[HISTORY: Adopted by the Town Board of the
Town of Irondequoit 5-15-2018 by L.L. No. 4-2018.[1] Aamendments noted where applicable.]
GENERAL REFERENCES
Investment policy — See Ch. 28.
[1]
Editor's Note: This local law also superseded former Ch. 51,
Procurement Policy, adopted 2-13-1996, as amended.
A.
The
Town of Irondequoit has adopted the policies and procedures described
herein, to comply with General Municipal Law (GML), §§ 103
and 104-b. Section 104-b was enacted in 1992 and required municipalities
to further define how procurements were made in accordance with § 103.
B.
Public
sealed bidding is required for the initial purchase of an item or
group of similar items costing more than $20,000, or if it is reasonably
anticipated purchasing in excess of $20,000 during the fiscal year
for an item or group of similar items. Sealed bids are also required
for a public works (labor and materials) or services contract where
the cost exceeds $35,000 annually. A "public works contract" is defined
as an improvement to a public facility in which the majority of the
costs are labor. Any questions concerning whether items should be
publicly bid should be addressed to the attorneys for the Town.
C.
Exceptions
to sealed bidding would include:
(1)
Purchases from New York State contracts and contracts let by counties,
cities, and towns within New York State.
(2)
Purchases of prison-made goods under Correction Law §§ 184
and 186, as amended or changed.
(3)
Purchases of products from preferred sources (State Finance Law § 162,
as amended or changed).
(4)
Emergency purchases as defined by General Municipal Law § 103,
as amended or changed.
(5)
Purchases from a sole source.
(6)
Professional services.
(7)
True leases.
D.
All
legal requirements must be complied with, including, but not limited
to, General Municipal Law §§ 103 and 104-b, State Highway
Law §§ 142 and 284, the State Finance Law and the Town
Law, as amended or changed.
Goods and services which are not required by law to be procured
by the Town pursuant to competitive bidding must be procured in a
manner so as to assure the prudent and economical use of public moneys
in the best interests of the taxpayers of the Town, to facilitate
the acquisition of goods and services of maximum quality at the lowest
possible cost under the circumstances and to guard against favoritism,
improvidence, extravagance, fraud and corruption. To further these
objectives, the governing board of the Town, by resolution, shall
adopt internal policies and procedures governing all procurements
of goods and services which are not required to be made pursuant to
the competitive bidding requirements of § 103 of the General
Municipal Law, as amended or changed, or of any other general, special
or local law.
The Town Board of the Town of Irondequoit shall require adherence
to the following:
A.
To
consider first the interests of the Town of Irondequoit and the improvement
of its government.
B.
To
endeavor to obtain the greatest value for every dollar expended.
C.
To
strive for knowledge of municipal equipment and supplies in order
to recommend items that may either reduce cost or increase efficiency.
D.
To
insist on and expect honesty in sales representation whether offered
verbally or in writing, through advertising or in a sample of a product
submitted.
A.
Section 104-b of the General Municipal Law, as amended or changed,
requires that the policies and procedures prescribe procedures for
determining whether a procurement is subject to competitive bidding,
and if it is not, documenting how the decision is reached. See "Documenting
Contract Awards for Non-Bid Procurement."[1]
B.
The initial determination of whether competitive bidding is required
includes the following procedures:
(1)
The Supervisor or Department Head seeking the procurement shall determine
whether it is expected that the political subdivision will spend in
excess of the competitive bidding thresholds for the same or similar
items or services (e.g., checking budgetary appropriations and/or
prior years' expenditures) over the course of the fiscal year.
The Supervisor and Department Heads shall meet periodically to ensure
the objectives of this statute are met.
(2)
The Supervisor or Department Head seeking the procurement shall determine,
as necessary or appropriate:
(a)
Whether an item is available under New York State contracts
and contracts let by counties, cities, and towns within New York State.
(b)
In the case of an emergency, whether the statutory criteria
(see General Municipal Law § 103, Subdivision 4, as amended
or changed) are met.
(c)
In the case of a lease, whether a document is a true lease and
not an installment purchase contract.
(d)
In the case of a sole source, whether an item is required in
the public interest, has no reasonable equivalent and is in fact available
only from one source.
(e)
In the case of a combination of professional services and a
purchase, for analyzing whether the professional service is the predominant
part of the transaction and is inextricably integrated with the purchase.
