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Legislation #: 170665 Introduction Date: 8/24/2017
Type: Ordinance Effective Date: 10/20/2017
Sponsor: COUNCILMEMBERS SHIELDS, REED AND LUCAS
Title: Amending Chapter 3, Code of Ordinances by enacting a new Sections 3-66, entitled the “Quality Services Assurance Act” that requires businesses that provide services to the City to submit documentation of the quality of the workforce employed on City Service Contracts or elect to pay its workers employed on City Service Contracts in Kansas City, Missouri certain hourly wage rates; appropriating $10,000.00 for the purpose of informing prospective contractors of the requirements of this ordinance; and recognizing this ordinance as having an accelerated effective date

Legislation History
DateMinutesDescription
8/24/2017 Filed by the Clerk's office
8/24/2017 Referred to Finance and Governance Committee
8/30/2017 Hold On Agenda (9/6/2017)
9/20/2017 Hold On Agenda (9/27/2017)
9/27/2017 Hold On Agenda (10/11/2017)
10/11/2017 Do Pass as a Committee Substitute
10/12/2017 Assigned Third Read Calendar as Substituted
10/19/2017 Councilmember Shields (Second by Reed) Move to Amend
10/19/2017 Councilmember Shields (Second by Reed) Move to Advance
10/19/2017 Passed as Substituted and Amended

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COMMITTEE SUBSTITUTE FOR ORDINANCE NO. 170665, AS AMENDED

 

Amending Chapter 3, Code of Ordinances by enacting a new Sections 3-66, entitled the “Quality Services Assurance Act” that requires businesses that provide services to the City to submit documentation of the quality of the workforce employed on City Service Contracts or elect to pay its workers employed on City Service Contracts in Kansas City, Missouri certain hourly wage rates; appropriating $10,000.00 for the purpose of informing prospective contractors of the requirements of this ordinance; and recognizing this ordinance as having an accelerated effective date

WHEREAS, the City provides many services to its citizens through both its own employees and through contracts with businesses that provide services needed by the City and its citizens; and

 

WHEREAS, the quality of City employees and Contractor employees greatly impacts the services received by the City and its citizens; and

 

WHEREAS, the U.S Bureau of Labor Statistics has reported record low unemployment rates including the most recent report of August 2017 that reported a 4.4% record of unemployment for the U.S. and Kansas City, MO-KS and 4% for the state of Missouri; and

 

WHEREAS, Wal-Mart raised its minimum wage to $10.00 per hour in 2015; and

 

WHEREAS, Target Corporation recently announced it raised its minimum wage to $11.00 per hour and plans to raise wages to $15.00 per hour by 2020 to attract and retain employee talent; and

 

WHEREAS, businesses like Target and Wal-Mart increased and are increasing the wages of their employees to have better trained workers who will stay in the job to improve the experience of their customers; and

 

WHEREAS, the citizens of Kansas City, Missouri deserve quality basic City services whether delivered by City employees or by a Contractor’s employees; and

 

WHEREAS, the private sector has found it necessary to increase wages to recruit, motivate and retain employees; and

 

WHEREAS, the City uses private sector benchmarks to improve the delivery of basic City services; and

 

WHEREAS, Section 290.528, RSMo, prohibits the City from requiring private businesses to pay employees more than the State minimum wage but exempts public employers from the prohibition; and

 

WHEREAS, Section 290.528, RSMo, recognizes the need for the City to provide quality services to its citizens with experienced, motivated and trained workers in that the City and other public employers are not prohibited from requiring their employees to be paid more than the State minimum wage; and

 

WHEREAS, the citizens deserve to have experienced, motivated and trained workers provide City services regardless of whether the services are delivered by a City employee or by the employees of an outside Contractor; and

WHEREAS, the City will follow the lead of the private sector to ensure that services provided to the City and its citizens are provided by experienced, motivated and trained workers and to minimize Contractor employee turnover during City contracts; NOW, THEREFORE,

 

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 amended by adding a new Section 3-66, entitled the “Quality Services Assurance Act” to read as follows:

 

Sec. 3-66. Quality Services Assurance Act.

