R-2022-067 Amending Purchasing Policy; Rescinding R-2021-100 and R-2002-064 2022-07-19RESOLUTION NO. R-2022-067
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH,
CALIFORNIA UPDATING THE CITY OF PISMO BEACH PURCHASING POLICY AND
PROCEDURES MANUAL TO REFLECT ASSEMBLY BILL 1234 REGARDING
COUNCIL EXPENSE REIMBURSEMENT; RESCINDING RESOLUTIONS R-2021-100
AND R-2002-064
WHEREAS, the City has Purchasing Policy and Procedures Manual (Policy) that contains
policies and procedures that should be followed by City employees, Council Members,
and Advisory Board Members required to perform purchasing activities in the course of
their duties; and
WHEREAS, expense reimbursement practices for public officials are primarily regulated
by Government Code Sections 36514.5 and 53232 et seq. (provisions enacted in 2005
by Assembly Bill (AB) 1234, a bill that is widely known for also establishing an ethics
training requirement for City Council Members and other officials); and
WHEREAS, these laws stipulate that Council Members and Advisory Body Members may
only receive expense reimbursement for "actual and necessary" expenses incurred in the
course of their duties, as documented by expense report forms and accompanying
receipts, which precludes such payments being made on a proactive or estimated basis;
and
WHEREAS, City staff recommends updating the Policy to formally memorialize the
existing reimbursable expenses for Council Members in compliance with AB 1234, to
formally rescind Resolution R-2002-064 that allowed proactive payments because it is in
conflict with the aforementioned state laws, and to rescind in Resolution R-2021-100,
which approved the most recent updates to the Policy; and
WHEREAS, at the June 21, 2022 Council meeting, there was consensus among the
majority of the Council to return an agenda item relating to the implementation of an auto
allowance policy, which if approved by the City Council as part of a separate agenda item
will be reflected in this update to the Purchasing Policy.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pismo Beach
hereby adopts the Pismo Beach Purchasing Policy And Procedures Manual revised as of
July 19, 2022 to reflect Assembly Bill 1234 regarding Council expense reimbursement
and attached as Exhibit A.
BE IT FURTHER RESOLVED that Resolutions R-2021-100 and R-2002-064 are hereby
rescinded.
PAGE 1 OF 56
R-2022-067
UPON MOTION OF Council Member Guthrie, seconded by Council Member Newton, the
foregoing resolution was adopted by the City Council of the City of Pismo Beach this 19th
day of July 2022, by the following vote:
AYES: 4 Guthrie, Newton, Reiss, Waage
NOES: 1 Blake
ABSENT: 0
ABSTAIN: 0
RECUSED: 0
Approved:
LOCt'7_
Ed Wa ge, Mayor
Attes
rica Inderli6d, Cjfy Clerk
PAGE 2 OF 56
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CITY OF PISMO BEACH
PURCHASING
POLICY & PROCEDURES
MANUAL
PURCHASING POLICY AND PROCEDURES
Preface
This manual contains policies and procedures that should be followed by City employees required
to perform purchasing activities in the course of their duties.
The contents are applicable to all City departments and to all component units governed by the
Pismo Beach City Council.
This manual has been prepared to assist City of Pismo Beach staff in the purchase of goods and
services. The establishment of a formal purchasing system is an integral part of a good financial
management system. Every employee making purchases on behalf of the City, should be familiar
with these guidelines. It is recommended that the Purchasing Policy be required reading for
managers and supervisors. This policy should be used as a guide for the development of internal
policies and procedures within the department. In addition, all employees required to conduct City
purchases must be familiar with this policy. This manual should be made readily available to
employees as a reference in carrying out day-to-day purchasing activities and in training new
employees.
Occasionally, unique operating requirements exist in a Department that may require deviating from
the procedures. Deviations from the policy must receive prior approval in writing from the
Administrative Services Director, or his/her designee.
Acknowledgements
The City wishes to recognize and thank the City of West Hollywood, the City of San Luis Obispo,
the City of Atascadero, the City of Arroyo Grande, and the California Society of Municipal Finance
Officers, for allowing the City of Pismo Beach to utilize information from their respective
Purchasing Policies and programs to develop this manual.
Originally prepared on: June 23, 2004
Revised on: December 18, 2012
Revised on: March 5, 2019
Revised on: June 6, 2019
Revised on: September 3, 2020
Revised on: February 21, 2020
Revised on: December 21, 2021
Revised on: July 19, 2022
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3:otts, PURCHASING POLICY AND PROCEDURES
Table of Contents
SECTION I: GENERAL INFORMATION 4
A. GLOSSARY 4
B. INTRODUCTION TO THE PURCHASING SYSTEM 8
1. Authority for Establishing Policies and Procedures 8
2. Overview of the Purchasing Process 8
3. Purchasing Policies 9
4. Local Business Preferences Policy 10
5. Federal, State and Other Grant Programs 12
6. Signature Authorization 13
7. Department Responsibilities 13
8. Payment authorization 14
9. Environmentally Preferable Purchasing Policy 14
SECTION II: GENERAL PURCHASING GUIDELINES 16
A. THE PURCHASING MATRIX FOR GENERAL SUPPLIES, MATERIALS, AND EQUIPMENT,
GENERAL TRADE AND PROFESSIONAL SERVICES: 17
B. THE PURCHASING MATRIX FOR PUBLIC PROJECTS: 18
SECTION III: PURCHASING TRANSACTIONS 19
A. GENERAL SUPPLIES, MATERIALS, AND EQUIPMENT 19
B. PROPRIETARY GOODS AND EQUIPMENT 24
C. GENERAL TRADE CONTRACT SERVICES 28
D. PROFESSIONAL SERVICES 35
E. PUBLIC PROJECTS 45
F. CAPITAL EXPENDITURES 52
SECTION IV: EXCEPTIONS TO COMPETITIVE PROCUREMENT PROCEDURES 54
A. SOLE SOURCE PROCUREMENT 54
B. COOPERATIVE AGREEMENTS 54
C. PIGGYBACK PURCHASES 54
D. STANDARDIZATION 55
E. AWARD AND RECORD OF SOLE SOURCE, COOPERATIVE, PIGGYBACK, AND
STANDARDIZATION PROCUREMENTS 55
F. EMERGENCY PROCUREMENTS 56
G. ROUTINE EXPENDITURES FOR UTILITIES, PAYROLL & OTHER SERVICES 56
H. FEDERALLY FUNDED PROCUREMENT POLICY 57
I. ADMINISTRATIVE EXCEPTIONS POLICY FOR PURCHASING 66
SECTION V: PURCHASE ORDERS 67
A. REQUIREMENTS- WHEN TO USE 67
B. REQUESTING A PURCHASE ORDER 67
C. SPECIAL PURCHASE ORDERS 68
D. YEAR END PROCESS FOR ENCUMBRANCES/PURCHASE ORDERS 69
SECTION VI: PAYMENT OF INVOICES 70
A. RECEIPT OF GOODS AND SEVICES 70
(4;
%%IPURCHASING POLICY AND PROCEDURES
B. INVOICE PROCESS 70
SECTION VII: CITY CREDIT CARD CHARGES 73
A. OVERVIEW 73
B. POLICIES 73
SECTION VIII: PETTY CASH REIMBURSEMENT 79
SECTION IX: BUDGET REVISIONS/TRANSFERS 81
A. WHEN TO USE 81
B. PROCESSING A REQUEST FOR BUDGET TRANSFER/REVISION 81
C. SPECIAL SITUATIONS 82
SECTION X: TRAVEL & MEAL POLICY 83
A. PURPOSE 83
B. OVERVIEW 83
C. GENERAL POLICY STATEMENT 83
D. GENERAL TRAVEL GUIDELINES 84
E. DEFINITIONS 85
F. PLANNING AN OFFICIAL TRIP 88
G. MEAL ALLOWANCES 92 L()
H. SUBMITTING TRAVEL FORMS 95 U_
SECTION XI: FRAUD PREVENTION AND REPORTING POLICY 99 Q
A. PURPOSE 99
B. APPLICABILITY 99 W
C. GENERAL POLICY AND RESPONSIBILITY 99 Q
D. PROCEDURES 100
SECTION XI: COUNCIL MEMBER REIMBURSEMENT POLICY 103 i2
A. PURPOSE 103
B. DEFINITIONS 103
C. COUNCIL MEMBER REIMBURSEMENT POLICY 103
D. SUBMITTING EXPENSE REIMBURSEMENT FORMS 104
Appendix A: LIST OF FORMS 106
1. Local Business Preference Option Form 106
2. Signature Authorization 106
3. IRS form W-9 106
4. Purchase Order Request — Laserfiche Forms 106
5. Petty Cash Voucher Form - SharePoint 106
6. Travel Forms 106
7. Credit Card Forms - SharePoint 106
8. Public Project Tracking Sheet 106
9. Request for Budget Transfer/Revision — Laserfiche Forms 106
10. Check Request Form - SharePoint 106
11. City of Pismo Beach Government Exempt form 106
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R-2022-067
eR PURCHASING POLICY AND PROCEDURES
SECTION I: GENERAL INFORMATION
The purpose of this section is to provide the reader with general information as it relates to
Purchasing for the City of Pismo Beach. All Forms related to this Purchasing Policy are located in
the following folder: S:\Purchasing Policy\Purchasing Forms
A. GLOSSARY
The following glossary has been prepared in order to provide guidance in the terminology
introduced in this document.
Asset Misappropriations — Theft or misuse of an organization's assets.
• Cash.
o Fraudulent Disbursements — Perpetrator causes organization to disburse funds through
some trick or device (e.g. submitting false invoices/time cards/sheets, expense
reimbursement schemes, check tampering, etc.)
o Skimming —Cash is stolen from an organization before it is recorded on the organization's
books and records.
o Cash Larceny — Cash is stolen from an organization after it has been recorded on the
organization's books and records.
• Inventory and all other assets.
o Misuse — Misuse of an organization's inventory or assets for personal use (e.g. City
vehicles, computers, supplies, etc.)
o Larceny— Inventory or other assets are stolen from an organization.
Business- a company or other organization that buys and sells goods, makes product, or provides
services. Types of business include corporation, partnership, individual, sole proprietorship, joint
venture, or any other private legal entity.
Change Order- A written order signed by the City Manager, or his/her designee, directing the
supplier or contractor to make changes or modifications to an existing order. The change order
may make written alteration to the specifications, delivery point, rate of delivery, period of
performance, price, quantity, or other provision of the contract.
Contract- Any authorized written City agreement, regardless of what it is called (purchase order,
contract, etc.), for the procurement of supplies, equipment, services, or construction.
PURCHASING POLICY AND PROCEDURES
Contractor- Any person and/or business having a contract with the City of Pismo Beach.
Construction- The process of building, altering, improving or demolishing any public structure or
building, or other public improvements of any kind to any public real property. It does not include
the operation, or preventative maintenance of existing structures, buildings, or real property.
Corruption — Wrongfully use influence in a business transaction in order to procure some
benefit for themselves or another person, contrary to duty to employer or the rights of another.
• Conflicts of Interest — An undisclosed economic or personal interest in a transaction that
adversely affects the employer.
• Bribery — The offering, giving, receiving, or soliciting of anything of value to influence an
official act or a business decision.
• Illegal Gratuities — A party who benefits from an official act or a business decision gives a gift
to a person who made the decision. An illegal gratuity does not require proof of intent to
influence.
• Economic Extortion — An employee demands that a vendor/contractor/etc. pay to influence
an official act or a business decision.
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Cost Reimbursement Contract- A contract under which a contractor is reimbursed for costs d
which are allowable and allocable in accordance with the contract terms and the provisions of
this manual.
Emergency Purchase- The purchase of goods or services is needed for a situation where the
health, safety, or welfare of the public is endangered if immediate corrective or preventative
action is not taken.
Employee- For the purposes if these purchasing policy and procedures, an individual drawing a
salary or wages from the City, whether elected or not; any non -compensated individual
performing personal services for the City or any department, agency, commission, council, board,
or any other entity established by the executive or legislative branch of the City; and any non -
compensated individual serving as an elected official of the City.
Encumbrance- An encumbrance is an outstanding purchase order for goods or services; a portion
of the budget appropriation is reserved in the amount of the purchase order. Encumbrances help
to ensure administrative and budgetary compliance.
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PURCHASING POLICY AND PROCEDURES
Facility- Any plant, building, structure, ground facility, real property, street, highway, or other
public work environment; and any utility system owned by the City, subject to the limitation on
utility systems stated in the "Public Project" definition.
Force Account- Work performed on public projects using internal resources, including but not
limited to labor, equipment, materials, supplies, and subcontracts of the City.
Fraud —An intentional misrepresentation, deceit, or concealment of a material fact known to the
person accused of the fraud, with the intention on the part of that person of thereby depriving
another person or the City of property, legal rights or otherwise causing injury.
Fraudulent Statements — Falsification of an organization's financial statements
Goods- articles for sale or use, often those produced for later consumption.
Immediate Family -Spouse, children, parents, brothers, and sisters.
Local Vendor- Any business, including a Corporation, partnership, individual, sole proprietorship,
joint venture, or any other private legal entity, which maintains a physical working office within
the City limits of the City of Pismo Beach.
Local Vendor Preference- refers to the sales tax portion of a quote/bid from a local vendor. The
sales tax amount should be deducted from the local vendor's total quote/bid amount as those
funds are returned to the community through sales tax revenues.
Maintenance Work- Routine, recurring, and usual work for the preservation or protection of any
publicly owned or publicly operated facility for its intended purposes; minor repainting;
resurfacing of streets and highways at less than one inch; landscape maintenance, including
mowing, watering, trimming, pruning, planting, replacement of plants, and servicing of irrigation
and sprinkler systems; and work performed to keep, operate, and maintain publicly owned water,
power, or waste disposal systems, including, but not limited to, dams, reservoirs, power plants,
and electrical transmission lines of 230,000 volts and higher.
Notice Inviting Bids- All documents, whether attached or incorporated by reference utilized for
soliciting sealed bids. Invitations for Bids (IFB) are awarded to the lowest responsible and
responsive bidder.
Occupational Fraud - Use of one's occupation for personal enrichment through the deliberate
misuse or misapplication of the employing organization's resources or assets. There are three
major categories of occupational fraud.
PURCHASING POLICY AND PROCEDURES
Other similar irregularities - Any activity involving questionable behavior or business dealings by
members of the public, contractors, vendors, agents or City employees, that put City revenue,
property, information and other assets at risk of waste or abuse.
Person- Any business, individual, corporation, union, committee, club, other organization, or group
of individuals.
Petty Cash Expenditures- are for minor, unscheduled and immediate purchases in which cash is the
preferred method of payment. Items such as postage charges and freight charges represent petty
cash expenditures.
Price Analysis- The evaluation of price data, without analysis of the separate cost components
and profit as in cost analysis, which may assist in arriving at prices to be paid and costs to be
reimbursed.
Procurement- The buying, purchasing, renting, leasing, trading or otherwise acquiring of any CO
supplies, equipment, services, or construction. It also includes all functions that pertain to the Lf)
obtaining of any supplies, equipment, services, or construction, including descriptions of LL
requirements, selection and solicitation of sources, preparation, and award of contracts, and all Q
phases of contract administration. CO
Public Project -The construction, reconstruction, erection, alteration, restoration, improvement,
demolition, and repair work involving any facility owned, leased, or operated by the City. The Q
definition also includes painting or repainting any facility owned, leased or operated by the City. d
Construction, erection, improvement, or repair of dams, reservoirs, and electrical transmission
lines of 230,000 volts and higher that are owned by the City, are considered a public project.
Public project does not include maintenance work.
Purchase- The buying or obtaining of any goods and/or services. It also includes all functions that
pertain to obtaining the goods and services.
Purchasing Officer or Agent- The Purchasing Officer shall be the head of and be responsible for
the administration and internal control of the City purchasing policies and procedures. The
Purchasing Officer shall be the City Manager or his Agent. The Agent can be an authorized
employee or designated department.
Request For Proposals (RFP)- All documents, whether attached or incorporated by reference,
utilized for soliciting proposals.
Responsible Bidder- means a bidder who has the capacity n all respects to perform fully the
requirements of the City, and the reliability which will assure good faith performance.
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PURCHASING POLICY AND PROCEDURES
Responsible Buyer- means any City employee authorized to order goods or services in
accordance with the policies and procedures stipulated in this manual. The employee can be the
Department Head or anyone he/she designates as a responsible buyer.
Services- The furnishing of labor, time, or effort by a contractor, not involving delivery of a
specific product other than reports which are merely incidental to the required performance.
"Services" shall include professional services such as Architects, Lawyers, Certified Public
Accountants, Engineers, etc. "Services" shall not include employment agreements or collective
bargaining agreements.
Specification- Any description or scope of work of the physical or functional characteristics or of
the nature of supplies, equipment, service, or construction. It may include a description of any
requirement for inspection, testing or delivery of supplies, equipment, services, or construction.
Supplies- All property, including but not limited to equipment, materials, printing, insurance, and
leases of real property, excluding land or a permanent interest in land.
Terms and Conditions- Any description of the physical or functional characteristics of goods or
services being purchased. It includes any description of requirement for inspecting, testing, or
preparing goods or services for delivery. Also included are any descriptions pertaining to the
completion of the purchase or contract such as delivery date, cash discounts, etc.
B. INTRODUCTION TO THE PURCHASING SYSTEM
1. Authority for Establishing Policies and Procedures
The Pismo Beach Municipal Code Chapter 3.08 sets forth in both general and specific
terms the policies and procedures of the City regarding purchasing. Those policies and
procedures are incorporated into this manual by reference and provide the authority and
basis on which it has been prepared.
2. Overview of the Purchasing Process
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The basic purchasing policy of the City of Pismo Beach is to obtain quality supplies,
services, vehicles and equipment needed for the proper operation of its various divisions
PURCHASING POLICY AND PROCEDURES
at the lowest possible overall cost. This includes maintaining a purchasing system that
ensures maximum use of the fair and open competition and receipt of the best value for
funds available, consistent with applicable laws and regulations.
The purchasing functions are decentralized, with each department/division responsible
for compliance with City policies and procedures. Purchasing responsibility and authority
shall be delegated to the lowest possible level consistent with good business practice and
sound financial management policy to the extent practical.
3. Purchasing Policies
The following policies apply to all purchases made by the City of Pismo Beach:
a. Purchases shall be consistent with either the adopted annual budget or City Council
approval of additional appropriations. It is the responsibility of the
department/division to maintain budget control of their individual budgets. Ultimate
responsibility for the individual budget rests with the Department Director.
b. All purchases shall be of the quality deemed necessary to suit the intended purpose,
suitable, and beneficial to the City, and in the City's best interest.
c. Competitive quotations will be sought based on established dollar limits.
d. The dollar limits for purchases and bids shall be established by ordinance or
resolution. Purchases shall not be split to avoid the required procedures or certain
dollar limits.
e. Receipt of goods or services will be verified and approved by the purchaser of the
supply or service prior to payment of invoices.
f. The emergency purchase of goods is authorized under certain conditions.
g•
Purchase of supplies, services, or equipment over $2,500 shall be made with an
authorized Purchase Order unless otherwise exempted in these guidelines. If a
purchase is made outside of this guideline:
• Such purchases are void and not considered an obligation of the City of Pismo
Beach.
• Invoices without an authorized purchase order may be returned to the vendor
unpaid.
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• All such transactions shall be brought to the immediate attention of the City
Manager.
h. Employees shall not have a direct or indirect financial interest in any contract or
purchase of goods and services entered into by the City, or shall derive any personal
benefit from the City's purchase of goods or services.
i. Employees shall not use the City's purchasing procedures to obtain property for
personal use.
Employees are prohibited from drafting any specifications for bids in such a way as to
intentionally limit the bidding directly or indirectly to any one bidder.
4. Local Business Preferences Policy
The City's Purchasing System defined in Chapter 3.08 of the City's Municipal Code was
"...adopted in order to establish efficient procedures for the purchase of supplies and
equipment, to secure supplies and equipment at the lowest possible cost commensurate
with quality needed .. "
Set forth below is a Local Business Preference Policy which is designed to offset
competitive disadvantages suffered by Pismo Beach Vendors, including but not limited to
high rents relative to Non -Local Vendors, and which is found and declared to be to be
compatible and consistent with the City's Purchasing System (Municipal Code Chapter
3.08).
a. General Guideline: Consistent with the City's Purchasing System, the City will strive
to purchase supplies, equipment and related services at the lowest possible cost
commensurate with quality needed.
In determining the lowest possible cost commensurate with quality needed, the City
shall include in its comparison(s) of purchase options all those costs and expenses
which the City deems appropriate, which may include comparable delivery or
transportation costs to a specified City site or location, adjustments for economic
values of quality differentials, and up to five years of comparable expected costs or
use and maintenance.
i. The bid, quote or proposal (hereinafter, all included in the term "Bid") which the
City determines best meets the above stated General Guideline will be
considered the Low Bid.
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PURCHASING POLICY AND PROCEDURES
ii. The business, contractor or vendor (hereinafter, all included in the term
"Business" or "Vendor") which submits the Low Bid will be considered the Low
Bidder.
b. Classification of Businesses and Vendors: For purposes of this Local Business
Preference Policy, all Vendors will be classified as being part of one of two groups of
Vendors:
i. Pismo Beach Vendor or Local Vendor
ii. Non -Local Vendor
c. Definitions of Businesses and Vendors:
A qualified Pismo Beach Vendor shall be defined as any individual, partnership,
corporation or other entity which meets all vendor qualifications set by the City
for or pertinent to the subject purchase; which has maintained its primary
office, distribution point or place of business within the City for a minimum of
one year preceding the submission of its quote/bid; and which has shown by
the records maintained by the City's Administrative Services Department as
having secured all necessary business licenses and as having paid all applicable
fees and taxes imposed by the City. In addition, the business must report and
pay sales tax to the State of California, and must identify the point of sale for
taxable transactions as a location within the Pismo Beach city limits. This point
of sale identification provides for allocation of sales tax receipts to the City of
Pismo Beach, pursuant to California Revenue and Taxation Code Section 72.
ii. A qualified Non -Local Vendor shall be defined as any individual, partnership,
corporation or other entity which meets all vendor qualifications set by the City
for or pertinent to the subject purchase, but which does not qualify as a Pismo
Beach Vendor.
iii. The term Local Vendor shall include those businesses which qualify as a Pismo
Beach Vendor.
d. Operation of the Local Business Preference Process
In soliciting Bids, the City will provide to those businesses the City deems to be (or
possibly be) qualified Local Vendors, a Local Business Preference Option Form, which
gives the Local Vendor the choice to participate (or NOT participate) in the Local
Business Preference Process.
