[HISTORY: Adopted by the Village Council of the Village of Spring Lake 6-15-2015 by Res. No. 2015-12. Amendments noted where applicable.]
This Policy shall provide the general framework for purchasing and sale of materials, supplies, equipment and property of the Village of Spring Lake (hereafter referred to as the "Village"). The designated officer responsible for serving as the Purchasing Agent is the Village Manager or his/her designee. The Spring Lake Village Council (hereafter referred to as the "Council") may establish by resolution the detailed purchasing procedures of the Village. By adoption of this Purchasing Policy (hereafter referred to as the "Policy"), the Council has determined that the best interests of the citizens of the Village are served by enactment of this Policy. Future amendments of this Policy may be accomplished by Council action, which shall be provided by a formal resolution amending this Policy. This Policy, together with any amendments, shall be kept by the Village Clerk/Treasurer as the official Purchasing Policy of the Village.
The following Policy represents the standard purchasing procedure for the Village and is intended to serve as a basic reference document for department heads and staff involved in purchasing and sale of materials, supplies, equipment and property; and the retaining of professional services.
The Village Council may designate one of the administrative officers of the Village as the Purchasing Agent, and that individual shall be responsible for the purchase and sale of all Village property. The Council may authorize the making of public improvements or the performance of any other Village work by a Village agency without competitive bidding. The Council may establish detailed purchasing, sale and contract procedures by ordinance or resolution.
It shall be the duty of the Village Manager to establish and maintain a central purchasing service for the Village with the Village Manager or their authorized representative being designated as the Purchasing Agent for the Village.
Conformance with policy. All purchases for the Village shall be made in accordance with this Policy and shall be made through the Purchasing Agent.
Sale of surplus Village property. The Purchasing Agent is authorized to sell supplies or equipment which have become unsuitable for Village use by reason of obsolescence, or other reasons, or may exchange the same for, or trade in the same on, new supplies or equipment. Surplus supplies or equipment shall be sold on a competitive basis to the highest bidder if the estimated value of each item exceeds $500 and in a manner prescribed by Council if less than $500.
Purchase of used equipment. In the event that the Village's needs can be met through the purchase of used equipment, the Purchasing Agent shall make every effort to obtain comparable costs to submit to the Council, along with a statement justifying the purchase.
Exceptions - emergency purchases. In the event of an emergency or such extenuating circumstances wherein time is of the immediate essence, the Village Manager is authorized to make purchases of such supplies, materials, equipment, or contractual services which in their discretion is deemed necessary to protect the public health, safety and welfare of the community, without complying with the bidding procedures outlined in this Policy. In the event of such emergency purchase, the Village Manager shall report the details of the purchase to the Council at its next regular meeting.
Professional services. Professional services such as those provided by architects, engineers, accountants, consultants, appraisers, attorneys and risk management auditors, which are expected to exceed $500, shall be secured through an evaluation and negotiation process administered by the Village Manager, with the assistance of a Committee (to include representation from the Council, the Finance Director/Clerk/Treasurer, a department head, and the Village Manager). This process will be initiated by the preparation of a "Request for Proposals" and distribution to appropriate individuals, companies, and corporations, allowing adequate public notice with sufficient time prior to the date set for submission of proposals. The "Request for Proposals" should include the following:
A full description of the service to be contracted;
The specific criteria that will be used in evaluating proposals;
Other such pertinent information such as delivery dates or time frame within which the proposed work must be completed; and
Responsible Village personnel who are available to answer questions and to whom the proposals should be addressed.
A statement indicating that the Village reserves the right to reject any and all bids, to waive irregularities and nonconformities in bids, to accept and reject bids based on what the Village Council deems is in the best interests of the Village, to negotiate with the selected bidder, and to make the bid award as the Village Council deems is in the best interests of the Village.
NOTE: a) If the professional services desired are for a board of the Village Council, i.e., Planning Commission, DDA, etc., the Council representation on the Committee will be replaced in total or in part by representation from the respective board membership. b) Professional services retained in this section may be for a specific project, with a specific anticipated time line, or general services for an unspecified length of time. c) Nothing in this section shall address selecting a Village Attorney by the Council, whose selection shall be at the sole discretion of the Council, under the guidelines of the Village Charter; and under terms and conditions determined by the Council to be in the best interests of the Village.
General guidelines. The expected cost of a purchase shall determine which procedures are required, as detailed below. If the bids or quotes obtained fall into a higher classification than expected, the procedures must be followed for the higher classification.
Zero to $100: Petty Cash with receipt.
