal or state
requirements for minority or women business enterprise participation or
disadvantaged business enterprise participation shall supersede this division
when required by law or federal or state contract.
(b) Each
department director and agency head is responsible for using good faith efforts
to achieve the city-wide MBE and WBE goals set forth in section 3-427.
(c) Each
contractor or developer with whom the city or an incentive agency enters into a
contract for which goals have been set shall either:
(1) Meet
or exceed the goals set for that contract; or
(2) Make
and provide evidence of good faith efforts to achieve the goals and request a
waiver of the contract goals, which waiver shall be granted in the event the
contractor or developer has demonstrated that it has made a good faith effort
to meet or exceed the goals.
Sec. 3-424. Reserved.
Sec. 3-425. Application to leases, tax increment
financing and tax abatement
entities.
(a) Lease of
city property for development. The provisions of this division shall apply
to all projects on property leased by the city to any person for development of
the property by that person or any other authorized person.
(b) Projects
under tax increment financing. The tax increment financing commission shall
adopt the city’s affirmative action program and the city’s minority and women's
business enterprise program which shall apply to all projects financed in whole
or in part by tax increment financing as that term is used in RSMo § 99.800 et
seq. All redevelopment agreements between the tax increment financing
commission and a developer must contain MBE/WBE goals and workforce utilization
goals which are approved by the boards and which are applicable to 100 percent
of all redevelopment project costs, identified within a tax increment financing
plan approved by the city council. For purposes of this subsection, the
"city's affirmative action program" and "minority and women's
business enterprise program" shall have the same meaning as used in this
division.
(c) Projects
under tax abatement entities. All corporations organized under RSMo §
353.010 et seq. for the purpose of redevelopment within the city limits, land
clearance for redevelopment authority with an area of operation within the
city, enhanced enterprise zone boards with an area of operation within the city
and planned industrial expansion authority for the city shall adopt the city’s
affirmative action program and the city’s minority and women's business
enterprise program which shall apply to all projects receiving city tax
abatement in whole or in part.
Sec. 3-426. Reserved.
Sec. 3-427. City-wide goals.
(a) The goals
set forth in this section are city-wide annual goals to be used by city
departments and incentive agencies. The city-wide goals are not goals for
individual contracts. They are goals for total MBE and WBE participation in all
contracts entered into each year. The city-wide goals are established as
follows:
Classification
|
Annual Goal
|
MBE
|
14.7
|
WBE
|
14.4
|
(b) The MBE and
WBE program will expire on December 1, 2022, unless prior to that date, the
director has issued a request for proposals to undertake a comprehensive
disparity study, and upon completion of the disparity study, presented the
study results to the city council to consider whether to maintain, modify, or
terminate the minority and women business enterprise program described by this
division.
(c) Neither
city-wide annual goals nor individual contract goals should be construed as a
limitation on contracting opportunities for the above listed classifications.
Such classifications shall be eligible to be awarded contracts consistent with
bidding or other contract procedures over and above the percentages listed.
Sec. 3-428. Reserved.
Sec. 3-429. City department and incentive agency MBE/WBE
utilization plan.
(a) Each city
department and incentive agency shall prepare and submit to the director by
April 1, unless otherwise extended by the director, an annual MBE/WBE
utilization plan for the next city fiscal year. Each city department and agency
MBE/WBE utilization plan shall include:
(1) Separate
city department or incentive agency goals for participation by qualified MBEs
and WBEs as prime contractors and subcontractors in the procurement of goods,
professional services, services and construction for the upcoming fiscal year.
The goals should be expressed as a percentage of the city department or
incentive agency's total fiscal year contract expenditures; and
(2) Any
other information that the city department or incentive agency or the director
deems relevant or necessary.
(b) A city
department or incentive agency may amend its MBE/WBE utilization plan during
the fiscal year to reflect changes in its projected contract expenditures or
other relevant circumstances, and shall inform the director of such changes.
(c) In planning
its individual contracts, each city department and incentive agency shall
utilize the methodologies described in this division and use its good faith
efforts to encourage and attempt to obtain participation of qualified MBEs
and/or WBEs and shape the scope, specifications and size of a contract to
enhance such participation.
(d) City
departments and incentive agencies shall encourage eligible businesses to:
(1) Apply
to the city’s department, Kansas Department of Transportation (KDOT) or
Missouri Department of Transportation (MODOT) for certification; and
(2) Have
their names included on departmental bidders and proposers lists in the
directory; and
(3) Seek
pre-qualification when applicable; and
(4) Compete
for city business as prime contractors, subcontractors and suppliers.
(e) City
departments and incentive agencies shall make reasonable efforts to:
(1) Advertise
contract opportunities in general circulation media, trade and professional
association publications, small business media, and publications of minority
and women's business organizations; and
(2) Send
written notice of specific contract opportunities to minority and women's
business organizations and those entities on the departmental bidder's and
proposer's list; and
(3) With
the assistance of the director, shape the scope, specifications and size of a
contract to enhance participation opportunities for qualified MBEs and WBEs.
(f) Each city
department, as part of his or her annual evaluation, shall be reviewed
concerning the implementation of the city's MBE/WBE program. In the event a
deficiency is found, the director of human relations or his or her designee
will work with the city department to identify prohibiting factors and offer
any assistance necessary to successfully implement this minority and women
business enterprise program.
Sec. 3-430. Reserved.
Sec. 3-431. Setting goals for individual contracts.
(a) Except for
goals to be established by the applicable board as provided in sections 3-450
and 3-453, goals shall be established for individual contracts by the director,
as determined pursuant to this section. Goals shall be applied to the total
dollar value of the contract, unless otherwise authorized by the director.
(b) Individual
contract goals shall be flexible and are to be determined on a
contract-by-contract basis. In determining whether goals should be established
for an individual contract or in setting the specific goal for an individual
contract, the following shall be considered:
(1) The
scope of work; and
(2) The
number and types of qualified MBEs and WBEs available to perform such work, or
portions of it; and
(3) Whether
the contract can be structured to create potential opportunities for qualified
MBEs and WBEs to participate as subcontractors, service providers and/or
suppliers; and
(4) The
level of participation of certified MBEs and WBEs in similar contracts awarded
by other city departments and incentive agencies, and on local projects awarded
by the state and federal governments in the previous and current fiscal years;
and
(5) The
city department's or incentive agency's progress toward meeting its annual
MBE/WBE goals and its expectations as to how future contracts will be used
toward meeting such goals; and
(6) The
potential dollar amount of the contract.
(c) When goals
for individual contracts are set, they shall be set as follows:
(1) For
all city and incentive agency construction contracts with an estimated cost of
more than $300,000.00, by the fairness in construction board upon
recommendation of the director as provided in section 3-453; and
(2) For
all city and incentive agency professional service and goods and services
contracts with an estimated cost of more than $160,000, by the fairness in
professional services and goods board, upon the recommendation of the director,
as provided in section 3-450.
(d) When goals
are established for a contract, such goals shall be stated in any invitation
for bid or request for proposals.No invitation for bid or request for proposals
shall be released until goals have been requested and set in accordance with
subsection (b) of this section, or until the city department or incentive
agency soliciting the contract has been notified by the director that goals
will not be established. If the goals are to be set by a board and such board
shall have failed to meet for any reason within thirty calendar days from the
date upon which such board shall have last convened, then the invitation for
bid or request for proposals may be released with the goals as recommended by
the director and an addendum thereto shall be issued setting forth the goals
once established by the board.
(e) For contracts
other than construction contracts, the director is authorized to require a
bidder or proposer to make good faith efforts to achieve MBE/WBE participation
without setting a numerical MBE/WBE goal on the solicitation as long as the
director could have set an MBE/WBE goal based on the factors in section
3-431(b).
Sec. 3-432. Reserved.
Sec. 3-433. Contractor utilization plan.
(a) When goals
have been established for a contract, each bidder, proposer, contractor, or
developer shall submit a notarized contractor utilization plan to the director,
or agency for incentive agency projects, which shall include the following:
(1) Names
and addresses of each qualified MBE or WBE that will participate in the
contract; and
(2) The
work to be performed by each qualified MBE and/or WBE, and the amounts each is
to be paid for such work.
(b) Bid
shopping is prohibited.
(c) At
the time of submission of the CUP, the bidder, proposer, contractor or
developer, shall also provide to the director, and the incentive agency for
incentive projects, a letter of intent signed by each MBE or WBE included in
the CUP and by the bidder, proposer, contractor or developer. The director must
approve or reject the CUP within thirty (30) calendar days of receiving the
CUP.
(d) Prior
to an incentive agency providing tax incentives to a developer, including the
issuance of a tax abatement certificate or the payment or reimbursement of
redevelopment project costs, the developer shall have provided to the incentive
agency and the incentive agency shall have incorporated within the incentive
agency contract a CUP for construction services and professional services that
has been approved or deemed approved by the director or the board, as
applicable, or in the event a CUP has not been approved or deemed approved by
the director or the board, then the incentive agency or city department shall
incorporate within the incentive agency contract a CUP which provides for goals
established pursuant to Section 3-431.
Sec. 3-434. Reserved.
Sec. 3-435. Determining contract participation credit
for MBEs and WBEs.
(a) The
following contract amounts shall be credited toward achieving the goals:
(1) The
total contract dollar amount that a prime contractor has paid or is obligated
to pay to a subcontractor that is a certified MBE or WBE, except as otherwise
expressly provided for herein.
(2) The
total contract dollar amount that a prime contractor that is a certified MBE or
WBE performed itself.
(3) Sixty
percent of the total dollar amount paid or to be paid by a prime contractor to
obtain supplies or goods from a supplier who is a certified MBE or WBE.
(4) Ten
percent of the total dollar amount paid or to be paid by a prime contractor to
obtain supplies or goods from a supply broker who is a certified MBE or WBE.
(5) One
hundred percent of the total dollar amount paid or to be paid by a prime
contractor to a manufacturer of construction supplies who is a certified MBE or
WBE.
(6) Subcontractor
participation with a lower tier MBE/WBE subcontractor by the subcontractor
using one of the above methods of participation.
(b) Notwithstanding
any other provision of this section, no credit toward achieving the goals on an
individual contract shall be given for:
(1) Participation
in a contract by any qualified MBE or WBE that does not perform a commercially
useful function. The prime contractor shall have the burden of proving that an
MBE or WBE is performing a commercially useful function.
(2) Any
portion of the value of the contract that an MBE or WBE subcontractor subcontracts
back to the prime contractor or any other contractor who is not a qualified
MBE/WBE.
(3) Materials
and supplies used on the contract unless the MBE/WBE is responsible for
negotiating price, determining quality and quantity, ordering the materials and
installing (where applicable) and paying for material itself.
(4) Work
performed by an MBE or WBE in a scope of work other than that in which the MBE
or WBE is currently certified.
(c) In order to
be credited towards the MBE or WBE goals on a particular solicitation for a
particular scope of work, the applicable MBE or WBE shall be certified by the
date on which the CUP is due.
(d) All prime
contractors on a city or incentive agency contract or development agreement are
to report names, address, scope of work, contract value of each subcontractor
retained by them or other subcontractors for the project and the amount paid to
each respective subcontractor.
Sec. 3-436. Reserved.
Sec. 3-437. Waiver of MBE/WBE goals.
