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CITY COUNCIL AGENDA ITEM NO. 11

Meeting Date: February 24, 2004

Subject/Title: Approve a Resolution amending the Purchasing Policy No.10-7 to update the credit card section to include use of the California State CAL-Card Procurement credit card.

Submitted by: Pam Ehler, Director of Finance and Information Systems
Becky Bridgen, Purchasing Agent

Approved by: John Stevenson, City Manager

RECOMMENDATION
Adopt a Resolution amending the Purchasing Policy No. 10-7 to update the credit card section to include use of the California State CAL-Card Procurement credit card.

PREVIOUS ACTION
On March 12, 1996, the City Council approved by resolution an amendment to the Purchasing Policy to add “Local Preference” language and clarifications to language for sealed bids, bid rejection and the right to audit every 4 years.

On June 8, 1999, the City Council approved by resolution an amendment to the Purchasing Policy on the recommendation of the auditor’s report to increase the monetary limitations from $10,000 to $25,000 before Council approval is required.

On March 27, 2001, the City Council approved amending the Purchasing Policy to allow new spending limitations. This approval increased the City Manager’s monetary limitations for budgeted goods, equipment and services from $25,000 to $50,000, also increased the monetary limits for purchase orders from $1,000 to $5,000, and increased the credit card limit from $2,000 to $5,000 for city business expenditures.

On February 26, 2002, the City Council approved amending the Purchasing Policy to increase the City’s purchases of recycled materials and recycled products and to further comply with the state-mandated AB939 waste reduction goals of 50% diversion.

On July 22, 2003, the City Council approved Resolution No. 2932 amending Purchasing Policy No. 10-7 to update Fixed Asset description and dollar amounts.

BACKGROUND
The majority of the changes in the new policy are verbiage clarifications to better define guidelines.

This policy also allows Directors to unilaterally decide which of their employees will receive a CAL-Card, up to a limit of $5,000. Currently, only Mid-Managers are allowed to receive credit cards.

There are several benefits of using the CAL-Card Program including no membership fees; no administrative fees, no minimum card count, no minimum spending amount; reduces petty cash and check requests; consolidates invoices of low value purchases into one invoice per month; invoices due 45 days from invoice date; standard and ad hoc management reports; dispute, fraud protection and VISA Waiver Liability; prompt payment rebate.

Per the State of California Department of General Services Procurement Division the pilot program indicates an average savings of $24.49 per transaction.

FISCAL IMPACT
Unknown

ATTACHMENTS
Resolution
Purchasing Policy

RESOLUTION NO. _______

APPROVE A RESOLUTION AMENDING THE PURCHASING POLICY TO UPDATE THE CREDIT CARD SECTION TO INCLUDE USE OF THE CALIFORNIA STATE CAL-CARD PROCUREMENT CREDIT CARD.

WHEREAS, On March 12, 1996, the City Council approved by resolution an amendment to the Purchasing Policy to add “Local Preference” language and clarifications to language for sealed bids, bid rejection and the right to audit every 4 years.

WHEREAS, On June 8, 1999, the City Council approved by resolution an amendment to the Purchasing Policy on the recommendation of the auditor’s report to increase the monetary limitations from $10,000 to $25,000 before Council approval is required.

WHEREAS, On March 27, 2001, the City Council approved amending the Purchasing Policy to allow new spending limitations. This approval increased the City Manager’s monetary limitations for budgeted goods, equipment and services from $25,000 to $50,000, also increased the monetary limits for purchase orders from $1,000 to $5,000, and increased the credit card limit from $2,000 to $5,000 for city business expenditures.

WHEREAS, On February 26, 2002, the City Council approved amending the Purchasing Policy to increase the City’s purchases of recycled materials and recycled products and to further comply with the state-mandated AB939 waste reduction goals of 50% diversion.

WHEREAS, on July 22, 2003, the City Council approved Resolution No. 2932 amending Purchasing Policy No. 10-7 to update Fixed Asset description and dollar amounts.

WHEREAS, the majority of the changes in the new policy are verbiage clarifications to better define guidelines.

WHEREAS, this policy also allows Directors to unilaterally decide which of their employees will receive a CAL-Card, up to a limit of $5,000. Currently, only Mid-Managers are allowed to receive credit cards.

WHEREAS, There are several benefits of using the CAL-Card Program including no membership fees; no administrative fees, no minimum card count, no minimum spending amount; reduces petty cash and travel requests; consolidates invoices of low value purchases into one invoice per month; invoices due 45 days from invoice date; standard and ad hoc management reports; dispute, fraud protection and VISA Waiver Liability; prompt payment rebate.