Zero to $500: Commercial Accounts with local vendors. Accounts established by the Finance Director with authorized staff signatories.
One hundred dollars to $5,000: No formal request for written quotations required. Every effort to obtain best price will be made. Finance Director or Village Manager approval required.
Greater than $5,000 to $10,000: three written quotations required. Village Manager and Council approval required.
Greater than $10,000: purchase order required. All purchases shall be by competitive bidding. After advertisement in a local newspaper of general circulation and/or regional construction RFP/RFQ listings such as Builders Exchange, with the sealed bids received by and opened in public under the control and oversight of the Village Clerk/Treasurer, or the deputy of either. The Village Manager shall prepare a report and recommendation to the Council with regard to the bids received. Council approval required.
Contracts with other governmental units. The provisions of this Policy relating to contracting shall not relate to contracts with other governmental units, which contracts are subject to approval by the Council at any regular or special meeting.
Blanket purchases. For recurring purchases costing more than $1,000 but less than $5,000, blanket purchase orders must originally be submitted to Council under the Purchasing Guidelines. Blanket purchase orders are valid for not more than three years from the date of Council approval.
Evaluation of bids on total cost; acquisition cost basis. In cases where bids are solicited for materials, supplies, or services, the award by the Council may be based on evaluation of the total cost to the Village considering the purchase price and the projected lifetime operation (life cycle analysis). The bid invitation shall state that the total cost criteria may be used to evaluate bids.
Noncompetitive negotiation. Contracts or agreements in excess of $5,001 may be made by noncompetitive negotiation only when competition is not suitable, as determined by the Council, following consideration of a recommendation from the Village Manager.
Request for proposals.
When in the judgment of the Village Manager, the specifications are varied on the type of material, supply or equipment acceptable to the Village, the Village Manager is authorized to seek proposals by written request to two or more vendors requesting they submit sealed proposals which will include bid price and the specifications of their product.
While advertisement in the newspaper is not required in seeking proposals, the Village Manager may place the advertisement in a local newspaper of general circulation or in a regional construction RFP/RFQ listing such as Builders Exchange if there are three or more vendors within the area of the newspaper distribution who would be qualified to submit a sealed proposal.
The procedures for accepting proposals under this section shall follow the guidelines as established herein (bidding procedures) except that the Council will evaluate the specifications and quality equally with price.
Limited suppliers. When in the judgment of the Village Manager there are two or less suppliers of an item to be purchased in the area of the general distribution of the newspaper, the request for bids may be made by letter to the suppliers. All other requirements of the bidding procedure shall remain the same.
State of Michigan MiDeal purchases. The Village Manager is authorized to purchase from the State of Michigan budgeted items or supplies that have been placed out for competitive bid by the state and contracts awarded and said items and prices then extended to the units of government within the state under an extended purchase program. Items and supplies purchased in this manner are an exception to this Policy.
Ottawa County reverse auction purchase. The Village Manager is authorized to purchase from the Ottawa County Reverse Auction budgeted items or supplies that have been placed out for competitive bid by the county and contracts awarded and said items and prices then extended to the units of government within the county under an extended purchase program. Items and supplies purchased in this manner are an exception to this Policy.
Additions to construction contracts. Should the Council determine that additional construction needs to be undertaken as part of, or in conjunction with, an already awarded construction contract, it may authorize a contract or change order for such additional work with the original contractor, and without the necessity of putting the additional work out for competitive bidding, if:
The price of the additional work does not exceed 25% of the original contract price;
The Village Manager has certified their opinion to the Council that it is not economically feasible for another contractor to undertake such additional work because of the cost or setup or because of the cost of work which would have to be duplicated by such other contractor; or
The Public Works Director and/or the project engineer retained by the Village to design such additional work, have certified their opinions to the Council that the price offered by the original contractor for doing the additional work is a fair price, considering the cost of materials and labor on the present market, and that such price gives the Village the benefit of savings which the contractor will realize as a result of doing the work in conjunction with the original contract work.
Additional purchases after competitive bids. The Village may purchase materials, supplies or services which are substantially identical to those previously purchased by the Village after complying with the terms of this policy and without obtaining new competitive bids, under the following conditions:
The purchase does not exceed in value 50% of the prior purchase;
The purchase occurs not more than 12 months after the opening of the bids for the prior purchase; and
The Village Manager has certified in writing to the Council that they have made diligent inquiry as to the market price of the item being purchased and has been reliably informed that such price has not declined since the original bids were obtained.