(a) When
a request for waiver has been filed on a city contract, the director may grant
a full or partial waiver of contract goals when the director has determined a
bidder or proposer has not met the goals despite its good faith efforts, as
defined in section 3-441. When a request for waiver been filed on an incentive
agency contract, the director and incentive agency shall make a mutual determination
as to whether the developer or its prime contractor has made good faith
efforts, as defined in section 3-441 to meet the contract goals, and to the
extent the director and incentive agency fail to mutually agree within thirty
(30) calendar days, the applicable board as determined by sections 3-449 and
3-451 shall determine whether good faith efforts were exerted and its
determination shall be final, and upon such determination that the developer or
its prime contractor has made good faith efforts with respect to such request
for waiver, the request for waiver shall be deemed approved by the director. The
process for such determination shall be as described in sections 3-450 and
3-453.
(b) Notwithstanding
any other provision of this division, the city council may waive the
requirements of this article and award a city contract to a lowest and best
bidder or a best proposer if the council determines it is in the best interests
of the city.
Sec. 3-438. Reserved.
Sec. 3-439. Joint venture and mentor-protégé programs.
(a) The
joint venture relationship. The department shall encourage voluntary
establishment of joint ventures on all request for proposals (RFP) and requests
for qualifications (RFQ). Joint ventures have the potential to create prime
contracting opportunities for businesses that include MBE/WBEs on eligible
projects.
(1) A
written joint venture agreement must be completed by all parties to the joint
venture and executed before a notary public, which clearly delineates the
rights and responsibilities of each member or partner, complies with any
requirements of the department, as set forth in RFP or RFQ documents, and
provides that the joint venture shall continue for the duration of the project.
The department shall review joint venture agreements prior to the award of a
contract to determine whether the partners, in fact, share a mutual interest in
the operation and success or failure of the joint venture. The department may
consider:
a. The
initial capital investment of each joint venture partner; and
b. The
proportional allocation of profits and losses to each venture partner, at least
40 percent of which must be allocated to the MBE or WBE partners; and
c. The
partners rights to management, control, and ownership; and
d. Whether
the partners maintain a joint checking account; and
e. The
method of and responsibility for accounting; and
f. The
method by which disputes are resolved; and
g. Any
additional or further information required by the director or department as set
forth in the request for qualifications or proposal documents or otherwise.
(2) The
joint venture, and each member of the joint venture, shall provide the
department access to review all records pertaining to joint venture agreements
before and after the award of a contract in order to reasonably assess
compliance with this division.
(3) The failure
of any joint venture partner to comply with this section shall render the joint
venture agreement invalid and subject the joint venture partners to any or all
of the penalties contained in section 3-465.
(b) The
mentor/protégé certification. Mentor/protégé certifications are voluntary
and designed to provide MBE/WBE firms with advice, technical assistance and/or
training. The program is not intended to remove the responsibility of the
minority or women owner from the actual day-to-day management of their firm.
The mentor/protégé team shall perform work as designated by the mentor within
its relevant scope of work, provided however that the mentor cannot be
responsible for the management of the MBE/WBE firm and the mentor and the
MBE/WBE must remain separate and independent business entities.
(1) Mentor
companies shall require approval by the department to participate in the
program; protégé companies must meet the certification requirements of section
3-461 to participate in the program.
(2) The
mentor/protégé relationship must be established by a written agreement,
completed by both parties to the relationship, and executed before a notary
public. This agreement shall clearly delineate the rights and responsibilities
of the mentor/protégé.
(3) The
department shall review the mentor/protégé agreement for compliance with this
section prior to certifying a mentor/protégé relationship.
(4) The mentor/protégé relationship shall exist at least three
years, but no more than five years as agreed to by the mentor/protégé team with
approval by the department. Both the mentor and protégé can terminate the
relationship at any time for any reason and must notify the director of the
termination in writing.
(5) A
mentor may utilize multiple protégés on a city contract but may have no more
than three protégés at any one time, each of which shall be mentored in
different commercially useful functions.
(6) A
protégé is limited to two mentor/protégé relationships as a participant in the
MBE/WBE program, and each relationship must be with a different mentor.
(7) During
the term of the mentor/protégé certification, the mentor and protégé businesses
must each provide to the department a quarterly summary of the mentor skills
provided to the protégé, which shall include:
a. The
time spent between mentor and protégé business in furtherance of the
mentor/protégé relationship; and
b. The
nature and extent of managerial, technical, financial and/or bonding assistance
provided; and
c. A
summary and explanation of any projects bid on or undertaken by the
mentor-protégé team in the private sector or for a governmental entity other
than the city; and
d. Any
additional or further information required by the department or incentive
agency as set forth in bid documents or otherwise.
(8) Assistance
the mentor may provide the protégé includes, but is not limited to, the
following:
a. Extending
financial assistance, in the forms of time notes, loans and stock purchases;
and
b. Providing
technical advice, including cost accounting, estimating, training, plan
interpretation, business management, loan packaging, financial counseling, and
advice relevant to the success of the particular type of business concern; and
c. Providing
equipment and personnel for specific and limited purposes, provided that the
equipment and personnel is clearly identified through lease agreements and
personnel records, and the protégé exercise the necessary control of personnel
and equipment within the normal course of business practice regardless of how
the personnel and equipment are acquired; and
d. Providing
bonding by either bonding or guaranteeing the bonding on a project-by-project
basis, provided that the mentor and protégé create a development plan that
includes provisions for ensuring that the protégé acquires the ability to
independently bond its projects; and
e. Providing
office space, clerical assistance, and other assistance at below market rates.
(9) The
following practices within the mentor/protégé relationship are prohibited:
a. A
mentor requiring, or a protégé voluntarily entering, an agreement with the
mentor to have an exclusive bidding agreement; and
b. Subcontracting
arrangements created to artificially inflate MBE/WBE participation; and
c. Formal
or informal agreements that unreasonably limit the protégés control or
management of its company; and
d. A
mentor entering into any agreement on behalf of the protégé; and
e. An
employer/employee relationship between the mentor and protégé at any time
during the term of the mentor/protégé relationship.
(10) Termination
of the mentor/protégé relationship. Either party to the mentor/protégé
relationship may terminate the relationship at will. The department may
terminate the mentor/protégé relationship for good cause shown. At the end of
the certification, the mentor shall no longer provide the protégé with any
assistance and a protégés acceptance of such assistance shall result in the
protégé not meeting the eligibility requirements for MBE/WBE certification.
(11) Mentor/protégé
business thresholds.
a. Notwithstanding
anything to the contrary herein, a mentors business with a protégé shall not
exceed the following amounts:
1. End
of year 1: 80 percent of the protégés gross receipts;
2. End
of year 2: 70 percent of the protégés gross receipts;
3. End
of year 3: 60 percent of the protégés gross receipts;
4. End
of year 4: 50 percent of the protégés gross receipts;
5. End
of year 5: 50 percent of the protégés gross receipts; unless the director
approves a waiver for good cause or the protégé does not exceed the limitation
applicable to the previous year.
b. If
the protégé is in its second mentor/protégé relationship, a mentors business
with a protégé shall not exceed the following amounts:
1. End
of year 1: 50 percent of the protégés gross receipts;
2. End
of year 2: 50 percent of the protégés gross receipts;
3. End
of year 3: 40 percent of the protégés gross receipts;
4. End
of year 4: 30 percent of the protégés gross receipts;
5. End
of year 5: 30 percent of the protégés gross receipts.
Sec. 3-440. Reserved.
Sec. 3-441. Standards to determine good faith efforts.
(a) Good faith
efforts are efforts that, given all relevant circumstances, a bidder, proposer,
contractor, or developer actively and aggressively demonstrates in attempting
to meet the prescribed goals. Good faith efforts must be demonstrated to be
meaningful and not merely formalistic compliance. Notwithstanding the foregoing
or anything in this division to the contrary, to the extent a bidder, proposer,
contractor or developer, as applicable, has performed the following, the
bidder, proposer, contractor or developer, as applicable, shall be
presumptively determined to be in compliance with this section and only
determined not to be in compliance upon a clear and convincing showing of an
affirmative act or omission that is intentionally contrary to the spirit of
this division:
(1) Advertised for
at least 15 calendar days prior to the bid or proposal due date opportunities
to participate in the contract in general circulation media, trade and
professional association publications, small and minority business media, and
publications of minority and women's business organizations which are included
in a list along with their contact information identified on the directory as
the list of publications available to publish such advertisements, which list
shall be updated by the department no less than every three (3) months, and
such fifteen (15) calendar days shall be deemed sufficient time to allow MBE
and WBE firms to participate effectively. Each advertisement shall contain the
information required by section 3-441(1)(9); and
(2) Sent
written notices at least fifteen (15) calendar days prior to the bid or
proposal due date containing the information required by section 3-441(1)(9),
by certified mail, e-mail or facsimile, to at least 80% of minority and women’s
business organizations which are included in a list along with their contact
information identified on the directory as the list of organizations available
to receive such notices, which list shall be updated by the department no less
than every three (3) months, and such 15 calendar days shall be deemed sufficient
time to allow MBE and WBE firms to participate effectively; or
(3) Sent
written notices, containing the information required by section 3-441(1)(9), by
certified mail, e-mail or facsimile, to at least 80% of MBEs and WBEs listed on
the directory certified in the applicable scopes of work for the particular bid
soliciting their participation in the Contract at least 15 calendar days prior
to the bid or proposal due date and such 15 calendar days shall be deemed
sufficient time to allow them to participate effectively; and
(4) Attempted
to identify portions of the work for qualified MBE and/or WBE participation in
order to increase the likelihood of meeting the goals, including breaking down
contracts into economically feasible units that take into consideration the
capacity of available MBE/WBEs appearing on the directory; and
(5) At
any time prior to submission of the CUP or submittal of a request for
modification of a CUP, requested assistance in writing in achieving the MBE/WBE
goals from the director and acted on the director's recommendations; and
(6) Conferred
with certified MBEs and WBEs which inquired about or responded to the bid
solicitation and explained to such MBEs and WBEs the scope and requirements of the
work for which their bids or proposals were solicited, and if not all certified
MBEs and WBEs in the particular scopes listed on the directory have inquired
about or responded to the bid solicitation for each scope of work, then contact
by certified mail, e-mail or telephone the greater of ten (10) or 80% of
additional certified MBEs and WBEs in the particular scopes listed on the
directory and offer to confer with such MBEs and WBEs for such particular scope
of work and request such MBEs and WBEs to submit a proposal; and
(7) Attempted
to negotiate in good faith with certified MBEs and WBEs which responded to the
bid solicitation or those certified MBEs and WBEs that were conferred with as
contemplated by section 3-441(a)(6), and other qualified MBEs and WBEs, at the
option of the bidder, proposer, contractor or developer, as applicable, to
perform specific subcontracts, not rejecting them as unqualified without sound
reasons based on a thorough investigation of their capabilities by the bidder,
proposer, contractor or developer; in the event an MBE or WBE is the low bid,
but rejected as unqualified, the bidder, proposer, contractor or developer and
the director or board, as applicable, shall provide sound reasons for rejecting
such MBE or WBE; and
(8) Attended pre-bid meetings when such
meetings were indicated in the solicitation of bids or otherwise by the bidder,
proposer, contractor or developer, as applicable or by the director provided
the director provides written direction to the bidder, proposer, contractor or
developer at the time the goals are recommended by the director pursuant to
section 3-431 to provide for a pre-bid meeting(s); and
(9) Written
notices and advertisements to be provided pursuant to (1), (2) and (3) above shall
include the following information:
(i) The
bid due date;
(ii) The
name of the project;
(iii)
The address or general location of the project;
(iv)
The location of plans and specifications for viewing;
(v)
Contact information of the prime contractor or developer, as applicable;
(vi)
A general description of the scopes of work that are the subject of the
solicitation;
(vii)
The goals established for the applicable contract, and if the goals are
still subject to board approval, then a statement that the goals as stated are
preliminary and are subject to board approval;
(viii)
If the project or any portion of the project is subject to prevailing wage
then a statement that all or a portion of the project will be subject to
prevailing wage, as applicable; and if only a portion of the scopes are subject
to prevailing wage, then identification of such scopes provided that such
scopes are known as of the time of bid solicitation;
(ix) The
date and time of any pre-bid meeting(s), if any, which have been scheduled by
the bidder, proposer, contractor or developer as of the bid solicitation; and
(x)
Any other information deemed relevant by the bidder, proposer, contractor
or developer, as applicable, or the director to the extent the director
provides written direction to the bidder, proposer, contractor or developer of
such additional information at the time the goals are recommended by the
director pursuant to section 3-431.