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e. The Local Business Preference Process shall consist of two Stages.
In Stage One, prior to considering any Local Business Preference, the City shall
complete a comparison of the qualified Bids received, to determine to the City's
satisfaction which Bid best meets the above stated General Guideline. This Bid
will be considered the Stage One Low Bid.
• If the Stage One Low Bid was submitted by a Pismo Beach Vendor, then the
Stage One Low Bid shall be considered the Low Bid. In such case, Stage Two
will be by-passed as not meaningful, and the City shall complete the purchase
accordingly.
• If there are no qualified Bids from Pismo Beach Vendors, then the Stage One
Low Bid shall be considered the Low Bid, and the City shall complete the
purchase accordingly.
• However, if there ARE qualified Bids from one or more Local Vendors (Pismo
Beach Vendors), but the Stage One Low Bid was submitted by a Non -Local
Vendor, then the Local Business Preference Process shall move to Stage Two.
ii. Stage Two involves implementation of the Optional 2% Local Discount Portion
of the Local Business Preference Process as follows:
• If the above described Stage One Low Bid was submitted by a Non -Local
Vendor, AND if one or more Pismo Beach Vendors submitted a qualified Bid,
including a signed Option to participate in the Optional 2% Local Discount
Portion, then the City will compute each Pismo Beach Vendor's Local
Preference Stage Two Bid by reducing by 2 % the dollar amount of that Pismo
Beach Vendor's qualified Bid considered in Stage One.
• If at least one Pismo Beach Vendor's Local Preference Stage Two Bid is less
than the previously computed Stage One Low Bid, the lowest Pismo Beach
Vendor's Local Preference Stage Two Bid shall be considered the Stage Two
Low Bid. In That case, the balance of Stage Two will be by-passed as not
meaningful, and the City shall complete the purchase of the above described
Stage Two Low Bid.
• If NO Pismo Beach Vendor's Stage Two Bid is less than the previously
computed Stage One Low Bid, then Stage Two is completed, and the City shall
complete the Purchase of the previously computed Stage One Low Bid.
5. Federal, State and Other Grant Programs
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PURCHASING POLICY AND PROCEDURES
Federal, State and other grant programs may require special conditions that are more
stringent than City procedures. The department accepting the grant is responsible to
ensure that all grant provisions are met and complied with.
For federally funded purchases, the City follows the Federally Funded Procurement Policy
(Pismo Beach Purchasing Policy & Procedures Manual Section IV.H.) to comply with the
Office of Management and Budget's (OMB) new guidance requirement Uniform
Administrative Requirements, Cost Principles, and Audit Requirements for Federal
Awards, Title 2 U.S. Code of Federal Regulations Part 200.
6. Signature Authorization
a. The Department Head shall complete and forward to Administrative Services a
Signature Authorization form, identifying those employees approved by the
Department Head to sign on various financial and other administrative documents.
The form shall be developed by the Administrative Services Director and revised from
time to time as needed.
b. The form shall identify the employee's name and signature and list the specific dollar
amounts each employee is authorized to sign. It is the Department Head's
responsibility to keep the information current.
c. Invoices, purchase order requests, contracts, change orders, and any other
documents submitted to the Finance Department missing the appropriate signatures
will be returned to the originating department.
d. Only Regular or Probationary City employees shall be authorized to sign documents
obligating the City to expend public monies. Temporary or Volunteer employees, or
individuals under contract with the City, may be able to acquire items but all receipts
must be countersigned by an authorized employee or Department Head.
e. The Department Head shall use appropriate discretion to keep the number of
authorized signatures to a minimum, to assure better control over departmental
expenditures.
7. Department Responsibilities
It is the responsibility of the acquiring department/division to:
a. Make purchases in accordance with established policies and procedures.
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b. Verify an appropriation is available for the purchase.
c. Anticipate the department/division needs in order to minimize the need for
emergency purchases.
d. Review goods and services received to ensure conformity with the purchase order or
contract.
e. When a cost discrepancy for goods or services dissatisfaction arises, notify the vendor
or supplier to resolve. If not resolved, contact the Administrative Services
Department to come up with a solution to resolve the issue so that a payment can be
arranged.
8. Payment authorization
a. An authorized signature on the invoice, receipt or other backup shall be considered
authorization for payment. The signature shall indicate that the signer has:
• Verified that the City has received the goods or services in good working
condition.
• Verified that the purchase complies with this purchasing policy and that funds
are available for the purchase.
b. In certain instances it may be in the City's best interest to issue payment prior to receipt
of the authorizing signature on the invoice. The City Manager or his/her designee may
authorize payment in those instances.
c. Checks shall be processed and issued by an employee other than check signer.
9. Environmentally Preferable Purchasing Policy
a. It is the policy of the City of Pismo Beach to reduce the environmental impact of its
purchases and comply with Senate Bill (SB) 1383 Lara, Chapter 395, that was signed into
law in September 2016 as a statewide effort to reduce emissions of short-lived climate
pollutants created by organic waste, dairy, and livestock. The emissions reduction targets
must reduce organic waste disposal 50% by 2020 and 75% by 2025. In order to reduce
methane emissions from organic waste disposal, beginning January 1, 2022, SB 1383
requires that City staff and the City's vendors purchase paper products that contain
recycled content at least 30%, by fiber weight, post -consumer fiber:
i. when available at no greater cost than nonrecycled products and
ii. the fitness and quality are equal to nonrecycled products.
14
PURCHASING POLICY AND PROCEDURES
More information is available
https://www.cal recycle.ca.gov/organ ics/sIcp/procurement/Recycled Pa per
at:
b. The Public Contract Code 12207 defines the paper products to include office supplies,
writing and printing papers, printed materials, and paper janitorial supplies.
C. City's vendors must certify postconsumer content and recyclability claims.
d. City staff must maintain records certifying the minimum recycled content and recyclability
of paper purchases either with the following two options:
i. Option 1: Product Vendor Certification:
Written documentation from the product vendor certifying:
• The products are eligible to be labeled with an unqualified recyclable label,
meaning that at least 60 percent of consumers or communities where the CD
items are sold have access to recycling facilities for the products
• The minimum percentage, if not the exact percentage, of postconsumer O
material in the products
O
ii. Option 2: Product Vendor Certification and Other Verification
• Written documentation from the product vendor certifying the products
are eligible to be labeled with an unqualified recyclable label, meaning that
at least 60 percent of consumers or communities where the items are sold
have access to recycling facilities for the products, AND
• Documentation, such as record of a product label, catalog, invoice, or a
manufacturer or vendor website, that verifies the minimum percentage, if
not the exact percentage, of postconsumer material in the products
15
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R-2022-067
PURCHASING POLICY AND PROCEDURES
PURCHASING POLICY AND PROCEDURES
SECTION II: GENERAL PURCHASING GUIDELINES A. THE PURCHASING MATRIX FOR GENERAL SUPPLIES, MATERIALS, AND EQUIPMENT,
GENERAL TRADE AND PROFESSIONAL SERVICES:
As previously stated, the purchasing process is decentralized; the Department Head or
designated employee requesting the merchandise or service ("Requestor") seeks out potential
vendors, obtains the bids if required, and interacts with the vendor.
The process begins with the determination, of what a product or service is needed. The Requestor
is responsible for assuring that adequate budgeted funds are available in the budget unit using the
Monthly Expenditure Reports or by using the Harris Financial system on the City network. The
Requestor is also responsible for identifying potential vendors.
Once these decisions are made, the individual will need to determine estimated price of the good
or service. Based on that information, the following policies apply.
This section includes a Purchasing Matrix for General Supplies, Materials, and Equipment, General
Trade and Professional Services a Purchasing Matrix and description for Capital Projections. The two
Purchasing Matrixes are intended for ease of use only. In the event of a conflict between the matrix
and the written policies in Section III, the latter shall control. Please note, some of the special
transactions/purchases are not included in the matrix. The next section covers these special
situations in detail.
16
Purchase Amount
•
$2,501 to
$15,000
$15,001 to
$50,000
More than
$50,000
Bid Process Approvals Required
No bid. If
contract
required,
purchase order is
required
•
3 written
quotations
recommended
Informal Quote. 3
written quotations
required included
with Purchase
Order
•
17
Designated
Employee or
Supervisor
s
Department
Head;
Purchasing
officer
City Manager
Purchase Order and
Contract Needed
Less than
$2,500 no;
$2,500 or more
yes
co
IL)
LL
0
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0
a.
R-2022-067
Q TY OF
PURCHASING POLICY AND PROCEDURES
W
B. THE PURCHASING MATRIX FOR PUBLIC PROJECTS:
Purchase Amount Bid Process Approvals Required
$5,000 to
$15,000
$15,001 to
$50,000
$50,001 to
$200,000
Over $200,000
3 written
quotations
recommended
3 written
quotations
recommended
Informal Bid. 3
written quotations
required
Department
Head;
Purchasing
officer
Purchase Order and
Contract Needed
Yes
PURCHASING POLICY AND PROCEDURES
SECTION III: PURCHASING TRANSACTIONS
A. GENERAL SUPPLIES, MATERIALS, AND EQUIPMENT
This section provides guidelines for the purchase of general supplies, materials, and equipment.
Supplies, materials, and equipment shall consist of any and all articles or things, which shall be
furnished to or used by any department, excluding proprietary equipment and goods (Section C)
and any goods purchased as part of a Public Works Project (Section E).
In instances where goods and services are purchased together from one vendor, this section shall
apply if the predominant portion of the purchase is goods (i.e. A purchase of equipment for $1,000
with a $300 installation fee would be covered under this section of the policy. A repair of equipment
with $1,000 in labor and $300 in parts would be covered under Section B -- General Trade Services.
Policy
11)
There are four levels of authority for normal purchases: Department Staff Award, Department Head
Award, City Manager Award, and City Council Award. Generally, authority is established by the 0
dollar amount of the purchase.
CV
1. Department Staff Award < _,2 500
The designated department staff may authorize the purchase of supplies, equipment, or services LJJ
as needed for purchases up to $2,500. These purchases do not require competitive bidding and 0
departments are given considerable discretion in these purchases.
2. Department Head Award $2,501 to 515,000
The Department Head may authorize the purchase of supplies, equipment, or services as
needed for purchases up to $15,000. It is highly recommended that staff obtain three written
quotations in writing, and be obtained and documented with the "Purchase Order Request"
form. See procedure outlined in Item 3.
3. City Manner Award $15,001 to $50.000
General supplies, materials and equipment purchases over $15,000 and under $50,000 must be
awarded by the City Manager or his/her designee. Informal bidding should be used to assure
the most competitive price is received for an item, while avoiding the additional time and
expense involved in formal bidding.
3.1 Informal Quotes: The department shall make every attempt to receive at least three written
quotations in writing or over the phone,
18 19
R-2022-067
PURCHASING POLICY AND PROCEDURES
Three Quotes: The department should make every reasonable attempt to obtain at least three bids,
however it is understood that at times it is not practical nor cost effective to continue soliciting
quotes until three bids are received. In the event that three viable quotes are not received, the
division shall document what steps were taken to obtain quotes, any vendors contracted that
declined to bid, and if applicable why it is not practical to receive three quotes.
Exceptions: The informal bid process may be bypassed with Department Head, City Manager or
Purchasing Officer approval, in the following four instances:
• In emergency situations where time is of the essence, the appropriate Department Head
may dispense with obtaining three informal quotes to obtain materials necessary in dealing
with the emergency. Immediately following the emergency, the Department Head shall
forward a copy of the purchase order along with an explanation to the City Manager or
Purchasing Officer.
• When one known supplier is available, the Department Head shall document that it is a "Sole
Source" purchase. Most sole source purchases shall be the result of the City deciding that it
is in its best interest to use a specific proprietary item. (i.e. For ease of maintenance, the
City may choose to only purchase one brand of computers).
• When there exists other governmental contracts that were competitively bid (such as State
Contracts, SLO County, SLO City, or other Agencies, etc.) that the City is eligible to use.
• When an item has been bid within the last 36 months and the price has not changed.
3.2 Evaluating Bids: The department shall evaluate the three informal quotes received and
determine the lowest most responsible bid. The City reserves the right to accept that bid which is
in the best interest of the City. When selecting the recommended bidder, the Department Head will
take into consideration:
• Price
• Ability, capacity, skill
• Ability to meet time requirements
• Character, integrity, and reputation
• Previous vendor experience
• Financial resources available for contract performance
• Ability to provide future maintenance and service, if necessary
3.3 Purchase Order A Purchase Order Request shall be prepared detailing the vendor name,
address, item being purchased, total price including tax and shipping, and budget account to be
charged. The Purchase Order Request shall be signed and dated by the authorized department
employee. (If an exception was used to bypass the information bidding procedures, the Department
Head must sign the Purchase Order Request.)
20
"ro 161? PURCHASING POLICY AND PROCEDURES
The purchase order packet shall be submitted to the City Manager or Purchasing Officer for
approval. He/she will review the purchase order packet for conformity to the purchasing policy, for
compliance with other established procedures and for availability of funds. The City Manager or
Purchasing Officer shall then approve and sign the Purchase Order Request. The Administrative
Services Department will issue a Purchase Order and forward to the originating department.
3.4 Purchasing Item: Once the department has received the approved Purchase Order from the
City Manager or his/her designee, they may contact the vendor and purchase the item. Items must
generally be shipped to a City address or worksite.
4. City Council Award > $50,000
General supplies, materials, and equipment purchases over $50,000 must be awarded by the City
Council. Formal bidding should be used to assure all possible vendors are given the opportunity to
bid on major City purchases, thereby assuring the City that it has received the most competitive
price. The formal process generally takes more time and expense than informal bidding and in some
instances may actually not be the most cost-effective approach. Lfl
4.1 Formal Bidding: The initiating department shall be responsible for completion of the formal bid IL
process, however, the process shall be coordinated with the City Clerk's Office and the 0
Administrative Services Department. Cr)
4.2 Bid Forms: The initiating department shall prepare a bid form including detailed specifications W
for the item to be purchased. The following format is suggested for competitive bids: 0
Submission of bids for proposals] — Include date, time, location and bid number as assigned by the 0—
City Clerk. Include a detailed list of the information the bid or proposal should contain.
Questions — List the name, address, and telephone number of the person to be contacted
concerning questions about the project.
Background — Provide as much background as necessary to give the bidder an understanding of the
environment in which the job will be performed and to which the job relates.
Scope of Work — Describe in detail the requirement for the job and detail specification.
Desired yroiect schedule— Be as specific as possible.
Minimum and desirable qualifications — Be as specific as possible.
Performance Bond — Whether a performance bond is required and if so, the amount and form of
bidders security.
21
R-2022-067
PURCHASING POLICY AND PROCEDURES
Notice Inviting Bids: The initiation department shall also prepare a notice inviting bids that includes
the following:
A general description of the item to be purchased.
A statement indicating where bid forms, specifications and bonding requirements can be obtained.
A statement specifying the time and place for the opening of the bids.
Per California Public Contract Code 20164, the first publication of the notice shall be at least ten days
before the date of opening the bids. The notice shall be published at least twice, not less than five
days apart, in a newspaper of general circulation, printed and published in the City. The notice may
also be sent to all applicable vendors.
4.3 Bid Opening: Sealed bids shall be submitted to the City Clerk's office and shall be clearly
identified with the Bid number on the envelope. Faxed or other electronic bids are not acceptable.
Bids shall be opened in public at the time and place stated in the public notice.
The City Clerk or his/her designee shall open the bids and shall record all bids received.
Any bid received after the time specified in the notice shall be rejected.
When a bidder's security is required, it will be announced in the public notice inviting bids. The
amount shall be determined at the time of preparation of the bid. It shall be in the form of cash,
certified or cashier's check, certificate of deposit in City of Pismo's name, or bid bond made payable
to the City of Pismo Beach. When a bidder's security is required, a bid shall not be considered unless
one of the aforementioned forms of security accompanies the bid. Bidders shall be entitled to
return of the bid security with the following exception:
The successful bidder must execute the contract and file acceptable documents within thirty (30)
calendar days from the date of award unless extended by the City Manager. Failure to execute the
contract shall be just cause for annulment of the award and forfeiture of the bidder's security, not
as a penalty, but as liquidated damages. The City Council may, upon refusal or failure of the
successful bidder to execute the contract, award the contract to the next lowest bidder.
All bids received shall be available for inspection during regular business hours in the City Clerk's
office for a period of not less than thirty (30) calendar days after the bid opening.
22
PURCHASING POLICY AND PROCEDURES
Rejection of Bids: The City reserves the right to reject any and all bids, to accept or reject any one
or more items of a bid, or to waive any irregularities or informalities in the bids or the bidding process
if to do so is deemed to best serve the interests of the City.
Determining Lowest Responsible Bidder: Award the bid shall be to the lowest responsible bidder.
All valid responsible bids shall be considered in determining the lowest bid. The City reserves the
right to accept that bid which is in the best interest of the City. When selecting the recommended
bidder the Department Head will take into consideration:
• Price
• Ability, capacity, and skill
• Ability to meet time requirements
• Character, integrity, and reputation
• Previous vendor experience
• Financial resources available for contract performance
• Ability to provide future maintenance and service, if necessary
co
Local Vendor Preference: The City has established a policy that provides for a two percent (2%) LL
preference to local bidders and vendors. (See Section I). This is accomplished by reducing the local
vendor's bids by 2% when comparing such bids to those of other bidders.
Tie Bids: If tie bids are received, quality and service being equal, the contract shall be awarded to a
local bidder.
a
If the above condition is not applicable, the City may, at its discretion:
Reject any and all bids presented and re -advertise; or
If the public interest will not permit the delay of re -advertising for bids, the City may accept either
one or accept the lowest bid made by negotiation with the tie bidders; or
Award the bid to any one of the low tie bidders by public drawing.
Exceptions to Formal Bidding: The formal bid process may be bypassed in the following four
instances:
In emergency situations where time is of the essence, the appropriate Department Head may
dispense with obtaining formal quotes to obtain materials necessary in dealing with the emergency.
Immediately following the emergency, the appropriate Department Head shall prepare a report to
Council explaining the emergency and the items purchased.
23
R-2022-067
PURCHASING POLICY AND PROCEDURES
When one known supplier is available, the Department Head shall prepare a report for Council
approval requesting an exemption from the formal bidding procedures and if applicable awarding
the bid to the "Sole Source".
When there exists other governmental contracts that were competitively bid that the City is eligible
to use in lieu of a formal bid.
When there are extenuating circumstances that would make formal bidding not the most cost
effective approach. This often relates to qualitative, artistic, or proprietary software/technological
issues. The appropriate Department Head shall prepare a report to Council requesting an exemption
from the formal bidding procedures.
4.4 Awarding the Bid: Once the bids have been evaluated, the Department Head shall prepare a
report to Council recommending the most responsive bidder. The Council shall then award the bid
in a public meeting.
4.5 Purchase Item: Once Council has awarded the bid, a Purchase Order Request form shall be
prepared detailing the vendor name, items being purchased, total price including tax and shipping,
date of Council approval, budget account charged, and a copy of the staff report and resolution. The
purchase order request shall be signed and dated by the authorized Department Head and City
Manager, then forwarded to the Administrative Services Department. The Administrative Services
Department will issue a purchase order and forward to the originating department. The department
may then contact the vendor and purchase the item. Items must generally be shipped to a City
address or worksite.
B. PROPRIETARY GOODS AND EQUIPMENT
This section applies to the purchase of equipment/software and other artistic goods that may only
be purchased through a proprietary vendor. There is no bidding requirement for this type of
purchase, since the item is being purchased based on qualification, rather than price.
Proprietary vendors are those vendors that directly sell their products and do not use distributors
or other outlets. (e.g. Select Financial software may only be purchased through Harris Computer
Systems, therefore it would be a "proprietary purchase" and covered under this section. Microsoft
Word may be purchased at many different stores and therefore is not a "proprietary purchase")
In general, these purchases should have considerable research and documentation before the
transaction is completed to assure the product best matches the requirements and needs of the
City, and that the best possible price has been obtained as compared to other like products. A
Purchase Order will always be required when the purchase is over$2,500. All documentation should
be included with the Purchase Order Request Packet.
24
14, r
PURCHASING POLICY AND PROCEDURES
Policy
There are four levels of authority for normal purchases: Department Staff Award, Department Head
Award, City Manager Award, and City Council Award. Generally, authority is established by the
dollar amount of the purchase.
1. Department Staff Award <52,50a
The designated department staff may authorize the purchase of proprietary goods as
needed for purchases up to $2,500. These purchases do not require competitive bidding
and departments are given considerable discretion in these purchases.
2. Department Head Award $2,501 to S15.000
The Department Head may authorize the purchase of proprietary goods as needed for
purchases up to $15,000. These purchases require three written quotations in writing or CO
over the phone, be obtained and documented with the "Purchase Order Request" form. See
procedure outlined in item 3. LL
0
3. City Manager Award $15,001 to $50,000 In
Proprietary goods purchases over $15,000 and under $50,000 must be awarded by the City 1—
Manager or his/her designee. Informal solicitation of qualifications should be used to assure LL)
quality goods are received for a reasonable price.
3.1 Informal Product Review: The Department shall make every attempt to receive at least three 11
products/qualifications in writing, over the phone, or in person.
Documentation: Informal product may be reviewed by the Purchasing Officer who can seek
additional quotes and verify the information. Ideally, documentation should include:
• The name of the company
• Pros/Cons of the product
• Estimated Price
• The person giving the quote
• The date and time of the phone call
• Brief justification for the selection of goods
Review of Three Products: The Department should make every reasonable attempt to review at
least three products, however, it is understood that at times it is not practical or possible to review
the products. In the event that three products are not reviewed, the Department shall document
why it is not practical to review alternate products.