NOW, THEREFORE, BE IT RESOLVED by the City of Brentwood as follows:

Section 1. this policy also allows Directors to unilaterally decide which of their employees will receive a CAL-Card, up to a limit of $5,000. Currently, only Mid-Managers are allowed to receive credit cards.

Section 2. The Purchasing Policy will be amended and updated to include use of the California State CAL-Card Procurement credit card.

PASSED, APPROVED AND ADOPTED on February 24, 2004 by the following vote:

AYES:

NOES:

ABSENT:

____________________________________
Brian Swisher
Mayor
Attest:

___________________________
Karen Diaz, CMC
City Clerk

Purchasing Policy
Table of Contents

I. Centralized Purchasing 3

II. Objectives of the Purchasing Division 3

III. Ethics 4

IV. Summary of Purchasing Options 5

V. Purchasing Cycle 5

VI. Purchasing Procedures 6

A. Requisition 6

B. Verification of Need 7

C. Quotations 7
1. Items costing $5,000 to $50,000 7
2. Items costing more than $50,000 7

D. Purchase Orders 9

E. Open Purchase Orders 9

F. Blanket Purchase Orders 11

G. Other Purchasing Methods 11
1. Credit Cards 11
2. Petty Cash 12
3. Exceptions 12
4. Sole Source/Non-Competitive Negotiations 13
5. Emergency Purchases 13
6. Cooperative Purchasing Agreements 15

H. Professional Services 16

I. Service Agreements 17

J. Miscellaneous Procedures 17
Purchasing Policy
Table of Contents

K. Public Projects 17

L. Monitoring Receipt of Goods or Services 17

M. Invoice Payment Procedures 18

VII. Local Preference 18

VIII. Recycled Products and Recycled Materials 19

IX. Unauthorized Purchases 20

X. Surplus Property 20

XI. Fixed Assets 21

Definitions 22

I. CENTRALIZED PURCHASING

In accordance with the general supervision of the Finance Director, the Purchasing Agent shall have the authority to:

 Purchase or contract for goods, equipment and services required by any department in accordance with the purchasing procedures prescribed in this policy.

 Purchase all budgeted goods, equipment and services required by the departments in amounts or estimated amounts fifty thousand dollars ($50,000) or less.

 Purchase all budgeted goods, equipment and services required by the departments in amounts of more than fifty thousand dollars ($50,000) with City Council approval.

II. OBJECTIVES OF THE PURCHASING DIVISION

The overall objective of Purchasing is to maintain, at all times and under all conditions, a continuous supply of goods and services necessary to support the City’s operations while meeting our obligations to the public. The Purchasing Division will meet this goal by the following means:
 Seek and stimulate competition.
 Develop and maintain materials standards consistent with the required levels of quality.
 Assure that all qualified and responsible suppliers have an equal opportunity to do business with the City.
 Utilize accepted public purchasing practices for conducting all purchasing business.
 Comply, in all respects, with all applicable laws without qualification or evasion.
 Conform to ethical practices in all transactions.
 Resolve complaints on all purchased goods and services.
 Provide leadership in the standardization of goods, equipment, service and inventory procedures.
 Make all possible attempts to reuse or recycle (i.e., yard sales or donations to other organizations) material and equipment declared surplus or obsolete before discarding.
 Conduct all responsibilities in a manner that will inspire good business relationships and insure the confidence of the public.
 Act to procure for the City the needed quality in goods, services and equipment at the least expense to the City. Whenever possible and practical, recycled products and recycled materials will be purchased to demonstrate compliance with the Waste Management Reduction Act and foster market development for recycled products.
 Encourage full and open bidding and endeavor to obtain as full and open competition as possible on all purchases.
 Prepare and recommend to the City Council rules governing the purchase of goods, services and equipment for the City.
 Keep informed of current developments in the field of purchasing, prices, market conditions and new products.
 Develop, with the approval of the City Attorney as to legal sufficiency, standard forms, terms and conditions of invitations to bid, purchase orders and contracts; develop and prescribe the use by agencies of other forms required in carrying out the provisions of this chapter, and amend or eliminate any such forms.
 Supervise the inspection, with the receiving department, of goods, services and equipment purchased, as required, to insure conformance with specifications, when necessary.
 Establish and maintain an inventory of goods and equipment purchased by the City to avoid duplicating purchases and ensure availability of inventoried supplies. Recommend the transfer of surplus or unused goods and equipment between departments as needed and the sale of all goods and equipment which cannot be used by any department or which have become unsuitable for City use.
 Maintain a bidders list, vendors catalog files and records needed for the efficient operation of the purchasing department.

