Item 31 - Purchasing Policies and Procedures

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Purchasing Policies and Procedures May 16, 2023 Page 2 3 4 2 9 iii) Amend Section 33-203 of Chapter 33, Article VIII concerning the Public Works Construction Rules and Regulations: (1) Housekeeping language administrative in nature. EXECUTIVE SUMMARY The City of Santa Ana’s Public Works Agency is responsible for building and maintaining Santa Ana’s infrastructure to maintain the quality of life of its residents and businesses. This includes building, maintaining, and administering projects related to public streets, traffic management, storm drains, sewers, water, trash collection, recycling, street sweeping, public right-of-way landscaping, park maintenance, graffiti removal, fleet maintenance, building maintenance, and facility improvements. Since the beginning of FY 2022-23, the City of Santa Ana has drafted and solicited over 105 Invitations for Bids (IFB) and Requests for Proposals (RFP); of which, approximately 76 percent were related to a Public Works Agency project. The Public Works Agency, together with the Finance and Management Services Agency, finds that revisions to both the City Manager’s contract authority and purchasing requirements regarding its informal and formal bidding process are recommended to modernize the City’s procurement process, increase the pool of companies who bid on City projects, increase efficiency, expedite project delivery, and closely align the City’s purchasing requirements with newly enacted federal and state guidelines while maintaining local vendor preferences. If approved, the City Manager will have authority to enter into public works contracts up to $750,000 and bidding requirements will increase (formal bid process) to $50,000 for both public works and non-public works contracts. DISCUSSION Background The City’s Municipal Code includes authority for the City Manager to bind contracts, purchasing thresholds for informal bids and formal bids, and local preference allowances. The City Council last updated the City Manger’s contracting authority in March 2019, increasing it from $25,000 to $250,000 for public works contracts, and $25,000 to $50,000 for non-public works contracts. The City Council last updated the purchasing thresholds (i.e. informal and formal bidding requirements) in 2012. Formal and Informal Bid Threshold The City has an existing formal process to advertise for and collect bids and proposals for purchases of goods and services over $25,000, and an informal bid requirement for purchases over $5,000. Informal bids require staff to document at least three informal quotes gathered via phone or email for purchases between $5,000 and $25,000, unless unique