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HomeMy WebLinkAboutProcurement Policy DRAFT.pdf1 Procurement Policy and Procedures Village of Cayuga Heights Procurement Policy and Procedures DRAFT WHEREAS, General Municipal Law §104-b requires the governing body of every municipality to adopt a procurement policy for all goods and services which are not required by law to be publicly bid, and WHEREAS, comments have been solicited from all officials and department heads in the Village of Cayuga Heights, THEREFORE BE IT RESOLVED: that the Village of Cayuga Heights does hereby adopt the following Procurement Policy and Procedures which is intended to apply to all goods and services which are not required by law to be publicly bid. Purpose Goods and services that are not required by law to be procured pursuant to competitive bidding must be procured in a manner as to assure the prudent and economical use of public moneys in the best interest of the taxpayers; to facilitate the acquisition of goods and services of maximum quality at the lowest possible cost under the circumstances; and to guard against favoritism, improvidence, extravagance, fraud and corruption. To further these objectives, the Village of Cayuga Heights Board of Trustees has adopted an internal policy and procedures governing all procurements of goods and services which are not required to be made pursuant to the competitive bidding requirements of General Municipal Law, §103 or of any other general, special, or local law. All transactions shall be in accordance with the Village of Cayuga Heights’ Code of Ethics as may be amended from time to time. Procedures for Determining Whether Procurements are Subject to Bidding The procedures for determining whether a procurement of goods or services is subject to competitive bidding and documenting the basis for any determination that competitive bidding is not required by law is as follows: Procedure Every purchase to be made must be analyzed to determine whether it is a purchase contract or a public works contract. Once that determination is made, a good faith effort will be made to determine whether it is known or can reasonably be expected that the aggregate amount to be spent on the item of supply or service exceeds the monetary threshold of competitive bidding taking into account past purchases and the aggregate amount to be spent in a fiscal year. Monetary thresholds may not be avoided by artificially splitting or breaking up contracts into lesser agreements, or entering into a series of agreements for sums below the dollar thresholds. Procurements Subject to Bidding Specification Document The specification document sets forth the standard and requirements that 2 Procurement Policy and Procedures competitors must observe. The specification should indicate the basis on which the bids and offers will be evaluated and the award made. Awarding Contracts: When competitive bidding is required, the award of the contract is generally made to the lowest priced responsible bidder which has complied with the specifications. The Village may elect to award a contract on the basis of “best value” instead of to the lowest responsible bidder. “Best value” is defined for this purpose as a basis for awarding contracts to the offeror which optimizes quality, cost and efficiency, among responsive and responsible offerors. The use of best value for awarding purchase contracts must be authorized by adoption of a local law. Statutory Exceptions to Quotation/Proposal Requirements of This Policy and Procedures The following items are not subject to competitive bidding pursuant to General Municipal Law §103: 1. Purchase contracts under $20,000 and public works contracts under $35,000; 2. Emergency purchases: pursuant to §103(4) of General Municipal Law which sets forth an exception to bidding requirements for emergency situations and provides as follows: "Notwithstanding the provisions of subdivision one of this section, in the case of a public emergency arising out of an accident or other unforeseen occurrence or condition whereby circumstances affecting public buildings, public property, or the life, health, safety or property of the inhabitants of a or district therein, require immediate action which cannot await competitive bidding, contracts for public work or the purchase of supplies, material or equipment may be let by the political subdivision.” Due to the nature of this exception, these goods or services must be purchased immediately and a delay in order to seek alternate proposals may threaten the life, health, safety or welfare of Village residents. This section does not preclude alternate proposals if time permits. 3. Certain municipal hospital purchases; 4. Preferred source goods purchased from approved, qualified, nonprofit agencies for the blind or severely handicapped, and certain approved qualified veterans’ workshops pursuant to State Finance Law §162(4); 5. Preferred source goods required to be purchased from the Correctional Industries Program of the Department of Corrections and Community Supervisions (Corcraft) pursuant to Correction Law §186; 6. Purchases under State contracts pursuant to General Municipal Law §104 and Service contracts entered into through the New York State Office of General Services “piggybacking” on certain other government contracts in accordance with the prerequisites in GML, §103 [16]. In these instances, the State has already 3 Procurement Policy and Procedures investigated and secured the lowest possible price for the municipality. 