25
R-2022-067
PURCHASING POLICY AND PROCEDURES
Exceptions: The informal product review process may be bypassed with Department Head, City
Manager or Purchasing Officer approval, in the following instances:
In emergency where time is of the essence, the appropriate Department Head may dispense with
informal product review process to obtain items necessary in dealing with the emergency.
Immediately following the emergency, the Department Head shall forward a copy of the purchase
order and contract along with an explanation to the City Manager or Purchasing Officer.
Evaluating Products: The Department Head shall select the product which, in their evaluation
process, is the best solution for the City.
3.2 Negotiation: The Department shall discuss with the highest ranked vendor the requirements of
the City and negotiate a reasonable fee for the product/items being purchased.
3.3 Contract and Purchase Order: A contract may be prepared, as applicable. The vendor and
the Department Head shall sign the contract.
The Department will obtain a completed IRS form W-9 from the vendor.
The contract shall be submitted to the Purchasing Officer for review. The Purchasing Officer will
review the contract for conformity to the purchasing policy, for compliance with other established
procedures and for availability of funds. The Purchasing Officer will forward the contracts to the
City Manager to approve and sign the contract.
The contract will be forwarded to the Administrative Services Department after being signed by the
City Manager. A purchase order will be generated from the signed contract.
The purchase order and executed contract will be forwarded to the vendor and originating
Department.
3.4 Executing the Contract: Once the department has received the approved Purchase Order and
a copy of the contract from the City Manager or his/her designee, they may make arrangements
with the vendor for purchase of the product.
4. City Council Award > $50,000
Proprietary purchases exceeding $50,000 must be awarded by the City Council. A more
formal evaluation should be used thereby assuring the City that is has purchased the best
product fit for the City. The formal process generally takes more time and expense than
informal solicitations and in some instances may actually not be the most cost-effective
approach.
26
PURCHASING POLICY AND PROCEDURES
4.1 Formal Evaluation of Products/Goods: To ensure maximum exposure and competition, the
responsible department shall prepare a list of potential firms from which to solicit quotes. City staff
shall make reasonable efforts to ensure that small business firms, located in San Luis Obispo County,
are aware of the purchase.
A selection committee shall be formed to evaluate the submitted data and determine the products
that should receive further consideration. The committee shall consist of at least three but no more
than six persons, appointed by the Department Head, subject to approval of the City Manager or
Purchasing Officer.
The Selection Committee may choose to interview all of the responding vendors, only the top few
ranking vendors, or to not perform interviews.
The Selection Committee may also choose to view demonstrations of all of the products (either at a
working site or at the City), only the top few ranking products, or to not view demonstrations.
After the interviews, demonstrations, and site visits (as applicable), the Selection Committee shall
rank the products.
CO
Lf)
LL
0
4.2 Negotiation: The Department Head shall discuss with the highest ranked vendor the CO
requirements of the City and negotiate a reasonable fee/contract.
LJJ
4.3 Awarding the Contract: The Department Head shall prepare a report to Council (9
recommending the top ranked product. The Council shall then award the purchase in a public
meeting.
Except for urgencies, all contracts exceeding $50,000 must be awarded by the City Council.
Otherwise:
Such purchases are null or void and not considered an obligation of the City. Invoices may be
returned to the contractor/service provider unpaid. The person ordering the unauthorized purchase
may be held personally liable for the costs of the contract.
4.4 Contract and Purchase Order: A contract may be prepared, as applicable. The vendor and the
Department Head shall sign three original copies of the contract.
The Department will obtain a completed IRS form W-9 from the contractor/service provider.
Proof of insurance in accordance with the contract shall be obtained.
27
R-2022-067
PURCHASING POLICY AND PROCEDURES
The City Attorney shall sign three original copies of the contract, as applicable, approving it as to
form.
All copies of the contract shall be submitted to the Purchasing Officer for review. The Purchasing
Officer will review the contract for conformity to the purchasing policy, for compliance with other
established procedures and for availability of funds. The Purchasing Officer will forward the
contracts to the City Manager to approve and sign the contract.
One original copy of the executed contract shall be remain in the City Clerk's Office, and the other
original shall be forwarded to the Administrative Services Department after being signed by the City
Manager or other Council designee. A purchase order will be generated from the signed contract.
The purchase order and executed contract will be forwarded to the contractor/service provider and
the originating Department.
4.5 Executing the Contract: Once the department has received the approved Purchase Order
and copy of the contract from the City Manager or his/her designee, they may make arrangements
with the vendor for purchase of the product.
C. GENERAL TRADE CONTRACT SERVICES
This section applies to the purchase of trade contract services. Trade services shall mean the repair,
rental or maintenance of equipment, machinery and other City -owned or operated property.
Included within this term are services necessary for the routine operation, repair or maintenance of
existing buildings or improvements. The term does not include services rendered by professionals
and other services, which are unique in nature and not subject to competition.
In instances where goods and trade services are purchased together from one contractor/service
provider, this section shall only apply if the predominant portion of the purchase is services (i.e.
repair of equipment with $1,000 in labor and $300 in parts would be covered under this section of
the policy. A purchase of equipment for$1,000 with a $300 installation fee would be covered under
Section III General Supplies, Materials, and Equipment.
Policy
There are four levels of authority for normal purchases: Department Staff Award, Department Head
Award, City Manager Award, and City Council Award. Generally, authority is established by the
dollar amount of the purchase.
1. Department Staff Award <$2,500
28
PURCHASING POLICY AND PROCEDURES
The designated department staff may authorize the purchase of services as needed up to
$2,500 per project or annually (for ongoing maintenance contracts) as applicable. Projects
that would typically be performed by one contractor/service provider may not be split into
components in order to avoid purchasing limits. These purchases do not require competitive
bidding and departments are given considerable discretion in these purchases.
2. Department Head Award 52,501 to $15.000
The Department Head may authorize the purchase of services as needed up to $15,000 per
project or annually (for ongoing maintenance contracts) as applicable. These purchases
require three written quotations in writing or over the phone, be obtained and documented
with the "Purchase Order Request" form. See procedure outlined in item 3.
3. City Manager Award $15.001 to 550.000
Trade service awards over $15,000 and under $50,000 must be awarded by the City Manager CO
or his/her designee. Informal bidding should be used to assure the most competitive price to
is received for an item, while avoiding the additional time and expense involved in formal
bidding.
ti
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0
d
3.1 Informal Quotes: The department shall make every attempt to receive at least three written
quotations in writing or over the phone.
Phone bids: Phone bids must be documented to the satisfaction of the Purchasing Officer. Ideally,
documentation should include the name of the company bidding, the person giving the quote, the
date and time of the phone call, the amount quoted and any other relevant information.
Three Quotes: The department should make every reasonable attempt to obtain at least three bids,
however it is understood that at times it is not practical nor cost effective to continue soliciting
quotes until three bids are received. In the event that three viable quotes are not received, the
department shall document what steps were taken to obtain quotes, any vendors contracted that
declined to bid, and if applicable why it is not practical to receive three quotes.
Exceptions: The informal bid process may be bypassed with Department Head, City Manager or
Purchasing Officer approval, in the following four instances:
In emergency situations where time is of the essence, the appropriate Department Head may
dispense with obtaining three informal quotes to obtain materials necessary in dealing with the
emergency. Immediately following the emergency, the Department Head shall forward a copy of
the purchase order along with an explanation to the City Manager or Purchasing Officer.
29
R-2022-067
PURCHASING POLICY AND PROCEDURES
When one known supplier is available, the Department Head shall document that it is a "Sole
Source" purchase. Most sole source purchases shall be the result of the City deciding that it is in its
best interest to use a specific proprietary item. (i.e. For ease of maintenance, the City may choose
to only purchase one brand of computers).
When there exists other governmental contracts that were competitively bid (such as State
Contracts, SLO County, SLO City, or other Agencies, etc.) that the City is eligible to use.
When a service has been bid within the last 36 months and the price has not changed.
Evaluating Bids: The department shall evaluate the three informal quotes received and determine
the lowest most responsible bid. The City reserves the right to accept that bid which is in the best
interest of the City. When selecting the recommended bidder, the Department Head will take into
consideration:
• Price
• Ability, capacity, skill
• Ability to meet time requirements
• Character, integrity, and reputation
• Previous vendor experience
• Financial resources available for contract performance
• Ability to provide future maintenance and service, if necessary
3.2 Contract and Purchase Order: A contract shall be prepared, as applicable. The vendor and
the Department Head shall sign the contract.
The contract shall be submitted to the Purchasing Officer for review. The Purchasing Officer will
review the contract for conformity to the purchasing policy, for compliance with other established
procedures and for availability of funds. The Purchasing Officer will forward the contracts to the
City Manager to approve and sign the contracts.
The executed contract shall be remain in the City Clerk's Office filed electronically. A purchase order
will be generated from the signed contract.
3.3 Executing the Contract: Once the department has received the approved Purchase Order and
copy of the contract from the City Manager or his/her designee, they may make arrangements with
the contractor/service provider for services.
Renewals
Contracts for ongoing services may include annual renewal provisions for up to five years, however,
in no instance may the contract exceed $50,000 in any one year. Cost increase related to such
30
g4410 I' PURCHASING POLICY AND PROCEDURES
renewals shall not exceed the Consumer Price Index (CPI) adjustments in the City designated area,
unless approved in advance by the City Manager.
3.4 Change Orders: The City Manager is authorized to issue change orders for changes or
additions to the original scope of work that result in less than $50,000 of overall contract amount.
Change orders in excess of the $50,000 total contract amount will need City Council approval.
4. City Council Award > $50.000
Trade service contracts exceeding $50,000 must be awarded by the City Council. Formal
bidding should be used to assure all possible contractor/service providers are given the
opportunity to bid on major City contracts, thereby assuring the City that it has received the
most competitive price. The formal process generally takes more time and expense than
informal bidding and in some instances may actually not be the most cost-effective
approach.
4.1 Formal Bidding: The initiating department shall be responsible for completion of the formal bid (O
process, however, the process shall be coordinated with the City Clerk's Office and the
Administrative Services Department. O
Bid Forms: The initiating department shall prepare a bid form including detailed specifications for 00
the item to be purchased. The following format is suggested for competitive bids:
LJJ
Submission of bids for proposals)— Include date, time, location and bid number as assigned by the (7
City Clerk. Include a detailed list of the information the bid or proposal should contain.
CL
Questions — List the name, address, and telephone number of the person to be contacted
concerning questions about the project.
Background— Provide as much background as necessary to give the bidder an understanding of the
environment in which the job will be performed and to which the job relates.
Scope of Work— Describe in detail the requirement for the job and detail specification.
Desired project schedule — Be as specific as possible.
Minimum and desirable qualifications— Be as specific as possible.
Performance Bond —Whether a performance bond is required and if so, the amount and form of
bidders security.
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Sample Contract —A sample of the contract that is expected to be used should be included in the
bid package.
Notice Inviting Bids: The initiating department shall also prepare a notice inviting bids that includes
the following:
• A general description of the item to be purchased
• A statement indicating where bid forms, specifications and bonding requirements can be
obtained
• A statement specifying the time and place for the opening of the bids
Per California Public Contract Code 20164, the first publication of the notice shall be at least ten days
before the date of opening the bids. The notice shall be published at least twice, not less than five
days apart, in a newspaper of general circulation, printed and published in the City. The notice may
also be sent to all applicable contractor/service providers.
4.2 Bid Opening: Sealed bids shall be submitted to the City Clerk's office and shall be clearly
identified with the Bid number on the envelope. Faxed or other electronic bids are not acceptable.
Bids shall be opened in public at the time and place stated in the public notice.
The City Clerk or his/her designee shall open the bids and shall record all bids received.
Any bid received after the time specified in the notice shall be rejected.
When a bidder's security is required, it will be announced in the public notice inviting bids. The
amount shall be determined at the time of preparation of the bid. It shall be in the form of cash,
certified or cashier's check, certificate of deposit in City of Pismo's name, or bid bond made payable
to the City of Pismo Beach. When a bidder's security is required, a bid shall not be considered unless
one of the aforementioned forms of security accompanies the bid. Bidders shall be entitled to
return of the bid security with the following exception:
The successful bidder must execute the contract and file acceptable documents within thirty (30)
calendar days from the date of award unless extended by the City Manager. Failure to execute the
contract shall be just cause for annulment of the award and forfeiture of the bidder's security, not
as a penalty, but as liquidated damages. The City Council may, upon refusal or failure of the
successful bidder to execute the contract, award the contract to the next lowest bidder.
All bids received shall be available for inspection during regular business hours in the City Clerk's
office for a period of not less than thirty (30) calendar days after the bid opening.
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Rejection of Bids: The City reserves the right to reject any and all bids, to accept or reject any one
or more items of a bid, or to waive any irregularities or informalities in the bids or the bidding process
if to do so is deemed to best serve the interests of the City.
Determining Lowest Responsible Bidder: Award of bid shall be to the lowest responsible bidder. All
valid responsible bids shall be considered in determining the lowest bid. The City reserves the right
to accept that bid which is in the best interest of the City. When selecting the recommended bidder
the Department Head will take into consideration:
• Price
• Ability, capacity, and skill
• Ability to meet time requirements
• Character, integrity, and reputation
• Previous vendor experience
• Financial resources available for contract performance
• Ability to provide future maintenance and service, if necessary
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Local Contractor/Service Provider Preference: The City has established a policy that provides for a O
two percent (2%) preference to local bidders and vendors (See Section I). This is accomplished by
reducing the local contractor/service provider's bids by 2% when comparing such bids to those of 43)
other bidders.
Tie Bids: If tie bids are received, quality and service being equal, the contract shall be awarded to a Q
local bidder. d
If the above condition is not applicable, the City may, at its discretion:
Reject any and all bids presented and re -advertise; or
If the public interest will not permit the delay of re -advertising for bids, the City may accept either
one or accept the lowest bid made by negotiation with the tie bidders; or
Award the bid to any one of the low tie bidders by public drawing.
Exceptions to Formal Bidding: The formal bid process may be bypassed in the following four
instances:
In emergency situations where time is of the essence, the appropriate Department Head may
dispense with obtaining formal quotes to obtain materials necessary in dealing with the emergency.
Immediately following the emergency, the appropriate Department Head shall prepare a report to
Council explaining the emergency and the items purchased.
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When one known supplier is available, the Department Head shall prepare a report for Council
approval requesting an exemption from the formal bidding procedures and if applicable awarding
the bid to the "Sole Source".
When there exists other governmental contracts that were competitively bid that the City is eligible
to use in lieu of a formal bid.
When there are extenuating circumstances that would make formal bidding not the most cost
effective approach. This often relates to qualitative, artistic, or proprietary software/technological
issues. The appropriate Department Head shall prepare a report to Council requesting an exemption
from the formal bidding procedures.
4.3 Awarding the Bid: Once the bids have been evaluated, the Department Head shall prepare a
report to Council recommending the most responsive bidder. The Council shall then award the bid
in a public meeting.
Except for urgencies, all contracts exceeding $50,000 must be awarded by the City Council.
Otherwise:
Such purchases are void and not considered an obligation of the city.
Invoices may be returned to the contractor/service provider unpaid.
The person ordering the unauthorized purchase may be help personally liable for the costs of the
contract.
4.4 Contract and Purchase Order: A contract may be prepared, as applicable. The
contractor/service provider shall sign three original copies of the contract.
The Department will obtain a completed IRS form W-9 from the contractor/service provider.
Proof of insurance in accordance with the contract shall be obtained.
The City Attorney shall sign three original copies of the contract, as applicable, approving it as to
form.
The W-9, proof of insurance, and all copies of the contract shall be submitted to the Purchasing
Officer for review. The Purchasing Officer will review the contract for conformity to the purchasing
policy, for compliance with other established procedures and for availability of funds. The
Purchasing Officer will forward the contracts to the City Manager to approve and sign the contracts.
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One original copy of the executed contract shall be remain in the City Clerk's Office, and the other
original shall be forwarded to the Administrative Services Department after being signed by the City
Manager or other Council designee. A purchase order will be generated from the signed contract.
The purchase order and executed contract will be forwarded to the contractor/service provider and
the originating Department.
4.5 Executing the Contract: Once the department has received the approved Purchase Order and
copy of the contract from the City Manager or his/her designee, they may make arrangements with
the contractor/service provider for services.
4.6 Renewals: Contracts for ongoing services may include annual renewal provisions for up to
five years. Cost increase related to such renewals shall not exceed the Consumer Price Index (CPI)
adjustments in the City designated area, unless approved in advance by the City Council.
4.7 Change Orders: The City Manager is authorized to issue change orders for changes or
additions to the original scope of work that result in less than a 20% aggregate change in contract
price. Change orders in excess of 20% shall be approved by the City Council.
D. PROFESSIONAL SERVICES
This section provides guidelines for the purchase of professional services. Professional services are
those activities performed by a consultant who possesses a high degree or expertise in a particular
profession. This would generally include (but not be limited to) architectural services, engineering
services, accounting/auditing services, environmental services, design services, technical services,
financial services, legal services, economic services and other administrative services. There is no
bidding requirement for this type of service, since the agent is being hired based on his/her
qualifications, not the lowest bid.
There are four levels of authority for normal purchases: Department Staff Award, Department Head
Award, City Manager Award, and City Council Award. Generally, authority is established by the
dollar amount of the purchase.
1. Department Staff Award < S2 500
The designated Department staff may authorize the purchase of professional services as
needed up to $2,500 per project or annually (for ongoing/recurring contracts) as applicable.
Projects which would typically be performed by one consultant may not be split into
components in order to avoid purchasing limits. These purchases do not require competitive
bidding and departments are given considerable discretion in these purchases.
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The Department will obtain a completed IRS form W-9 from the contractor/service provider
prior to awarding the contract. The W-9, shall immediately be forwarded to the
Administrative Services Department in order to comply with Federal Reporting
Requirements.
2. Department Head Award $2 501 to $15 000
The Department Head may authorize the purchase of professional services as needed up to
$15,000 per project or annually (for ongoing/recurring contracts) as applicable. Projects
which would typically be performed by one consultant may not be split into components in
order to avoid purchasing limits. These professional service agreements shall have sufficient
documentation of background analysis to support the contract. Informal solicitation of
qualifications should be used to assure quality services are received for a reasonable price.
See procedure outlined in item 3.
The Department will obtain a completed IRS form W-9 from the contractor/service provider
prior to awarding the contract. The W-9, shall immediately be forwarded to the
Administrative Services Department in order to comply with Federal Reporting
Requirements.
3. City Manager Award 515,001 to $50,000
Professional service contracts over $15,000 and under $50,000 must be awarded by the City
Manager or his/her designee. These professional service agreements shall have sufficient
documentation of background analysis to support the contract. Informal solicitation of
qualifications should be used to assure quality services are received for a reasonable price.
3.1 Informal Solicitation of Qualifications: The Department shall make every attempt to solicit at
least three qualifications/proposals in writing or over the phone. It is important that the
specifications are accurate and comprehensive, thus it may be beneficial to transmit the
specifications and responses by fax or mail even when the proposal is received verbally.
Documentation: Informal quotations must be documented to the satisfaction of the City Manager
or Purchasing Officer. Ideally, documentation should include:
• The name of the company
• The person giving the quote
• The date and time of the phone call
• Understanding of the required scope of services
• Specialized experience of the firm and its personnel, relative to the required services
• References who can be contacted to verify past record of performance, i.e., completion of a
quality product, in a timely manner, and within budget constraints
• The capacity of the firm to perform the subject project within a required time frame
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• Estimated Price
Three Quotes: The Department should make every reasonable attempt to obtain at least three
responses, however it is understood that at times it is not practical, nor cost effective to continue
soliciting quotes until three responses are received. In the event that three responses are not
reviewed, the Department shall document the steps that were taken to obtain quotes, and if
applicable, why it is not practical to receive additional responses.
Exceptions: The informal bid process may be bypassed with Department Head, City Manager or
Purchasing Officer approval, in the fallowing instances:
In emergency where time is of the essence, the appropriate Department Head may dispense with
obtaining three informal quotes to obtain services necessary in dealing with the emergency.
Immediately following the emergency, the Department Head shall forward a copy of the purchase
order and contract along with an explanation to the City Manager or Purchasing Officer.
When one known service provider is available, the Department Head shall document that it is a
"Sole Source" purchase.
3.2 Evaluating Bids: The Department shall select the consultant which, in their evaluation process,
is the most qualified to perform the work. The evaluation and selection process shall be based upon
the following considerations:
• General quality and responsiveness to the request, including but not limited to:
• Responsiveness to the terms, conditions, and items of performance
• Grasp of the problem, work to be performed, and approach to be used
• Organization and personnel making the proposal
• Evidence of good organizational and management practices
• Qualification of the personnel
• Specialized expertise of the firm and its personnel relative to the required services
• References who can be contacted to verify past record of performance (i.e., completion of a
quality product in a timely manner and within budget constraints)
• Previous consultant experience
• The financial condition of the firm
• Capacity of the firm to perform the subject project within a required time frame
• If appropriate, the price, in any of the following formats, may be considered
• Total price and price breakdown
• Price range
• Cost schedule
Ongoing Professional Services: In some instances it is in the best interest of the City to have current
ongoing contracts with multiple consultants for the same or very similar services (i.e. services that
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can be defined as to scope of work but not as to required events such as contract planning services,
public safety investigations, soils testing, contract building inspections services, etc.) These services
would be handled by establishing an eligibility list and by entering into annual ongoing professional
service contracts.
The process for selecting firms for annual ongoing professional service contracts shall be generally
the same as for other professional services contracts, however multiple consultants may be
awarded an ongoing contract based on the informal process and may be placed on the eligibility list.
Additional consultants may also be awarded contracts and placed on the eligibility list at a later date,
using the informal process without impacting contracts currently in place.
As events occur and need arises, work will be assigned to the firms/individuals on the eligibility list
at the sole discretion of the Department Head.
Negotiation: The Department Head shall discuss with the highest ranked firms(s) the requirements
of the project, the scope of services needed to meet the requirements, and negotiate a reasonable
fee for the established work assignment.
3.3 Contract and Purchase Order: A contract shall be prepared. The consultant and the Department
Head shall sign the original contract.
The Department will obtain a completed IRS form W-9 from the consultant, in order to comply with
Federal Reporting Requirements.