A.
Categories of procurements. This list identifies whether these categories
are subject to the competitive bidding requirements of § 103
of the General Municipal Law, as amended or changed, or the local
policies required by § 104-b.
|
Subject to Bidding (§ 103)
|
Local Policies (§ 104-b)
| |
|---|---|---|
|
Purchase and Public Work Contracts:
| ||
|
Purchase contract, above $20,000
|
X
| |
|
Purchase contract, below $20,000
|
X
| |
|
Contract for public work, above $35,000
|
X
| |
|
Contract for public work, below $35,000
|
X
| |
|
Procurements Excepted From Both §§ 103
and 104-b:
| ||
|
Preferred sources (State Finance Law, § 162)
|
X
| |
|
Correctional institutions (Correction Law, §§ 184
and 186)
|
X
| |
|
State contract (General Municipal Law § 104)
|
X
| |
|
County contract (General Municipal Law § 103, Subdivision
3)
|
X
| |
|
Procurements Excepted from § 103:
| ||
|
Emergencies (General Municipal Law § 103, Subdivision
4)
|
X
| |
|
Sole source (e.g., patented or monopoly item)
|
X
| |
|
Professional services
|
X
| |
|
True leases
|
X
| |
|
Insurance
|
X
| |
|
Secondhand equipment from another government (General Municipal
Law § 103, Subdivision 6)
|
X
| |
|
Certain municipal hospital purchases (General Municipal Law
§ 103, Subdivision 8)
|
X
|
B.
Exceptions to competitive bidding requirements. The following is
a description of the various exceptions to the requirements of General
Municipal Law § 103:
(1)
Preferred sources. Under State Finance Law § 162, as amended
or changed, all suitable products and services, as determined and
approved by the New York State Office of General Services, shall be
procured by any political subdivision in accordance with applicable
specifications of the political subdivision from qualified charitable
nonprofit agencies for the blind, qualified nonprofit agencies for
other severely handicapped, qualified special employment programs
for the mentally ill or veterans' workshops, which have been
approved by the Commissioner of Social Services, Education or Mental
Health, as the case may be, and which are organized under the laws
of New York State, and are manufacturing such products or performing
such services within the state, whenever the products are available
at a price determined by the Office of General Services. Competitive
bidding requirements are not applicable to these purchases.
(2)
Goods made in correctional institutions.
(a)
Under Correction Law § 184, as amended or changed,
the Commissioner of Correctional Services is required to cause to
be manufactured by inmates in state correctional institutions items
as are required by the state and political subdivisions, and to furnish
these items at prices as shall be fixed and determined, upon requisition.
That section provides: "No article so manufactured . . . shall be
purchased from any other source . . . unless the commissioner . .
. shall certify that the same cannot be furnished upon such requisition,
and no claim therefor shall be audited or paid without such certificate."
See also Correction Law § 186, as amended or changed.
(b)
Since the Legislature has provided a purchasing requirement
for articles manufactured in correctional institutions which is contrary
to § 103 of the General Municipal Law, as amended or changed,
said section has no application to such purchases. Under the Correction
Law, a town may apply to the Department of Correctional Services for
a waiver which would allow the town to make the purchase from other
sources pursuant to normal competitive bidding requirements. In addition,
a town may appeal the purchase price on the basis that it unreasonably
exceeds fair market price (Correction Law § 186, as amended
or changed). For further information on this program, political subdivisions
may contact the Department of Correctional Services, Division of Correctional
Industries.
(3)
State contracts. Pursuant to General Municipal Law § 104,
as amended or changed, political subdivisions and districts therein
are authorized to make purchases, in excess of $500, of materials,
equipment and supplies (except printed material) through the New York
State Office of General Services (OGS), subject to rules established
by OGS (see State Finance Law § 163). Section 104 of the
General Municipal Law provides that purchases by the town through
OGS are excepted from competitive bidding requirements. A town may
purchase numerous items at the same prices and under the same terms
and conditions as the state. Under § 104 of the General
Municipal Law, all purchases are subject to audit and inspection by
the political subdivision and the political subdivision must accept
sole responsibility for payment to the vendor. No official may make
a purchase through the OGS when bids have already been received unless
the purchase may be made upon the same terms, conditions and specifications,
but at a lower price, through OGS.