(2)
In the event the bidder, proposer, contractor or developer amends
the scopes previously bid or decides to further open bids, and determines that
further notice is necessary, the time for giving notices as provided in (1),
(2) and (3) above shall be deemed sufficient if given seven (7) business days
in advance of the applicable updated bid due; and
(10) For
city construction contracts only, within five business days after drawing the
bid specifications, sent certified letters, verifiable e-mails or proof of facsimiles
to qualified MBEs and WBEs listed on the M/W/DBE Kansas City Mo. Online
Directory.
(b) Good faith
efforts analysis may be performed (1) in the event a CUP is rejected, (2) a
request for modification is rejected, or (3) as of the completion of the project,
if the bidder, proposer, contractor or developer is not able to meet the goals
following the approval of a CUP or request for modification. In the event of
one of the foregoing events, a bidder, proposer, or developer or its prime
contractor shall submit documentation of its good faith efforts when requested
by the city or incentive agency.
(c) Good faith
efforts shall be made prior to submission of the contractor utilization plan to
the director; provided however efforts made to increase participation of MBEs
and WBEs following submission of the CUP can be considered as evidence of good
faith efforts to meet the goals.
(d) For incentive
projects, the director shall submit to the relevant incentive agency, his or
her initial findings of good faith prior to sending the final good faith
efforts finding to the developer and as soon as practicable thereafter the
director and incentive agency shall mutually agree as to whether good faith
efforts were exerted prior to submitting a final determination to the
developer. To the extent the director and incentive agency fail to agree within
thirty (30) calendar days, the applicable board as determined by sections 3-449
and 3-451 shall determine whether good faith efforts were exerted and the
board’s determination shall be final. The process for such determination shall
be as described in sections 3-450 and 3-453.
(e)
Notwithstanding anything herein to the contrary, to the extent the proposer,
bidder, contractor or developer or its prime contractor has not met each of the
criteria set forth in section 3-441(a) for a presumptive determination that the
bidder, proposer, contractor, developer, or its prime contractor has exerted
good faith efforts, the director, incentive agency or applicable board,
nonetheless, may determine, given all relevant circumstances, that good faith
efforts were exerted by the proposer, bidder, contractor, developer or its
prime contractor. To the extent good faith efforts are determined with respect
to the contractor utilization plan, modification or waiver submitted by a
bidder, proposer, or developer or its prime contractor, such contractor
utilization plan, modification or waiver, shall be deemed approved by the
director and the applicable waiver granted.
Sec. 3-442. Reserved.
Sec. 3-443. Modification or substitution.
(a) A bidder,
proposer, contractor, or developer shall not make any modification or
substitution with regard to an approved contractor utilization plan unless the
modification or substitution has first been requested of the director and
approved. For city contracts after bid or proposal opening or after a contract
is awarded, the director may approve substitutions of other qualified MBE/WBEs
for those listed in the contractor utilization plan or approve modifications of
the amount of participation listed in the contractor utilization plan, if the
director determines or, in the case of incentive projects, the applicable
incentive agency and the director mutually determine, except in the event the
incentive agency and director fail to mutually agree, in which case the
applicable board as determined by sections 3-449 and 3-451 determines that the
bidder, proposer, contractor, or developer made and provided evidence of good
faith efforts to substitute the listed MBE/WBE with other qualified MBE/WBEs
for the listed scope of work or any other scope of work in the project, finds
that the bidder, proposer, or contractor has not attempted intentionally to
evade the requirements of this division and it is in the best interests of the city
and the applicable incentive agency to allow a modification or
substitution, and also finds one of the following:
(1) The
listed MBE/WBE is non-responsive or cannot perform; or
(2) The
listed MBE/WBE has increased its previously quoted price to the bidder,
proposer, contractor, or developer without a corresponding change in the scope
of the work; or
(3) The
listed MBE/WBE has committed a material default or breach of its contract with
the contractor or developer; or
(4) Requirements
of the scope of work of the contract have changed and render subcontracting not
feasible or not feasible at the levels required by the goals established for
the contract; or
(5) The
listed MBE/WBE is unacceptable to the contracting department; or
(6) The
listed MBE/WBE thereafter had its certification revoked.
The process for
such determination by the applicable board in those circumstances in which the
director and applicable incentive agency fail to mutually agree on an incentive
project shall be as described in sections 3-450 and 3-453.
(b) If there is
an increase in the quantity of the scope of work performed by an MBE/WBE,
contractor or developer shall make good faith efforts to use such MBE/WBE for
the increased work. If extra work not within the general scope of the contract
and in excess of $160,000.00 is required, the director shall assign MBE/WBE
goals for the extra work, if appropriate, and the contractor or director shall
make good faith efforts under the circumstances to achieve the goal.
(c) Bid
shopping is prohibited.
(d) For
incentive projects, the director shall submit to the relevant incentive agency,
his or her initial determination of whether a modification or substitution is
appropriate to the developer and as soon as practicable thereafter the director
and the incentive agency shall mutually agree as to whether a modification or
substitution is appropriate prior to submitting final determination to the
developer; provided, however, to the extent the incentive agency and director
fail to agree within thirty (30) calendar days, the applicable board determined
by sections 3-449 and 3-451 shall determine good faith efforts and the board’s
determination shall be final. The process for such determination shall be as
described in sections 3-450 and 3-453.
Sec. 3-444. Reserved.
Sec. 3-445. Contract award process.
(a) Whenever a
bidder or proposer has submitted a bid or proposal that is not in material
compliance with the requirements of this division, the contracting department
or incentive agency shall reject the bid or proposal unless the goals are
waived pursuant to section 3-437.
(b) If, after a
contract is awarded, it is determined that a solicitation or award is in
violation of this division, the contractor or developer may continue
performance if the department director or incentive agency head makes a written
determination that it is in the best interests of the city or the incentive
agency, without prejudice to any other legal remedies available to it under the
contract.
Sec. 3-446. Reserved.
Sec. 3-447. Liquidated damages.
(a) All city and
incentive agency contracts which contain goals shall contain a provision which
provides for liquidated damages in the event the contractor or developer fails
to achieve the MBE/WBE participation specified in the contractor utilization
plan as finally approved by the director or the goals established pursuant to
3-431, whichever is lower, and fails to exert good faith efforts, as determined
by the director or, in the case of incentive projects, the mutual determination
of the director and the applicable incentive agency; except in the event the
director and incentive agency fail to mutually agree, in which event, the
determination of the applicable board determined by sections 3-449 and 3-451.
The process for such determination shall be as described in sections 3-450 and
3-453.
(b)
The amount of liquidated damages for city contracts shall be in
an amount as determined by the director. For incentive agency contracts, the
director and incentive agency shall jointly agree on the amount of liquidated
damages and may jointly agree to a remedy alternative to liquidated damages
which promotes the goals of the city’s MBE/WBE program. For incentive agency
contracts, should the incentive agency and director fail to come to an
agreement on the amount of the liquidated damages or a remedy alternative to
liquidated damages, the applicable board’s determination (pursuant to sections
3-449 and 3-451) of liquidated damages or other alternate remedy under the
incentive agency contract shall be final. The process for such determination
shall be as described in sections 3-450 and 3-453.
(c) The liquidated
damages may not exceed the difference between the monetary amount of the
MBE/WBE participation finally approved, and as may be modified or waived, in
accordance with this division, and the amount actually paid to certified MBEs
and WBEs appearing on a CUP or modification approved by the director, unless
waived pursuant to section 3-437. In determining the amount actually paid to
qualified MBEs and WBEs, no credit shall be given for that portion of the
MBE/WBE participation that was not approved in accordance with the provisions
of section 3-435, provided however that the director, director and incentive
agency, or board, as appropriate may allow credit if they determine, in
theirsole discretion, that the contractor or developer acted in good faith.
Notwithstanding the foregoing, in the event the CUP anticipated that the
contractor or developer would exceed the goals established prior to the
submission of the CUP, the liquidated damages may not exceed the difference
between the monetary amount of the MBE/WBE participation pursuant to such goals
established prior to the submission of the CUP and the amount actually paid to
MBEs and WBEs.
Sec. 3-448. Reserved.
Sec. 3-449. Fairness in professional services and goods board.
(a) Establishment
and authority.
There is hereby established a fairness in professional services and goods board.
The board’s authority is limited to bids, proposals and contracts for professional
services, other services, goods, materials and supplies, (other than
construction materials and supplies) for the city or an incentive project in
which the estimated cost of such professional services, other services, goods,
materials and supplies is more than $160,000. The board shall set goals to
increase the utilization of MBEs/WBEs in professional services contracts, other
services contracts, goods, materials and supplies contracts (other than
construction materials and supplies), to make determinations as to whether good
faith efforts have been made and the assessment and amount of liquidated
damages on incentive agency projects when the applicable agency and the
director fail to mutually agree, and has the authority to hear and investigate
appeals on city contracts as set forth in section 3-450.
(b) Board composition. The board shall be composed of seven members
(including a chairperson) and six alternates, all appointed by the mayor and
all of whom shall be industry experts in the areas of professional services,
general services and goods and materials.
(c) Term. The
terms of all board members shall be for a period of four years, however, all
members shall continue in office as such until the respective successors shall
have been appointed.
(d) Alternates.
In the event a board member is unable to attend a meeting or has a conflict of
interest with regard to an issue at hand, the alternate shall temporarily serve
in such member's stead. It is the board member's responsibility to notify his
or her alternate that they may be needed at the meeting. The term of an
alternate shall expire at the expiration of the term of the board member.
(e) Absence of chairperson. In
the event the chairperson is not in attendance at any board meeting, a majority
of board members shall select a member to act as chairperson for that meeting.
(f)
Ineligibility. The following persons are ineligible to serve on
the board:
(1)
Members of the city council; and
(2)
Employees of the city; and
(3)
Nonresidents of the city, unless the nonresident works in the city
metropolitan area or is appointed to represent the interests of an organization
that maintains an office in the city metropolitan area.
(g)
Conflict of interest. In the event a board member has a conflict of
interest in a contract or issue that comes before the board, the member shall
be temporarily replaced by the alternate. In the event an alternate has a
conflict of interest in a bid, contract or issue that comes before the board,
the alternate shall recuse himself.