III. ETHICS

City personnel must discharge their duties impartially to assure fair competition for City business by responsible vendors. In addition, they shall conduct themselves in a manner that will create confidence in the integrity of the City’s purchasing operations.

It shall be a breach of ethical standards for City personnel to accept gifts, rebates, kickbacks, personal services, or in any way incur personal gain from any vendor, actual or potential, doing business with the City, except as allowed under state law.
All vendors will be treated equally and fairly at all times by all personnel, with equal information given to each vendor who participates in the procurement process.

IV. SUMMARY OF PURCHASING OPTIONS

Purchases up to $100 Use petty cash, credit card, open purchase order or purchase direct and submit the receipt for reimbursement.
Purchases $101 to $5,000 (Excluding tax, shipping and handling) Use credit card, open purchase orders or requisitions or purchase direct. Obtaining two (2) quotes is optional Department head or designee approves invoice copy and confirms that goods or services were received.
Purchases $5,000 to $50,000 Purchase order and/or contract required; Requisitions submitted with bidding documentation and specifications. Three (3) written quotes, faxes are acceptable. Professional services require City Manager or designee approval.
Purchases more than $50,000 Purchase order and/or Contract required and must be approved by City Council. Sealed bids submitted to City Clerk (on CIP projects only). City Council approval required.

V. PURCHASING CYCLE

All of the City's procurements involve the following steps. The procedures to be followed at each step are described more fully below in the Purchasing Procedures section:

A. Action: Determine need

Action by: The requesting department.

Determining need includes verifying that the proposed purchase complies with the adopted City budget.

B. Action: Prepare purchase requisition

Action by: The requesting department.

The purchase requisition must include the appropriate accounting code so that the cost can be accounted for correctly. Completed purchase requisitions are logged in the department's requisition log, and sent to the Purchasing Agent with quotations or other supporting documents.

C. Action: Prepare Purchase Order or Contract

Action by: The Purchasing Agent.

After the requisition is approved, the Purchasing Agent will issue a purchase order or contract incorporating the terms of the procurement. If a Contract, the vendor or service provider must execute the agreement, and return a signed copy to the Purchasing Agent. Depending on the amount of the purchase, the Purchasing Agent, Department Head or City Manager or designee executes the Purchase Order and/or contract on behalf of the City.

D. Action: Monitor Delivery or Performance

Action by: The requesting department.

Monitoring includes confirming that the City receives the bargained-for quantity and quality of goods or services. (For detailed information see page 17)

E. Action: Approving payment

Action by: The requesting department.

Written approval must appear on the invoice, if applicable, and must be returned to Accounts Payable with any other documentation, such as a packing slip, a copy of the purchase order and manifest if applicable.

VI. PURCHASING PROCEDURES

A. REQUISITION

A requisition is an in-house document used to request a purchase order. The requisition contains all information necessary to obtain goods and services.
1. Requisitions are required for all Purchase Orders.
2. The requesting department prepares the requisition using the City’s standard requisition form and codes with the correct accounting code.
3. All requisitions must be approved in writing by the department head or designee. The approval represents that the department has sufficient funds budgeted to pay for the purchase.
4. Each department shall maintain a requisition log of all requisitions issued as well as a copy of each completed requisition form.
5. When the requisition is complete, the department sends it to the Purchasing Agent along with bidding documentation and product specifications, where required.
6. The requisition can be used for purchases under $5,000 if no on-site labor is required. Photocopy the completed requisition covering the words “Purchase Requisition” and the number in the right upper corner. Write the requisition number in the Purchase Order No. area and fax to the vendor. When the invoice is received, Accounts Payable will know by that number which department to send it to.

B. VERIFICATION OF NEED

Upon receipt of a properly completed requisition, the Purchasing Agent checks the document for accuracy, completeness, and reviews the City's inventory to determine whether the requested items are available from surplus or in stock and meets the requesting departments requirements. If the Purchasing Agent identifies suitable items already in the City's possession, the requesting department will be notified and will have two working days to inform the Purchasing Agent if it will accept the goods in stock. If the department does not inform the Purchasing Agent within that time that the goods in stock are unacceptable, the Purchasing Agent will arrange for delivery of the goods in stock to the requesting department and cancel the requisition.