The contract along with the form W-9, shall be submitted to the Purchasing Officer for review. The
Purchasing Officer will review the contract for conformity to the purchasing policy, for compliance
with other established procedures and for availability of funds. The Purchasing Officer will forward
the contracts to the City Manager to approve and sign the contracts. The City Clerk's office will file
the contract electronically.
The contract, with the W-9, will be forwarded to the Administrative Services Department after being
signed by the City Manager. A purchase order will be generated from the signed contract.
The purchase order and executed contract will be forwarded to the vendor and originating
Department.
3.4 Executing the Contract: Once the department has received the approved Purchase Order and
copy of the contract from the City Manager or his/her designee, they may make arrangements with
the consultant for services.
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4. City Council Award > S50.000
Professional service contracts exceeding $50,000 must be awarded by the City Council. A
Formal Request for Proposal (RFP) or a Request for Qualifications (RFQ) process should be
used, thereby assuring the City that it has engaged the most qualified consultant available
for the engagement. The formal process generally takes more time and expense than
informal solicitations of qualifications and in some instances may actually not be the most
cost-effective approach. CO
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4.1 Developing the RFP or RFQ: Because RFP's and RFQ's ask for a subjective product, they should N
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• A precise description of the problem or objective 0
• The services to be performed
• The product to be provided
PURCHASING POLICY AND PROCEDURES
3.5 Renewals: Contracts for ongoing professional services may include annual renewal provisions
for up to five years, however, in no instance may the contract exceed the Consumer Price Index (CPI)
adjustments unless approved in advance by the City Manager.
3.6 Change Orders: The City Manager is authorized to issue change orders or contract amendments
for changes or additions to the original scope of work that result in less than a $50,000 annual
contract amount. Change orders in excess of the $50,000 contract amount shall be approved by the
City Council.
Formal Request for Proposal (RFP) or Request for Qualifications (RFQ):
contain the greatest detail possible, and may include the following:
The anticipated time schedule for:
• Submittal of the RFP/RFQ (date and time)
• Any pre -proposal conference (date, time and location)
• Review and evaluation of the proposals
• Award of the contract
• Commencement of work on the project
• Completion date
• Evaluation factors and the relative importance of each.
• Expectations or limitations on the part of the City, i.e.
• The format, form and quantity of any expected reports
• The extent/nature of assistance/cooperation available from the City
Expected content of the RFP/RFQ, including:
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• The overall description of techniques to be used
• Listing of similar services provided to other clients
• Listing of available references to contact
• Description and qualifications of assigned lead and supporting personnel
• Time and staff expected to be expended
• Facilities and equipment to be used
• Portion of contract to be performed by sub -contractors
• Subcontractors/Sub-consultants qualifications
• Cost, in summary and total, and desired method of payment. The RFP/RFQ for services may,
but is not required to, state the amount budgeted for the service
Contractual requirements including, but not limited to:
• Prohibition against assignment
• Indemnification
• Insurance requirements
• Bonding requirements
• Warranties
• Compliance with federal, state and City laws, rules and regulations
• Sample contract
Construction project management service RFP's may require evidence be provided of experience in
construction project design review and evaluation, construction mobilization and supervision, bid
evaluation, project scheduling, cost -benefit analysis, claims review and negotiation, and general
management and administration of a construction project.
4.2 Issuing RFP/RFQ: To ensure maximum exposure and competition, the responsible Department
shall prepare a list of potential firms to receive the RFP/RFQ. City staff shall make reasonable efforts
to ensure that small business firms, located in San Luis Obispo County, are aware of the RFP/RFQ's
issued.
If required or desired, the responsible Department will submit the RFP/RFQ notice to be advertised
in a local newspaper of general circulation. The notice will be published one or more times beginning
at least fourteen calendar days prior to the designated closing. Additional advertisements may be
placed in a regional newspaper of general circulation; appropriate professional or trade journals;
and state or governmental publications designed for public notice.
A reasonable length of time between solicitation and closing dates must be allowed to provide
potential respondents time for preparation in accordance with the complexity, the size of the
project, and the scope of advertising.
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City staff may conduct conferences to explain the requirements of the project. A sufficient amount
of time should be allowed after the RFP/RFQ has been issued to allow potential respondents to
become familiar with the project. Any clarification or changes required to the RFP/RFQ, as a result
of the conference, shall be added as written amendment. A summary of the conference shall be
provided to all prospective respondents receiving the request.
The requesting Department shall prepare sufficient copies of the RFP/RFQ to allow distribution to
potential respondents of record and responses to the published advertisements. In addition, the
Department shall maintain a list of RFP/RFQ's issued and responses.
Amendments should be used to make any changes in quantities, descriptions, schedules, or to
correct defects or ambiguities in the original RFP/RFQ. Amendments are provided to ensure that all
potential respondents are furnished with the same information with which to prepare for proposals.
Amendments to the RFP/RFQ shall be identified as such and shall require acknowledgement as such
by firms receiving the RFP/RFQ. Amendments shall be sent to all known recipients of the RFP/RFQ
within a reasonable time period before the closing date. If the time and date established for the
receipt of proposals does not allow sufficient time for consideration and changes, the time and date
will be modified by amendment.
4.3 Proposal Opening: Proposals shall be submitted to the City Clerk's office and shall be clearly
identified with the Proposal number on the envelope. Faxed or other electronic proposals are not
acceptable.
Proposals received by 5:00 p.m. of the designated closing day will be opened on the following
workday for preliminary review.
Any proposal received after the time specified in the RFP/RFQ shall be returned unopened.
To avoid disclosure of the contents of competing RFPs/RFQs, proposals will be opened in the
presence of the City Clerk or his/her designee and the Department Head or his/her designee,
requesting the proposals.
Respondents may modify or withdraw their proposals prior to the established closing date and time,
without penalty. However, any modifications submitted after the established closing date and time
will not be accepted. Such modifications will be returned to the respondent, unopened.
The City Clerk's office shall maintain a list of proposals received, including name and address of
respondent, the number of modifications received, if any, and any additional information requested.
The register will be open to inspection after the award of the contract or the rejection of all
proposals.
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Proposals and modifications shall be shown only to the evaluation committee personnel, the City
Clerk or his/her designee, and the Department Head or his/her designee, until a recommendation
is made to Council or all proposals have been rejected.
Rejection of Proposals: The City reserves the right to reject any and all proposals, to accept or reject
any one or more items of a proposal, or to waive any irregularities or informalities in the proposal
or the RFP/RFQ process if to do so is deemed to best serve the interests of the City.
4.4 Evaluation Factors and Methods: Because unique services are requested, cost is not considered
the primary selection criteria.
Evaluation factors may include:
General quality and responsiveness of the proposal, including but not limited to:
• Responsiveness to the terms, conditions, and items of performance
• Completeness and thoroughness of the proposal
• Grasp of the problem, work to be performed, and approach to be used
Organization and personnel making the proposal:
• Evidence of good organizational and management practices
• Qualification of the personnel
• Specialized experience of the firm and its personnel relative to the required services
• References who can be contacted to verify past record of performance, i.e., completion of a
quality product, in a timely manner, and within budget constraints
• The financial condition of the firm
• Capacity of the firm to perform the subject project within a required time frame
If appropriate, the price, in any of the following formats, may be considered:
• Total price and price breakdown
• Price range
• Cost schedule
A Selection Committee shall be formed to evaluate the submitted data and determine the
consultants that should receive further consideration. The Committee shall consist of at least three
but no more than six persons, appointed by the Department Head, subject to approval of the City
Manager or his/her designee.
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PURCHASING POLICY AND PROCEDURES
The Selection Committee may choose to interview all of the responding consultants, only the top
few ranking consultants or to not perform interviews.
After the interviews (if applicable), the Selection Committee shall rank the consultants based on
their proposals, interviews, and references.
Exceptions to Formal RFP/RFQ: The formal RFP/RFQ process may be bypassed in the following three
instances:
In emergency situations where time is of the essence, the appropriate Department Head may
dispense with the formal RFP/RFQ process to obtain services necessary in dealing with the
emergency. Immediately following the emergency, the appropriate Department Head shall prepare
a report to Council explaining the emergency and the items purchased.
When one known service provider is available, the Department Head shall prepare a report for
Council approval requesting an exemption from the formal RFP/RFQ procedures and if applicable CO
awarding the bid to the "Sole Source".
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When there are extenuating circumstances that would make the formal RFP/RFQ process not the 0
most cost effective approach. This often relates to qualitative, artistic or proprietary '
software/technological issues. The appropriate Department Head shall prepare a report to Council N
requesting an exemption from the formal bidding procedures. UJ
4.5 Ongoing Professional Services: In some instances it is in the best interest of the City to have Q
current ongoing contacts with multiple consultants for the same or very similar services (i.e. services a
that can be defined as to scope of work but not as to required events such as contract planning
services, public safety investigations, soils testing, contract building inspections services, etc). These
services would best be handled by establishing an eligibility list and by entered into annual ongoing
professional service contracts.
The process for selecting firms for annual ongoing professional service contracts shall be generally
the same as for other professional services contracts, however multiple firms may be awarded an
ongoing contract based on the RFP/RFQ process and may be placed on the eligibility list. Additional
firms/individuals may also be awarded contracts and placed on the eligibility list at a later date, using
the RFP/RFQ process without impacting contracts currently in place.
Council shall award each ongoing contract that is expected to exceed $50,000 at a public meeting.
As events occur and need arises, work will be assigned to the consultants on the eligibility list at the
sole discretion of the Department Head. The Department Head, however, shall make a reasonable
attempt to rotate work between consultants subject to the availability and special needs.
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Negotiation: The Department Head shall discuss with the highest ranked firm(s) the requirements
of the project, the scope of services needed to meet the requirements, and negotiate a reasonable
fee/contract for the established work assignment.
4.6 Awarding the Contract: The Department Head shall prepare a report to Council recommending
the most responsive consultant. The Council shall then award the purchase in a public meeting.
Except for urgencies, all contracts exceeding $50,000 must be awarded by the City Council.
Otherwise:
• Such purchases or void and not considered an obligation of the City
• Invoices may be returned to the contractor/service provider unpaid
• The person ordering the unauthorized purchase may be held personally liable for the costs
of the contract
4.7 Contract and Purchase Order: A contract shall be prepared. The consultant shall sign three
original copies of the contract.
The Department will obtain a completed IRS form W-9 from the consultant.
Proof of insurance in accordance with the contract shall be obtained.
The City Attorney shall sign three original copies of the contract, approving it as to form.
All copies of the contract shall be submitted to the Purchasing Officer for review. The Purchasing
Officer will review the contract for conformity to the purchasing policy, for compliance with other
established procedures and for availability of funds. The Purchasing Officer will forward the
contracts to the City Manager to approve and sign the contract.
One original copy of the executed contract shall be remain in the City Clerk's Office, and the other
original shall be forwarded to the Administrative Services Department after being signed by the City
Manager or other Council designee. A purchase order will be generated from the signed contract.
The purchase order and executed contract will be forwarded to the contractor/service provider and
the originating Department.
4.8 Executing the Contract: Once the department has received the approved Purchase Order and
copy of the contract from the City Manager or his/her designee, they may make arrangements with
the vendor for purchase of the product.
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4.9 Renewals: Contracts for ongoing services may include annual renewal provisions for up to five
years.
4.10 Change Orders: The City Manager is authorized to issue change orders or contract
amendments for changes or additions to the original scope of work that result in less than 20% of
the Council -approved contract amount and less than$50,000. Change orders in excess of the 20%
of the Council -approved contract amount and less than $50,000 shall be approved by the City
Council.
E. PUBLIC PROJECTS
This section provides guidelines for "Public Project" procurement. Public Project means
construction, reconstruction, erection, alteration, restoration, improvement, demolition, and repair
work involving any facility owned, leased, or operated by the City. The definition also includes
painting or repainting any facility owned, leased or operated by the City. Construction, erection,
improvement, or repair of dams, reservoirs, and electrical transmission lines of 230,000 volts and
higher that are owned by the City, are considered a public project.
A public project does not include maintenance work, consisting of routine, recurring, and usual work
for the preservation or protection of facilities owned or operated by the City, including minor
repainting. Street and highways resurfacing at less than one (1") deep, landscape maintenance
(mowing, watering, trimming, pruning, planting, replacement of plants, and servicing of irrigation
and sprinkler systems) are not a public project.
Facility means any plant, building, structure, ground facility, utility system, subject to the limitation
found in paragraph (3) of subdivision (c), real property, streets and highways, or other public work
improvement.
Policy
It is the City of Pismo Beach's policy to follow the Uniform Construction Cost Accounting
Procedures for all Public Projects, as set forth in the Public Contract Code (Article 2, commencing
with Section 22010). The City of Pismo Beach has adopted the purchasing limits and policies as
set forth in Public Contract Code Sections 22030 to 22045. For any public proiect that is
performed by force account that has total direct and indirect costs under$60,000 needs a public
project tracking sheet and needs a project code from the financial system.
1. Department Staff Award < $5,000
The designated department staff may contract public projects as needed up to $5,000 per
project or public project may be performed by the employees of the City force account.
Projects that would typically be performed by one contractor may not be split into
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components in order to avoid purchasing limits. These purchases do not require competitive
bidding and departments are given considerable discretion in these purchases.
The Department will obtain a completed IRS form W-9 from the contractor prior to awarding
the contract. The W-9 shall immediately be forwarded to the Administrative Department in
order to comply with Federal Reporting Requirements.
2. Department Head Award $5,001 to $15.000
The Department Head may contract public projects as needed up to $15,000 per project
or public project may be performed by the employees of the City by force account.
Projects that would typically be performed by one contractor may not be split into
components in order to avoid purchasing limits. It is recommended that these contracts
have three written quotations in writing. For any public proiect that is performed by force
account that has total direct and indirect costs under $60.000 needs a public project
tracking sheet and needs a project code from the financial system. The final Public Project
Tracking Sheet with actual costs compared to the estimate shall be turned in with the
final invoice.
The Department will obtain a completed IRS form W-9 from the contractor prior to
awarding the contract. The W-9, shall immediately be forwarded to the Administrative
Services Department in order to comply with Federal Reporting Requirements.
3. City Manager Award 515,001 to $50 000
The City Manager must award public Project contracts over $15,000 and under $50,000.
The Department may recommend a contractor without using the informal bid process,
however a negotiated contract, purchase order, and approval by the City Manager is
required for these purchases. For any public project that is performed by force account
that has total direct and indirect costs underS60,000 needs a public project tracking sheet
and needs a project code from the financial system. The final Public Project Tracking
Sheet with actual costs compared to the estimate shall be turned in with the final invoice.
The Department Head may also elect to perform the project using employee's of the •
City by force account.
3.1 Contract and Purchase Order: A contract shall be prepared. The contractor and the Department
Head shall sign the original contract.
The Department will obtain a completed IRS form W-9 from the consultant, in order to comply with
Federal Reporting Requirements.
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The contract with the form W-9, shall be submitted to the Purchasing Officer for review. The
Purchasing Officer will review the contract for conformity to the purchasing policy, for compliance
with other established procedures and for availability of funds. The Purchasing Officer will forward
the contracts to the City Manager to approve and sign the contract. The City Clerk's office will file
the contract electronically.
The contract, with the W-9, will be forwarded to the Administrative Services Department after being
signed by the City Manager. A purchase order will be generated from the signed contract.
The purchase order and executed contract will be forwarded to the vendor and originating
Department.
Except for urgencies, all contracts exceeding $15,000 must be signed by the City Manager.
Otherwise:
• Such purchases are null and void, and not considered an obligation of the City
• Invoices must be returned to the contractor unpaid
• The person ordering the unauthorized purchase may be held personally liable for the costs
of the contract
3.2 Executing the Contract: Once the Department has received the approved Purchase Order and
copy of the contract from the City Manager or his/her designee, they may make arrangements with
the contractor for services.
4. City Council Award $50.001 to $200.000— Level 1
Public Projects exceeding $50,000 and less than $200,000 shall be informally bid or
formally bid and awarded by the City Council in accordance with the Public Contract Code
Sections 22000 to 22045. For any public project that is performed by force account that
has total direct and indirect costs under 560,000 needs a public project tracking sheet and
needs a project code from the financial system. The final Public Project Tracking Sheet
with actual costs compared to the estimate shall be turned in with the final invoice.
4.1 Informal Bids: The City shall solicit informal bids in accordance with Public Contract Code
Sections 22034-22036.
4.2 Contract and Purchase Order:
a. A contract shall be prepared, and two original copies shall be signed by the Department
and contractor.
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b. The Department will obtain a completed IRS form W-9 from the contractor/service
provider.
c. Proof of insurance in accordance with the contract shall be obtained.
d. Performance and payment bonds shall be obtained (bonds must be in a form accepted
by the City and must meet all City requirements).
e. The City Attorney shall sign three original copies of the contract, approving it as to form.
f. All copies of the contract shall be submitted to the Purchasing Officer for review. The
Purchasing Officer will review the contract for conformity to the purchasing policy, for
compliance with other established procedures and for availability of funds. The
Purchasing Officer will forward the contracts to the City Manager to approve and sign
the contract. One copy will remain in the City Clerk's office.
g. The second original contract, with the W-9, will be forwarded to the Administrative
Services Department after being signed by the City Manager. A purchase order will be
generated from the signed contract.
h. The purchase order and executed contract will be forwarded to the vendor and
originating Department.
i. Except for urgencies, all contracts exceeding $15,000 must be signed by the City
Manager or Purchasing Officer. Otherwise:
i. Such purchases are null and void, and not considered an obligation of the City.
ii. Invoices must be returned to the contractor unpaid.
The person ordering the unauthorized purchase may be held personally liable for
the costs of the contract.
4.2 Executing the Contract: Once the Department has received the approved Purchase Order
and copy of the contract from the City Manager or his/her designee, they may make arrangements
with the contractor for services.
5. City Council Award> $200,000 — Level 2
Public Projects exceeding $200,000 must be formally bid and awarded by the City Council
in accordance with the Public Contract Code Sections 22000 to 22045.
5.1 Formal Bidding: The City shall solicit formal bids in accordance with Public Contras Code
Sections 22000-22045,
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The initiating Department shall be responsible for completion of the formal bid process; however,
the process shall be coordinated with the City Clerk's Office and the Administrative Services
Department.
a. Bid Forms: The initiating Department shall prepare a bid form including detail
specifications for the services to be purchased. The following format is suggested for
competitive bids:
Submission of bids tor proposals) — Include date, time, location and bid number as
assigned by the City Clerk. Include a detail list of the information the bid or proposal
should contain.
Questions — List the name, address, and telephone number of the person to be
contacted concerning questions about the project.
Background — Provide as much background as necessary to give the bidder an
understanding of the environment in which the job will be performed and to which the
job relates.
Scope of Work— Describe in detail the requirement for the job and detail specification.
Desired project schedule — Be as specific as possible.
Minimum and desirable qualifications— Be as specific as possible.
Performance Bond — Whether a performance bond is required and if so, the amount and
form of bidders security.
Sample Contract — A sample of the contract that is expected to be used should be
included in the bid package.
b. Notice Inviting Bids: The initiating Department shall also prepare a notice inviting bids
that includes the following:
i. A general description of the services to be performed.
ii. A statement indicating where bid forms, specifications and bonding requirements
can be obtained.
iii. A statement specifying the time and place for the opening of the bids.
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iv. The notice shall be published at least fourteen (14) calendar days before the date
of the opening of bids in a newspaper of general circulation, printed and published
in the City. (It is recommended that it be published twice, not less than five days
apart).
v. The notice shall also be mailed to all construction trade journals specified in Section
22036 of the Public Contract Code. The notices shall be mailed at least fifteen (15)
calendar days before the date of opening the bids per Public Contract Code 22037.
5.2 Bid Opening
a. Sealed bids shall be submitted to the City Clerk's office and shall be clearly identified with
the Bid number on the envelope. Faxed or other electronic bids are not acceptable.
b. Bids shall be opened in public at the time and place stated in the public notice.
c. The City Clerk or his/her designee shall open the bids and shall record all bids received.
d. Any bid received after the time specified in the notice shall be rejected.
e. When a bidder's security is required, it will be announced in the public notice inviting
bids. The amount shall be determined at the time of preparation of the bid. It shall be
in the form of cash, certified or cashier's check, certificate of deposit in the City of Pismo
Beach's name or bid bond made payable to the City of Pismo Beach. When a bidder's
security is required, a bid shall not be considered unless one of the aforementioned
forms of security accompanies the bid. Bidders shall be entitled to return of the bid
security with the following exception:
The successful bidder must execute the contract and file acceptable documents within
ten (10) calendar days from the date of award unless extended by the City Manager.
Failure to execute the contract shall be just cause for annulment of the award and
forfeiture of the bidders' security, not as a penalty, but as liquidated damages. The
City Council may, upon refusal or failure of the successful bidder to execute the
contract, award the contract to the next lowest bidder.
f. All bids received shall be available for inspection during regular business hours in the City
Clerk's office for a period of not less than thirty (30) calendar days after the bid opening.
Rejection of Bids: The City reserves the right to reject any and all bids, to accept or reject any one
or more items of a bid, or to waive any irregularities or informalities in the bids or the bidding process
if to do so is deemed to best serve the interests of the City. If after the first invitation of bids all bids
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PURCHASING POLICY AND PROCEDURES
are rejected, the City may elect to re -advertise for bids or have the project done by force account
(see section 22038 of the Public Contract Code for procedures and limitations).
Determining Lowest Responsible Bidders: Award of bid shall be to the lowest responsible bidder.
All valid responsible bids shall be considered in determining the lowest bid. Before the award, the
bidder may be required to furnish evidence of capability, equipment and financial resources to
adequately perform the work. Bidders not found to be qualified may have their bid rejected.
Tie Bids: If tie bids are received, quality and service being equal, the contract shall be awarded to a
local bidder.
If the above condition is not applicable, the City may, at its discretion:
• Reject any and all bids presented and re -advertise
• City may accept either one or accept the lowest bid made by negotiation with the tie bidders
• Award the bid to any one of the low tie bidders by public drawing
5.3 Awarding the Bid: Once the bids have been evaluated, the Department Head shall prepare a
report to Council recommending the most responsive bidder. The Council shall then award the bid
in a public meeting.