(h)
Quorum. Four members of the board shall constitute a minimum
quorum.
(i) Convening the board. The board
shall be appointed and first convene no later than February 1, 2019. The
goal-setting responsibilities of the board as stated in section 3-450(a) will
be performed by the director or HRD until such time as the board is convened.
Sec.
3-450. Responsibilities of the fairness in professional services and goods
board.
(a)
Prior to solicitation, the director
and appropriate city staff or, in case of an incentive project, a
representative of the developer of the incentive project, shall present to the
board recommended MBE/WBE goals for each proposed contract as recommended by
the director and city staff or developer, as applicable. The board shall
determine within fifteen (15) calendar days of being notified of the same,
whether any goals are appropriate and, if so, shall set the goals in
conformance with section 3-431 hereof. The goals shall be included in the
invitation for bid or request for proposals. Except as otherwise provided in this
division, no invitation for bid or request for proposals shall be released
until goals have been requested and set, or until the city department
soliciting the contract has been notified by the director that goals will not
be established.
(b)
Any bidder or proposer on a city project for which the board has
jurisdiction pursuant to section 3-431(c) may, prior to award of the contract
(except in the instance of a substitution, in which case shall necessarily
occur after the award of a contract), appeal to the board any determination by
the director concerning the following issues:
(1)
Waiver of the individual contract goals pursuant to section
3-437(a); or
(2)
Determination of good faith efforts pursuant to section 3-441; or
(3)
Substitution of an MBE/WBE listed on a contractor utilization
plan pursuant to section 3-443; or
(4)
Modification of the percentage of the participation on a contractor
utilization plan pursuant to section 3-443.
(c) Any contractor on a city contract for
which the board has jurisdiction pursuant to section 3-431(c) may appeal to the
board any determination by the director concerning the following issues:
(1)
MBE/WBE contract credit towards meeting the percentage of MBE/WBE
participation identified in the utilization plan; or
(2)
Substitution of an MBE/WBE listed on a contractor utilization
plan pursuant to section 3-443; or
(3)
Modification of the percentage of the participation on a contractor
utilization plan pursuant to section 3-443; or
(4)
The assessment or amount of liquidated damages.
(d) Appeals shall be made to the board by
the bidder, proposer, or contractor, as applicable, by filing a written notice of
an appeal with the director within fifteen (15) calendar days after receipt of
written notice of the director’s determination through a written request
submitted to the director for review by the board, stating the grounds of such
appeal with specificity. The director shall promptly forward a copy of any
appeal to the chairperson and members of the board.
(e) To the extent a bidder, proposer, or
contractor is notified in writing that any determination made by the director
is final and appealable to the board, and such bidder, proposer, or contractor
fails to file an appeal of such final determination within fifteen (15)
calendar days of receipt of such final determination, such failure to file a
timely appeal shall constitute a waiver of the right of a bidder, proposer, or contractor
to appeal such final determination, and such person shall be estopped to deny
the validity of any determination which could have been timely appealed.
(f) Authority
of board.
(1) The
board shall have authority to decide appeals, and may reverse, affirm or modify
determinations of the director set forth in subsections (b) and (c) hereof. The
board shall have the power to inquire into all the facts and circumstances of
appeals within its jurisdiction and may hold hearings for such purpose. The
board shall not hold hearings to inquire into those matters which the board,
upon recommendation by the city attorney or her designee, deems to be frivolous
and without merit and whose determination shall be final.
(2)
Except for those appeals which are found to be frivolous in
accordance with section 3-350(f)(1), the board
shall hold a hearing within thirty (30) calendar days of the date of filing of
a timely appeal. The failure to hold a hearing within the prescribed time shall
result in the determination of the director being overturned without further
action, unless the delay was requested or caused by the party filing the
appeal.
(3)
The board shall issue a written report of its decision within the
later of thirty (30) calendar days of the filing of a timely appeal or fifteen
(15) calendar days from the conclusion of the hearing and its decision shall be
final for all purposes. Notwithstanding the foregoing, the city council shall
retain the right to waive any provision of this division in accordance with
section 3-437(b).
(g)
Any bidder, proposer, or contractor whose interests will be
affected by any appeal may be permitted by the board to intervene in the
appeal.
(h)
In the event an appeal is pending before the board and the
project is presented to the city council for consideration prior to the board’s
issuance of its decision, the city council shall be notified by including in
the fact sheet notification that there is an appeal pending before the board.
The city council may elect to delay award of the project until after the board
issues its decision.
(i)
For incentive agency projects, when the applicable incentive
agency and the director are unable to reach a mutual determination within
thirty (30) days, the board shall have the authority to make determinations as
to whether good faith efforts have been made and on the assessments and amount
of liquidated damages, pursuant to sections 3-437, 3-441, 3-443, and 3-447. The
board shall have the power to inquire into all the facts and circumstances and
hold hearings for such purpose. When agreement cannot be reached after the
requisite thirty (30) days, the director or applicable agency shall notify the
board of such disagreement within five (5) days. Upon notification by the
director or applicable agency, the board shall hold a hearing within thirty
(30) calendar days. The board shall issue its determination as to whether good
faith efforts have been made within fifteen (15) calendar days from the
conclusion of the hearing and its decision shall be final for all purposes. Notwithstanding
the foregoing, the city council shall retain the right to waive any provision
of this section.
Sec. 3-451. Fairness in construction board.
(a) Establishment
and authority. There is hereby established the fairness in construction board.
The board's authority is limited to city construction bids, proposals and
contracts, and those incentive projects, in which the estimated cost thereof is
more than $300,000.00. The board's authority is limited to setting goals for
each such contract, to make determinations as to whether good faith have been
made and the assessment and amount of liquidated damages on incentive agency
projects when the applicable agency and the director fail to mutually agree, and
hearing and investigating appeals set forth in section 3-453 hereof arising
from city bids, proposals and contracts under its jurisdiction.
(b) Board
composition. The board shall be composed of seven members and six alternates
appointed by the mayor, each of whom is experienced in construction management,
as follows:
(1) One
member and one alternate recommended by the Builders' Association; and
(2) One
member and one alternate recommended by the Heavy Constructors' Association;
and
(3) One
member and one alternate recommended by the Minority Contractors' Association
of Kansas City; and
(4) One
member and one alternate recommended by the Kansas City Hispanic Association
Contractors Enterprise, Inc.; and
(5) One
member and one alternate recommended jointly by the Women Construction Owners
and Executives and National Association of Women in Construction; and
(6) One
member and one alternate jointly recommended by the specialty contractors
associations; and
(7) Chairperson
appointed by the mayor and submitted to the entities named in section 3-451(b)
(1)—(6) for approval. Any one of the named entities can veto the mayor's
submission and require another submission.
(c) Term. The
terms of all board members shall be for a period of four years, however, all
members shall continue in office as such until the respective successors shall
have been appointed. Board members serving as of the effective date of this
division shall retain their seats for the remainder of their unexpired terms.
(d) Alternates.
In the event a board member is unable to attend a meeting of the board or has a
conflict of interest with regard to a particular contract or issue, the
alternate shall temporarily serve in such member's stead. The term of an
alternate shall expire at the expiration of the term of the board member.
(e) Ineligibility.
The following persons are ineligible to serve on the board:
(1) Members
of the city council; and
(2) Employees
of the city; and
(3) Nonresidents
of the city, unless the nonresident works in the city metropolitan area or is
appointed to represent the interests of an organization that maintains an
office in the city metropolitan area.
(f) Conflict of
interest. In the event a board member has a conflict of interest in a contract
or issue that comes before the board, the member shall be temporarily replaced
by the alternate. In the event an alternate has a conflict of interest in a
bid, contract or issue that comes before the board, the alternate shall recuse
himself.
(g) Absence of
chairperson. In the event the chairperson is not in attendance at any board
meeting, a majority of board members shall select a member to act as chairman
for that meeting.
(h) Quorum.
Four members of the board shall constitute a minimum quorum unless otherwise
increased by board rules.
Sec. 3-452. Reserved.
Sec. 3-453. Responsibilities of the fairness in
construction board.
(a) Goal
setting. Prior to solicitation, the director and appropriate city staff or, in
case of an incentive project, the director and a representative of the
developer of the incentive project shall present to the board MBE/WBE goals for
each proposed construction contract as recommended by the director and city
staff or developer, as applicable. The board shall determine within fifteen
(15) calendar days of being notified of the same, whether any goals are
appropriate and, if so, shall set the goals in conformance with section 3-431
hereof. The goals shall be included in the invitation for bid or request for
proposals. Except as otherwise provided in this division, no invitation for bid
or request for proposals shall be released until goals have been requested and
set, or until the city department soliciting the contract has been notified by
the director that goals will not be established.
(b) Any bidder
or proposer on a city construction project having a construction contract for
which the board has jurisdiction pursuant to section 3-431(c) may, prior to
award of the construction contract (except in the case of a substitution, in
which case shall necessarily occur after the award of a contract) may, prior to
award of the construction contract, appeal to the board any determination by
the director concerning the following issues:
(1) Waiver
of the individual contract goals pursuant to section 3-437(a); or
(2) Substitution
of an MBE/WBE listed on a contractor utilization plan pursuant to section
3-441; or
(3) Substitution
of an MBE/WBE listed on a contractor utilization plan pursuant to section
3-443; or
(4) Modification
of the percentage of the participation on a contractor utilization plan
pursuant to section 3-443.
(c) Any
contractor having a contract for which the board has jurisdiction pursuant to
section 3-431(e), may prior to the award of a construction contract (except in
the case of a substitution, in which case shall necessarily occur after the
award of a contract) appeal to the board any determination by the director
concerning the following issues:
(1) MBE/WBE
contract credit towards meeting the percentage of MBE/WBE participation
identified in the contractor utilization plan; or
(2)
Substitution of an MBE/WBE listed on a contractor utilization plan pursuant to
section 3-443; or
(3) Modification
of the percentage of the participation on a contractor utilization plan
pursuant to section 3-443.
(4) The
assessment or amount of liquidated damages.
(d) Appeals
shall be made to the board by filing with the director within fifteen (15)
calendar days after notice of the director's determination through a written
request for review by the board, stating the grounds of such appeal with
specificity. The director shall promptly forward a copy of any appeal to the
chairperson and members of the board.
(e) To the extent
a bidder, proposer, or contractor is notified that any determination made by
the director is final and appealable to the board, and such bidder, proposer,
or contractor fails to file an appeal of such final determination within
fifteen (15) calendar days of such final determination, such failure to file a
timely appeal shall constitute a waiver of the right of a bidder, proposer, or
contractor to appeal the director's determination and such person shall be
estopped to deny the validity of any determination which could have been timely
appealed.
(f) Authority
of board.
(1)
The
board shall have authority to decide appeals, and may reverse, affirm or modify
determinations of the director, as applicable set forth in subsections (b) and
(c) hereof. The board shall have the power to inquire into all the facts and
circumstances of appeals within its jurisdiction and may hold hearings for such
purpose. The board shall not hold hearings to inquire into those matters
which the board, upon recommendation by the city attorney or her designee,
deems to be frivolous and without merit and whose determination shall be final.
(2) Except for those appeals which are found to be frivolous in
accordance with section 3-353(f)(1), the board shall hold a hearing within
thirty (30) calendar days of the date of filing of a timely appeal. The
failure to hold a hearing or determine an appeal frivolous within the
prescribed time shall result in the director’s determination being overturned
without further action, unless the delay was requested or caused by the party
filing the appeal.