 

(a)    If the estimated consideration for a City Service Contract exceeds $160,000.00, the city manager or manager of procurement services shall require potential contractors to submit information and documentation regarding the following areas prior to contract award to ensure that experienced, motivated and trained workers will staff the City Service Contract:

 

(1) Turnover rate for the last three calendar years for non-exempt employees and exempt employees; and

 

(2) Employee benefits provided to exempt and non-exempt employees; and

 

(3) Training provided to exempt and non-exempt employees, including those that will provide services to the City; and

 

(4) Promotional opportunities for non-exempt and exempt employees; and

 

(5) Average tenure of exempt and non-exempt employees during the immediately preceding three calendar years; and

 

(6) Employee incentive rewards and employee recognition policies; and

 

(7) Employee feedback and communication; and

 

(8) Mentorship programs; and

 

(9) Education benefits for exempt and nonexempt employees; and

 

(10) Any other information or documentation required by the city manager or manager of procurement services.

 

(b) In lieu of a potential contractor complying with Section 3-66(a), a potential contractor may certify and contractually agree to pay all employees employed on a City Service Contract that perform services in the corporate limits of the City of Kansas City, Missouri, not less than the following hourly wage rates:

 

(1) Beginning May 1, 2018: $10.00; and

 

(2) Beginning September 1, 2019: $11.25; and

 

(3) Beginning September 1, 2020: $12.50; and

 

(4) Beginning September 1, 2021: $13.75; and

 

(5) Beginning September 1, 2022: $15.00.

 

(c) For purposes of Section 3-66(b), the following definitions apply:

 

(1) “Apprentice” means a person bound to serve another for a specified time in order to learn some art, trade, profession, or business;

 

(2) "Base wage" means the minimum hourly rate of compensation that an employee who customarily and regularly receives more than thirty dollars ($30.00) a month in tips shall be paid;

 

(3) "Commission" means a payment based on a percentage of the value of sales or other business done;

 

(4) "Tip" means a gratuity earned by an employee for providing good service.

 

(d) For purposes of Section 3-66(b), the following shall not be considered employees:

 

(1) An individual employed by the United States, the State of Missouri or any political subdivision of the State other than by the City of Kansas City, Missouri;

 

(2) An individual engaged in the activities of an educational, charitable, religious or nonprofit organization where the employer-employee relationship does not, in fact, exist or where the services rendered to such organizations are on a voluntary basis;

 

(3) Apprentices in a registered apprentice program recognized by the State of Missouri or the Federal Bureau of Apprenticeship and Training, as well as any apprentice participating in an apprenticeship program providing significant instructional and practical experience and offered by the City of Kansas City, Missouri.

 

(4) Temporary employees of an educational, charitable or religious youth camp or retreat where room and board are provided to the employee, or if a day camp, where board only is provided. To qualify under this exemption the employer must hold a valid certificate issued annually by the Director of the Missouri Department of Labor pertaining to exemption of seasonal employees;

 

(5) Any employee that is the parent, spouse, child or other member of the employer's immediate family; for purposes of this subsection, the employer shall include the principal stockholder of a family corporation;

 

(6) Interns working for a business for academic credit in connection with a course of study at an accredited school, college or university; and

 

(7) Persons working for a business in connection with a court-ordered community service program.