C. QUOTATIONS
1. Items costing $5,000 to $50,000 (Excluding tax, shipping and handling): The requesting department shall obtain three (3) written quotes and attach product specifications to the requisition with a vendor selection. Faxed quotes are acceptable. See Sole Source, page 13.
2. Items costing more than $50,000:
a. City Council must approve all purchases before the Purchasing Agent will issue a contract or purchase order.
b. Authorization to procure service items or goods costing more than $50,000 will be submitted to the City Council along with three (3) solicited written quotes and a recommended vendor selection from staff. Although the price of an item will be a significant factor in selecting a vendor, the lowest bid does not necessarily need to be awarded the contract. However, when goods or services are standardized or of uniform quality, the award will be given to the lowest bid.
c. Requisitions for purchases of more than $50,000 must have supporting documentation from the City Council meeting (staff report and resolution or meeting minutes) at which the goods or services were approved, bidding documentation and product specification with the requisition when submitted to the Purchasing Agent.
d. The requesting department will solicit, receive and evaluate bids for goods (For Capital Improvement projects, the requesting department will work in conjunction with the Project Services Division).
(1) The requesting department will prepare a Request for Quotation or Proposal which shall include a general description of the articles or services to be purchased, and shall state where Requests for Quotation or Proposal and specifications may be secured and the time and place for opening bids, if applicable. The City will publish the Notice Inviting Bids in a newspaper of general circulation one or more times at least ten days before the bid opening date, or post the Notice Inviting Bids on the public bulletin board in the City Hall at least ten days before the bid opening date. (CIP projects only)
(2) Bids are delivered to the City Clerk, and are secured in a bid box until the announced bid opening time. The bids are not to be received by the individual who initiated the requisition. Bids are considered RECEIVED upon the bid opening at the advertised time. A bid committee consisting of at least 3 people, including representatives of the requesting department, will evaluate the bids. Late bids shall be returned unopened. (CIP projects only)
(3) The bid committee will make a recommendation regarding the award to the City Manager, or the City Council, whichever is required. Upon award, a Purchase Order or contract approved by the City Manager or designee will be issued to the successful bidder.
(4) A notice of bid rejection shall be sent to those bidders whose bids are not selected for award.
3. The requesting department will attach a copy of all product or service specifications to the purchase requisition when submitted to the Purchasing Agent. The Purchasing Agent will be responsible for holding all official bid specifications and keep such records for at least 3 years. Public works project bids will be held by the Engineering Department.
D. PURCHASE ORDERS

1. A Purchase Order is the principal document used to obtain goods and services for the City.

2. Purchase Orders are required for all equipment, goods or services costing more than $5,000.

3. The Purchasing Agent will issue Purchase Orders, which are not valid until the Purchasing Agent has signed the Purchase Order.

4. Change orders that put any Purchase Order over $50,000 will require subsequent ratification from the City Council.

E. OPEN PURCHASE ORDER
1. Open Purchase Orders will be used to obtain less expensive routine goods and services for repetitive, high volume, low dollar goods or services. The Finance Director and Purchasing Agent can issue Open Purchase Orders to vendors regularly used by the City that will allow pre-authorized personnel to pick up or order routine goods and services.
2. The Purchasing Agent will provide the vendor with a written list of individuals authorized to obtain goods and services through the open purchase order.
3. The Purchasing Agent will keep copies of all documentation associated with each open purchase order.
4. Issuance of the Open Purchase Order
a. At the beginning of each fiscal year each department head will submit a requisition for each open purchase order to be issued to a regularly used vendor.
b. All requisitions requesting Open Purchase Orders should be sent to the Purchasing Agent, who will review them for propriety, efficiency and issuance.
c. Cancellation or modification to an open purchase order will be done by a "change order". Change orders are necessary to change authorized personnel on an open purchase order. The Purchasing Agent will notify affected vendors of any change orders.
5. The following information shall be listed in requisitions forms:
a. The period of time for which the open purchase order will be valid. Normally that period of time will be for the fiscal year. Shorter periods of time may be listed for seasonal programs.
b. The goods or services that may be obtained by authorized personnel, and goods and services that cannot be obtained through Open Purchase Orders.
c A list of personnel who are authorized to use the Open Purchase Order.
d. The department and account numbers that will be automatically charged. Personnel using the open purchase order need to specify which account will be charged on the specific invoice.
6. Using Open Purchase Orders
a. Authorized personnel will identify themselves to the vendor by means of their employee identification card or drivers license before receiving the goods or services.
b. Authorized personnel will give the vendor the purchase order number and department account to be charged for the order.
c. Authorized personnel will sign a bill of sale or service order itemizing the goods or services and obtain a copy from the vendor. The bill of sale or service order must show the Open Purchase Order number. These documents will be forwarded to their department head or authorized designee.
d. The department head or designee will sign the copy of the service order or bill of sale authorizing payment and forward it to Accounts Payable for payment processing.
e. All vendors will be required to send the original invoice to Accounts Payable to be matched up with the department copies for payment.
f. Any invoice having an unauthorized signature must be approved by the department head and the Finance Department prior to payment. Vendors who allow unauthorized use of an Open Purchase Order may not receive payment, and the open purchase order may be canceled.
F. BLANKET PURCHASE ORDERS
1. Blanket purchase orders can be utilized for items that are used by the City for on-going operations. Vendors agree to honor a price for a given product for a given period of time. The City may not know specifically how much of the product will be consumed or when it will be consumed.
2. Releases on Blanket purchase orders will be performed by the Purchasing Agent or authorized designee.
G. OTHER PURCHASING METHODS
1. CREDIT CARDS
The City Manager will be issued a credit card with a $10,000 limit to be used for City business expenditures only. Department Heads (with City Manager approval), and employees (with Department Head approval) will be issued a credit card with a limit designated by the Department Head, not to exceed $5,000, to be used for City business expenditures only. It is the responsibility of every individual issued a credit card to reconcile and attach backup documentation, with the appropriate coding, to be forwarded to the department Approving Official and who will then forward the documents to Accounts Payable. The credit card can be used for items such as: Travel expenses; hotel reservations; business meeting meals; training; and ordering goods from vendors approved by the Department Head.
a. For more information on the CAL-Card Program please refer to the CAL-Card Handbook, which will be issued along with your card after appropriate training.
2. PETTY CASH
a. A petty cash account will be issued to each department and the Department head will authorize in writing a specific individual to be the custodian of their petty cash account.
b. Petty cash will only be used when other sources of procurement are not available.
c. Each reimbursement must be documented with a receipt or verifiable proof of the expenditure and have written department head or designee approval.
d. Petty cash reimbursements to an employee will not exceed $100 for any single item.
e. Reimbursements to employees greater than $100 will be by check processed through the normal accounts payable process on an expense report.
f. Each petty cash custodian must reconcile his or her petty cash account as needed. Finance will audit within a six-week period.
g. A maximum travel or training reimbursement of $20 may be paid from petty cash if the only cost associated with the training or travel is parking or bridge toll.
3. EXCEPTIONS
Generally, the following items do not require the use of purchase orders and are not subject to the Purchasing Policy: refunds, memberships, dues, subscriptions, employee reimbursements, travel reimbursements, and pre-payments such as PG&E contract work.