(4)
County, city, and town contracts. Pursuant to General Municipal Law
§ 103, Subdivisions 3 and 16, as amended or changed, purchases
through any county, city, or town in New York State are exempted from
the competitive bidding requirements of General Municipal Law, § 103
as amended or changed. As with purchases through OGS, all purchases
are subject to audit and inspection by the Town, and the Town must
accept sole responsibility for payment to the vendor. No local official
may make a purchase through a county, city, or town when bids have
already been received unless the purchase may be made upon the same
terms, conditions and specifications, but at a lower price, through
that county, city, or town.
(5)
Limitations on state, county, city, and town contracts.
(a)
The exception for state, county, city, or town contract purchases
applies only when purchases are made from the current state, county,
city, or town vendor or in certain cases, a listed agent or distributor,
whose contract has been extended to political subdivisions. Thus,
the Town may not, as an exception to bidding requirements, purchase
from a vendor other than a vendor holding a current state, county,
city, or town contract that has been extended to political subdivisions,
even if the purchase is equal to or below the state or county price.
For example, if a quote or bid were less than the state or county
contract price, the Town cannot simply accept that lower price without
going through the normal bid or quotation process.
(b)
Purchases from vendors holding state, county, city, or town
contracts may not be made upon terms and conditions which materially
or substantially vary from the state, county, city, or town contract.
Also, these exceptions relate to both purchase contracts and contracts
for public work.
(c)
Notwithstanding anything contrary under General Municipal Law
§ 103(16), the exception from public bidding shall apply
only to New York State contracts and contracts let by towns, cities,
and counties in New York State.
(6)
True leases.
(a)
The courts have held that "true lease" agreements are neither
purchases nor contracts for public work and, thus, are not subject
to bidding under General Municipal Law § 103, as amended
or changed. Competitive bidding requirements may not be avoided by
simply casting an agreement, which is truly a purchase or contract
for public work, as a lease or rental.
(b)
Although no one factor is determinative, the following factors
are to be considered when determining whether an agreement is a true
lease or an installment purchase contract:
[1]
Transaction is a device intended to circumvent the competitive
bidding statutes;
[2]
Intent to transfer title to Town, present or not;
[3]
Town assumes indicia of ownership (i.e., risk of loss, maintenance,
repairs, insurance);
[4]
Principle and interest component present in payment;
[5]
Useful life of property involved;
[6]
Acquisition of equity by Town during term of this agreement;
[7]
Fair market rental value;
[8]
Value of option to purchase at end of the agreement; and/or
[9]
Total cost of payments in comparison to fair market value of
property at inception of contract.
(7)
Insurance. The courts have held that insurance coverage is not subject
to formal competitive bidding.
(8)
Emergencies.
(a)
An exception to the competitive bidding requirements exists
for emergency situations (General Municipal Law § 103, Subdivision
4, as amended or changed). The following are three basic statutory
criteria to be met in order to fall within this exception:
[1]
The situation arises out of an accident or other unforeseen
occurrence or condition.
[2]
The circumstances affect public buildings, public property or
the life, health, safety or property of the Town's residents.
[3]
The situation requires immediate action which cannot await competitive
bidding.
(b)
Generally, there must be a present, immediate and existing condition
which is creating an imminent threat or danger and which requires
such immediate action that a further delay to comply with competitive
bidding requirements would be so detrimental to the public interest
that it overcomes the strong public policy in favor of bidding. Because
the emergency must result from an accident or unforeseen occurrence,
it is doubtful the Town may invoke the emergency exception in a situation
which is the result of inaction or dilatory behavior on the part of
local officials and which, therefore, could have been foreseen in
time to advertise for bids. Even when the Town Board passes a resolution
that a public emergency exists, the public interest dictates that
purchases are made at the lowest possible costs, seeking competition
by informal solicitation of quotes or otherwise, to the extent practicable
under the circumstances.
(9)
Sole source.
(a)
Competitive bidding is not required under § 103 of
the General Municipal Law, as amended or changed, in those limited
situations when a town, in the public interest, requires particular
goods or services which uniquely serve the public interest, for which
there is no substantial equivalent and which are, in fact, available
from only one good source (see gen. 1986 Opns St Comp No. 86-25, p.