(3) The board shall issue a written report of its decision within
the later of thirty (30) calendar days of the filing of a timely appeal or fourteen
(14) calendar days from the conclusion of the hearing and its decision shall be
final for all purposes. Notwithstanding the foregoing, the city council shall
retain the right to waive any provision of this article in accordance with
section 3-437(b).
(g) Any bidder,
proposer or contractor whose interests will be affected by any appeal may be
permitted by the board to intervene in the appeal.
(h) In the
event an appeal is pending before the board and the project is presented to the
city council for consideration prior to the board's issuance of its decision,
the city council shall be notified by including in the fact sheet notification
that there is an appeal pending before the board. The city council may elect to
delay award of the project until after the board issues its decision.
(j)
For incentive agency projects, when the applicable incentive
agency and the director are unable to reach a mutual determination within
thirty (30) days, the board shall have the authority to make determinations as
to whether good faith efforts have been made and on the assessments and amount
of liquidated damages, pursuant to sections 3-437, 3-441, 3-443, and 3-447. The
board shall have the power to inquire into all the facts and circumstances and
hold hearings for such purpose. When agreement cannot be reached after the
requisite thirty (30) days, the director or applicable agency shall notify the
board of such disagreement within five (5) days. Upon notification by the
director or applicable agency, the board shall hold a hearing within thirty
(30) calendar days. The board shall issue its determination as to whether good
faith efforts have been made within fifteen (15) calendar days from the
conclusion of the hearing and its decision shall be final for all purposes. Notwithstanding
the foregoing, the city council shall retain the right to waive any provision
of this section.
Sec. 3-454. Reserved.
Sec. 3-455. Procedures for construction contracts.
The following
shall apply to construction contracts in which the estimated cost thereof is
more than $300,000.00:
(1) Bid
submissions. Bidders shall submit an affidavit of intended utilization with
their bids.
(2) Forty-eight
hour submissions. Bidders on city contracts shall submit the following within
48 hours after bid opening:
a. A
notarized contractor utilization plan in conformance with section 3-433 hereof;
and
b. Letters
of intent to subcontract; and
c. A
request for waiver of the contract goals pursuant to section 3-437(a) if the
bidder failed to meet or exceed the goals.
(3) Timely
submission of the contractor utilization plan is a material element of the
submission. The director is authorized to extend the 48 hour deadline for the
letters of intent to subcontract but not the deadline for submission of the
contractor utilization plan.
(4) The
apparent successful bidder shall submit documentation of good faith efforts
made prior to 48 hours after bid opening when requested by the city or the
incentive agency.
(5) A
notarized affidavit certifying actual MBE/WBE participation in the contract,
including the names of such MBE/WBEs and the participation amount, and a
certification that all MBE/WBE subcontractors and other subcontractor have been
paid must be submitted by the contractor prior to the city's release of
retainage under the contract.
(6) Any
increase in the amount of MBE/WBE participation after submission of the
contractor utilization plan shall not count toward meeting the contract goals,
unless otherwise permitted under section 3-443 hereof.
(7) Bid
shopping is prohibited.
Sec. 3-456. Procedures for incentive agency agreements.
For incentive
projects, the incentive agency shall require that the CUP be approved prior to
granting the applicable incentive. If the incentive project is bid in phases,
the developer(s) shall submit an estimated time table for additional phases.
The director shall approve or reject the CUP within fifteen (15) calendar days
of receiving the same and, if rejected, provide a written explanation for such
rejection. If the director fails to reach a decision within fifteen (15) calendar
days of receiving the CUP, the CUP will be deemed approved by the director or
in the event a CUP has not been approved or deemed approved by the director
then the incentive agency shall incorporate within the incentive agency
contract a contractor utilization plan which provides for goals established
pursuant to Section 3-431.
Sec. 3-457. Procedures for all other contracts.
The following
procedures shall apply to all contracts not covered by Section 3-455 and 3-456,
and for which goals have been established:
(1) For
contracts awarded pursuant to competitive bidding, bidders shall submit an
affidavit of intended utilization with their bid. Within 48 hours after bid
opening, they shall submit the following additional documentation:
a. A
notarized contractor utilization plan in conformance with section 3-433 hereof;
and
b. Letters
of intent to subcontract; and
c. A
request for waiver of contract goals pursuant to section 3-437(a) if the bidder
failed to meet or exceed the goals.
(2) For
contracts awarded pursuant to requests for proposals, proposers shall submit an
affidavit of intended utilization with their proposal. Prior to the award of
any contract, they shall submit the following additional documentation:
a. A
notarized contractor utilization plan in conformance with section 3-433 hereof;
and
b. Letters
of intent to subcontract; and
c. A
request for waiver of the contract goals pursuant to section 3-437(a) if the
proposer fails to meet or exceed the goals.
(3) Timely
submission of the contractor utilization plan is a material element of the bid
submission. The director is authorized to extend the 48-hour deadline for the
letters of intent to subcontract but not the deadline for submission of the
contractor utilization plan.
(4) Documentation
of good faith efforts shall be submitted when requested by the city or the
incentive agency.
(5) Any
increase in the amount of MBE/WBE participation after submission of the
contractor utilization plan shall not count toward meeting the contract goals,
unless otherwise permitted under section 3-443 hereof.
Sec. 3-458. Reserved.
Sec. 3-459. Required reporting for contractors and
developers.
All contractors
and developers with a contractor utilization plan shall provide any and all
information required by the director in a format prescribed by the director in
such intervals as the director may determine.
Sec. 3-460. Reserved.
Sec. 3-461. Certification and appeals.
(a) To ensure
that this article benefits only MBEs and WBEs that are owned and controlled by
bona fide minorities and women, the director shall certify MBEs and WBEs and
mentor/protégés who wish to participate in the program. Any person not
certified by the human relations department shall not be regarded as an MBE,
WBE, or mentor/protégé program under this division.
(b) Each person
that seeks certification as an MBE/WBE must demonstrate by written
documentation or affidavit that it has suffered from past race or gender
discrimination in the city and in the applicable trade or industry. A unified
certification process (UCP) certificate, a Missouri Highway and Transportation
Department certification or a Kansas Department of Transportation certification
along with the documentation stated in this subsection, is sufficient for
certification as a DBE so long as the firm has never been denied certification
by any federal, state or local authority at any time and meets the definition
of section 3-421(a) (20) and the requirements of this section.
(c) Each entity
seeking certification as an MBE/WBE must demonstrate by written documentation
or affidavit that it’s owner or individual owner’s personal net worth (as
defined in this section) is equal to or less than the permissible personal net
worth amount determined by the U.S. Department of Transportation to be
applicable to its DBE programs. Entities seeking certification as an MBE/WBE
shall submit all information or documentation requested by the city’s human
relations department in determining whether the entity complies with this
subsection.
(c) Each person
that seeks certification as an MBE/WBE in the Kansas City metropolitan area
must demonstrate the business enterprise has a real and substantial presence.
After the effective date of this provision, any business enterprise shall be
deemed to have a real and substantial presence in the Kansas City metropolitan
area if:
(1) The
firm's principal office or place of business is in the Kansas City metropolitan
area; and
(2) The
firm maintains full-time employees in one or more of the firm's offices within
the Kansas City metropolitan area to conduct or solicit business in the Kansas
City metropolitan Area the majority of their working time; and
(3) The
firm has transacted business more than once in the Kansas City metropolitan
area within the last three years; and
(4) The
firm’s principal office or place of business has been in existence in the
Kansas City metropolitan area at least six months prior to application for
participation in the MBE/WBE program.
If an MBE/WBE does not have a real and
substantial presence in the Kansas City metropolitan area as specified under
subsection (c)(1) through (c)(4), the firm shall remain certified until their
certification expires. After the firm's certification expires, the firm must
meet the requirements of subsection (c) (1) through (c) (4) to be recertified.
(e) All
applicants and certified businesses shall be subject to an audit by the
director at any time. An applicant's or certified business' refusal to
facilitate an audit shall be grounds for denial of its certification
application or revocation of its certification.
(f) All
applicants and certified businesses shall be required to demonstrate and prove
that the business has the skill and expertise to perform as a subcontractor in
the particular area of work for which it is requesting listing or is listed on
the M/W/DBE Kansas City, Mo. Online Directory.
(g) All
applicants and certified businesses shall submit such information or
documentation as may be required by the director in connection with its
certification as an MBE or WBE, including, but not limited to current licenses
and federal, state and local tax returns and schedules (business and personal),
and all other forms that are required to be included with or attached to the
return at the time of filing. Failure to submit such information or
documentation shall result in the denial of its certification application or
revocation of its certification.
(h) A
certification application may be withdrawn by an applicant without prejudice at
any time prior to an on-site audit. All applications and documentation
submitted to support an application will not be returned to the applicant.
Following the withdrawal of a certification application, the applicant may not
reapply for certification for a period of one year from the date of withdrawal
of the application.
(i) Burden of
proof in the certification process. The firm seeking certification has the
burden of demonstrating to the director, by a preponderance of the evidence,
that it meets all the requirements for certification. The director shall make
determinations concerning whether individuals and firms have met their burden
of demonstrating minority and woman status, business size, expertise,
commercially useful function, ownership, management, independence and control
by considering all the facts in the record, viewed as a whole.
(j) Determination
of minority and woman status. If the director has reason to question whether an
individual is a minority or woman, the director shall require the individual to
demonstrate, by a preponderance of the evidence, that he or she is a minority
or woman. In making such a determination, the director must consider whether
the person has held himself or herself out to be a minority or woman over a
long period of time prior to application for certification and whether the
person is regarded as such by the relevant community. Evidence of active
participation in relevant community organizations will be considered in such
determinations. The director may require the applicant to produce appropriate
documentation. An entity may be simultaneously certified as an MBE or WBE if it
meets all criteria for both MBE and WBE certification
(k) Business
size determinations. To be an MBE/WBE, a firm (including its affiliates) must
be an existing and currently functioning small business. The director shall apply
the SBA business size standard(s) found in 13 CFR part 121.201 and as amended
as of the date of application and appropriate to the type(s) of work the firm
seeks to perform.
(l) Determination
of ownership. In determining whether the minority or women participants in a
firm own the firm, the director shall consider all the facts in the record,
viewed as a whole.
(1) To be
an MBE/WBE, a firm must be at least 51 percent owned by one or more minority
and women individuals, reflected as follows:
a. In
the case of a corporation, such individuals must own at least 51 percent of
each class of voting stock outstanding and 51 percent of the aggregate of all
stock outstanding.
b. In
the case of a partnership, 51 percent of each class of partnership interest
must be owned by minority and women. Such ownership must be reflected in the
firm's partnership agreement.
c. In
the case of a limited liability company, at least 51 percent of each class of
member interest must be owned by the minority and women individuals.
(2) The
firm's ownership by minority or women must be real, substantial, and
continuing, going beyond pro forma ownership of the firm as reflected in
ownership documents. The minority or women owners must enjoy the customary
incidents of ownership, and share in the risks and profits commensurate with
their ownership interests, as demonstrated by the substance, not merely the
form, of arrangements.
(3) All
securities that constitute ownership of a firm shall be held directly by the
minorities or women. Except as provided in this subsection (3), no securities
or assets held in trust, or by any guardian for a minor, are considered as held
by minority or women individuals in determining the ownership of a firm.