Bond and Trust Account Payments
Deposit Accounts
Pass-Throughs
Utility Payments
Postage
Benefits
Insurance
Annual Maintenance Agreements
Permits
Escrow Payments

4. SOLE SOURCE/NON-COMPETITIVE NEGOTIATIONS

It is the City's policy to encourage competition in procurements. Non-competitive negotiations may be used for purchases of unique goods or services that are available from only one source. The requisitioning department is responsible for supplying the Purchasing Agent with a concise written justification for the sole source purchase.
 Purchases up to $50,000 require approval by the City Manager or designee.
 Purchases more than $50,000 require City Council approval.
5. EMERGENCY PURCHASES
a. In an emergency, essential purchases may be made and services obtained without following the City's usual procurement procedures. An emergency is a sudden, unexpected occurrence that poses a clear and imminent danger and requires immediate action to prevent or mitigate the loss or impairment of life, health, property, or essential public services, as declared by the City Manager.
b. If the emergency arises DURING normal business hours:
The Purchasing Agent shall confirm the declaration of the emergency with the City Manager.

 The Purchasing Agent shall either issue a Purchase Order and purchase the required goods or authorize the department to do so, or commandeer goods and services in consultation with the City Attorney.

c. If the emergency occurs AFTER normal business hours:
 City employees shall obtain authorization from the highest City official available before making purchases.

 Any City employee who makes an emergency purchase after normal business hours shall submit receipts to their department head the following workday.

d. This is the language from the public contracts code.
In order for the City to contract for construction services in an emergency situation without following the City’s usual procedures, the City Council must pass a resolution by a four-fifths vote declaring that the public interest and necessity demand the immediate expenditure of public money to safeguard life, health or property.

If no notice for bids will be given, the City Council must make a finding, based on substantial evidence set forth in the meeting minutes, that the emergency will not permit a delay resulting from a competitive solicitation for bids, and that the action is necessary to respond to the emergency. The City Council shall review the emergency action at the next scheduled meeting and at every meeting thereafter until the emergency action is terminated, determine, by a four fifths vote, that there is a need to continue the emergency action. The emergency action shall be terminated at the earliest possible date that conditions warrant so that the remainder of the emergency action can be completed by giving notice for bids to let contracts.

e. For every emergency purchase made, the department head shall, no later than five days (5) thereafter, submit to the Purchasing Agent a memo listing all expenditures and supported by delivery receipts and a written explanation of the circumstances of the emergency that justify the use of emergency procedures.

f. The Purchasing Agent shall submit monthly to the City Council a list of all emergency purchases of more than fifty thousand dollars ($50,000), made during the preceding month, with an explanation of the circumstances of each. The department head will be responsible for responding to the Council's questions about the emergency purchase.