41). Thus, for example, if the Town, acting in good faith and without
intent to arbitrarily inhibit or restrict competition, determines
that a particular patented item is required in the public interest
and it is further determined that such item is available only from
one source so that no possibility of competition exists, competitive
bidding may not be required for the procurement of the item.
(b)
In making these determinations, the Town should document, among
other things, the unique benefits of the item as compared to other
items available in the marketplace, that no other item provides substantially
equivalent or similar benefits; and that, considering the benefits
received, the cost of the item is reasonable when compared to other
products or services in the marketplace. In addition, the Town should
document that, as matter of fact, there is no possibility of competition
for the procurement.
(10)
Professional services.
(a)
The courts have held that professional services are not contracts
for public work, as that phrase is used in the bidding statutes, and,
therefore, are not subject to competitive bidding procedures. The
determination of whether the professional service exception is applicable
in given situations must be made on a case-by-case basis, examining
the particular services to be acquired.
(b)
Generally, professional services involve specialized expertise,
use of professional judgment and/or a high degree of creativity. Also,
the services generally are to be performed by particular designated
individuals. Finally, the courts have noted that professional service
contracts often involve a relationship of personal trust and confidence.
Among the services which have been held to be exempt from competitive
bidding under this exception are those of an engineer, architect,
land surveyor, attorney, physician and insurance broker.
(c)
Generally, if the situation warrants a solicitation of costs,
an effective method would be a request for proposal (RFP). The extent
of the RFP would be decided on a case-by-case basis.
(11)
Secondhand equipment from other governments. There is a statutory
exception to competitive bidding requirements which permits the purchases
of surplus and secondhand supplies, materials or equipment without
competitive bidding from the federal or state government or from any
other political or public benefit corporation within the state (General
Municipal Law, § 103, Subdivision 6). However, purchases
of used items from any other source (e.g., private sources like auctions
or going-out-of-business sales) are not exempt from bidding requirements.
A.
Analysis
of proposed procurements. There must be a determination as to whether
a proposed procurement is subject to competitive bidding, and if not,
documenting how the decision is reached. Three initial questions must
be addressed: Is the proposed procurement a purchase contract or a
contract for public work? If it is either, is the amount above the
applicable threshold in § 103 of the General Municipal Law
as amended or changed? If so, do any exceptions apply? If it is not,
what type of procurement is it?
B.
In
general, purchase contracts involve the acquisition of commodities,
materials, supplies, or equipment, while contracts for public work
involve services, labor or construction. Each procurement must be
reviewed on a case-by-case basis to determine which kind of purchase
it would be. If it would involve a substantial amount of service,
to the extent that the service provided to the Town is the focal point
and the acquisition of goods is incidental, then it would be considered
a contract for public work. Conversely, if the service or labor is
only minimal or incidental to the acquisition of goods, it would be
considered a purchase contract.
C.
For
example, a contract for interior painting of a building involves both
material (paint) and labor (painting). In most instances, the labor
component of the contract will be predominant, making it a contract
for public work. In contrast, replacing a boiler furnace, while involving
both equipment (the boiler) and labor, will, in most instances, consist
primarily of a charge for the equipment, making it a purchase contract.
D.
In
documenting whether a proposed procurement is below the bidding limits,
records should include evidence of a written or verbal quotes (telephone
logs, etc.) to substantiate that the price of the item or service
would not exceed the bidding limits. In addition, since similar procurements
to be made in a fiscal year must be considered in the aggregate for
purposes of determining whether a particular item must be bid, the
responsible individual could document the amount expended in previous
years and that the monetary thresholds are not anticipated to be exceeded
in the current year, and therefore, bidding would not be required.
In this process, the amount anticipated to be spent in the current
year should be documented because the amount involved may affect the
method of competition to be sought. Documentation should also explain
how it was determined that the procurement was either a purchase or
a public works contract.
A.
Verbal
quotations. A telephone log or other record should provide, at a minimum,
the date, the item or service desired, the price quoted and the name
of the vendor's representative.
B.
Written
quotations. Vendors should provide, at a minimum, the date, a description
of the item or details of the service to be provided, the price quoted,
name of contract and signature. Quotes from websites are also acceptable,
provided that the relevant webpages are printed and kept in Town files
similar to written quotes provided by other vendors.
C.