However, securities or assets held in trust are regarded as held by a minority
or woman for purposes of determining ownership of the firm, if:
a. The beneficial
owner of securities or assets held in trust is a minority or woman, and the
trustee is the same or another such individual; or
b. The
beneficial owner of a trust is a minority or woman who, rather than the
trustee, exercises effective control over the management, policy-making, and
daily operational activities of the firm. Assets held in a revocable living
trust may be counted only in the situation where the same minority or woman is
the sole grantor, beneficiary, and trustee.
(4) The
contributions of capital or expertise by the minority or women owners to
acquire their ownership interests must be real and substantial. Examples of
insufficient contributions include a promise to contribute capital, an
unsecured note payable to the firm or an owner who is not a disadvantaged
individual, or mere participation in a firm's activities as an employee. Debt
instruments from financial institutions or other organizations that lend funds
in the normal course of their business do not render a firm ineligible, even if
the debtor's ownership interest is security for the loan.
(5) In
situations where expertise is relied upon as part of a minority or woman
owner's contribution to acquire ownership:
a. The
owner's expertise must be:
1. In a
specialized field; and
2. In
areas critical to the firm's operations; and
3. Indispensable
to the firm's potential success; and
4. Specific
to the type of work the firm performs; and
5. Documented
in the records of the firm. These records must clearly show the contribution of
expertise and its value to the firm.
b. The
individual whose expertise is relied upon must have a significant financial
investment in the firm.
(6) The
director shall always deem as held by a minority or woman individual, for
purposes of determining ownership, all interests in a business or other assets
obtained by the individual:
a. As
the result of a final property settlement or court order in a divorce or legal
separation, provided that no term or condition of the agreement or divorce
decree is inconsistent with this section; or
b. Through
inheritance, or otherwise because of the death of the former owner.
(7) Presumptions
regarding interests obtained without consideration:
a. The
director shall presume as not being held by a minority or woman individuals,
for purposes of determining ownership, all interests in a business or other
assets obtained by the individual as the result of a gift, or transfer without
adequate consideration, from any non-minority or male individual or non-MBE/WBE
firm who is:
1. Involved
in the same firm for which the individual is seeking certification, or an
affiliate of that firm; or
2. Involved
in the same or a similar line of business; or
3. Engaged
in an ongoing business relationship with the firm, or an affiliate of the firm,
for which the individual is seeking certification.
b. To
overcome this presumption and permit the interests or assets to be counted, the
minority or woman individual must demonstrate to the director, by clear and
convincing evidence, that:
1. The
gift or transfer to the disadvantaged individual was made for reasons other
than obtaining certification as an MBE/WBE; and
2. The
minority or woman individual actually controls the management, policy, and
operations of the firm, notwithstanding the continuing participation of
non-minority or male individual or non-MBE/WBE firm who provided the gift or
transfer.
(8) The
director shall apply the following rules in situations in which marital assets
form a basis for ownership of a firm:
a. When
marital assets (other than the assets of the business in question), held
jointly or as community property by both spouses, are used to acquire the
ownership interest asserted by one spouse, the director shall deem the
ownership interest in the firm to have been acquired by that spouse with his or
her own individual resources, provided that the other spouse irrevocably
renounces and transfers all rights in the ownership interest in the manner
sanctioned by the laws of the state in which either spouse or the firm is
domiciled. The director shall not count a greater portion of joint or community
property assets toward ownership than state law would recognize as belonging to
the minority or woman owner of the applicant firm.
b. A
copy of the document legally transferring and renouncing the other spouse's
rights in the jointly owned or community assets used to acquire an ownership
interest in the firm must be included as part of the firm's application for
MBE/WBE certification.
(9) The
director may consider the following factors in determining the ownership of a
firm. However, the director must not regard a contribution of capital as
failing to be real and substantial, or find a firm ineligible, solely because:
a. A
minority or woman individual acquired his or her ownership interest as the
result of a gift, or transfer without adequate consideration, other than the
types set forth in subsection (7) of this section; or
b. There
is a provision for the co-signature of a spouse who is not a minority or woman
individual on financing agreements, contracts for the purchase or sale of real
or personal property, bank signature cards, or other documents; or
c. Ownership
of the firm in question or its assets is transferred for adequate consideration
from a spouse who is not a minority or woman to a spouse who is such an
individual. In this case, the director must give particularly close and careful
scrutiny to the ownership and control of a firm to ensure that it is owned and
controlled, in substance as well as in form, by a minority or woman individual.
(m) Determinations
concerning control. In determining whether the minority or women owners control
a firm, the director must consider all the facts in the record, viewed as a
whole.
(1) Only
an independent business may be certified as an MBE/WBE. An independent business
is one the viability of which does not depend on its relationship with another
firm or firms.
a. In
determining whether a potential MBE/WBE is an independent business, the
director must scrutinize relationships with non-MBE/WBE firms, in such areas as
personnel, facilities, equipment, financial and/or bonding support, and other
resources.
b. The
director must consider whether present or recent employer/employee
relationships between the minority and woman owner(s) of the potential MBE/WBE
and non-MBE/WBE firms or persons associated with non-MBE/WBE firms compromise
the independence of the potential MBE/WBE firm.
c. The
director must examine the firm's relationships with prime contractors to
determine whether a pattern of exclusive or primary dealings with a prime
contractor compromises the independence of the potential MBE/WBE firm.
d. In considering
factors related to the independence of a potential MBE/WBE firm, the director
must consider the consistency of relationships between the potential MBE/WBE
and non-MBE/WBE firms with normal industry practice.
(2) An
MBE/WBE firm must not be subject to any formal or informal restrictions which
limit the customary discretion of the minority or women owners. There can be no
restrictions through corporate charter provisions, by-law provisions, contracts
or any other formal or informal devices (e.g., cumulative voting rights, voting
powers attached to different classes of stock, employment contracts,
requirements for concurrence by non-disadvantaged partners, conditions
precedent or subsequent, executory agreements, voting trusts, restrictions on
or assignments of voting rights) that prevent the minority or women owners,
without the cooperation or vote of any non-minority or male, from making any
business decision of the firm. This paragraph does not preclude a spousal
co-signature on documents.
(3) The
minority and women owners must possess the power to direct or cause the
direction of the management and policies of the firm and to make day-to-day as
well as long-term decisions on matters of management, policy and operations.
a. A
minority or women owner must hold the highest officer position in the company
(e.g., chief executive officer or president).
b. In a
corporation, minority or women owners must control the board of directors.
c. In a
partnership, one or more minorities or women owners must serve as general
partners, with control over all partnership decisions.
(4) Individuals
who are not minorities or women may be involved in an MBE/WBE firm as owners,
managers, employees, stockholders, officers, and/or directors. Such individuals
must not, however, possess or exercise the power to control the firm, or be
disproportionately responsible for the operation of the firm.
(5) The
minority and women owners of the firm may delegate various areas of the
management, policymaking, or daily operations of the firm to other participants
in the firm, regardless of whether these participants are minority or women.
Such delegations of authority must be revocable, and the minority and women owners
must retain the power to hire and fire any person to whom such authority is
delegated. The managerial role of the minority and women owners in the firm's
overall affairs must be such that the recipient can reasonably conclude that
the minority and women owners actually exercise control over the firm's
operations, management, and policy.
(6) The
minority and women owners must have an overall understanding of, and managerial
and technical competence and experience directly related to, the type of
business in which the firm is engaged and the firm's operations. The minority
and women owners are not required to have experience or expertise in every
critical area of the firm's operations, or to have greater experience or
expertise in a given field than managers or key employees. The minority and
women owners must have the expertise, technical competence, and ability to
intelligently and critically evaluate information presented by other
participants in the firm's activities and to use this information to make independent
decisions concerning the firm's daily operations, management, and policymaking.
Generally, expertise limited to office management, administration, or
bookkeeping functions unrelated to the principal business activities of the
firm is insufficient to demonstrate control.
(7) If
state or local law requires the persons to have a particular license or other
credential in order to own and/or control a certain type of firm, then the
minority or women persons who own and control a potential MBE/WBE firm of that
type must possess the required license or credential. If state or local law
does not require such a person to have such a license or credential to own
and/or control a firm, the director must not deny certification solely on the
ground that the person lacks the license or credential. However, the director
may take into account the absence of the license or credential as one factor in
determining whether the minority or women owners actually control the firm.
(8) The
director may consider differences in remuneration between the minority and
women owners and other participants in the firm in determining whether to
certify a firm as an MBE/WBE. Such consideration shall be in the context of the
duties of the persons involved, normal industry practices, the firm's policy
and practice concerning reinvestment of income, and any other explanations for
the differences proffered by the firm. The director may determine that a firm
is controlled by its minority or woman owner although that owner's remuneration
is lower than that of some other participants in the firm. In a case where a
non-minority or non-woman individual formerly controlled the firm, and a
minority or women individual now controls it, the director may consider a
difference between the remuneration of the former and current controller of the
firm as a factor in determining who controls the firm, particularly when the
non-minority or non-woman individual remains involved with the firm and
continues to receive greater compensation than the minority or woman
individual.
(9) In
order to be viewed as controlling a firm, a minority or woman owner cannot
engage in outside employment or other business interests that conflict with the
management of the firm or prevent the individual from devoting sufficient time
and attention to the affairs of the firm to control its activities. For
example, absentee ownership of a business and part-time work in a full-time
firm are not viewed as constituting control. However, an individual could be
viewed as controlling a part-time business that operates only on evenings
and/or weekends, if the individual controls it all the time it is operating.
(10) A
minority or woman individual may control a firm even though one or more of the
individual's immediate family members (who themselves are not minorities or
women) participate in the firm as a manager, employee, owner, or in another
capacity. Except as otherwise provided in this paragraph, the director must
make a judgment about the control the minority or woman owner exercises
vis-à-vis other persons involved in the business as in other situations,
without regard to whether or not the other persons are immediate family
members. If the director cannot determine that the minority or woman owners, as
distinct from the family as a whole, control the firm, then the minority or
woman owners have failed to carry their burden of proof concerning control,
even though they may participate significantly in the firm's activities.
(11) Where
a firm was formerly owned and/or controlled by a non-minority or non-woman
individual (whether or not an immediate family member), ownership and/or
control were transferred to a minority or woman individual, and the
non-minority or non-woman individual remains involved with the firm in any capacity,
the minority or woman individual now owning the firm must demonstrate to the
director, by clear and convincing evidence, that:
a. The
transfer of ownership and/or control to the minority or woman individual was
made for reasons other than obtaining certification as an MBE/WBE; and
b. The
minority or woman individual actually controls the management, policy, and
operations of the firm, notwithstanding the continuing participation of a
non-minority or non-woman individual who formerly owned and/or controlled the
firm.
(12) In
determining whether a firm is controlled by its minority or women owners, the
director shall consider whether the firm owns equipment necessary to perform
its work. However, the director must not determine that a firm is not
controlled by minority or women individuals solely because the firm leases,
rather than owns, such equipment, where leasing equipment is a normal industry
practice and the lease does not involve a relationship with a prime contractor
or other party that compromises the independence of the firm.
(13) The
director shall grant certification to a firm only for specific types of work in
which they are currently functioning and in which the minority or women owners
have the ability to control the firm. To become certified in an additional type
of work, the firm needs to demonstrate to the director that its minority or
women owners are able to control the firm with respect to that type of work.