All public project contracts exceeding $50,000 must be awarded by the City Council. Otherwise:
• Such purchases or void and not considered an obligation of the City
• Invoices may be returned to the contractor/service provider unpaid
• The person ordering the unauthorized purchase may be held personally liable for the costs
of the contract
5.4 Contract and Purchase Order: A contract shall be prepared and the contractor shall sign two
original copies of the contract.
The Department will obtain a completed IRS form W-9 from the consultant.
Proof of insurance in accordance with the contract shall be obtained.
Performance and payment bonds shall be obtained (bonds must be in a form accepted by the City
and must meet all City requirements).
The City Attorney shall sign two original copies of the contract, approving it as to form.
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Both copies of the contract, the W-9, proof of insurance, and copies of the bonds shall be submitted
to the Purchasing Officer for review. The Purchasing Officer will review the contract for conformity
to the purchasing policy, for compliance with other established procedures and for availability of
funds. The Purchasing Officer will forward the contracts to the City Manager to approve and sign
the contract.
One original copy of the executed contract along with the proof of insurance and copies of the bonds
shall be remain in the City Clerk's Office, and the other original with the W-9 and proof of insurance
shall be forwarded to the Administrative Services Department after being signed by the City
Manager or other Council designee. A purchase order will be generated from the signed contract.
The purchase order and executed contract will be forwarded to the contractor/service provider and
the originating Department.
5.5 Executing the Contract: Once the department has received the approved Purchase Order and
copy of the contract from the City Manager or his/her designee, they may make arrangements with
the vendor for purchase of the product.
5.6 Change Orders: The City Manager is authorized to issue change orders for changes or additions
to the original scope of work that result in less than a 20% aggregate change in contract price.
Change orders in excess of 20% shall be brought to the City Council for approval.
F. CAPITAL EXPENDITURES
1. Capital expenditures include land, buildings, and major improvements to buildings and
equipment. Generally, the item has a useful life of at least two years and costs at least
$5,000. Items of small value which may have a relatively long life such as shovels, tool
boxes, scissors, etc., but are of small individual value, should be classified as supplies.
Replacement or repair parts (and labor for such replacement or repair for capital items)
should be charged to a maintenance or supplies account.
a. Cost includes the actual cost of the item itself, plus freight, installation costs, and any
other expenses incurred that are necessary to get the item delivered, installed, and in
working order.
b. The unit price of an item rather than the total cost of the purchase is the value to be
used as the guide.
c. The City requires that all newly acquired fixed assets be centrally recorded. The
Administrative Services Department will enter the fixed asset into the general ledger
PURCHASING POLICY AND PROCEDURES
system for inventory and valuation purposes. All City owned fixed assets are to be
used only for official City business.
d. Capital items are subject to the same approval requirements as any other purchase.
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SECTION IV: EXCEPTIONS TO COMPETITIVE PROCUREMENT PROCEDURES
A. SOLE SOURCE PROCUREMENT
Negotiations. A contract may be awarded without competition when the City Manager
determines in writing, after conducting a good faith review of available sources, that here is only
one source for the required supply, service, or construction item. The City Manager shall conduct
negotiations, as appropriate, as to price, delivery, and terms.
Cost or Pricing Data. When the City determines that analysis of the proposed price is
necessary to determine if it is reasonable and fair, a contractor shall submit cost or pricing data
upon request and shall certify that to the best of its knowledge and belief the cost or pricing data
submitted was accurate, complete and current as of a mutually determined date.
Award the purchase.
B. COOPERATIVE AGREEMENTS
The City Manager may arrange for the City to enter an agreement with one or more local, county
state, federal, or other public entity, school district, League of California Cities, California
Communities Program, or other non-profit association or group consisting of governmental
entities, in order to cooperatively purchase supplies, equipment, services, including but not
limited to materials, vehicles and apparatus, in cooperation, provided that:
The purchase contract with the Suppliers (s) is the result of competitive bidding or negotiation
and is made in compliance with the competitive bid or proposal requirements of any participating
entity or organization; and
The purchase conforms to the City's specifications for the item or service; and
The estimated price of the purchase is lower than that estimated for the purchase if made directly
by the pursuant to this Manual.
Award the purchase.
C. PIGGYBACK PURCHASES
The City Manager may arrange for the City to enter into purchase contracts with a Supplier(s) for
the purchase of supplies, equipment, services, including but not limited to materials, vehicles and
apparatus, the pricing and terms of which have been previously established by another local,
county, state, federal, or other public entity, school district, League of California Cities, California
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Communities Program, or other non-profit association or group consisting of governmental
entities; provided that:
The purchase contract with the Supplier(s) is the result of competitive bidding or negotiation and
is made in compliance with the competitive bid or proposal requirements of any participating
entity or organization; and
The purchase is made within a reasonable time of the competitive bid or negotiation; and
The purchase conforms to the City's specifications for the item or service; and
The estimated price of the purchase is lower than that estimated for the purchase if made directly
by the City pursuant to this Manual.
Award the purchase.
D. STANDARDIZATION
co
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When supplies, equipment, or services have been uniformly adopted or otherwise standardized, 0
or when an item is designated to match others in use by the City, the purchase is not subject to t0
this Manual.
W
Award the purchase. 0
E. AWARD AND RECORD OF SOLE SOURCE, COOPERATIVE, PIGGYBACK, AND 0—
STANDARDIZATION PROCUREMENTS
1. Award by City Council. Purchases exceeding $50,000 or an amount set by City Council
shall be awarded by the City Council after receiving the recommendation of the City
Manager.
2. Award by City Manager. The City Manager may award purchases of less than the amount
that requires award by City Council, after receiving the recommendation of the City
Manager or requesting Department Head. The City Manager may execute contracts and
other necessary related documents on behalf of the City for purchases within his or her
awarding authority.
3. Public Record. A record of cooperative, piggyback and standardization procurements
shall be maintained as public record for purchases of item(s) or service(s) exceeding the
amount fixed by the City Manager for solicitation of Informal Quotes. Said record shall
list each supplier or contractor's name, the amount and type of each contract, and the
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identification number of each contract file. The record shall be kept with the
corresponding purchase order.
F. EMERGENCY PROCUREMENTS
a. Authorization: Notwithstanding any other provisions of this Manual, an emergency
declared by an appropriate authority as described in Pismo Beach Municipal Code
Chapter 2.32, Emergency Services, requires that an order be placed with the most
expeditions source of equipment, goods or services, taking into account timeliness of
deliver and price. In the event of an Emergency, the City Manager/ Director of
Emergency Services is authorized to approve without solicitation of bids purchases,
leases, or other contracts for goods or services up to a value of $100,000. The City
Manager may make or authorize others to make emergency procurements of
supplies, equipment, services, or construction items when there exists a threat to
public health, welfare, or safety; provided that such emergency procurements shall
be made with such competition as is practical under the circumstances. A written
determination of the basis for the emergency and for the selection of the particular
contractor shall be included in the contract file and maintained as a public record for
purchases of item(s) or service(s) exceeding the amount fixed by the City Manager for
solicitation of Informal Quotes. As soon as practical, a record of each emergency
procurement shall be made and shall set forth contractor's name, the amount, and
type of the contract, a listing of the item(s) or service(s) procured under the contract,
and the identification number of the contract file.
b. Ratification: Emergency procurements shall be ratified as soon as practical, as
follows:
i. Ratification by City Council: Emergency procurements exceeding $100,000 or
the amount set by City Council shall be ratified by the City Council at their next
regular City Council after receiving the recommendation of the City Manager.
ii. Ratification by the City Manager: Emergency procurements exceeding $15,000
shall be ratified by the City Manager after receiving the recommendation of the
Department Head.
G. ROUTINE EXPENDITURES FOR UTILITIES, PAYROLL & OTHER SERVICES
Routine expenditures that benefit several departments, such as telephone, utilities, debt service
payments, and payroll benefit costs, shall be paid by the Administrative Services Department
without the use of a Purchase Order Request. Computer spreadsheets, reports, or other coding
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information will be sufficient to use as backup documentation. These procedures may be waived in
the event of an emergency, if it is in the public interest.
H. FEDERALLY FUNDED PROCUREMENT POLICY
1. Purpose and Applicability. This section pertains to federally -funded projects and purchases.
The purpose of this section is to ensure compliance with all applicable federal requirements
when federal money is being expended by the City. To the extent that any provisions of this
policy are inconsistent with any other City regulations, the provisions of this policy shall
prevail with respect to federally -funded procurements. If any provisions of this policy
becomes inconsistent with federal requirements, whether due to a change in federal law or
regulations, through judicial precedent, or for any other reason, then the City shall not be
required to comply with the inconsistent provision.
2 Code of Conduct. As representatives of the City of Pismo Beach employees are expected to
conduct themselves in a professional and ethical manner, maintaining high standards of CD
integrity and the use of good judgement. Employees are expected to be principled in their LC)
business interactions and act in good faith with individuals both inside and outside the City. LL
The following Code of Conduct shall govern the performance, behavior and actions of the Li
City, including employees, directors, appointed or elected officials, volunteers, or agents who
are engaged in any aspect of federally funded procurement, including, but not limited to, t'7
purchasing goods and services, awarding contracts and grants, and the administration and LU
supervision of contracts: 0
a. No employee, director, appointed or elected official, volunteer, or agent of the City shall a
participate in the selection, award, or administration of contracts supported by a federal
award if a conflict of interest is real or apparent to a reasonable person.
b. Conflicts of interest may arise when any employee, officer, or agent of the City, any
member of his or her immediate family, his or her partner, or an organization which
employs or is about to employ any of the parties indicated herein, has a real or apparent
financial or other interest in or a tangible personal benefit form a firm considered for
the contract.
c. No employee, director, appointed or elected official, volunteer, or agent of the City shall
do business with, award contracts to, or show favoritism toward a member of his or her
immediate family, spouse's family, or to any company, vendor, contractor, or parties to
subcontractors who either employ or has any relationship to a family member; or award
a contract or bid which violates federal, state and local procurement laws and policies
established to maximize free and open competition among qualified vendors.
d. The City's employees, directors, appointed or elected officials, volunteers, or agents
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shall neither solicit nor accept gratuities, favors, gifts, consulting fees, trips, or anything
having a monetary value in excess of the gift limitation amount established by the Fair
Political Practices Commission from a vendor, potential vendor, family or employees of
a vendor, contractor or parties tosubcontractors.
e. Disciplinary measures for violations of the Code of Conduct by employees, directors,
appointed or elected officials, volunteers, or agents who are engaged in any aspect of
procurement, including, but not limited to, purchasing goods and services, awarding
contracts and grants, and the administration and supervision of contracts could lead to
disciplinary measures, up to and including possible termination of employment.
3. Solicitation Procedures
a. Acquisition of unnecessary or duplicative items must be avoided. Consideration should
be given to consolidating or dividing procurements to obtain a more economical purchase.
When appropriate, an analysis will be made of lease versus purchase alternatives, and
any other appropriate analysis to determine the most economical approach.
b. To foster greater economy and efficiency, and in accordance with efforts to promote
cost-effective use of shared services, the City shall enter into state and local
intergovernmental agreements or inter -entity agreements where appropriate for
procurement or use of common or shared goods and services.
c. Procuring federal excess and surplus property in lieu of purchasing new equipment and
property whenever such use is feasible and reduces project costs shall be utilized.
d. Value engineering clauses may be used in contracts for construction projects of sufficient
size to offer reasonable opportunities for cost reductions. Value engineering is a
systematic and creative analysis of each contract item or task to ensure that its essential
function is provided at the overall lower cost.
e. Contracts shall only be awarded to responsible contractors possessing the ability to
perform successfully under the terms and conditions of a proposed procurement.
Consideration will be given to such matters as contractor integrity, compliance with
public policy, record of past performance, and financial and technical resources.
f. Records will be maintained sufficient to detail the history of procurement. These records
will include, but are not necessarily limited to the following: rationale for the method of
procurement, selection of contract type, contractor selection or rejection, and the basis
for the contract price. The City Clerk will be the repository for said records and shall be
maintained in accordance with the City's adopted records retention schedule.
g. Time and material type contracts (open-ended) may be used only after a determination
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that no other contract is suitable. Time and material type contract means a contract
where the cost to the City is the sum of the actual cost of materials and direct labor
hours charged at fixed hourly rates that reflect wages, general and administrative
expense, and profit. Each time and material contract will set a ceiling price that the
contractor exceeds at its own risk. A higher degree of oversight is required in order to
obtain reasonable assurance that the contractor is using efficient methods and effective
cost controls.
h. The City alone will be responsible, in accordance with good administrative practice and
sound business judgment, for the settlement of all contractual andadministrative issues
arising out of procurements. These issues include, but are not limited to, source
evaluation, protests, disputes, and claims. These standards do not relieve the City of
Pismo Beach any contractual responsibilities under its contracts. The federal awarding
agency will not substitute its judgment for that of the City unless the matter is primarily
a federal concern. Violations of law will be referred to the local, state, or federal authority
having proper jurisdiction.
4. Competition
a. All procurement transactions must be conducted in a manner providing full and open
competition. In order to ensure objective contractor performance and eliminate unfair
competitive advantage, contractors that develop or draft specifications, requirements,
statements of work, and invitations for bids or requests for proposals will be excluded
from competing for such procurements. Some of the situations considered to be
restrictive of competition include, but are not limited to:
1) Placing unreasonable requirements on firms in order for them to qualify to do
business;
2) Requiring unnecessary experience and excessive bonding;
3) Noncompetitive pricing practices between firms or between affiliated companies;
4) Noncompetitive contracts to consultants that are on retainercontracts;
5) Organizational conflicts of interest;
6) Specifying only a brand name product instead of allowing an equal product to be
offered and describing the performance or other relevant requirements of the
procurement; and
7) Any arbitrary action in the procurement process.
b. Procurements shall be conducted in a manner that prohibits the use of statutorily or
administratively imposed state or local geographical preferences in the evaluation of
bids or proposals, except in those cases where applicable federal statutes expressly
mandate or encourage geographic preference. Nothing in this section preempts state
licensing laws. When contracting for architectural and engineering (A/E) services,
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geographic location may be a selection criterion provided its application leaves an
appropriate number of qualified firms, given the nature and size of the project, to
compete for the contract.
c. All solicitations will incorporate a clear and accurate description of the technical
requirements for the material, product, or service to be procured. Such description must
not, in competitive procurements, contain features which unduly restrict competition.
The description may include a statement of the qualitative nature of the material,
product or service to be procured and, when necessary, must set forth those minimum
essential characteristics and standard to which it must conform if it is to satisfy its
intended use. Detailed product specifications should be avoided if at all possible. When
it is impractical or uneconomical to make a clear and accurate description of the
technical requirements, a brand name or equivalent description may be used as a means
to define the performance or other relevant requirements of procurement. The
specific features of the named brand which must be met by offers must be clearly stated.
d. Bids and proposals shall identify all the requirements which the offerors must fulfill and
all other factors to be used in evaluation bids or proposals
5. Methods of Procurement. In addition to the City's purchasing policy approval limits, one of
the following methods should be used:
a. Micro -purchase: Purchases where the aggregate dollar amount does not exceed
$3,000, or the current limitation set by the Federal Acquisition Regulation at 48 CFR
Subpart 2.1, where this threshold is periodically adjusted for inflation.
b. Small purchase: Purchases up to the Simplified Acquisition threshold, which is currently
$150,000. Informal purchasing procedures are acceptable, but price or rate quotes must
be obtained from an adequate number of sources.
c. Sealed bid: Purchases over the Simplified Acquisition threshold, which is currently
$150,000. Under this purchase method, formal solicitation is required, and the fixed price
(lump sum or unit price) is awarded to the responsible bidder who conformedto all material
terms and is the lowest in price. This method is the preferred procurement method for
construction contracts, if the following conditionsapply:
1) A complete, adequate, and realistic specification or purchase description is available;
2) Two or more responsible bidders are willing and able to compete effectively for the
business, and,
3) The procurement lends itself to a firm fixed price contract and the selection of the
successful bidder can be made principally based on price.
If this method is used, the following requirements shall apply:
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PURCHASING POLICY AND PROCEDURES
4) The invitation for bids will be publicly advertised and bids must be solicited from an
adequate number of known suppliers, providing them sufficient response time prior
to the date for opening the bids;
5) The invitation for bids, which will include any specifications and pertinent
attachments, must define the terms or services in order for the bidder to properly
respond;
6) All bids will be publicly opened at the time and place prescribed in the invitation for
bids;
7) Afirm fixed price contract award will be made in writing to the lowest responsive and
responsible bidder. Where specified in bidding documents, factors such as discounts
will only be used in determining which bid is lowest. Payment discounts will only be
used to determine the low bid when prior experience indicates that such discounts
are usually taken advantage of; and
8) Any or all bids may be rejected if there is a sound documented reason.
d. Competitive proposals: Purchases over the Simplified Acquisition threshold, which is
currently $150,000. This procurement method requires formal solicitation, fixed -price or
cost -reimbursement contracts, and is used when sealed bids are not appropriate. The
contract should be awarded to the responsible firm whose proposal is most advantageous
to the program, with price being one of the various factors. If this method is used, the
following requirements apply:
1) Requests for proposals must be publicized and identify all evaluation factors and
their relative importance. Any response to publicized requests for proposals
must be considered to the maximum extent practical;
2) Proposals must be solicited from an adequate number of qualified sources;
3) The methods for conducting technical evaluations of the proposals received and
for selecting recipients may include, but not limited to: oral interviews,
references, past performance, availability to perform work, and certifications as
determined by project scope.
4) Any response that takes exception to any mandatory items in this proposal
process may be rejected and not considered;
5) Contracts must be awarded to the responsible firm whose proposal is most
advantageous to the program, with price and other factors considered; and,
6) Competitive proposal procedures may be used for qualifications -based
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procurement of architectural/engineering (A/E) professional services whereby
competitors' qualifications are evaluated and the most qualified competitor is
selected, subject to negotiation of fair and reasonable compensation. The
method, where price is not used as a selection factor, can only be used in
procurement of A/E professional services. It cannot be used to purchase other
types of services, though A/E firms are a potential source to perform the
proposed effort.
e. Noncompetitive proposals: Also known as sole -source procurement, this may be
appropriate only when one or more of the following criteria are met:
1) The item is available only from a single source;
2) The public emergency for the requirement will not permit a delay resulting from
competitive solicitation;
3) The Federal awarding agency or pass -through entity expressly authorizes
noncompetitive proposals in response to a written request from the non-
federal entity; or
4) After solicitation of a number of sources, competition is determined
inadequate.
f. Contract Cost and Price. A cost or price analysis shall be performed in connection with
every procurement action in excess of the Simplified Acquisition threshold ($150,000),
including contract modifications. The method and degree of analysis is dependent
on the facts surrounding the particular procurement situation, but as a starting point,
independent estimates shall be made prior to receiving bids andproposals.
1) Profit shall be negotiated as a separate element of the price for each contract in which
there is a no price competition and in all cases where cost analysis is performed. To
establish a fair and reasonable profit, consideration must be given to the complexity
of the work to be performed, the risk borne by the contractor, the contractor's
investment, the amount of subcontracting, the quality of its record of past
performance, and industry profit rates in the surrounding geographical area for
similar work.
2) Costs or prices based on estimated costs for contracts under the federal award are
allowable only to the extent that costs incurred or cost estimates included in
negotiated prices would be allowable for the City under Subpart E- Cost Principles
of Part 200- Uniform Administrative Requirements, Cost Principles, and Audit
Requirements for Federal Awards.
3) The cost plus a percentage of cost and percentage of construction cost methods of
contracting shall be used.
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6. Federal Awarding Agency or Pass -Through Entity Review
a. The City shall make available, upon request of the federal awarding agency or pass -
through entity, technical specifications on proposed procurements where the federal
awarding agency or pass -through entity believes such review is needed to ensure that
the item or service specified is the one being proposed for acquisition. This review
generally will take place prior to the time the specification is incorporated into a
solicitation document. However, if the City desires to have the review accomplished
after a solicitation has been developed, the Federal awarding agency or pass -through
entity may still review the specifications, with such review usually limited to the technical
aspects of the proposed purchase.
b. The City will make available upon request, for the Federal awarding agency or pass -
through entity pre -procurement review, procurement documents, such as requests for
proposals or invitations for bids, or independent cost estimates,when:
1) Procurement procedures or operations fails to comply with the procurement
standards in this part;
2) The procurement is expected to exceed the Simplified Acquisition Threshold
($150,000) and is to be awarded without competition or only one bid or offer is
received in response to a solicitation;
3) The procurement, which is expected to exceed the Simplified Acquisition Threshold,
specifies a "brand name" product;
4) The proposed contract is more than the Simplified Acquisition Threshold and is to be
awarded to other than the apparent low bidder under a sealed bid procurement; or
5) A proposed contract modification changes the scope of a contract or increases the
contract amount by more than the Simplified Acquisition Threshold.
c. The City is exempt from the pre -procurement review in paragraph 2 of this section if the
federal awarding agency or pass -through entity determines that its procurement
systems comply with the standards of this part.
d. The City may request that its procurement system be reviewed by the federal awarding
agency or pass -through entity to determine whether its system meets these standards
in order for its system to be certified. Generally, these reviews must occur where there
is continuous high -dollar funding, and third -party contracts are awarded on a regular
basis;
e. The City may self -certify its procurement system. Such self -certification must not limit
the federal awarding agency's right to survey the system. Under a self -certification
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procedure, the federal awarding agency may rely on written assurances from the City that
it is complying with these standards. The City must cite specific policies, procedures,
regulations, or standards as being in compliance with these requirements and have its
system available for review.
7. Bonding Requirements. For construction or facility improvement contracts or subcontracts
exceeding the Simplified Acquisition Threshold ($150,000), the federal awarding or pass -
through entity may accept the bonding policy and requirements of the City provided that
the federal awarding agency or pass -through entity has made a determination that the
federal interest is adequately protected. If such a determination has not been made, the
minimum requirements must be as follows:
a. A bid guarantee from each bidder equivalent to five percent (5%) of the bid price. The
bid guarantee must consist of a firm commitment such as a bid bond, certified check, or
other negotiable instrument accompanying a bid as assurance that the bidder will, upon
acceptance of the bid, execute such contractual documents as may be required within
the time specified;
b. A performance bond on the part of the contractor for 100 percent (100%) of the contract
price. A performance bond is one executed in connection with a contract to secure
fulfillment of all the contractor's obligations under such contract; and,
c. A payment bond on the part of the contractor for 100 percent (100%) of the contract
price. A payment bond is one executed in connection with a contract to assure payment
as required by law of all persons supplying labor and material in the execution of the work
provided for in the contract.