 

  (e) For purposes of Section 3-66(b), an employee who customarily and regularly receives more than thirty dollars ($30.00) a month in tips and/or commissions shall be paid at least a base wage equivalent to sixty percent of the hourly wage rate established by Section 3-66(b). Initially the base wage rate shall be six dollars ($6.00). That wage will increase simultaneously and proportionately with each hourly wage rate increase. The employer may consider tips and commissions as part of wages, but the tips and commissions combined with the employer's payment of wages to the employee shall not equal less than the hourly wage rate as provided in Section 3-66(b). In the event an employee earns insufficient tips and/or commissions combined with the base wage to receive a wage at least equal to the hourly wage rate established by Section 3-66(b), the employer shall pay the employee the difference to ensure the employee receives a wage equal to the hourly wage rate established by Section 3-66(b). All tips received by such employee shall be retained by the employee, except that nothing in this section shall prohibit the pooling of tips among employees. Where employees practice tip pooling or splitting (as where staff give a portion of their tips to bus persons), only the amount actually retained by each employee shall be considered part of that employee's wages.

 

(f) For purposes of this Section 3-66, the term “City Service Contract” includes the following types of procurements and contracts for services:

 

(1) Alternative construction delivery method; and

 

(2) Concession contract for services; and

 

(3) Construction contract; and

 

(4) Design build contract; and

 

(5) Design Professional contract; and

 

(6) Information Technology procurements, excluding software as a service, and hardware contracts; and

 

(7) Invitation for Bids; and

 

(8) Qualification-based selection process; and

 

(9) Reverse auction; and

 

(10) Request for proposals; and

 

(11) Request for qualifications; and

 

(12) Term supply contract for services; and

 

(13) Term supply contract for services combined with goods, supplies, materials, equipment, or any combination of, if City staff estimates the services are more than half of the estimated value of the term and supply contract.

 

(g) The term “City Service Contract” excludes the following types of procurements and contracts for services:

 

(1) Cooperative agreement; and

 

(2) Cooperative Procurements; and

 

(3) Non-municipal agency contracts; and

 

(4) Piggybacking; and

 

(5) Purchasing pool and/or cooperative; and

 

(6) Sole brand purchase; and

 

(7) Term supply contract for goods, supplies, materials, equipment, or any combination of if City staff estimates the services are fifty percent or less of the estimated value of the term and supply contract.

 

(h) The monetary amount set forth in Section 3-66(a), shall be automatically adjusted in accordance with Section 3-91.

 

(i) Notwithstanding Section 3-66(a) and (b), the city manager and the manager of procurement services are authorized to require potential contractors to submit any documentation and information they deem necessary from potential contractors on all City Service Contracts.

 

(j) This Section 3-66 shall apply to all applicable City Service Contracts, solicitations, and procurements commenced on or after May 1, 2018.

 

Section 2. The sum of $10,000.00 is herein appropriated from Account No. 18-1000-072100-B, Procurement, for the purpose of informing all prospective vendors and other businesses of the requirements of this ordinance.

 

Section 3. That nothing in this Ordinance shall be deemed to nor shall be applied in such a manner so as to have a constitutionally prohibited effect as an ex post facto law or impairment of an existing contract within the meaning of the Missouri Constitution, Article 1, Section 13 and all City Service Contracts commenced prior to the applicability of Section 1 of this Ordinance shall continue in full force and effect and shall be carried to completion in accordance with the provisions of those contracts and ordinances in effect as of the date upon which such contracts became effective and such contracts may be amended, extended, and renewed.

 

Section 4. That any City Service Contract, solicitation, procurement, or award having commenced prior to the applicability of Section 1 of this ordinance or otherwise pending or under consideration by the city council prior to the applicability of Section 1 of this ordinance shall remain unaffected.

Section 5. This ordinance, relating to the appropriation of money, is recognized as an ordinance with an accelerated effective date as provided by Section 503(a)(3)(C) of the City Charter and shall take effect in accordance with Section 503, City Charter.

 

_____________________________________________

I hereby certify that there is a balance, otherwise unencumbered, to the credit of the appropriation to which the foregoing expenditure is to be charged, and a cash balance, otherwise unencumbered, in the treasury, to the credit of the fund from which payment is to be made, each sufficient to meet the obligation hereby incurred.

 

 

___________________________________

Randall J. Landes

Director of Finance

 

Approved as to form and legality:

 

 

___________________________________

Sarah Baxter

Assistant City Attorney