7. Purchases under county contracts and certain federal General Serv ice Administration contracts pursuant to General Municipal Law §103(3); 8. Professional services or services requiring special or technical skill, training or expertise. The individual or company must be chosen based on accountability, reliability, responsibility, skill, education and training, judgment, integrity, and moral worth. These qualifications are not necessarily found in the individual or company that offers the lowest price and the nature of these services are such that they do not readily lend themselves to competitive procurement procedures. In determining whether a service fits into this category the Board of Trustees shall take into consideration the following guidelines: (a) whether the services are subject to State licensing or testing requirements; (b) whether substantial formal education or training is a necessary prerequisite to the performance of the services; and (c) whether the services require a personal relationship between the individual and municipal officials. Professional or technical services shall include but not be limited to the following: services of an attorney; services of a physician; technical services of an engineer or architect engaged to prepare plans, maps and estimates; securing insurance coverage and/or services of an insurance broker; services of a certified public accountant; investment management services; printing services involving extensive writing, editing or art work; management of municipally owned property; and computer software or programming services for customized programs, or services involved in substantial modification and customizing of pre-packaged software; 9. Sole Source - Competitive bidding is not required under section 103 of the General Municipal Law in those limited situations where there is only one possible source from which to procure goods and services required in the public interest. Appropriate documentation is required to show that a sole source condition existed. Documentation The decision that a purchase is not subject to competitive bidding will be documented in writing by the head of the department l making the purchase. This documentation may include written or verbal quotes (telephone logs) from vendors, a memo from the purchaser indicating how the decision was arrived at, a copy of the contract indicating the source which makes the item or service exempt , a memo from the purchaser detailing the circumstances which led to an emergency purchase, or any other written documentation that is appropriate. Alternative proposals or quotations for goods and services shall be secured by use of either written requests for proposals, written quotations, verbal quotations or any other method of procurement that furthers the purposes of the General Municipal Law §104-b. Documentation is required for each action taken in connection with procurement. 4 Procurement Policy and Procedures Methods of Competition to be used for Non-Bid Procurements Alternative proposals or quotations should be obtained by use of written requests for proposals (RFPs), written quotations, verbal quotations or any other method that furthers the purposes of the law. This method of purchase assures the prudent and economical use of public moneys in the best interest of the taxpayers and facilitates the acquisition of goods and services of maximum quality at the lowest possible cost. Awards to Other than the Lowest Responsible Dollar Offeror Documentation and an explanation are required whenever a contract is awarded to other than the lowest responsible offeror. This documentation will include an explanation of how the award will achieve savings or how the offeror was not responsible. A determination that the offeror is not responsible shall be made by the purchaser and may not be challenged under any circumstances. · Whenever any contract is awarded to other than the lowest responsible dollar offeror, the reasons that such an award furthers the purpose of General Municipal Law, section 104-b, as set forth herein above, shall be documented as follows: Estimated Amount of Purchase Contract Method $500 - $4,999 two (2) verbal quotes $5,000 - $19,999 two (2) written/fax quotes or written RFPs Estimated Amount of Public Works Contract Method $500 - $2,999 two (2) verbal quotes $3,000 - $9,999 two (2) written/fax quotes $10,000 - $34,999 two (2) written/fax quotes or written RFPs A good faith effort shall be made to obtain the required number of proposals or quotations. If the purchaser is unable· to obtain the required number of proposals or quotations, the purchaser will document the attempt made at obtaining the proposals. In no event shall the failure to obtain the proposals be a bar to the procurement. Items Excepted from this Policy and Procedures by the Board of Trustees Pursuant to General Municipal Law § 104-b(2)(g), the procurement policy may contain circumstances when, or