The Village may grant an award to a qualified local bidder/vendor as defined below for an amount equal to the lowest bid submitted which meets specifications. The following businesses shall be given the opportunity to lower their overall bid amount on any transaction if they are within the following percentage:
Village of Spring Lake, Spring Lake Township, Grand Haven Township, City of Ferrysburg and City of Grand Haven businesses - within 5% for projects up to $100,000 and 4% for project at or over $100,000.
Ottawa County businesses - within 4% for projects up to $100,000 and 3% for projects at or over $100,000.
Village of Spring Lake, Spring Lake Township, Grand Haven Township, City of Ferrysburg and City of Grand Haven businesses shall have priority over Ottawa County businesses.
To be considered for local bidder preference, a local bidder/vendor shall have met the following qualifications for a minimum of one year prior to the date bids are due:
Shall be in compliance with all Village codes and ordinances.
Shall not be indebted or in default to the Village.
Purchase order procedures.
Purchase orders are issued at the request of the vendor. The purchase order shall include the following information:
Name and address of vendor;
Date of requisition, expected date of delivery and any shipping instructions (e.g., UPS);
Provisions for the "Account" where the account number is provided by a department head indicating the account to which the item should be charged. This number will be checked by the Finance Director/Clerk/Treasurer (where the Finance Director/Clerk/Treasurer desires to make a purchase, it will be checked by the Village Manager) for verification of adequate funds in the account;
Provisions for "Quantity" where the definite unit to be purchased is provided. Provisions for "Description," where the type and variety of materials wanted is provided;
Provisions for "Price" where the unit amount and total is provided;
The department head requesting the purchase shall sign the purchase order. Once the purchase order is signed by the department head, it is then forwarded to the Clerk/Treasurer/Finance Director to verify the account number and funds available.
The verified purchase order is then forwarded to the Village Manager or Finance Director for approval.
Purchases shall not be confirmed with vendors and purchase order numbers will not be furnished to vendors until the above items are completed.
All purchase orders are to be numbered consecutively.
Bid forms. The Bid Procedure Forms shall be established by the Purchasing Agent, reviewed by the Village Manager and recommended to and approved by the Village Council. The official Bid Procedure Forms are to be attached to the original Purchasing Policy of the Village, and retained within the Village Clerk/Treasurer's office. The Bid Procedure Forms to be used upon adoption of this Policy are attached, and are noted as Addendum to this Policy.
Editor's Note: The Addendum, Bid Procedure Forms, Invitation to Bid, and Sample Bid Form are included as attachments to this chapter.
The Purchasing Agent shall prepare, or cause to be prepared, specifications for the articles or services required, and shall advertise the requirements of the Village at least once in a newspaper of general circulation in the Village, inviting the tender of bids in writing for the furnishing of such requirements.
The bids shall be opened and read aloud by the Village Clerk/Treasurer or deputy of either, in public at the Village Hall, at the time and place specified in the published notice.
Any bid or proposal received at the place designed for submission after the time set for opening of bids is a late bid. It is the Village's policy that all late bids be rejected unless such lateness was occasioned by acts or omissions of the Village.
Bid deposits or surety may be prescribed in the public notice inviting bids. The bid deposit or surety shall be returned to all unsuccessful bidders within 30 days of the opening date. Should a successful bidder fail to enter into a contract with the Village within the time specified after written notification of the bid award, the bid deposit or surety shall be forfeited to the Village.
Performance bonds may be required in such amount as shall be found necessary to protect the best interests of the Village.
The Village Manager shall report to the Village Council the bids and tabulation thereof, and may recommend to the Council the bid which best meets the interest of the Village or, if the interest of the Village would be better served, the rejection of any or all bids.
The Council shall have the right to reject any and all bids, to waive irregularities in bidding and to accept bids, which do not conform in every respect to the bidding requirements, and to negotiate with the selected bidder. If the Council shall find any of the bids satisfactory, it shall award the contract to the lowest, responsible bidder unless the Council shall determine that the public interest will be better served by accepting the higher bid. The Council shall authorize the execution of the contract by the successful bidder and the filing of any bond, which may have been required. If two or more of the lowest bids received are for the same total amount or unit price, quality and service being equal, the contract or purchase may be awarded to one of the tied bidders by drawing lots in public.
No contract for purchase of articles or services in excess of $1,000 in cost shall be made unless the Village Council has authorized the same to be made by motion or resolution, and, if a contract is required, it shall be approved as to form by the Village Attorney's office and certified as to availability of funds by the Village Finance Director/Treasurer.