The director may not, in this situation, require that the firm be recertified
or submit a new application for certification, but must verify the minority or
women owner's control of the firm in the additional type of work.
(14) A
business operating under a franchise or license agreement may be certified if
it meets the standards in this subpart and the franchiser or licenser is not
affiliated with the franchisee or licensee. In determining whether affiliation
exists, the director should generally not consider the restraints relating to
standardized quality, advertising, accounting format, and other provisions
imposed on the franchisee or licensee by the franchise agreement or license,
provided that the franchisee or licensee has the right to profit from its
efforts and bears the risk of loss commensurate with ownership. Alternatively,
even though a franchisee or licensee may not be controlled by virtue of such
provisions in the franchise agreement or license, affiliation could arise
through other means, such as common management or excessive restrictions on the
sale or transfer of the franchise interest or license.
(15) In
order for a partnership to be controlled by minority or women individuals, any
non-minority or non-women partners must not have the power, without the
specific written concurrence of the minority or women partner(s), to
contractually bind the partnership or subject the partnership to contract or
tort liability.
(16) The
minority or women individuals controlling a firm may use a professional and
commercial employee leasing company. The use of such a company does not
preclude the minority or woman individuals from controlling their firm if they
continue to maintain an employer-employee relationship with the leased
employees. This includes being responsible for hiring, firing, training,
assigning, and otherwise controlling the on-the-job activities of the
employees, as well as ultimate responsibility for wage and tax obligations
related to the employees.
(17) The
director may consider, in making certification decisions, whether a firm has
exhibited a pattern of conduct indicating its involvement in attempts to evade
or subvert the intent or requirements of the MBE/WBE program.
(18) The
director shall evaluate the eligibility of a firm on the basis of present
circumstances. The director shall not refuse to certify a firm based solely on
historical information indicating a lack of ownership or control of the firm by
the minorities or women at some time in the past, if the firm currently meets
the ownership and control standards of this part.
(19) MBE/WBE
firms and firms seeking MBE/WBE certification shall cooperate fully with the
director's requests (and DOT requests) for information relevant to the
certification process. Failure or refusal to provide such information is a
ground for a denial or removal of certification.
(20) An
eligible MBE/WBE firm must be owned by individuals who are minorities and
women. Except as provided in this paragraph, a firm that is not owned by such
individuals, but instead is owned by another firm—even an MBE/WBE firm—cannot
be an eligible MBE/WBE.
a. If
the minorities or women own and control a firm through a parent or holding
company, established for tax, capitalization or other purposes consistent with
industry practice, and the parent or holding company in turn owns and controls
an operating subsidiary, the director may certify the subsidiary if it
otherwise meets all requirements of this section. In this situation, the
individual owners and controllers of the parent or holding company are deemed
to control the subsidiary through the parent or holding company.
b. The
director may certify such a subsidiary only if there is cumulatively 51 percent
ownership of the subsidiary by the minority and women individuals. The
following examples illustrate how this cumulative ownership provision works:
Example 1: Minority and
women individuals own 100 percent of a holding company, which has a
wholly-owned subsidiary. The subsidiary may be certified, if it meets all other
requirements.
Example 2: Minority and
women individuals own 100 percent of the holding company, which owns 51 percent
of a subsidiary. The subsidiary may be certified, if all other requirements are
met.
Example 3: Minority and
women individuals own 80 percent of the holding company, which in turn owns 70
percent of a subsidiary. In this case, the cumulative ownership of the
subsidiary by minority and women individuals is 56 percent (80 percent of the
70 percent). This is more than 51 percent, so the director may certify the subsidiary,
if all other requirements are met.
Example 4: Same as example
2 or 3, but someone other than minorities or women owners of the parent or
holding company controls the subsidiary. Even though the subsidiary is owned by
minority or women individuals, through the holding or parent company, the
director cannot certify it because it fails to meet control requirements.
Example 5: Minority or
women individuals own 60 percent of the holding company, which in turn owns 51
percent of a subsidiary. In this case, the cumulative ownership of the
subsidiary by minority or women individuals is about 31 percent. This is less
than 51 percent, so the director cannot certify the subsidiary.
Example 6: The holding
company, in addition to the subsidiary seeking certification, owns several
other companies. The combined gross receipts of the holding companies and its
subsidiaries are greater than the size standard for the subsidiary seeking
certification and/or the gross receipts cap. Under the rules concerning affiliation,
the subsidiary fails to meet the size standard and cannot be certified.
(21) Recognition
of a business as a separate entity for tax or corporate purposes is not
necessarily sufficient to demonstrate that a firm is an independent business,
owned and controlled by minority and women individuals.
(n) An
MBE/WBE's certification shall expire three years from the date of certification
effective immediately. An application for renewal shall be submitted on forms
provided by the director. The director is authorized to require MBE/WBE's firms
to submit yearly updates of information including, but not limited to, current
licenses and federal, state and local tax returns and schedules (business and
personal), and all other forms that are required to be included with or
attached to the return at the time of filing.
(o) Once
certified, an MBE/WBE must notify the department in writing within 30 calendar
days of any change(s) in circumstances affecting the firm's ability to meet
ownership, control, or size requirements or any material change(s) in the
information provided in the certification application process. The statement
must include supporting documentation describing in detail the nature of such
changes. Change(s) in management responsibility among members of a limited
liability company are also covered by this requirement. If the MBE/WBE fails to
make timely notification of such change(s), it will be deemed to have failed to
cooperate and certification may be revoked.
(p) The
director shall safeguard information that reasonably may be regarded as
confidential business information from disclosure to unauthorized persons
consistent with federal, state and local law.
(q) If the
United States Department of Transportation changes the requirements for certifications,
the city council shall re-examine the certification requirements imposed by
this section.
(r) Appeals of
denials of certification.
(1) If
the city denies a request for MBE/WBE certification from a firm which is not
currently certified by the city, then the firm shall be ineligible to reapply
for MBE/WBE certification for one year from the later of the date of the denial
of certification or the final date of any decision on an appeal.
(2) Persons
who have applied for DBE certification in conjunction with MBE/WBE
certification and have been denied MBE/WBE certification may be certified if
the reason(s) for denial is solely for MBE/WBE certification criteria
equivalent to the DBE certification criteria and they successfully appeal their
DBE certification and otherwise fulfill the requirements for MBE/WBE
certification.
(3) Persons
who have applied for MBE/WBE certification and who have not applied for DBE
status may appeal the denial of certification to the same extent and subject to
the same provisions applicable to appeals of revocation of certification,
except as provided in (4) of this subsection.
(4) In
circumstances where a firm has failed to submit required documentation, failed
to demonstrate real and substantial presence, or exceeded business size
standards, there will be no administrative re-consideration of a denial of
MBE/WBE certification.
(s) Appeals
of revocations of certification.
(1) Persons
who have who have had their MBE/WBE certification revoked by the department may
be reinstated if the reason(s) for revocation is solely for MBE/WBE
certification criteria equivalent to the DBE certification criteria and they
successfully appeal their DBE certification, and they otherwise fulfill the
requirements for MBE/WBE certification. If a person was certified as a DBE, the
person must follow the UCP appeal procedures and there is no city appeal.
(2) In
circumstances where a certified firm has failed to submit required
documentation, failed to demonstrate real and substantial presence, or exceeded
business size standards, there will be no administrative reconsideration of a
revocation of MBE/WBE certification.
(3) Upon
the revocation of certification as an MBE/WBE/DBE or mentor/protégé by the
department, the director shall notify the affected party in writing by
certified mail, setting forth the reason(s) for the revocation of
certification. Except as provided in (1) and (2) of this subsection, any firm
who has had certification as an MBE/WBE or mentor/protégé revoked by the
department may appeal the decision by filing a written notice of appeal as
designated by the director within 20 business days of receipt of the notice of
the revocation of certification. The procedures applicable to any appeal shall
be as follows:
a. The
written notice of appeal must state the reason(s) for the appeal and include
all supporting documentation to be considered for the appeal. The information
or documentation submitted is limited to the issue(s) raised in the written
notice of appeal. No new or additional documentation or information shall be
considered for the appeal without a showing by the firm that it was not
available or, through due diligence, could not have been made available. The
written notice must specify whether the firm wishes to appeal in writing and/or
appear personally for a hearing and if they intend to be accompanied by
counsel.
b. Within
ten business days of receipt of the notice of appeal from the aggrieved party,
the director shall forward the notice to a neutral hearing officer selected
through the city's standard procurement process.
c. Within
ten business days from the date of receipt of the notice from the director, the
hearing officer shall set a hearing date. The hearing officer shall cause
notice of the hearing to be served upon all parties by certified mail. Such
notice shall set forth with particularity the charges filed by the aggrieved
business and shall include the hearing date, time, and place.
d. At
the hearing, all parties shall be provided a fair and impartial hearing and
shall be allowed to make a presentation concerning the determination of
noncompliance with the requirements of this article or the revocation of
certification as an MBE/WBE or mentor/protégé. Legal counsel may accompany the
firm during the hearing, speak on behalf of the firm, respond to questions, and
otherwise make a presentation. Each owner will be limited to a period of 15
minutes to address the hearing officer, unless extended by the hearing officer
for good cause. Reasonable accommodations will be made for those with
disabilities and/or limited language proficiency. For the appeal, the burden of
proof rests on the MBE/WBE or mentor/protégé to show that the revocation of
certification was improper.
e. The
hearing officer shall, within 15 business days of the hearing or within 15 days
of the deadline set by the hearing officer for the submission of any additional
documentation, if applicable, make a written decision on the appeal, which
decision shall affirm, alter, or reverse the revocation of certification by the
department. Written notice of the decision on the appeal shall be sent to all
parties by mail setting forth the reasons for the decision.
f. If
the hearing officer finds for the aggrieved party, as appropriate, the business
shall be reinstated as an MBE/WBE or mentor/protégé and added to the
certification database maintained by the department. The decision of the
hearing officer shall be binding on all parties, subject to the right of appeal
as provided by law.
g. The
firm that receives a decision from the hearing officer upholding the revocation
of certification is ineligible to reapply for MBE/WBE certification for two
years from the later of the date of the revocation of certification, or the
final date of any court decision.
(t) The city
manager is authorized to revoke MBE and WBE certification for cause. The
certification of a person who has been debarred by the city in a debarment
proceeding shall be automatically terminated or modified in a manner provided
by the debarment ordinance. If an MBE/WBE has its DBE or MBE/WBE certification
revoked by another governmental entity after a hearing, its MBE/WBE
certification shall automatically be terminated with the city unless the
MBE/WBE's certification was revoked for violating a certification requirement
that is not a violation of the city's MBE/WBE certification requirements. No
individual, corporation, partnership, limited liability company or any other
business entity whatsoever shall be certified as an MBE or WBE if the minority
or female whose ownership interest would serve as the basis for obtaining
certification, or who would control the entity seeking certification, presently
owns or previously owned a majority interest in or controlled an MBE or WBE
whose certification has been revoked for cause within the five year period
immediately preceding the submittal of the certification application. No
individual, corporation, partnership, limited liability company or any other
business entity whatsoever shall be certified as an MBE or WBE if the minority
or female whose ownership interest would serve as the basis for obtaining
certification, or who would control the entity seeking certification, presently
owns or previously owned a majority interest in or controlled an MBE or WBE
whose certification has been suspended for cause, provided however that this
restriction shall last no longer than the term of the suspension.