types of procurements for which, in the sole discretion of the governing body, the solicitation of alternative proposals or quotations will not be in the best interest of the municipality. The Board sets forth the following circumstances when, or types of procurements for which, it may not be in the best interests of the Village of Cayuga Heights taxpayers to solicit alternative proposals or quotations or document the basis for not accepting the lowest proposal: 1. Purchases of surplus and second-hand goods from any source or goods purchased at auction. If alternate proposals are required, the Village is precluded from purchasing surplus and second-hand goods at auctions or through specific advertised sources 5 Procurement Policy and Procedures where the best prices are usually obtained. It is also difficult to try to compare prices of used goods and a lower price may indicate an older product. 2. Goods or services under $500. The time and documentation required to purchase through this policy may be more costly than the item itself and would therefore not be in the best interests of the taxpayer. In addition, it is not likely that such de minimis contracts would be awarded based on favoritism. 3. Employee expenses such as conference expenses, mileage and other reimbursable expenses in performance of day-to-day duties. 4. Reimbursement of petty cash funds. 5. Utility bills. 6. Service contracts for a fixed monthly or annual amount for which a formal contract exists. 7. Interdepartmental charges. 8. Medical examinations. 9. Legal notices. 10. Postage 11. Other limited exceptions apply. These are outlined in various documents and are available from the Clerk & Treasurer upon request. Individual(s) Responsible for Purchasing With the exception of purchases made under blanket purchase orders and/or confirming orders (those requiring immediate action) only the persons designated as purchasing agent may commit the local government for a purchase. The following individuals are designated as purchasing agents. They may designate their assistant to perform this function in their absence . Names and titles of individuals responsible for purchasing and their respective titles; Brent Cross Superintendent of Public Works Asst. Superintendent of Public Works Glenn Galbreath Village Justice Joan Mangione Clerk & Treasurer James Steinmetz Chief of Police George Tamborelle Fire Department Superintendent The listed information will be updated biennially or at the time of a staff change. 6 Procurement Policy and Procedures General 1. Material, equipment, supplies and/or services to be purchased shall be of the quality and in the quantity required to serve the function in a satisfactory manner, as determined by the appropriate purchasing department head. 2. It is the responsibility of the requisitioner and the appropriate purchasing department head to provide an adequate description of all items needed so that the procurement may be reviewed and/or specifications prepared to procure the desired commodity and/or service. As needed the requisitioner will assist the purchasing department head in the preparation of specifications. 3. It is the responsibility of the purchasing department head to make alternative suggestions to the requisitioner if, in the judgment of the purchasing department head, the specifications would restrict competition or otherwise preclude the most economical purchase of the required items. In case of disagreement as to the content of the specifications the Board of Trustees, after reviewing all available data, should make the final determination. Requisition The requisitioner will provide the Clerk & Treasurer with the following information on items to be procured: 1. Description of item requested 2. Quantity required 3. Department and appropriation to be charged 4. Date 5. Signature of requisitioner and/or department head Purchase Order 1. Each department head is responsible for the compliance with the purchasing procedures adopted. 2. Only purchase order forms provided by the Clerk & Treasurer shall be used. 3. Purchasing information shall be provided as described above. 4. The purchase order will be prepared by the Clerk & Treasurer and based on the signed requisition information. 5. All purchase orders will be approved by the purchasing department head and the Clerk & Treasurer. 6. The Clerk & Treasurer will certify by signature on each purchase order that the moneys are available and that the appropriation has been encumbered. 