6. COOPERATIVE PURCHASING AGREEMENTS

a. The Purchasing Agent may purchase equipment, goods or services through cooperative purchasing agreements of other governmental or public agencies. Purchases through cooperative agreements may be accomplished without soliciting competitive bids. These agreements will be used only when in the City’s best interest.

 Purchases up to $50,000 require approval by the City Manager.
 Purchases more than $50,000 require City Council approval.

b. When the Purchasing Agent receives a requisition for equipment, goods or services that are covered by a cooperative purchasing agreement, the Purchasing Agent will inform the requesting department of the option of using the agreement to get the best available prices. Unless the requesting department informs the Purchasing Agent within two working days that the equipment, goods or services covered under the cooperative purchasing agreement are unacceptable, the Purchasing Agent will place the order under the cooperative purchasing agreement that the Purchasing Agent determines offers the best value.

c. The Purchasing Agent will distribute to all departments a list of the cooperative purchasing agreements to which the City is a party, identifying the available equipment, goods and services.

H. PROFESSIONAL SERVICES
1. Professional services do not require competitive bids. Requisitions for professional services should have service contracts or proposal letters attached. Professional services totaling more than $5,000 need City Manager or designee approval.

2. Pursuant to Government Code Sections 4526 and 4529.5, selection of professional services to be rendered by architects, landscape architects, engineers, environmental engineers, land surveyors or construction managers shall be made based on demonstrated competence and the qualifications necessary for the satisfactory performance of the services required, and fair and reasonable prices for the services.

For example, the selection of construction project management services shall be primarily based on experience in construction project design review, construction mobilization and supervision, bid evaluation, project scheduling, cost-benefit analysis, claims review and negotiation and general construction management.

3. All departments will use a standard agreement acceptable to the City Attorney for the use of any professional service.

I. SERVICE AGREEMENTS

The Purchasing Agent will keep all product warranties and service agreements. Working copies of such warranties and agreements will be forwarded to each respective department.
J. MISCELLANEOUS PROCEDURES
1. Staff will prepare a City Council action item before the beginning of each fiscal year that will authorize the use of vendors for recurring services for the upcoming fiscal year. The action item will list the vendor and the estimated cost of goods or services for the fiscal year.
2. A contract or purchase order that has been previously approved by the City Council for specific services does not need to be resubmitted to the City Council unless a vendor is requesting a rate increase. Long-term contracts approved by the City Council for a specific time frame do not need to be resubmitted, but will be re-bid at least once every three years.
K. PUBLIC PROJECTS
Public Projects of $25,000 or more - Public projects are regulated by State Law and Ordinance 661 adopted by the City Council on April 10, 2001.

L. MONITORING RECEIPT OF GOODS OR SERVICES

Upon receipt of the goods or services, the requesting department shall inspect the items to determine:

 if the order is in acceptable condition
 if the order is complete
 if the specifications were met

1. If the items are in an acceptable condition or the service rendered is complete, the requesting department shall sign the packing slip or invoice and forward it to Accounts Payable, with the receiving copy of the Purchase Order.

2. If the items are not acceptable or incomplete, or if the packing slip does not match the Purchase Order, or the services were not provided as required, the requesting department shall notify the Purchasing Agent to contact the vendor, or complete a requisition for a change order to the Purchase Order to reflect the differences.

3. If items are back-ordered and are to be delivered at a later date, a copy of the receiving report should indicate that the order is partially received and a Purchase Order manifest filled out and attached. The department should keep the original green receiving report until the order is complete. If the balance of the order is not received within thirty days, the requesting department can initiate a request to cancel the balance of the order.

M. INVOICE PAYMENT PROCEDURES

1. The City desires to pay its bills in a prompt manner to take advantage of discounts and to avoid late charges and penalties. All invoices should be addressed to 150 City Park Way, Brentwood, CA 94513-1364. Invoice payment is contingent upon receiving a proper invoice, including applicable sales tax, and delivery of the goods or services. All departments must cooperate by returning receiving forms, Purchase Order manifests, invoices, packing slips, and check requests to the Finance Department promptly. These documents must reach the Finance Department within three working days after the department receives and verifies the receipt of the goods or services.

2. The Finance Department issues checks on Friday of each week. In order for a check request, invoice or any other payment document to be issued on these processing dates, the Finance Department must receive proper documentation, including all authorization signatures, no later than Friday at Noon of the previous week.