Procurements subject to § 104-b of the General Municipal
Law are listed in the following chart with policies and procedures:
|
Dollar Limits
|
1 Or More Verbal Quotes
|
3 Or More Verbal Quotes
|
Written Quotes 3 Or More
|
|---|---|---|---|
|
Purchase Contracts Below $20,000
| |||
|
Under $500
|
X
| ||
|
$500 - $999
|
X
| ||
|
$1,000 - $19,999
|
X
| ||
|
Contract for Public Work Below $35,000
| |||
|
Under $1,000
|
X
| ||
|
$1,000 - $4,999
|
X
| ||
|
$5,000 - $34,999
|
X
|
D.
Price documentation. Copies of the verbal quotation record or the
written quotation (with the above information) must be attached to
each purchase order as it is processed for ordering. Purchase orders
without this information will be returned to the ordering department.
A sample of the Town of Irondequoit Quotation Log is attached.[1]
[1]
Editor's Note: Said log is on file in the Town offices.
A.
In
each of these situations, the following documentation should be maintained
to show that the procurement is in the best interest of the local
government and how that determination was made. Following are suggested
acceptable methods of documentation:
(1)
Emergencies: Documentation should include a telephone log of verbal
quotes.
(2)
True leases: Documentation should include written quotes, cost-benefit
analysis of leasing versus purchasing, etc. Requests for proposals
may be used for obtaining true leases.
(3)
Secondhand equipment from other governments: Documentation should
include market price comparisons (verbal or written quotes) and name
of government.
(4)
Requests for proposals (hereinafter referred to as RFP): A request
for proposal and evaluation of proposals should consider quality of
service as well as price. Quality can be judged by factors such as
experience, staffing, ability to respond within the time constraints
established by the Town and suitability for the needs of the Town.
The award should be the most advantageous to the Town from all perspectives,
not only cost, but normally would include negotiations of cost.
(a)
A well-planned solicitation effort is needed to identify a sufficient
number of qualified firms. To locate qualified firms, one might advertise
in trade journals, check listings of professionals, talk to other
local officials, etc. Although many firms may be active in a given
locality, not all are likely to have the specialized knowledge and
experience needed to perform a satisfactory service. A good solicitation
effort helps to ensure that these qualified firms are aware of the
government's needs and procurement procedures and are thereby
able to participate in the proposal process.
(b)
A well-planned solicitation effort helps to encourage qualified
firms to respond to RFP's. Preparing a response to an RFP can
be costly. Qualified firms may be unwilling to go to the trouble and
expense of preparing a proposal if critical details of the engagement
or the method used to select (i.e., quality versus price) are not
made clear during the process.
(c)
A well-planned solicitation effort can result in reduced costs
through increased competition. Of course, if not properly managed,
competition can produce unsatisfactory results. A government may obtain
a poor-quality service, for example, if only cost factors are considered
in the selection of a firm. However, if a sufficient pool of qualified
firms is identified through a sound solicitation effort, governments
can enjoy the economic benefits of competition without sacrificing
quality.
B.
Depending
on services obtained and specific circumstances, procedures will necessarily
vary. The specific steps to be followed should be approved by the
governing board. The documentation maintained would include how firms
were identified for solicitation, the RFP, the criteria for evaluating
proposals, the proposals for services received from the various firms
and any other relevant information.
C.
Since there is no requirement in § 104-b of the General
Municipal Law, as amended or changed, on the frequency of solicitation,
periodic solicitation can be made at reasonable intervals. For example,
a professional could be selected with the option reserved by the local
government of extending the contract in succeeding years before initiating
another RFP process.
A.
The
Town of Irondequoit operates in a decentralized purchasing environment.
Therefore, when a public bid is required it is coordinated by the
department generating the greatest need for the items/services. That
responsibility includes these procedures to be followed:
(1)
Present items/services to Economy Task Force to determine any needs
from other departments.
(2)
Obtain bid number from Town Clerk's office.
(3)
Coordinate legal advertisement with Town Clerk.
(4)
Prepare and distribute specifications to vendors and file a copy
with the Town Clerk's office. Bid specifications must include
the three attachments (bid proposal sheet, noncollusion certificate
and terms and conditions) filled out as necessary.
(5)
Coordinate bid opening time with Town Clerk's office and ensure
that representative from department attends bid opening.
(6)
Open bids, review and prepare recommendation for Town Board.