7. Multiple copy purchase orders shall be used. The original will be provided for the vendor. One copy will be returned to the requisitioning department. A copy will be 7 Procurement Policy and Procedures retained by the Clerk & Treasurer. Confirming Orders A verbal order, subject to subsequent confirmation by a written purchase order may be given in cases where necessity for immediate action exists. The individual placing such an order shall justify the need for this action when providing the requisition information. A confirming order should be issued immediately after availability of funds is determined. The order shall follow the same procedures as other orders but shall have priority so that the vendor will receive the order without delay. The order shall be marked "CONFIRMATION - DO NOT DUPLICATE." Department heads are responsible for orders placed verbally. Blanket Orders Blanket purchase orders or open-end accounts may be issued to various vendors for the purchase of items considered to be of immediate need or for the purpose of consolidated purchases. The amount of the blanket purchase order shall be determined by the Clerk- Treasurer. It shall be based on information available in the records covering previous fiscal years and data obtained from the purchasing department head. Blanket purchase orders shall not extend beyond the Village's fiscal year end. Billings against blanket orders shall be made monthly. The department head should keep a record of purchases made to insure that they do not exceed the amount allowed by the blanket purchase order. Blanket orders may be cancelled prior to the fiscal year end at any time by the Clerk- Treasurer. Any encumbered, unexpended funds shall be returned to the original appropriation. In some cases, it will not be practical to encumber blanket orders of a broad nature. Note that the above contract exceptions are valid only when the purchases are made from the vendor holding the current State, state approved or county contract. Notice to Vendors Notice will be given to each new supplier explaining the purchasing format. Vendors deviating from the purchasing procedures will be notified immediately and informed of possible consequences. Such notice will include the statement "The Village of Cayuga Heights will not be responsible for purchases made without prior authorization from the designated purchasing department head except as otherwise stated herein." The purchasing department head shall also notify the vendor of the Village's tax status , and obtain the appropriate tax information from the vendor as is necessary to comply with Internal Revenue Service reporting requirements. Receipt of Goods The requisitioning department shall notify the Village Office when goods are received. This shall be done by providing a copy of the packing slip, which should be signed to indicate 8 Procurement Policy and Procedures that the goods have been received and are in satisfactory condition. Insufficient Appropriations In the event that an appropriation balance is insufficient, and funds are not available in the same department and type classification, the Clerk & Treasurer will notify the department head. To request an increase in appropriation, the department head should proceed as follows: The request for a transfer or an increase in appropriations should be in writing and directed to the Clerk & Treasurer. An explanation as to why the purchase is necessary must be included in the request. The amount needed and the accounts involved must be indicated. The Treasurer will present a summary of all transfer requests to the Village Board in a regular or special meeting. After approval of the transfer he/she shall notify the purchasing department head that the order may be processed. When funds exist in a department in the same type classification the purchase order may be issued prior to board approval of the transfer from the sub classification. For example , a transfer may be presumed from account A8160.410 to A8160.420, because the department (A8160) is identical and the type classification (400, contract expenditure) is identical. Such requisitions will be encumbered on the appropriate account and the transfers shall be made prior to the payment of the invoice. Audit of Claims Standard vouchers shall be prepared for payment of all items purchased under this policy. The purchase order number should be included on the voucher. The voucher shall be signed by the responsible department head in the space provided. Vouchers received up to one week prior to a regularly scheduled Board of Trustees meeting will be included on the Abstract of Audited Vouchers and submitted for Board approval by the Clerk &Treasurer. Once such approval has been made the invoices may be paid. Input From Officers Comments have been solicited from department heads and appointed officials therein involved in the procurement process prior to the enactment of this policy and procedures, and will be solicited from time to time hereafter. Annual Review The Board of Trustees shall annually review and, when needed, update this policy and procedures. The Village Clerk & Treasurer shall be responsible for conducting an annual evaluation of the effectiveness of the procurement policy and procedures and an evaluation of the control procedures established to ensure compliance with the procurement policy, and shall be responsible for reporting back to the board. 9 Procurement Policy and Procedures Unintentional Faiure to Comply The unintentional failure to comply fully with the provisions of General Municipal Law, §104-b shall not be grounds to void action taken or give rise to a cause of action against the Village of Cayuga Heights or any officer or employee thereof. Resolution Adopted on ___________ __, 2015 by ____________ vote of the Board of Trustees of the Village of Cayuga Heights. Effective Date This policy shall go into effect ___________ __, 2015 and will be reviewed annually. 10 Procurement Policy and Procedures