(u) MBE/WBE
program graduation.
(1) If an
MBE or WBE has been certified by the city in more than one North American
Industry Classification System (NAICS) code or has an affiliate which has been
certified by the city in a NAICS code other than that of the MBE or WBE, then
the annual receipt level used as the graduation criterion for such MBE or WBE shall
apply separately to each NAICS code for which the MBE or WBE and its affiliate
have been certified subject to the business size standards in this division.
Such an MBE or WBE and any affiliate that has exceeded the graduation criteria
in one NAICS code shall be deemed to be graduated from the MBE/WBE contracting
program as to that major group, and may continue to be certified in another
NAICS code having a higher monetary graduation level but shall no longer be
considered eligible to be or remain certified in the NAICS code with the lower
size standard. An MBE or WBE that has exceeded the graduation criteria for the
largest NAICS code applicable to its activities shall be deemed to be graduated
from the MBE/WBE program for all purposes.
(2) The
department shall send a graduation determination letter which shall serve to
notify the MBE or WBE that it has graduated from the MBE/WBE program. The
mailing of the graduation determination letter shall trigger a three-year
termination period. During the termination period, an MBE or WBE may bid and
perform work to the same extent it was able to do so before graduation, and its
utilization may be applied towards satisfaction of contract goals, if any, to
the extent it is performing a commercially useful function corresponding to a
NAICS code in which it was certified prior to graduation.
(3) The
termination period shall expire three years from the date of mailing of the
graduation determination letter. Any work bid by the graduated MBE or WBE after
expiration of the termination period shall not be applied towards satisfaction
of contract goals, if any. Any work performed by the graduated MBE or WBE after
expiration of the termination period shall not be applied towards satisfaction
of contract goals, if any, unless the work was commenced or is scheduled to
commence pursuant to solicitation made prior to the expiration of the
termination period.
(4) During
the termination period, the MBE or WBE shall comply with the requirements of
this article to the same extent it was required to comply prior to graduation.
A failure to do so may result in the reduction or elimination of the
termination period.
(5) Application
to affiliates. The graduation criteria set forth above shall be deemed to apply
to the minorities or women upon whom eligibility for certification is based and
all affiliates to such minorities and women. No business enterprise shall be
certified based upon one or more minorities or women who owned or who was an
affiliate of an MBE or WBE which has become ineligible for renewed
certification because of the achievement of graduation criteria.
Sec. 3-462. Reserved.
Sec. 3-463. Duties and authority of director.
(a) The
director is hereby authorized to establish rules and regulations to implement
this division which rules and regulations shall be submitted to the city
council for its approval and shall be in writing and published.
(b) Notwithstanding
any other section to the contrary, the director is hereby authorized to
establish rules and regulations to implement the city's MBE/WBE program
requirements into contracts that utilize alternative construction delivery
methods pursuant to chapter 3, Code of Ordinances, or other alternative
procurement or contracting methods if the contract would be subject to MBE/WBE
goals under this division. Except for cooperative agreements that involve
construction, the fairness in construction board shall set the MBE/WBE goals
for construction contracts.
(c) The
director shall, in addition to any other duties specified herein:
(1) Administer
and enforce this article to ensure that MBE/WBEs have equal opportunity to
participate in city contracts and subcontracts and work with all city
department directors and agency heads to implement the city's MBE/WBE program;
and
(2) Coordinate
the establishment of MBE/WBE methodologies with all city departments and
incentive agencies including establishment of goals, except goals to be
established by the applicable Board, as may be appropriate to remedy underutilization
of MBE/WBEs; and
(3) Update
the M/W/DBE Kansas City Mo. Online Directory available to all bidders,
proposers, the general public, city departments and incentive agencies no less
frequently than every three (3) months; and
(4) Assist
city departments incentive agencies, bidders, proposers, contractors and
developers in finding qualified MBEs and WBEs to participate in contracts; and
(5) Identify
appropriate participation opportunities for qualified MBEs and WBEs in
contracts; and
(6) Publish
an annual report for the city's fiscal year which states for each city
department and agency:
a. The
number of contracts awarded and the total contract dollars awarded pursuant to
such contracts; and
b. The
number of prime contracts awarded to WBEs and MBEs as identified by race and/or
ethnicity and the total dollars awarded and paid pursuant to such contracts;
and
c. The
number of subcontracts awarded to WBEs and MBEs as identified by race and/or
ethnicity and the total contract dollars awarded and paid pursuant to such
contracts; and
d. A
summary of total waiver requests submitted that are granted or denied and the
reasons for the grant or denial; and
e. The
number of MBE/WBE firms certified by race and/or ethnicity; and
(7) Provide
a compliance report to the city manager within 30 days after the end of each
quarter which shall include:
a. The
total number of contracts awarded and the total contract dollar amount awarded
pursuant to such contracts; and
b. The
number of contracts awarded to qualified MBEs as identified by race and/or
ethnicity and WBEs and the total contract dollar amount awarded and paid
pursuant to such contracts; and
c. The
director of human relations evaluation of the city's progress toward meeting
MBE/WBE utilization plans and any actions he or she intends to take to address
any shortfall in meeting the goals established in such plans; and
d. Any
other information as may be required by the city manager; and
(8) Provide
monthly compliance reports to the applicable incentive agency for contracts
entered into in connection with sections 3-425(b) and 3-425(c) updating the
incentive agency as to the project developer’s compliance with the M/WBE goals
and work with the applicable incentive agency to assist developers who are not
compliant. Failure of the director to furnish these reports does not absolve
incentive agency or developer from complying with the processes outlined by
agreement with the incentive agency; and
(9) Provide
the city council a report outlining the effects of any revisions to this
division within 18 months of their effective date. The purpose of this report
is to ensure that such revisions promote increased opportunities for minority
or women business enterprise participation on contracts.
(10) Develop
and maintain relationships with organizations representing contractors,
including minorities and women organizations, and solicit their support for the
city's program; and
(10) Furnish
staff assistance to the boards established in this division. This shall include
but not be limited to providing to the boards within thirty days following the
end of each quarter interim reports containing the information described in
subsection (6) and such other reports and information as the board, from time
to time, may request; and
(11) Implement
any federal or state minority business enterprise program required by law or
federal or state contract; and
(12) Appoint
a designated neutral hearing examiner for certification revocation hearings.
Sec. 3-464. Reserved.
Sec. 3-465. Penalties for noncompliance; no retaliation.
(a) Whenever a
bidder, proposer or contractor has submitted a bid that is not in material
compliance with the requirements of Division, the contracting department or
agency shall reject the bid or proposal unless the goals are waived pursuant to
section 3-437.
(b) The
director is authorized to recommend suspension, revocation, sanction or
debarment of any contract or contractor, as appropriate, for providing false or
misleading information to the department, purposefully omitting or refusing to
provide information requested by the department, or otherwise violating any
provision of this division.
(c) The
director is authorized to suspend or revoke the certification of an MBE/WBE or
mentor/protégé, as appropriate, for providing false or misleading information
to the department, purposefully omitting or refusing to provide information
requested by the department, or otherwise violating any provision of this
division, without having to make a recommendation to any other person or
department.
(d) Sanctions
shall be imposed in conformity with any applicable federal, state or local
laws. In determining whether to suspend or revoke the certification an MBE/WBE
or mentor/protégé, the director shall consider the following factors:
(1) Whether
the failure to comply with applicable requirements involved intentional conduct
or, alternatively, may be reasonably concluded to have resulted from a
misunderstanding on the part of the MBE/WBE or mentor/protégé; and
(2) The
number of specific incidents of failure by the MBE/WBE or mentor/protégé to
comply; and
(3) Whether
the MBE/WBE or mentor/protégé has been previously suspended; and
(4) Whether
the MBE/WBE or mentor/protégé has failed or refused to provide the director
with any information requested by the director or required to be submitted to
the director pursuant to law or these procedures; and
(5) Whether
the MBE/WBE or mentor/protégé has materially misrepresented any applicable
facts in any filing or communication to the director; and
(6) Whether
any subsequent restructuring of the subject business or other action has been
undertaken to cure the deficiencies in meeting applicable requirements.
(e) Suspensions
may be for any length of time not to exceed five years. Suspensions in excess
of one year and revocations of certification shall be reserved for cases
involving intentional or fraudulent misrepresentation or concealment of
material facts, multiple acts in contravention of applicable requirements,
cases where the MBE/WBE or mentor/protégé has been previously suspended, or
other similarly egregious conduct.
(f) The making
of any false or misleading statements shall be grounds for application of any
applicable criminal and or civil penalties in addition to the grounds for
sanction.
(g) No person
shall intimidate, threaten, coerce or discriminate against any individual or
business for the purpose of interfering with the implementation or enforcement
of any provision of this article because such individual or business filed a
complaint or cooperated in the investigation of a complaint.
Sec. 3-466. Reserved.
Sec. 3-467. Mediation of disputes.
(a) Any claim
or dispute between a contractor, subcontractor or supplier that remains
unresolved after 30 calendar days shall be subject to mandatory mediation
conducted in accordance with the rules of the Uniform Mediation Act. The
mediation shall be conducted by an impartial mediator appointed by the
department, who shall render his or her services with full regard for each
party's interests. If the subject matters of the dispute or the parties to the
dispute are such that the assigned mediator would have a conflict of interest
or personal interest in the outcome of the mediation, he or she shall
immediately be recused and another mediator shall be appointed.
(b) The
procedures for the mediation shall be established by the appointed mediator in
conjunction with the parties, who shall attempt to resolve their dispute in
good faith.
(c) Except to
the extent disclosure is otherwise required by law, the mediation and the terms
of any settlement reached by the parties shall remain confidential.
(d) The
mediation provided for by this section shall be a condition precedent to the
initiation or pursuit of any other lawful means of resolving the dispute,
including arbitration and other legal proceedings.
(e) The
contractors shall share equally the expense of the mediator's fee. Agreements
reached in mediation shall be enforceable as settlement agreements in any court
having jurisdiction thereof.
(f) Every
contractor entering into a contract as defined by section 3-421(a) (13) shall
incorporate the provisions of this section into each related agreement with a
subcontractor or supplier, but the failure to do so shall not alleviate the
obligation of the parties to utilize the mediation provided for herein as a
condition precedent to the initiation or pursuit of any other lawful means of
resolving the dispute, including arbitration and other legal proceedings. The
requirements of this section shall be deemed incorporated into each related
agreement by operation of law and shall supplant any term or provision, written
or oral, to the contrary.
(g) Notwithstanding
the foregoing, for incentive projects any arbitration or mediation between the
prime contractor or developer and the M/WBE firm shall be in accordance with
the arbitration or mediation provisions, as applicable, contained in the
contract between the prime contractor or developer and the M/WBE firm. The
provision shall not serve to inhibit the director’s ability to assist the prime
contractor or developer and the MBE/WBE firm in reaching a compromise in
matters of dispute.
Sec. 3-468. Reserved.
Sec. 3-469. Severability.
The provisions
of this division are severable. If any provision or its application to any
person or circumstance is held invalid by a court of competent jurisdiction,
the remaining provisions, including the application of such provisions to other
persons or circumstances, shall continue in full force and effect.
Secs. 3-470—3-500. Reserved.
_____________________________________________
Approved
as to form and legality:
___________________________________
Dustin
E. Johnson
Assistant
City Attorney