8. Contract Provisions. All federal funding source compliance provisions shall include the
following:
a. Equal Employment Opportunity- All contracts, when funded in whole or partly by monies
derived from the federal government (either directly or indirectly), shall contain a
provision requiring compliance with Equal EmploymentOpportunity.
b. Davis -Bacon Act- Applies to construction contracts in excess of $2,000. It requires
contracts to pay laborers and mechanics wages not less than the prevailing wage as
determined by the Secretary of Labor and must be required to pay wages not less than
once a week. Each bid solicitation published by the City must contain the current
prevailing wage determination. Any award of the contract must be conditioned on
contractor's acceptance of that wage determination and suspected or reported
violations of this act shall be immediately reported to the Federal awarding agency.
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c Copeland "Anti -Kickback" Act- Applies to construction contracts in excess of $2,000. It
prohibits kickbacks in construction contracts funded with Federal monies. Contractors and
subcontractors or subrecipients shall be prohibited from inducing any person employed
in the construction, completion, or repair of public work, to give up any part of the
compensation to which he or she is otherwise entitled and suspected or reported
violations shall be immediately reported to the Federal awardingagency.
d. Clean Air Act & Federal Water Pollution Control Act- Applies to contracts and sub grants
in excess of $150,000. Contractor shall be required to comply with all applicable
standards, orders or regulations issued pursuant to the Clean Air Act and the Federal
Water Pollution Control Act. Suspected or reported violations must be reported to the
Federal awarding agency and the Regional Office of the Environmental Protection
Agency (EPA).
e. Debarment and Suspension- Contracts funded with federal grant monies may not be
awarded to contractors that have been debarred or suspended from receiving federal
monies pursuant to the System for Award Management(SAM).
f. Byrd Anti -Lobbying Amendment- Contractors that apply or bid for an award of $100,000
must certify that they will not and have not used federal funds to pay any person or
organization for influencing or attempting to influence an officer or employee of any
agency, a member of Congress, officer or employee of Congress, or an employee of a
member of Congress in connection with obtaining any Federal contract, grant or any other
award.
9. Contracting with small and minority business, women's business enterprises, and labor
surplus area firms. All necessary affirmative steps will be taken to assure that minority
business, women's business enterprises, and labor surplus area firms are used when
possible. Affirmative steps include:
a. Placing qualified small and minority businesses and women's business enterpriseson
solicitation lists;
b. Assuring that small and minority businesses and women's business enterprises are
solicited whenever they are potential sources;
c. Dividing total requirements, when economically feasible, into smaller tasks or quantities
to permit maximum participation by small and minority businesses and women's business
enterprises;
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d. Establishing delivery schedules, where the requirement permits, which encourage
participation by small and minority businesses and women's businessenterprises;
e. Using the services and assistance, as appropriate, of such organizations as the Small
Business Administration and the Minority Business Development Agency of the
Department of Commerce; and,
f. Requiring the prime contractor, if subcontracts are to be let, to take the affirmative steps
listed in paragraphs (1) through (5) of this section.
I. ADMINISTRATIVE EXCEPTIONS POLICY FOR PURCHASING
1. Exceptions to competitive procurement procedures that are not included in the existing
purchasing policy.
a. Risk Management Insurance Payments
b. Attorney Bills with an existing contract
c. SLO County Department of Public Works
d. SLO County Air Pollution Control District
e. State of Ca Department of Forestry and Fire Protection
f. State Water Resources Control Board
g. Attorney or Court Settlements
h. Refunds
i. Travel or Training
2. In the event an invoice does not have a purchases order issued, and exceeds the purchasing
limits, the invoice will need to be approved by the Administrative Services Director, City
Manager, or the Management Services Director as the City Manager's Designee dependent
on the amount of the invoice.
a. Over $2,500-$15,000, Department Head and Administrative Services Director
b. $15,001-$50,000, Department Head, Administrative Services Director, and City Manager
Approval
c. More than $50,000, City Council Approval.
3. If an invoice exceeds a purchase order that was issued for a routine purchase, the invoice will
need to be approved by the Administrative Services Director.
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SECTION V: PURCHASE ORDERS
A. REQUIREMENTS- WHEN TO USE
1. For all purchases of tangible items or services over $2,500, a Purchase Order (P.O.) is
required.
2. Once an informal bid or formal bid has been accepted and approved, a Purchase Order
Request shall be prepared (by the requesting department) using a "Purchase Order
Request Form". The form should detail:
• Vendor name
• Vendor address
• Item being purchased
• Total price including tax and shipping
• Budget account to be charged
(The Administrative Services Department will assign a P.O. number after the request has been
approved and entered into the financial system.) The Purchase Order Request shall be signed
and dated by the Department Head.
B. REQUESTING A PURCHASE ORDER
1. To request a purchase order, first fill out the "Purchase Order Request Form".
2. Compile the purchase order packet. The purchase order packet (which includes any
written bids submitted by vendors and any other pertinent documentation) shall be
submitted to the Accounting Manager or his/her designee for approval. If necessary, the
P.O. packet will be forwarded to the City Manager's Office for approval. Once all
approvals have been obtained, the Purchase Order will be encumbered in the Finance
system, and a P.O. number will be automatically assigned. By encumbering the funds in
the general ledger, they will be held for that specific purpose, and will not be available for
any other purpose unless the purchase order is canceled and the funds are released. Note
that if the invoice presented for payment is equal to the amount of the Purchase Order,
the encumbrance will automatically be liquidated upon payment of the invoice. However,
if the invoice is a partial payment of the Purchase Order, it is the Requestor's responsibility
to instruct Accounts Payable to liquidate the encumbrance when final payment has been
made.
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3. Once the Purchase Order has been generated (for non -contracts), the purchase order will
be sent to the requesting department. The department will need to send the purchase
order to the vendor to initiate the order for goods or services.
C. SPECIAL PURCHASE ORDERS
1. Blanket Purchase Orders (sometimes referred to as "Open" Purchase Orders)
a. When to Use
When very similar goods or services are purchased frequently during the year. Generally,
any individual purchase is small in relation to the total amount authorized by the blanket
purchase order or in relation to the total amount budgeted for the goods or services.
When there are a limited number of vendors who supply a particular good or service.
Vendors may be unwilling to repeatedly bid on small jobs especially when they have not
been awarded the job in the past. However, the prospect of a large annual contract may
induce them to prepare a complete and more competitive bid.
b. How to Process
The Requestor should:
Identify and document the need to have a blanket purchase order through the
examination of past purchasing records and the current budget.
Solicit bids and obtain approvals using the same criteria as for a single item purchase
order; i.e., if the total amount is more than $50,000, the formal bidding process must be
followed and City Council approval obtained.
Prepare a Purchase Order Request Form to generate a Purchase Order to be sent to the
vendor and to encumber the funds on the General Ledger for an amount not to exceed
the contract amount. In either case, the Purchase Order or the contract must include
wording that clearly identifies the arrangement, such as:
Furnish goods or services as requested by City of Pismo Beach employees (or state
specifically who is authorized to place orders) when above purchase order number is
referenced up to a total maximum amount of $(state an amount). Issue invoices for each
individual order placed. This purchase order expires on (date).
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D. YEAR END PROCESS FOR ENCUMBRANCES/PURCHASE ORDERS
1. Because of the large volume of requests presented at year-end, Administrative Services
will establish a cutoff date for Requests for Purchase Orders each year, near the end of
June. At year-end, all accounts must have an available balance greater than or equal to
the amount of the purchase order requested. If needed, please process a "Request for
Budget Transfer/Revision" form prior to submitting the "Purchase Order Request" form.
2. Purchase orders issued in the General Fund, Special Revenue Funds, Debt Service Funds,
and Capital Improvement Project Funds may be carried forward to the future fiscal year.
Except for capital improvement projects, prior -year carry forward purchase orders will be
liquidated at the end of the fiscal year.
For example, Fiscal Year 2019-20 or FY 2020 purchase orders are:
• carried over to Fiscal Year 2021
• liquidated on June 30, 2020
• not carried over to the next fiscal year, 2021
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SECTION VI: PAYMENT OF INVOICES
A. RECEIPT OF GOODS AND SEVICES
Once the department/division has received the approved Purchase Order from the City Manager or
his/her designee, they may contact the vendor and purchase the item. Items must generally be
shipped to a City address or worksite. If the product will be shipped to an alternate location, this
should be cleared through the Administrative Services Department in advance.
Once the merchandise or service order has been placed, then the requesting department will wait
until the item is received, or the service completed. Once this has occurred, the department should
await arrival of the invoice for payment.
B. INVOICE PROCESS
1. Once an invoice/receipt/ backup is received, Department staff should verify that the
goods/services were received in good working order, that the invoice is for the agreed
upon price, etc.
Directly on the invoice/receipt/backup, the Department staff should then scan into
Laserfiche workflows and fill out the appropriate metadata, including:
• That they are authorizing payment (i.e. use stamp
• The amount that they are authorizing for payment
• The account number that is to be charged
• Provide invoice/receipt/backup
2. In addition to the above, Accounts Payable will be looking for the following in order to
process payment:
Signed approval directly on the invoice/receipt/form. If you need to mail the original
invoice/receipt/form, make a copy of it and approve the copy.
Do not approve memos or internally generated documents.
Do not approve "Statements" or "Previous Balances" for payment. If there is an item on the
Statement for which we do not have an invoice, contact the vendor and get a copy of the
invoice.
If the item is for more than $2,500 the approved purchase order should be attached to the
invoice.
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PURCHASING POLICY AND PROCEDURES
3. A W-9 should already be on file in Administrative Services, if not — attach it or contact
Accounts Payable to find out how to proceed.
4. If the payment is part of a contract, a copy of the contract should already be on file in
Administrative Services, otherwise- attach it. Ilan invoice is part of a purchase order that has
already been approved, and if the invoice is greater than $50,000, then it does not need to
go back to Council for approval. For invoices less than $50,000, the normal Department
Staff, Department Head, and City Manager approvals apply. For example, if the Council
approved a contract for $200,000 and a purchase order was set up for the contract, then the
City Manager could approve an invoice for $70,000 without going to Council.
5. Attach a copy of the related flyer/seminar brochure/notification to ALL travel and training
payment requests. In addition a copy of the approved "Travel Authorization form" should
be attached for all training/travel expenses out of the San Luis Obispo/Santa Barbara County
areas. (This includes all per diem requests, tuition requests, lodging reimbursements, etc.) co
6. In order to streamline Accounts Payable we request that you do the following: LI_
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Adhere to the following accounts payable schedule. (We currently process an average of OD
200 invoices each A/P run.)
Invoices are typically due on Tuesday.
On Wednesday, the Accounts Payable Clerk will review all of the invoices, double check
coding, make sure that all of the necessary documentation is included, check for duplicate
payments and call individuals with questions or problems.
Tuesday and Wednesday are typically spent entering invoices.
Thursday is spent on the invoice edit list. On Thursday afternoon or Friday morning, checks
are typically printed. The rest of Friday is spent matching checks to invoices, making any
necessary additional copies, checks, running down problems and processing special
requests.
Late invoices and early check requests do not easily fit into the schedule. Going back to redo
any one process in order to accommodate one late invoice can cost anywhere from an
additional 15 minutes to 2 hours of time. Please try to avoid it.
7. Plan ahead. Please try to avoid "emergency checks". We understand that sometimes a
check must be cut outside the regular check run, but please try to keep these checks to an
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absolute minimum. Processing for an emergency check may cost an additional one to two
hours of staff time over a "regular check".
8. Let us know. Please give us advance warning of any emergency checks that may be coming
our way. This will help ensure that the check is processed in a timely manner.
9. Don't promise "special checks" or "early checks" to anyone without first checking with
accounts payable. There are rare instances when it just can't be done.
10. Contact the Accounts Payable Clerk directly for special processing or emergency checks.
With an average of 500 invoices flowing through accounts payable at any one time, don't
assume that the Accounts Payable Clerk is going to notice your note asking for a check by a
certain date.
11.
12.
Use a "Check Request Form" instead of a purchase order as a request for a check
Requests for reimbursements of expenses should be made on an "Travel Expense
Reimbursement Form". The receipt or other original backup pertaining to the
reimbursement should be attached.
13. Requests for per diem should be made on the 'Travel Advance Form". A separate request
should be completed for each employee. Be sure to attach a copy of the city manager
approved "Travel Authorization Form" and a copy of the seminar brochure, etc.
14. Requests for advance checks for lodging, some tuition checks etc, should also be made on
the "Travel Advance Form". Be sure to attach a copy of the approved "Travel Authorization
Form" and a copy of the seminar brochure, etc.
15. Mileage Requests - Requests for reimbursement of mileage (other than training &
conference mileage) should be made on a "Mileage Reimbursement Form"
16. Avoid coding invoices to "Other".
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3s • PURCHASING POLICY AND PROCEDURES
SECTION VII: CITY CREDIT CARD CHARGES
A. OVERVIEW
The City of Pismo Beach uses various methods to procure goods and services. To further improve
purchasing options and facilitate purchasing ease for City employees, the City is utilizing credit
cards issued by US Bank through the Cal -Card program. These guidelines establish the City's basic
policies and procedures for using credit cards in making minor supply and service purchases, and
paying for travel expenses when on City business. While this policy is fairly broad in scope, these
guidelines cannot cover every issue, exception or contingency situation that may arise. As a
result, the basic standard that should always prevail is to use common sense and good judgment
in the use and stewardship of City resources.
These guidelines are organized into the following sections:
B.
• Policies
• Procedures
POLICIES
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1. Finance will issue City credit cards to permanent employees as approved by the M
department head. Department heads will set credit card limits up to $2,500. Based on W
written justification by the department head, the Administrative Services Director may 0
approve credit limits in excess of this amount. Department heads may also set "per Q
transaction" limits at their discretion. Authorization to use the City credit card is �'
restricted to the cardholder or designated staff in the cardholder's respective division as
authorized by the cardholder's supervisor. Evidence of prior approval shall be included in
the supporting back-up associated with the purchase.
2. In the event that a credit cardholder needs to make a one-time purchase that exceeds
their credit limit, the department head may request in writing to the Administrative
Services Director or her designee to temporarily increase the credit limit. In the request
for a temporary increase, justification for the increase will be considered.
3. City issued credit cards should never be used to circumvent established competitive
purchasing procedures. This means no purchases for goods or services should be made
in excess of $2,500 that would otherwise require competitive purchasing procedures. If
a purchase is made in excess of $2,500, the appropriate purchasing procedures will apply.
Further, purchase orders must be completed in advance for qualifying expenses charged
to the credit card, and will not be processed after charges have been completed.
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4. City issued credit cards may be used in paying for travel expenses. However, the City's
Travel Guidelines still apply to all such credit card payments, including the use of Travel
Authorizations and per diem amounts.
5. City credit cards are for official City of Pismo Beach business only. No personal purchases
may be charged to the card. Charging personal expenses on City credit cards is a misuse
of City funds, and a serious breach of the City's ethics policy. Doing so, even if the intent
is to reimburse the City later, will result in disciplinary action, up to and including
termination and legal action. Minor incidental expense as a component part of a larger
billing, such as personal calls on a hotel bill, may be allowed if reimbursed at the time the
credit card billing is submitted for payment.
6. If a City employee has a City issued credit card to purchase items for the City, the City
credit card must be used. In the event that a City credit card is not used by an employee
who has been issued a card for non -travel related expenses, then the City will not
reimburse the employee for those items. The only exception is for case -by -case
emergency purchases approved by the Department Director or City Manager. Not
allowing for personal credit card reimbursements will help avoid fraudulent activity
where an item may be purchased on a personal credit card, then returned without the
City's knowledge.
7. Costco Purchases: Items purchased from Costco shall be purchased using the City's Costco
membership card. In the event that the City's Costco membership card is not used, the
City will not reimburse the employee for those items.
8. No Gift Cards: City employees shall not purchase any gift cards for City employees or
volunteers with City funds. Only the City Manager and Management Services Director
may purchase gift cards for the benefit of the City staff and volunteers as a whole.
C. PROCEDURES
1. Requesting Credit Cards
Department heads should submit a Credit Card Request Form to Administrative Services
to approve cardholders and set credit limits. This request should be in writing, and should
include justification for the request.
2. Criteria
Credit cards will only be issued to permanent full-time employees.
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a. Department heads will set credit limits up to $2,500 and should consider the following
factors when approving credit cards and setting limits:
i. Ability to hold the employee accountable for purchases made on the card.
ii. Frequency and average dollar value of purchases made by the employee.
b. Once approved by the Administrative Services Department, employees will sign a City
Credit Cardholder Use Agreement which sets forth their obligations and
understandings of the program and a US Bank Cardholder Acknowledgement of
Receipt with US Bank responsibilities and acknowledgement of receipt of the card.
3. Card Restrictions
The credit card can be used to purchase supplies, materials, and equipment that do not (0
exceed the single purchase transaction limit. In addition, the credit card may be used to L )
pay for City related travel expenses. THE CREDIT CARD SHALL NOT BE USED FOR
THE FOLLOWING:
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Cash advances, wire transfers, money orders, etc.
b. Purchases of items for which the City has contracts (water meters, bulk fuel, etc.) Q
unless it is an emergency situation, and approved by the Approving Official. a
c. Gambling, Betting, Casino gaming, or other related activities.
d. Political or religious organizations.
e. Court costs, fines, bail or bonds.
f. Rentals, except for small pieces of equipment to be used for less than a week in
duration.
g. Temporary employees.
h. Alcoholic beverages and tobacco products.
Other restrictions may be applied by your Department Head.
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4. Credit Card Purchases
Each cardholder is responsible for the security and safe -keeping of the credit card and is
to complete the following steps with each purchase:
a. Purchase goods by internet, telephone or in person.
b. Require the vendor to itemize the receipt/invoice with the following information:
i. Description of commodities purchased
ii. Quantity purchased
iii. Price per item
iv. Amount of sales tax and total amount
v. Shipping charges, if applicable
**Note: The cardholder should be sure to obtain the itemized receipt for every
transaction. Accounts Payable is not authorized to pay for items that are not detailed
on a receipt. If a cardholder fails to obtain the itemized receipt for every purchase, they
may be held personally responsible for the charges.
5. Standard Process for Payment
After the transaction is complete, the cardholder should forward the itemized receipt
with the appropriate approvals to Accounts Payable through the Laserfiche Credit Card
Receipt template. The metadata in the template is to be completed each time a credit
card transaction is made to provide information regarding the purchase. The cardholder,
and approving official should review the receipt for accuracy, and code with the
appropriate account number to be charged. Accounts Payable will accumulate all receipts
and reconcile to the credit card statement at the end of the month.
6. Missing Receipts
The employee should make every attempt to obtain documentation validating the
transaction. In the event a receipt was not received from a transaction, the cardholder
will be held responsible. It is not the responsibility of the Administrative Services
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10. Lost or Stolen Cards
Cardholders are responsible for ensuring that the issuing bank and the Administrative
Services Department are notified immediately if the card is lost or stolen. Failure to do so
may result in the cardholder being held responsible for fraudulent use of the card.
11. Disciplinary Action
The Director of Administrative Services or authorized designee will notify Department
Heads regarding misuse of City credit cards. Department Heads will be responsible for all
disciplinary action surrounding misuse of cards, or abuse of this policy. This will include
cancellation of card privileges, and other action as deemed appropriate.
12. Return of Cards
Cardholders will immediately surrender their card upon request of their department head.
Administrative Services is responsible for retrieving the card prior to an employee's
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PURCHASING POLICY AND PROCEDURES
Department to contact vendors to obtain receipts. Charges on a credit card statement
without a corresponding receipt cannot be paid by the City due to legal restrictions.
Employees who have missing receipts will be subject to follow-up action, including
cancellation of card privileges and disciplinary action.
7. Disputed Charges
If an item is billed incorrectly, the cardholder is responsible for contacting the vendor within
10 days of the transaction. The employee should notify Accounts Payable, and should
provide all documentation relating to the charge in a timely manner. Accounts payable will
contact the bank, and will pursue the matter until resolved.
8. Returned Items
If an item is returned, the cardholder is responsible for contacting the vendor and requesting
a credit transaction. The cardholder should obtain a credit slip, and notify Accounts Payable
immediately. CO
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Missing receipts may delay payment of a credit card statement. The result can be expensive
late fees. Late fees received due to cardholder negligence will be charged to the cardholder's d'
department. A cardholder who continually accrues late fees will be subject to follow-up LLJ
action, including cancellation of card privileges and disciplinary action. 0
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PURCHASING POLICY AND PROCEDURES
separation from the City. Use of the City credit card for any purpose after its surrender is
strictly prohibited.
13. Responsibilities
Below is a summary of the responsibilities mentioned in these procedures:
a. Cardholders. Safeguard credit card at all times. Purchase supplies and services on
behalf of City in Accordance with these guidelines.
b. Department Heads. Authorize issuance of credit cards and set credit limits. Develop
and implement departmental procedures to be sure credit card purchases are
approved and forwarded to Administrative Services in accordance with the City's
Purchasing Policy, and in a timely manner. When necessary, retrieve credit cards
from cardholder and enforce disciplinary action.
c. Administrative Services Department. Establish account relationship with bank. Assist
with card requests by notifying the bank, and issue cards as requested by department
heads in accordance with these guidelines. Collect receipts, reconcile credit card
statements monthly, and process payments in accordance with the City's Purchasing
Policy and procedures. Assist with billing disputes and the replacement of lost or
stolen cards. Maintain a file of credit cardholder use agreements and a current listing
of all credit cards. Collect and destroy credit cards returned due to cardholder misuse
or separation by the employee.
14. Exceptions
No exceptions or deviations from this policy will be made without approval from the
Administrative Services Director and the City Manager.
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PURCHASING POLICY AND PROCEDURES
SECTION VIII: PETTY CASH REIMBURSEMENT
The Petty Cash fund is used to reimburse purchases that were originally paid out-of-pocket by a
City official or employee.
1. Petty Cash may be used to reimburse or advance City expenses up to $50.00. The main
petty cash drawer in City Hall is maintained in the Administrative Services Department.