(7)
Implement Town Board decision with all necessary followup administration.
(8)
Contact legal counsel for the Town at any point during the process
for all necessary legal advice.
B.
The
above represents the normal bidding process. If the situation merits
a departure from these procedures it should be addressed accordingly
at that time by the Economy Task Force.
This policy and procedure shall be used by the Town of Irondequoit
in the procurement of professional services, including accounting/auditing,
legal, engineering, architecture, landscape architecture, planning,
survey and other like services; however, selection of expert witnesses
and appraisers shall be subject to the approval of the appropriate
department head and Supervisor.
A.
When professional services are required by the Town, the Town Board
shall be notified, and the Supervisor and Comptroller, together with
the head of the department that requires said professional service,
shall prepare a scope of services for the project or need of the Town
that requires such professional services.
B.
At least three firms shall be solicited by the Town for consideration
as providers of the professional service. Factors to be considered
in determining which firms to solicit will be:
(1)
The disciplines required by the project.
(2)
The experience of the firm on a particular type of project and any
unique requirements of the project.
(3)
The quality of performance of the firm on previous work done for
the Town.
(4)
The experience record of the firm on a particular type of project.
(5)
Location of office and staff who will perform the work.
(6)
Any other pertinent considerations as may be identified.
D.
The Selection Committee shall determine by majority vote who will
write the request for proposal document.
E.
Requests for proposals.
(1)
A formal proposal on the descriptive scope of the project or services
sought shall be requested of the firms identified. The solicitation
of proposals will include the scope of the project or services sought
and a proposed schedule for completion or terms of said professional
relationship.
(2)
The response to the proposal shall include discussion on the proposed
approach to the project or services required, any special aspects
of the project, schedule, staffing, projected budgets (if applicable),
any other information pertinent to executing the project or services
and a proposed fee schedule for such services.
F.
Proposals shall be formally evaluated and ranked as to order of preference
by the Selection Committee. Interviews with each of the firms submitting
proposals shall be held prior to ranking, provided that if more than
three firms submit proposals, the Selection Committee may provide
a preliminary assessment of all proposals and elect to interview no
less than the top three firms. An evaluation memorandum shall be prepared
documenting the results of the evaluation and reasons for the selected
ranking.
G.
When the ranking is completed, negotiations shall be held with the
top-ranked firm to establish detailed scope of such professional services,
a fair and reasonable fee for such professional services, and other
terms and conditions of the professional service agreement as may
be necessary given the nature of the project or services sought. In
the event that negotiations are not successful, the second-ranked
firm shall be invited to engage in a similar negotiation with the
Committee; and similarly the third-ranked firm shall be so engaged
in a negotiation if an agreement cannot be negotiated with the second.
H.
In the event that the Selection Committee cannot recommend any of
the firms, the entire process as described above shall be reinitiated.
I.
When negotiations are complete, the Selection Committee shall present
the scope of the professional services to be performed and the proposed
fee to the Town Board for approval.
J.
Whenever practical, this process shall be used simultaneously when
more than one project of a similar type exists for which professional
services are required.
K.
This procedure need not apply to services with an estimated cost
of less than $5,000. In such cases, the department proposing to utilize
such professional service shall review the qualifications of firms
capable of performing such professional service, negotiate the scope
of such professional service and the project work to be performed
and establish fees for such professional service.
L.
The complete ranking sheet used by the Selection Committee shall
be made available for review in the office of the Town Clerk after
the Town Board has approved the contract with the consultant.
M.
Upon completion of the professional services, the user department
and the Comptroller shall prepare an evaluation of the professional
services with particular attention to outstanding or unsatisfactory
performance. This evaluation shall be reviewed with the professional
service provider, modified by the professional service provider's
input, if appropriate, and submitted to and retained by the Selection
Committee for its information and consideration in making future determinations
and selections.
N.
This procedure is considered fair and effective in ensuring quality
services at a fair, reasonable and controlled cost both to the Town
of Irondequoit and the professional service provider the Town retains.
A provision of the purchasing policies and provisions may be
changed by memorandum attached as an addition or deletion to the appropriate
provision by the Comptroller subject to the approval of the Town Board
and shall be added to the appendix herein.[1]
[1]
Editor's Note: Said appendix is included as an attachment to this chapter.