3. The Finance Department will prepare a disbursement report weekly, to be reviewed and approved by the Finance Director and City Manager before checks can be released.

Manual checks will be issued only in emergency situations, with prior approval from the Finance Director. Departments must plan ahead for funds, especially travel, conference registration and per diem requests.

VII. LOCAL PREFERENCE

When two or more proposals or Requests for Quotation are the same, in unit, quality, service and total cost, the Purchasing Agent shall give preference to the vendor who operates within the planning area as defined in the City’s General Plan.

Preference shall be given to a local vendor if the quote for services or taxable goods is:
 less than $10,000 and is within 5% of the lowest quote
 more than $10,000 up to $500,000 and is within 3% of the lowest quote
 more than $500,000 up to $1,000,000 and within 2% of the lowest quote
 more than $1,000,000 and within 1% of the lowest quote

VIII. RECYCLED PRODUCTS AND RECYCLED MATERIALS

• All departments shall use recycled products whenever practical. Special emphasis shall be placed on the purchase of products manufactured with post-consumer recycled materials. Departments will also evaluate products on the recycled product list established by the Purchasing Agent.

• All departments may, at their option and with concurrence of the Purchasing Agency, require procurement of designated recycled products or recycled products above the levels required by this policy.

• The City shall require its contractors and consultants to use and specify recycled products in fulfilling contractual obligations whenever practical, as long as it meets the projects quality and durability requirements.

• The City shall promote the use of recycled products publicizing its procurement policy whenever practical.

• The Purchasing Agent shall coordinate the implementation of this policy. The Purchasing Agent will establish a list of recycled products that shall be purchased by all departments whenever practicable and will develop the mechanism for maintenance, additions and deletions to the list of recycled products available for procurement. Maintenance of the list will include addition of new products containing recycled material as they become available and make available to department specifications on the new product along with a list of suggested uses. The Purchasing Agent will also work with all departments to establish minimum recycled content standards for designated recycled products to maximize recycled-product availability, recycled content and competition. To the extent such information is known; City staff shall identify to the Purchasing Agent, products available with recycled content and vendors from whom such products are available. The Purchasing Agent will also be responsible for information and dissemination of that information to all departments and for annual policy review.

IX. UNAUTHORIZED PURCHASES

A. If any department purchases or contracts for any goods, materials, equipment or services without complying with the provision of this policy, such purchase or contract shall be void and of no effect, unless thereafter approved by the person or entity required by this policy to approve such purchase or contracts. However, the City Council shall be under no obligation to approve unauthorized purchases not made in accordance with these procedures.

B. An employee who makes an unauthorized purchase shall be subject to discipline as provided in the Brentwood Municipal Code, Chapter 2.24 Personnel System, including any one or more of the following disciplinary actions:
 Verbal or written warnings
 Verbal reprimand
 Written reprimand
 Suspension (with or) without pay
 Reduction is salary within range
 Demotion
 Dismissal

C. The head of the department approving an unauthorized purchase shall be held accountable for identifying and correcting non-conforming purchases made by department employees. Repeated instances of non-conforming purchases within a department may lead to disciplinary action against the department head.

D. No department shall divide orders for goods, services or equipment in order to evade the dollar limits of this policy.

E. No goods or services for personal use may be purchased on City accounts or with City funds, unless authorized by a Council policy.

X. SURPLUS PROPERTY

A. All departments shall submit an annual report to the Purchasing Agent, showing all goods and equipment that are no longer used or that have become obsolete or worn out. The Purchasing Agent will make useable goods and equipment available to other departments through the requisition process.

B. The Purchasing Agent, with approval from the Finance Director, shall have authority to sell all goods and equipment which cannot be used by any department or which have become unsuitable for city use, or to exchange the same for, or trade in the same on new goods or equipment.

C. Under no circumstances will any department head or any City employee sell, give away, exchange, rent, loan or borrow City owned property without prior written authorization from the Finance Director through the Purchasing Agent. This prohibition applies to any fixed asset that may have a value when sold for scrap (e.g. water meters). This property shall be stored for future use by other departments or disposed of by the Purchasing Agent.

XI. FIXED ASSETS

For the purposes of inventory, fixed assets will be described as follows:

Assets that will be tracked:
 Land parcels
 Site Improvements
 Buildings / Structures
 Machinery and Equipment
 Licensed Vehicles
 Major Infrastructure
 Right of ways / Easements
 Capital Improvements

Excluded items will be:
 Assets of an intangible nature
 Records & Drawings, consumable supplies and spare parts, inventory items
 Leased property & personal property of employees
 Maintenance and repair of capital assets

• Equipment includes moveable property which is relatively permanent and of significant value such as generators, pumps, machines, tools, vehicles and portable or removable devices. Items with a value of $2,500 or under will not be included.