2. The procedures to obtain Petty Cash Reimbursement are as follows:
Fill out a Petty Cash Voucher Form within two weeks of incurring the expense.
Complete the form, including the account number to be charged, description, date
requested, and amount.
Attach a receipt or other supporting documentation showing the amount of the charge. CO
Complete a Mileage Reimbursement Form if the request is for mileage reimbursement. L
Policies on mileage reimbursement are outlined in the travel reimbursement section O
above Section VI. D. 6.
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Submit the documents to Administrative Services for reimbursement. Q
0—
Obtain division manager or department director approval.
Upon reimbursement, sign and return the Petty Cash Voucher Form.
3. Petty Cash Advances
An advance of petty cash funds is a PRIVILEGE. Failure to reconcile the actual expenses
with documented receipt to the advance request within 5 days will result in revocation of
the privilege of receiving petty cash advances.
The procedures to obtain a petty cash advance are as follows:
Fill out a Petty Cash Voucher Form.
Complete the form, check the "ADVANCE" box, and list the amount requested, the
account number to be charged, date requested and a brief description of the proposed
use of funds. Please note the maximum petty cash advance is $50.00.
Obtain division manager or department director approval.
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Return all unused cash and submit all receipts or other supporting documentation within
5 days. The Petty Cash Voucher form will be adjusted to reflect the actual expenditures.
PURCHASING POLICY AND PROCEDURES
SECTION IX: BUDGET REVISIONS/TRANSFERS
A. When to Use
Budget transfers can be made within the same fund and within the same department subject to
the approval requirements discussed below. The "Request for Budget Transfer/Revision" form is
prepared to document and to accomplish the transfer. To process purchase orders and invoice
payments without delay, budget transfers are made when:
• The amount of a Purchase Order Request being prepared or the amount of an invoice
presented for payment will cause the annual budget to be exceeded and budgeted funds
are available in other accounts within the division or department. The "Request for
Budget Transfer/Revision" form accompanies the "Purchase Order Request" form or an
invoice to be paid.
• A Purchase Order is processed even though budgeted funds are not available. The
Requestor of the transaction should take action to cover the shortfall immediately. This
keeps the general ledger up to date and lets the individual manager, as well as upper V—
management, know where their division or department, and the City as a whole stand in
relation to the annual budget.
• The Monthly Expenditure Report received by each manager shows a budget shortfall. w
Each manager is responsible for reviewing the report for accuracy and taking corrective 0
action as necessary. Budget shortages in individual categories within a fund and within a Q
division or department can be covered by using the "Request for Budget a
Transfer/Revision" form to transfer from other categories.
B. Processing a Request for Budget Transfer/Revision
The Forms and Approvals to make a Request for Budget Transfer/Revision are as follows:
The Request for Budget Transfer/Revision form must include all the information requested
including both account number and description.
Approval requirements depend on what type of accounts are affected, who initiates the request,
and the amount of the request.
By submitting a "Request for Budget Transfer/Revision" form for grant or matching funds, the
Department Director is verifying to the Administrative Services Department that appropriate
approvals have been received from the Funding Source.
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For transfers between operating expense accounts within the same fund, the following is
required:
• Division Manager initiates a transfer within their division and the Department Director
must approve
• Department Director initiates and approves a transfer between divisions within his/her
Department
• City Manager approval is required
For transfers of capital projects between departments, City Manager and Department Directors
approvals are required.
For transfers between departments initiated by two Department Directors, the following is
required:
• City Council approval is required
• For transfers between funds
• To appropriate funds from the unreserved fund balance
• The Administrative Services Department reviews and approves all transfers after the
above approvals are obtained
C. Special Situations
There are special situations that require consultation with the Administrative Services Director
or his/her designee before the request is initiated and approved as outlined above. These
include:
• Transfers from allocated expense accounts
• Transfers from salaries and related benefits can only be done after analysis by
Administrative Services and is based on vacancies, current expenditures and staffing
projections,
• Transfers from program or program -specific funding sources
The Department Director initiating the request is responsible for assuring that all Council
approved programs retain adequate funding to meet the stated goals, and should not authorize
any transfers that jeopardize the program.
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SECTION X: TRAVEL & MEAL POLICY
A. PURPOSE
The City of Pismo Beach acknowledges the value of professional seminars, conferences, training,
and meetings and recognizes the need for City employees to travel outside the City to conduct
City business. It is the intent of the City to provide travel and expense funds for all reasonable
expenses incurred in the course of such travel. These include transportation, lodging, registration
fees, meals, and any other related expenses if they are for official business and fit within this
policy.
It is the intention of this document to establish a uniform policy for authorizing, monitoring, and
documenting travel by City personnel. Any reference to employees in this policy includes City
personnel. Council Members and Advisory Body Members are also included in this policy, and
are called out separately as "Council and Advisory Body Members" if the policy differs from City
employees.
The purpose of this policy is to also provide a written record and documented audit trail of funds
expended for official travel by City employees and Council and Advisory Body Members for
insurance purposes and to ensure the proper accounting of all City paid travel expenses.
B. OVERVIEW
These guidelines are organized into the following sections:
• General Policy Statement
• General Travel Guidelines
• Definitions
• Planning an official trip
• Meal Allowances
• Submitting Travel Forms
C. GENERAL POLICY STATEMENT
This policy is to assure that City employees and Council and Advisory Body Members adhere to
procedures when arranging for travel, lodging, meals, and other expenses, and that City employees
are paid for reasonable expenses incurred for travel, conferences, meetings, and meals as a result
of conducting authorized City business. The policy assures that payments made by the City are for
actual and necessary expenses incurred for City business. It also assures that City employees and
Council and Advisory Body Members will receive advances/reimbursements in a timely manner.
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Employee travel may be authorized for conducting City business of local and non -local travel
activities such as professional meetings, conferences and training sessions. Payments for travel and
meeting expenses may be in the form of either advances, reimbursement, or by City credit card,
including appropriate registration fees, food, lodging, transportation costs, and reasonable
incidental expenses.
Each Department Head shall be held responsible and accountable for the interpretation and
administration of this policy within his/her department. Department Heads will be expected to
consult with the Administrative Services Director and/or the City Manager, or their designee, on any
questions related to this policy.
All regular, temporary, or contract employees must receive authorization in advance from their
supervisor, and then receive final approval from his/her Department Head or his or her designee for
all travel and conferences. The Department Head or his or her designee may authorize the request
subject to his/her discretion and subject to City Council approval of the annual budget. The City
Manager shall authorize and approve reimbursement for Department Head and Council travel. The
respective Department Head managing the Advisory Body shall authorize and approve
reimbursement for Advisory Body Members.
D. GENERAL TRAVEL GUIDELINES
There are two key "golden rules" to remember about making an official trip:
• Keep it official.
• Keep records of all expenses.
1. Keeping it official.
If the employee takes time away from official business for personal matters, or if the return
is delayed after completion of the event, expenses incurred for personal business will not be
reimbursed. When combining business and personal travel in this manner, Department Head
or his or her designee approval is required. If this extended period occurs during regular
scheduled work hours, the time will be counted as vacation or leave without pay.
2. Keeping records for all reimbursable expenses.
As discussed below under "Submitting Travel Forms", employees must maintain a detailed
record of all reimbursable expenses incurred during his/her travel: transportation, lodging,
baggage handling, parking fees, registration fees, telephone, and any other reasonable and
necessary expenses.
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E. DEFINITIONS
1. Employee
For purposes of this policy, employee means all regular, part-time, temporary, and contract
employees designated to represent the City of Pismo Beach at an authorized meeting,
training session, or conference.
Council and Advisory Body Members
For purposes of this policy, Council and Advisory Body Members means all Council members,
Advisory Body Members, and Commissioners that represent the City of Pismo Beach at an
authorized meeting, training session, or conference. Council and Advisory Body Members
are required per AB 1234 to seek reimbursement for meals up to the maximum federal per
diem rate for each city and state where the travel occurs.
AB 1234 contains certain requirements and restrictions on local agency practices relating to
reimbursing local elected and appointed officials' expenses. AB 1234 requires local agencies
to:
• Adopt expense reimbursement policies that specify the kinds of activities that will be
reimbursable;
• Identify a "reasonable time" within which requests for reimbursement must be
submitted in those policies;
• Use expense report forms; and
• Require that all expenses must be documented with receipts (these documents are
public records subject to disclosure ).
AB 1234 says that such a reimbursement policy may specify what constitutes reasonable
rates for travel, meals, lodging and other expenses. If a local policy does not specify
reimbursement rates, then the reimbursable rates default to those in the Internal Revenue
Service guidelines.
If a Council and Advisory Body Member wants to seek reimbursement for levels of expenses
not otherwise authorized under the agency's reimbursement policy, then the official may
seek prior approval for such reimbursement from the City Manager (before incurring the
expense).
2. Travel
For the purposes of this policy statement, the word "travel" is used to denote activities of
individuals in connection with authorized attendance at conferences, meetings, seminars
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and training, including necessary transportation thereto and there from. Travel is further
delineated as local or non -local as defined below.
• Local Travel (No Travel Authorization or Travel Expense Reimbursement Form is
needed): Official travel performed within 100 miles from Pismo Beach City Hall, and
accomplished within one day. Exceptions to the 100-mile rule include training North of
the San Luis Obispo County/Monterey County line and training in Santa Barbara County
beyond the Gaviota Pass.
• Non -Local Travel (Requires submittal of Travel Authorization or Travel Expense
Reimbursement Form): Official travel involving at least one overnight absence from the
City of Pismo Beach or to a location over 100 miles from City Hall. Exceptions to the
100-mile rule include travel North of the San Luis Obispo County/Monterey County line
and travel in Santa Barbara County beyond the Gaviota Pass.
3. Per Diem: Meals and Incidental Expense (M&IE) Allowance
A per diem meal and incidental expense (M&IE) allowance is an allowance to pay for meal
and incidental expenses while traveling on business. It provides the maximum per diem rate
you can use without treating part of the per diem allowance as wages for tax purposes.
• For employees, the amount of expenses advanced or reimbursed under a per diem
allowance system will be deemed substantiated without receipts, provided the
requirements of the regulations are met.
• For Council and Advisory Body Members, Council and Advisory Body Members are
required per AB 1234 to seek reimbursement for meals up to the maximum federal per
diem rate for each city and state where the travel occurs. Council and Advisory Body
Members must provide receipts in all instances to substantiate the request for
reimbursement.
Federal Per Diem Rate: The per diem amount for meals and incidental expenses are
provided by the U.S. General Services Administration for each city and state where the
employee travels. The total amount per day is listed for each location, and then is broken
down into breakfast, lunch, dinner, and incidentals. The rates can be found at:
http://www.gsa.govinerdiem.
Meals: Expenses for meals, tips, taxes, and fees for food. An employer is not required to
reduce the M&IE even if meals are provided in -kind to the employee, if the employer
reasonably believes that the M&IE will be incurred.
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Incidental Expenses: Expenses for luggage handling services, including fees and tips given to
porters, baggage carriers, bellhops, hotel maids, stewards or stewardesses and others on
ships. Incidental expenses allowance is provided for overnight travel.
Per Diem Allowance Rules
If a per diem allowance is used, employees are deemed to have substantiated the amount
of expenses equal to the lesser of the Federal per diem rate or the per diem allowance paid
by the employer.
• The per diem must be at or less than Federal rates to be fully excludable from wages
for tax purposes.
• No receipts are required if a per diem allowance is used for employees, but the
payments must meet the other substantiation requirements including date, time, place,
and business purpose. For Council and Advisory Body Member, receipts are required
for the City to reimburse the traveler up to the federal per diem rate.
• An employer's substantiation requirements must, at a minimum, meet the Federal
requirements. An employer may have more stringent requirements, such as requiring
meal and/or lodging receipts.
• If employees use a City credit card for any purpose, a receipt is required. If the amount
of the meal is less than the per diem M&IE, the employee may request the difference
on the Travel Expense Reimbursement Form. If the amount of the meal is greater than
the per diem M&IE, the employee is responsible for reimbursing the City for the
difference.
4. Internal Revenue Service (IRS) Accountable vs. Non -Accountable Plan
An accountable plan is an allowance or reimbursement policy under which amounts are
nontaxable to the recipient if the following requirements are met:
• There must be a business connection to the expenditure.
• There must be adequate accounting by the recipient within a reasonable period of time.
• Excess advances must be returned within a reasonable period of time.
A nonaccountable Ulan is an allowance or reimbursement program or policy that does not
meet all three requirements for an accountable plan. Payments, including advances,
reimbursements, allowances, etc., made under a nonaccountable plan are taxable wages
subject to all withholding when paid or when constructively received by an employee. The
employees may be able to deduct these expenses as itemized deductions on their individual
tax returns.
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An "Accountable Expense Reimbursement Plan" must meet the following requirements
in order to be considered a tax-exempt payment to the employee.
• The employee must substantiate the expense incurred.
• The employee must refund any advances in excess of substantiated expenses,
excluding the per diem M&IE advance.
• The expense must have a business connection.
If the above requirements are not met, the payment to the employee becomes taxable
as wages and is reported as such on the W-2.
5. Miscellaneous Expenses
Miscellaneous expenses are not considered part of a per diem M&IE allowance and,
therefore, substantiation is required in the form of a receipt. Miscellaneous expenses
include cab fares, fax, telephone, copy charges, and other business related expenses. City
funds will not be used to purchase alcohol or reimburse employees for alcohol related costs.
6. Mileage Reimbursement
Reimbursement for personal auto expense will be at the published IRS mileage
reimbursement rate in effect on the date of travel. Mileage reimbursement shall be deemed
to cover all expenses incurred of whatever description, including but not limited to required
liability insurance, gasoline, oil, maintenance, and wear and tear.
F. PLANNING AN OFFICIAL TRIP
1. Method of Travel
Transportation costs include, but are not limited to, airplane, train, bus and taxi fares,
bridge tolls, parking and car rental. You should generally take the most direct and
commonly traveled routes. Other routes may be authorized when official business
requires their use. If you take any indirect route or stop along the way for personal
reasons, you will not be reimbursed for non -business expenses. Selection of carrier,
reservations, and ticketing should be arranged as early as feasible to obtain the greatest
discount. Also consider the use of alternative transportation methods, such as using a
nearby airport and ground transportation if the total fares are lower.
Air Travel on City business should be coach class and booked using any common City
method of payment. Air travel should not be used into areas in which ground
transportation is approximately 2-3 hours. If you make booking arrangements and other
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arrangements would have been less costly to the City, you may have to reimburse the
City the difference. Take advantage of lower airfare rates by booking your flight as early
as possible, and purchasing non-refundable tickets. You may sometimes avoid higher
airfare by staying over a Saturday night. In some instances, an extra night in a hotel/motel
can be much less than the added cost of the airfare.
In certain circumstances on longer flights, in order for the City to receive full value on the
compensation being paid to the employee while flying, a "Premium Economy" seating
arrangement that allows for sufficient space to use a laptop, that provides an electrical
outlet for charging a mobile device, and that provides for adequate space to otherwise
work productively while traveling by air, may be authorized. In order to assist staff
members to work while traveling by air, the City Manager will consider having the City
pay for the additional cost for a Premium Economy seating arrangement and pay for
Internet access on the plane. Those eligible include members of the City Council,
Department Heads, and the CVB Executive Director if all of the following conditions are
met:
• Flight is for city business out-of-state, exceeding 3 hours in duration
• Flight is scheduled during a work day from Monday through Friday and City work will
actually be performed OR flight is scheduled on Saturday or Sunday and the employee
traveling agrees to perform City work during the flight
• The Premium Economy option is approved by the City Manager in advance (before
travel is booked)
Department Heads may consider taking different flights in case an emergency may occur
while in flight. A generally accepted rule is to have no more than two members on the
same flight, if there is a strong possibility of danger while traveling.
City vehicles should be used if one is available. Please make a request at least one week
in advance. If refueling is necessary, you may request reimbursement for any gasoline
purchases. Make sure to check the vehicle for safety and damages before you begin the
travel. Use of City Vehicle for any training requires Department Head or his or her
designee approval. See City Vehicle Usage Policy (Resolution R-2011-017).
Rental vehicles at City expense may only be obtained when you are on City business and
other modes of transportation are not available, too costly, or impractical. A rental
vehicle requires prior approval of the Department Head or his or her designee. Only small
or intermediate size vehicles, or vehicles with an equivalent rental rate, will be
authorized. If two or more persons are attending the same meeting or conference, and
a vehicle is needed for City business, only one vehicle may be rented at City expense. The
rental should be charged to a City credit card in order to avoid the need for additional car
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rental insurance to be purchased from the rental agency. As a precaution against paying
for preexisting damage, carefully examine the condition of the rental vehicle before
leaving the lot, and immediately report any damages to the car rental office.
Public Transit. Carpooling — You are encouraged to make optimum use of available public
transit services and carpooling.
Private Vehicle — There are times in which the use of an employee's personal vehicle is
preferable because either a City owned pool vehicle is not available or because the use of
a privately owned vehicle is deemed more efficient. Please refer to the City Vehicle Usage
Policy (R-2011-017) for more information. For travel within 100 miles of the Pismo Beach
City Hall in a private vehicle, fill out a Mileage Reimbursement Form.
For non -local travel, prior approval must be obtained by completing a Travel
Authorization form. The total documented mileage and all other travel expenses incurred
cannot exceed the amount of car rental or airfare. The City shall only reimburse you the
least costly means of travel. For employees, the additional time spent driving must also
be considered and approved by the Department Head or his or her designee prior to the
trip.
When using a private vehicle, appropriate mileage reimbursement shall be processed. All
travel claims should be submitted showing the total mileage from an Internet travel site
reflecting the starting and ending points at Pismo Beach City Hall, regardless of where the
actual travel began/ended (i.e. home, another meeting, etc.). Reimbursement shall be at
the current rate authorized by the employees negotiated MOU rate or, if no other
negotiated rate, the Internal Revenue Service rate. Realize that any gas, damages, needed
service, or repair to your personal vehicle occurring on the trip will be your responsibility,
as these costs are included in the per mile cost reimbursement.
You are entitled to reimbursement for necessary transportation expenses incurred while
on official City non -local travel. You should schedule your trip so that you leave at a
reasonable hour and arrive at your destination on time. You should also return promptly
when your business is finished, thereby minimizing the time away from work and ensuring
full reimbursement of all related expenses.
2. Compensation for travel time
Department Heads must consider staff schedules and when authorizing travel for City
employees. Department Heads shall adjust an employee's travel dates and time to reduce
overtime or make other arrangements in the weekly work schedule to reduce overtime.
Overtime is based on the 40 hour work week, not the 8 hour day. When travel time
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exceeds the normal workweek, the City's rules for overtime apply to those employees
eligible for overtime. In determining overtime compensation, normal commute time
should be deducted from the total travel time. Additionally, normal unpaid meal periods
are not considered work time while traveling. Overtime eligibility applies equally to
drivers and passengers, and should be granted whether the travel occurs during normal
workdays or on weekends or evenings. Fair Labor Standards Act guidelines will apply
when traveling by public transportation.
3. Lodging
Lodging is allowed for attendance at conferences, seminars or meetings that are in excess
of 100 miles or two hours of travel time from Pismo Beach City Hall (not from the
employee's home). Exceptions to the 100-mile rule include training North of the San Luis
Obispo County/Monterey County line and training in Santa Barbara or beyond the Gaviota
Pass. Reasonable lodging expense will be paid at actual cost (including taxes and parking)
for as many nights as necessary. The accommodations used should be economical but
practical. In general, the employee should select the most reasonable priced
accommodations available consistent with the purpose and goals of the travel. Room
service charges on the hotel bill must be business related and substantiated with an
itemized receipt.
When making lodging reservations, be sure to ask if a "government rate" is available.
Some cities exempt travelers on government business from the local transient occupancy
tax (TOT). This can be as high as 12-15% savings on lodging costs depending on the local
TOT rate. A completed "City of Pismo Beach Government Exempt Form" should be given
to the Hotel when you check in at the reservation desk.
For Council and Advisory Body Members, the City will pay for reasonable lodging expenses
at the actual cost for official city business that requires an overnight stay. The
accommodations used should be economical but practical. In general, the Council and
Advisory Body Members should select the most reasonable priced accommodations
available consistent with the purpose and goals of the travel. If such lodging is in
connection with a conference, lodging expenses must not exceed the group rate
published by the conference sponsor. If a group rate is not available, then the government
rate or IRS per diem rate for lodging for a given area are presumed reasonable and hence
reimbursable.
If the lodging exceeds the group rate, government rate, and the IRS per diem rate, the
City Manager can approve prior to the travel on a Travel Authorization Form
reimbursement to the Council and Advisory Body Member for the amount up to the IRS
per diem lodging rate on a non-taxable basis, and any additional amount may be
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reimbursed to the Council and Advisory Body Member, but is considered taxable as
wages for the Council and Advisory Body Member.
Room service charges on the hotel bill must be business related and substantiated with
an itemized receipt.
G. MEAL ALLOWANCES
1. Non-Local/Overnight Travel Meal allowance:
a. Per Diem meals and incidental expenses (M&/E)
The City will advance and reimburse an employee based on the federal per diem
rates for meals and incidental expenses (M&IE) for different geographical areas.
M&IE includes meals, tips, taxes, and fees for food, and luggage -handling services.
The per diem M&IE amounts are provided by the U.S. General Services
Administration for each city and state where the employee travels. The total
amount per day is listed for each location, and then is broken down into breakfast,
lunch, dinner, and incidentals. The rates can be found at:
http://www.gsa.gov/perdiem. The City will reimburse a Council and
Advisory Body Member based on the federal per diem rates for meals on the
Travel Expense Reimbursement Form substantiated by receipts.
b. Using a City credit card for meals
In the event that an employee uses a City credit card to purchase a meal, the
employee must substantiate the expense with a receipt. If the amount of the meal
is less than the per diem M&IE, the employee may request the difference on the
Travel Expense Reimbursement Form. If the amount of the meal is greater than
the per diem M&IE, the employee is responsible for reimbursing the City for the
difference.
c. Using personal cash for meals, then requesting reimbursement
In the event that an employee or Council and Advisory Body Member uses their
own personal cash for meals, then requests reimbursement from the City, the
employee or Council and Advisory Body Membermay request the Per Diem M&IE
rate on the Travel Expense Reimbursement Form, substantiated by receipts.
d. Guidelines for meal allowances are as follows:
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• Using the Per Diem M&IE rates provides for the employee to eat while traveling re
on City business.