• Relatively permanent is defined as a useful life of ten years or longer.

• Significant value is defined as $10,000 and over for items described by this section.

• However, this may include borderline items that do not meet both criteria of $10,000 or more and a useful service life of ten years or more.

Inventory tags are used primarily to identify items that fall within the definition of fixed assets, to provide departments with a reference when conducting their annual inventories and to provide a means of listing, cataloging and controlling assets of the City. Although it may not be feasible to tag each category of fixed assets, it should be assigned an inventory number.

When adding, disposing, or trading-in fixed assets, an Asset Information Form must be completed and submitted to Purchasing along with purchase requisition. This will provide the fixed asset monitor with adequate information. All disposals (trade-in, donation or disposal of irreparable assets) must be approved by Purchasing and the Finance Director.

The following procedures must be completed when requesting pick-up or delivery of surplus equipment:

1. Complete City Asset Information form.

2. Submit to the Purchasing Agent for approval.

Each department will be responsible for arranging the pick up or requested surplus equipment.


DEFINITIONS

Approving Official (AO) – Manager, Supervisor or designated person of a CAL-Card Procurement cardholder. Receives reconciled statements from cardholders.

Bidders Security - When deemed necessary by the City Manager, City Council and/or Purchasing Agent, the public notices inviting bids may require bidders to furnish cash, a bond or other security. The successful bidder shall forfeit its bid security if it refuses or fails to execute the contract within ten days after the notice of award of the contract has been mailed. If the City Council awards the contract to the next bidder, the first bidders security shall be applied by the City to defray the cost difference between the first bid and the second bid. The defaulting bidders shall also be held liable for any costs in excess of its bid bond which the City incurs in purchasing the goods or services elsewhere. Bid security submitted by unsuccessful bidders will be returned when the City has an executed contract with one of the bidders, or if the City rejects all bids.

Bidders List - An updated list of suppliers by goods or service.

Blanket Purchase Order - A purchase order number that the City has assigned to a designated vendor for specific goods and/or services at specified prices.

Bulletin Board - A location established in the lobby of the City Hall to post a notice of pending purchases and services.

CAL-Card Procurement Card – A procurement card using the Visa Network. Contracted by the State of California with U.S. Bank. Available to all public entities within the state.

Cooperative Purchasing - Two or more public entities combining their purchase requirements to obtain lower prices through volume buying and to reduce administrative costs.
Local Vendor - A firm or individual who regularly maintains a place of business and transacts business in, or maintains an inventory of merchandise for sale in, or is licensed by, or pays business taxes to, the City; or businesses within the City of Brentwood’s planning area as defined in the City’s General Plan.
Post-Consumer Recycled Materials - A finished material or product that has served its intended use and would not normally be disposed of as solid waste. Examples of post-consumer recovered materials include, but are not limited to old newspaper, office paper, yard waste, steel, glass, aluminum cans, plastic bottles, oil, asphalt, concrete and tires.
Practicable - Sufficient in performance and available at a reasonable price within a reasonable time period.
Pre-Consumer - Materials or by-products generated after manufacturing of a product is completed, but before the product reaches the end-use consumer. Examples of pre-consumer recovered materials include, but are not limited to; obsolete inventories of finished goods, rejected unused stock and paper wastes generated during printing, cutting and other converting operations.
Professional Services - Services of architects, attorneys, consultants, engineers or physicians, or other individuals or organizations possessing a high degree of professional or technical skill.

Purchase Order - A form used by the Purchasing Department to obtain goods and services from vendors. The purchase order spells out the specific items to be delivered, price, quantity, and delivery requirements, as well as terms and conditions.

Purchase Order Amendment - A form used by the Purchasing Department to alter, adjust, revise, terminate, or cancel a purchase order.

Purchase Order Manifest – A form to be filled out by the requisitioner and attached to a Purchase Order that will have more than one (1) invoice submitted for payment. The manifest records information such as council actions, purchase order dollar amount, change orders and invoices.

Recycled Material - Waste material and by-products that have been recovered or diverted from the solid waste stream and that can be utilized in place of raw or virgin material in the production of a product. Recycled materials may consist of material derived from post-consumer waste, manufacturing waste, industrial scrap, agricultural waste and other items, all of which can be used in the manufacture of new products.

Requisition - A form requesting departments submit to the Purchasing Department to initiate procurement of needed goods or services.

City Administration
City of Brentwood City Council
150 City Park Way
Brentwood, CA 94513
(925) 516-5440
Fax (925) 516-5441
E-mail allcouncil@brentwoodca.gov