• Per Diem M&IE does not include meals eaten prior to or after the trip. During
partial days of travel, per diem advances shall be reduced for such items. During
full days, per diem M&IE are provided by the day. For example, if an employee
or Council and Advisory Body Member does not eat breakfast or lunch and
spends all or most of the per diem M&IE for the day on dinner, the employee
can still receive the full per diem M&IE for the day and the Council and Advisory
Body Member can still receive up to the full per diem for meals for the day if
substantiated by receipts. In the same scenario, if the employee uses the City
credit card for the dinner and the receipt shows that the amount is greater than
the dinner allowance, but still less than the full day per diem M&IE, the
employee may still receive the full day Per Diem amount.
• If requesting a meal reimbursement for a guest, the employee must include the
name and business relationship of the guest to substantiate the expense.
• Per Diem M&IE reimbursements will be made after the trip when submitted on
the Travel Expense Reimbursement Form. Per Diem for meals reimbursements
will be made after the trip with receipts when submitted on the Travel Expense O
Reimbursement Form.
• Employees are allowed to receive Per Diem M&IE allowance or meal 4
reimbursement for meals that conferences may already provide if specified on
the Travel forms.
• Advances or additional travel expenses over $50 shall be made by check only, Q
not petty cash.
CL
In calculating meal allowances fo
used:
Departure
• If you depart after 8:00 a.m.,
• If you depart after 2:00 p.m.,
day.
• If you depart after 8:00 p.m.,
Return
• If you return after 6:00 p.m.,
the day.
• If you return between 2:00 p
lunch allowances.
• If you return between 8:00
allowance.
r partial days, the following guidelines should be
deduct the breakfast allowance for that day.
deduct the breakfast and lunch allowance for that
deduct all meal allowances.
you may claim the full per diem meal allowance for
.m. and 6:00 p.m., you may claim the breakfast and
a.m. and 2:00 p.m., you may claim the breakfast
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2. Local Travel Meal Allowance:
In general, meal allowances will not be issued or reimbursed for Local Travel or
Training when it occurs within 100 miles from Pismo Beach City Hall, and
accomplished within one day. Exceptions to the 100-mile rule include travel North of
the San Luis Obispo County/Monterey County line and travel in Santa Barbara County
beyond the Gaviota Pass. Meal allowances that fall under Local Travel and Training do
not qualify under the IRS Accountable Plan.
Meals are taxable as wages to the employee and included on the year end W2 form
If meals are provided to employee for local travel that does not include an overnight
stay. Department Heads may allow meal requests for local travel, keeping in mind
that these local travel meals are considered additional income to the employee and
are not part of an accountable plan.
On the occasion that meals are provided for travel that does not include an overnight
stay, the City can issue the Per Diem rate for the local travel destination, and payable
to the employee only. If paid in advance, the check can be issued in the employee's
name only; or can be reimbursed after the travel in the employee's name only. The
meal requests are payable to employee for Tax Reporting purposes.
Exceptions to taxing meals as wages for local travel:
A. Meals are not taxable as wages to the employee if they are provided:
• On the employer's business premises, and
• For the employer's convenience.
(See the IRS Taxable Fringe Benefit Guide for examples.)
For example, Public Work employees may be provided breakfast and lunch on July
5th in order to quickly clean up the beach (on City business premise) so they won't
have to stop for a long breakfast and lunch break (for the employer's
convenience).
B. Trade or Professional Association Meetings: Advances or Reimbursements for
meal expenses for employees directly related to and necessary for attending
business meetings or conventions of certain exempt organizations are excludable
from wages if the expenses of your attendance are related to your trade or
business. These organizations include chambers of commerce, business leagues,
and trade or professional organizations. Meals with meetings must be
substantiated with a receipt.
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C. Directly -Related Meals/Entertainment or Associated Entertainment: Meals are
reimbursable or allowance provided to employees for meals in the course of
entertaining customers and are not taxable if:
(1) it meets the Directly -Related Meals or Entertainment test:
• the main purpose of the combined business and meal is the active conduct
of business,
• business is actually conducted during the meal period, and
• there is more than a general expectation of deriving income or some other
specific business benefit at some future time.
OR
(2) if it meets the Associated Entertainment Test:
• associated with the active conduct of the employer's business, and
• directly before or after a substantial business discussion.
(See the IRS Taxable Fringe Benefit Guide for examples.)
Whether a business discussion is substantial depends on the facts of each case. A
business discussion will not be considered substantial unless you can show that
you actively engaged in the discussion, meeting, negotiation, or other business
transaction to get income or some other specific business benefit. You must be
able to show that the business discussion was substantial in relation to the meal.
These Directly -Related Meals/Entertainment or Associated Entertainment Meals
must be substantiated with a receipt.
Meals with meetings or overtime meals must be substantiated with a receipt.
H. SUBMITTING TRAVEL FORMS
1. Determine Method of Payment and timing of submitting forms
There are three ways to pay for travel expenses: "direct vendor payment", "cash/check
advance", and "employee or Council and Advisory Body Member reimbursement". Direct
vendor payments are made by the City to an organization to pay for specific costs related
to a trip. These are usually registration fees, lodging, and airfare, and can be paid through
Accounts Payable or through the use of a City credit card. Cash or check advances are
lump sum payments made to the employee prior to the event to cover expenses as they
arise on the trip. The third method of employee or Council and Advisory Body Member
reimbursement occurs when the employee or Council and Advisory Body Member elects
to pay for some or all travel related expenses first, and is reimbursed upon completion of
the travel.
To obtain either direct vendor payments or a cash/check advance, the employee must
complete a Travel Advance form and a Travel Authorization form and attach a copy of the
flyer or brochure announcing the event, as well as any other appropriate supporting
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documentation. Travel Authorization Forms and Travel Advance Forms should be
submitted to the Administrative Services Department at least two weeks prior to travel.
Upon return from the event, the employee and Council and Advisory Body Member must
account for all expenses incurred and return any unused portion of the advance within ten
(10) days (excluding the per diem MI&E allowance for employees), along with the
completed Travel Expense Reimbursement Form. The employee will be reimbursed the
difference if the actual, authorized expenses incurred exceed the amount advanced,
excluding the per diem MI&E allowance.
2. Travel Forms
There are two forms that need to be completed when planning travel for Department
employees and Council and Advisory Body Members: a) Travel Authorization Form; and b)
Travel Expense Reimbursement Form. An additional form is needed for Travel Advances.
This form should be completed when an advance for travel is needed. The form is called c)
Travel Advance Form. For local travel within 100 miles of the Pismo Beach City Hall in a
personal vehicle, fill out a d) Mileage Reimbursement Form.
a) Travel Authorization Form
The Travel Authorization must be submitted first. It includes the total expense
information, the required approval signatures, and will break down what will be paid
by check, credit card, advance, etc. If there are prepayments or advances to be
processed, please attach a Travel Advance form. Out of state travel for Department
Heads and Council and Advisory Body Members shall be approved by the City
Manager.
b) Travel Expense Reimbursement form
The Travel Expense Reimbursement form itemizes all expenses associated with the
event and is approved by the Department Head or his or her designee. This form must
be submitted to the Administrative Services Department no later than ten 110) days
following the event but in no event greater than thirty (30) days following the
completion of the activity.
• If this form is not submitted to the Administrative Services Department within 30
days, no future advances or prepayments will be processed for the employee, per
Resolution (R-2009-022).
• If the form is not received within 30 days following the completion of the activity,
the employee or Council and Advisory Body Member will not receive
reimbursement for expenses associated with the event. Any exceptions must be
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approved by the City Manager. At that point, the amount of the travel advance
will become taxable and reported on the employee's W-2.
Please attach all of the receipts to the Travel Expense Reimbursement Form. The
expenses are to be broken down by day. In the event that the person traveling does
not use all the money they were advanced for the trip (excluding per diem
M&IE), they are required to return the unused portion to the City prior to the
submission of the Travel Expense Reimbursement form. Attach a copy of the receipt
to the form. Keep in mind that employees are allowed the federal per diem rate per
day for the geographic area for meals while Council and Advisory Body Members are
allowed up to the federal per diem rate per day for the geographic area for meals if
substantiated by receipts for those meals. If more than federal per diem rate per
day is spent the employee or Council and Advisory Body Member will not be
reimbursed for the overage. Please submit the Travel Expense Reimbursement
Form with a copy of the approved Travel Authorization form.
c) Travel Advance Form
The Travel Advance Form summarizes the expenses you would like prepaid in
advance - such as the hotel, the event registration fee, etc. This form also summarizes
any advances to the employee to be made - such as per diem for meals and mileage
reimbursement if they are using a personal car. Please refer to the federal per diem
meals and incidentals rates for the geographic area of travel at:
http://www.gsa.RovJpei'diern. Please note the required documentation to be
submitted with this form, such as an event brochure or advertisement listing the
registration fees or event cost, Google/maps, or similar documentation including one-
way mileage from City Hall to the destination address, and hotel confirmation
documents from web or fax. Travel Advance forms must be submitted within 10
working days prior to a check being issued.
d) Mileage Reimbursement Form
The Mileage Reimbursement Form is for local travel within 100 miles of the Pismo Beach
City Hall in a private vehicle. The starting point is Pismo Beach City Hall. Turn the form
in and Google/maps information to the Administrative Services Department within two
(2) weeks of incurring expense, or monthly on the last Friday of the Month.
For non -local travel, prior approval must be obtained by completing a Travel
Authorization form and ultimately provided on the Travel Expense Reimbursement
Form. The total documented mileage and all other travel expenses incurred cannot
exceed the amount of car rental or airfare.
3. Lost or No receipts
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If an employee or Council and Advisory Body Member has lost a receipt for a travel -
related item or no receipt is provided, a memo is required. The memo must include
the following:
• Explain the circumstances in detail, such as time, activity, and reason for losing the
receipt or reason that receipt was not provided.
• Include all receipt information such as place of business, amount, date,
description of item.
• The employee or Council and Advisory Body Member must sign it.
• The Department Head or his or her designee, or the City Manager for Council and
Advisory Body Member, must sign it.
4. Department Head Approval
Department heads approving Travel Expense Reimbursement forms are responsible
for ensuring that:
• All expenses are reasonable, necessary, and consistent with these guidelines.
• Required receipts are attached.
• The final disposition is correct (e.g. balance due employee; balance due City).
• Any amounts due to the City are reimbursed.
• Final accounting of all expenses is submitted to the Administrative Services
Department.
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SECTION XI: FRAUD PREVENTION AND REPORTING POLICY
A. PURPOSE
The City of Pismo Beach is committed to protecting taxpayer dollars and assets from fraud
and recovering losses as a result of fraudulent activities. The Fraud Prevention and
Reporting Policy is established to facilitate the development of controls which will aid in
the prevention and detection of fraud against the City. The Policy empowers the
Administrative Services Director to conduct investigations and report findings to the City
Manager.
This policy sets out specific guidelines and responsibilities regarding appropriate actions
that must be followed for the investigation of fraud and other similar irregularities.
B. APPLICABILITY
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This policy applies to all Elected Officials, Advisory Body members, and employees of the
City of Pismo Beach as well as any business or individual doing business with the City. O
C. GENERAL POLICY AND RESPONSIBILITY LC II
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1. It is the City's intent to fully investigate any suspected acts of fraud or other similar
irregularity. As used in this policy, "fraud" means an intentional misrepresentation,
deceit, or concealment of a material fact known to the person accused of the fraud,
with the intention on the part of that person of thereby depriving another person or
the City of property, legal rights or otherwise causing injury.
2. An objective and impartial investigation will be conducted regardless of the position,
title, length of service, or relationship with the City of any party who might be, becomes
involved in, or is the subject of, such investigation.
3. Each Department Director, and Manager is responsible for instituting and maintaining
a system of internal controls to provide reasonable assurance for the prevention and
detection of fraud, misappropriations and other irregularities. Management should be
familiar with the types of improprieties that might occur within their area of
responsibility and be alert for any indications of such conduct.
4. The Administrative Services Director has the primary responsibility for the investigation
of all activity defined in this policy.
5. The Administrative Services Director will notify the City Manager and other pertinent
Department Directors, including the Management Services Director and Police Chief, as
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needed, of a reported allegation of fraudulent or irregular conduct upon the
commencement of the investigation to the extent practical. Throughout the
investigation the City Manager will be informed of pertinent investigative findings.
6. In all circumstances where there are reasonable grounds to indicate that a fraud may
have occurred, the Administrative Services Director, subject to the advice of the City
Attorney, will contact the City Police Department.
7. Upon conclusion of the investigation, the results will be reported to the members of
the City Council, the City Attorney, and others as determinednecessary.
8. The City Attorney will pursue every reasonable effort, including court -ordered
restitution, to obtain recovery of the City's losses from the offender, or other
appropriate source.
D. PROCEDURES
1. All Employees
Any employee who has knowledge of an occurrence of irregular conduct, or has reason to
suspect that a fraud has occurred, shall immediately notify their supervisor. If the
employee has reason to believe that their supervisor may be involved or does not feel
comfortable reporting the occurrence to their supervisor, the employee shall immediately
notify the Administrative Services Director (or the City Manager if the Administrative
Services Director is not available).
Employees have a duty to cooperate during an investigation.
Employees who knowingly make false allegations will be subject to discipline in
accordance with the City's Personnel Rules and Regulations.
2. City Management
Upon notification from an employee of a suspected fraud, or if management has reason
to suspect that a fraud has occurred, they shall immediately notify the Administrative
Services Director.
3. Administrative Services Director
Upon notification or discovery of a suspected fraud, the Administrative Services Director
will promptly investigate the suspected fraud. In all circumstances, where there are
reasonable grounds to indicate that a fraud may have occurred, the Administrative Services
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Director will inform the City Attorney. Subject to the advice of the City Attorney, the
Administrative Services Director will contact the City Police Department.
4. Contacts/Protocols
After an initial review and a determination that the suspected fraud warrants additional
investigation, the Administrative Services Director will notify the City Manager. The
Administrative Services Director will coordinate the investigation with the City Attorney
and appropriate law enforcement officials.
5. Security of Evidence
Once a suspected fraud is reported, the Administrative Services Director, in consultation
with the City Attorney, shall take immediate action to prevent the theft, alteration, or
destruction of relevant records. Such actions include, but are not necessarily limited to,
removing the records and placing them in a secure location, limiting access to the location
where the records currently exist, and preventing the individual suspected of committing
the fraud from having access to the records. The records must be adequately secured until
the Administrative Services Director obtains the records to begin the audit investigation.
6. Personnel Actions
If a suspicion of fraud is substantiated by the investigation, disciplinary action, in
accordance with the City's Personnel Rules and Regulations, may be taken by the City
Manager, in consultation with the Management Services Director, the Administrative
Services Director, and the City Attorney.
7. The City or a person acting on behalf of the Cityshall not do any of the following because
an employee has reported fraud in accordance with the requirements of this policy:
o Dismiss or threaten to dismiss an employee
o Discipline or suspend, or threaten to discipline or suspend, an employee
o Impose any penalty upon an employee; or
o Intimidate or coerce an employee.
The violation of this section may result in discipline up to and including dismissal in
accordance with the City's Personnel Rules and Regulations.
8. Media Issues
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Any City employee or elected or appointed official contacted by the media with respect to
an audit investigation shall refer the media to the City Manager. The alleged fraud or audit
investigation shall not be discussed with the media by any person other than through the
City Manager or his or her designee, in consultation with the Administrative Services
Director.
If the Administrative Services Director is contacted by the media regarding an alleged fraud
or audit investigation, they will consult the City Manager, before responding to a media
request.
Neither the Administrative Services Director nor the City Manager or Management Services
Director will discuss the details of any ongoing fraud investigation with the media in any
manner that may compromise the integrity of the investigation.
9. Documentation
At the conclusion of the investigation, the results will be reported to the City Manager, the
City Attorney, and others as determined necessary. If the report concludes that the
allegations are founded, the report will be forwarded to the City Police Department.
10. Completion of the Investigation
Upon completion of the investigation, including all legal and personnel actions, any records,
documents and other evidentiary material will be returned by the Administrative Services
Director to the appropriate department.
11. Reporting to External Auditors
The Administrative Services Director will report to the external auditors of the City all
information relating to investigations.
12. Training
New employees are trained at the time of hiring about the City's Code of Conduct and Fraud
Prevention and Reporting Policy. This training explicitly covers expectations of all
employees regarding:
a) Their duty to communicate certain matters;
b) A list of the types of matters, including actual or suspected fraud, to be
communicated along with specific examples; and
c) Information on how to communicate those matters.
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SECTION XI: COUNCIL MEMBER REIMBURSEMENT POLICY
A. PURPOSE
The purpose of this policy is to establish maximum reimbursement amounts for certain types of
legitimate expenses incurred by City Council Members in the performance of their official duties;
and require the substantiation of these expenses in the form of a receipt or other acceptable
proof prior to reimbursement, in accordance with AB 1234. This section shall apply only to
reimbursement of expenses not related to travel; reimbursements of travel -related expenses
shall be regulated by Section X of this Purchasing Policy.
B. DEFINITIONS
"Official duties" shall mean any and all actions undertaken by the Council Member that are
necessary or desirable for the fulfillment of the duties assigned to the official by state law, City
law, City policy, or custom, and generally in keeping with the office's purview and organizational
norms, and performed for the benefit of the public. "Official duties" shall not include duties
performed in the course of fulfilling external committee assignments for third -party
organizations offering a stipend for said assignment.
"Travel -related" shall mean any expense or activity that is contemplated by Section X: Travel and
Meal Policy of this Purchasing Policy.
C. COUNCIL MEMBER REIMBURSEMENT POLICY
1. Council Members shall be eligible for reimbursement for the following types of expenses,
and in the following amounts:
a. Miscellaneous expenses: A maximum of $95 per month for other actual and necessary
expenses relating to the performance of official duties. Eligible expenses shall include,
but not be necessarily limited to:
i. Mileage for vehicle trips taken in the official's personally owned or rented vehicle
that are not travel -related, except that any official who has executed an
agreement with the City for the payment of a car allowance shall not be eligible
for the first 100 miles of same -day or to -and -from travel that is covered by the car
allowance vehicle expense reimbursement relating to their owned or rented
vehicles except as otherwise provided in the agreement; overnight travel mileage
is still reimbursed per the non -local travel policy as indicated in Section X.
ii. Parking expenses that are not travel -related;
iii. Meal expenses that are not travel -related;
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iv. Office supplies such as pens, pencils, or paper and ink for a home printer;
v. Other actual and necessary expenses relating to the performance of official duties
not listed above, subject to approval of the Administrative Services Director.
b. Ineligible expenses: Notwithstanding any of the above provisions, expense
reimbursement shall not be made for costs incurred in the purchase, consumption, or
provision of alcohol, or expenses incurred in the course of any activity that is
otherwise in conflict with City policies, or unlawful for the official in question.
2. All requests for reimbursement shall be accompanied by an expense report form as
described in subsection D. below.
3. All requests for reimbursement shall be accompanied by a receipt or other acceptable
documentation substantiating the amount of the expense, along with other details, as
described in subsection D. below.
4. All such records of expenses and related reimbursement requests shall be public,
notwithstanding any information that is exempt from release under the California Public
Records Act or other applicable statute.
D. SUBMITTING EXPENSE REIMBURSEMENT FORMS
1. A request for reimbursement shall be submitted within ten (10) days after the date the
expense is incurred / after the end of the month. If the form is not received within thirty
(30) days following the incurring of the expense / end of the month, the Council will not
receive reimbursement for expenses associated with the expense. Any exceptions must
be approved by the City Manager.
2. A request for reimbursement shall be made in the form of a Mileage Reimbursement
Form for mileage reimbursements, and a Check Request Form for all other eligible
expenses. Relevant receipts or other acceptable documentation shall be attached to the
Mileage Reimbursement and Check Request Form
a. Mileage Reimbursement Form:
The Mileage Reimbursement Form is for local travel within 100 miles of the Pismo
Beach City Hall in a private vehicle. The starting point for purposes of mileage
calculations is Pismo Beach City Hall regardless of the actual departure point. A Google
map or similar map substantiating the distance travelled shall accompany the mileage
reimbursement form in lieu of a receipt.
b. Check Request Form
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3. In the event the expense evidenced by the cumulative receipts for expenses occurring in
one calendar month is greater than the maximum allowance, the Council Member will be
reimbursed only the maximum amount.
4. Lost or No receipts: If a Council Member has lost a receipt for a reimbursable expense or
no receipt is provided, a memo is required. The memo must include the following:
• Explain the circumstances in detail, such as time, activity, and reason for losing the
receipt or reason that receipt was not provided.
• Include all receipt information such as place of business, amount, date, description
of item.
• The Council Member must sign it.
• The City Manager or designee must sign it.
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Appendix A: LIST OF FORMS
All Forms related to this Purchasing Policy are located in the following locations:
by clicking on the hyperlinks below, available in Laserfiche Forms, or in S:\Purchasing
Policy \Purchasing Forms.
The following is a list of all forms listed in this document:
1. Local Business Preference Option Form
2. Signature Authorization
3. IRS form W-9
4. Purchase Order Request — Laserfiche Forms
5. Petty Cash Voucher Form - SharePoint
6. Travel Forms
a. Travel Form for City Employees - SharePoint (includes Travel Authorization, Travel
Advance, and Travel Expense Reimbursement forms)
b. Travel Forms for City Employees Example - SharePoint
c. Travel Form for Council Members and Advisory Board Members - SharePoint
(includes Travel Authorization, Travel Advance, and Travel Expense Reimbursement
forms)
d. Travel Forms for Council Members and Advisory Board Members Example -
SharePoint
e. Mileage Reimbursement Form - SharePoint
7. Credit Card Forms - SharePoint
f. Credit Card Request Form
g. Credit Cardholder Use Agreement
8. Public Project Tracking Sheet
9. Request for Budget Transfer/Revision — Laserfiche Forms
10. Check Request Form - SharePoint
11. City of Pismo Beach Government Exempt form
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