[HISTORY: Adopted by the Town Council of
the Town of Smithfield 6-19-2012 by Ord. No. 2012-04.[1] Amendments noted where applicable.]
GENERAL REFERENCES
Bid bonds — See Ch. 7.
[1]
Editor's Note: This ordinance also superseded former Ch. 81,
Purchasing Policy, adopted 10-15-1996 (Ch. 2, Art. III, Div. 5, of
the 1985 Code of Ordinances), as amended.
A.
Established.
This chapter represents the official Town policy for all purchases
by and on behalf of the Town of Smithfield to include purchases by
the Smithfield Water District, Smithfield Sewer Authority and Smithfield
Ice Rink. The Town will strive to buy the best quality goods and services
at the lowest price. Where this policy conflicts with the Town Charter
or state law governing municipal purchases, the latter shall govern.
B.
Objective.
The objectives of the purchasing system herein established are as
follows:
(1)
Procure materials, supplies, equipment, and services of all types
at the lowest cost consistent with quality requirements.
(2)
Establish the responsibility for the purchasing function in a central
purchasing office. Under the general supervision of the Town Manager,
the Finance Director or his representative shall be the purchasing
agent for every Town department or agency, including the School Department,
for selected purchases.
(3)
Exercise positive financial control of the purchasing function.
(4)
Provide an efficient and cost effective means for procurement of
materials, supplies or equipment, avoiding duplication and overstocking.
(5)
Establish and maintain standards of quality in materials, equipment
and services.
The purchasing agent shall be responsible for establishing a
centralized purchasing system to incorporate requisitions and purchase
orders for all purchases made on behalf of the Town, except as hereinafter
provided. In establishing specifications for purchases, the purchasing
agent shall solicit and consider the requirements of the user department
as articulated by the applicable department director. The purchasing
agent may promulgate rules, consistent with this chapter, to further
its objectives. The purchasing agent shall also consult with the Town
Manager and Director of Finance, as necessary, in developing proposed
specifications for more complex or expensive purchases. The Town Manager
is authorized to resolve any interdepartmental conflict involving
the relative importance of quality requirements and estimated price
in developing the specifications.
A.
Scheduled
buying. The purchasing agent shall schedule buying for items which
are used on a reoccurring volume basis. Each Town department shall
submit department supply and material requests, together with anticipated
annual usage to the purchasing agent for the creation of proper and
necessary buying schedules. The purchasing agent shall consolidate
multiple department requests for common-use items into one large purchase,
to reduce unit prices, when practical.
B.
Cooperative
purchasing. Whenever feasible, the purchasing agent shall consider
arrangements for purchases in conjunction with other units of government.
This will generate larger volume, which may create more attractive
unit prices by creating a larger volume purchase.
C.
School
Department purchases. The purchasing agent shall implement the provisions
of § C-5.18(a) of the Town Charter, which provides that
all supplies, materials and equipment required by the School Department,
excluding instructional materials, such as textbooks, workbooks, and
curriculum materials, shall be purchased under the supervision of
the purchasing agent.
D.
Projects. All purchases of equipment, real property, or for construction which are included in a project as defined by § C-4.16 of the Town Charter shall be supervised by a building committee appointed by the Town Council.
E.
Exemptions.
Certain items of expense may be processed for payment without submitting
a requisition for a purchase order. Expenses of this nature are usually
reoccurring obligations of the Town, such as utility services, provided
there is a specified billing period, to include electricity, gas,
water and sewer, telephone, and the following:
(1)
Postage, freight, maintenance/service contracts.
(2)
Pension contributions and payments, FICA contributions.
(3)
Judgments and claims.
(4)
Travel reimbursements.
(5)
Authorized employee benefit payments.
(6)
Petty cash reimbursements.
(7)
Authorized payroll deductions.
(8)
Appropriations to agencies authorized at the Financial Town Meeting.
F.
Local
purchasing. In purchasing materials, goods and services, preference
will be given to Smithfield vendors, where price and quality are judged
to be equal by the purchasing agent or Town Council, as applicable.
G.
Contracts.
All contracts required to memorialize the purchase of goods or services
shall be in a form approved by the Town Solicitor.
The following procedures are prescribed to initiate requests
for materials, supplies, equipment or services (including professional
services) for the Town:
A.
In
general. A requisition memo is used as the initial step in the purchasing
procedure. This memo is designed to advise the purchasing agent of
the need for these items. The requisition memo shall be submitted
to allow sufficient time for review and solicitation of bids by the
purchasing agent. The rate of consumption of items requisitioned shall
be carefully considered in arriving at the quantity requested. Requisitions
for the same material or service shall not be artificially divided
so as to circumvent this chapter.
B.
Preparation.
(1)
Requisition forms are available from the purchasing agent, Finance
Department, or may be photocopied. On the requisition form are spaces
for the following: a requisition number (use optional); vendor's
name, address and vendor number; the department originating the requisition;
whether the purchase order will confirm a verbal order already placed
with the vendor; the purchase order number (if known at the time the
requisition is prepared); the vendor's product number and description
(insert catalog page number, if applicable); the selling unit (ton,
gallon, etc.); the quantity, unit price and extended price; the full
account number; shipping and handling charges (most deliveries should
be f.o.b. Smithfield and incur no shipping charges); the person submitting
the requisition (department director or a duly authorized representative);
the date the requisition is prepared and the approval signature by
the purchasing agent. Unless otherwise specified, the delivery of
the material will be scheduled directly to the department ordering
the material.
(2)
The description of the item(s) shall be sufficiently complete to
enable the purchasing agent to proceed with the purchase or to order
from an existing price agreement contract without requesting supplementary
information. Common use items should be described by their popular
names, supplemented by number, size, style or other identifying data.
Departments must exercise care to avoid using a "closed" description
or specification which describes the product of one manufacturer exclusively
and prevents the obtaining of competitive bids. A requisition may
specify a model number and brand name "or equal thereto" to denote
a minimum standard of quality.
C.
Routing.
Upon completion of the form, the preparing department will send the
requisition to the purchasing agent who will verify the availability
of funds for the purchase, sign it, if approved, and prepare a purchase
order or return it to the originating department for a purchase order.
The purchasing agent may waive requests for requisitions to expedite
purchases. Requisitions disapproved by the Finance Director will be
returned to the department concerned, along with an explanation for
the disapproval. The purchasing agent will solicit sealed bids when
required, once requisition approval is secured under all applicable
provisions of this chapter.
The following sets forth the policies and procedures for processing
purchase orders:
A.
General.
The purchase order is the vendor's authorization to provide the
equipment, materials, supplies or services specified. If there is
no other contract between the parties, the purchase order constitutes
the contract between the Town and the vendor. The purchase order,
prior to expending funds, is initiated by the requisition's originating
department and is next forwarded to the purchasing agent for review
of available funding, approval and signature. The Town Manager next
receives the purchase order for approval and signature. After being
signed by all the proper officials, distribution of the purchase order
will be as follows:
(1)
The original copy (white) is mailed to the vendor by the requisitioning
department.
(2)
The second copy (yellow) is retained by the requisitioning department
for filing along with the department copy of the requisition memo.
(3)
The third copy (pink) is the receiving report which is sent to the
requisitioning department to be used upon receipt of the material/services
to substantiate payment.
B.
Change
orders. The change order is used to change, correct or cancel any
purchase order. Change orders will be prepared by the purchasing agent
whenever a change to the original purchase order makes it necessary.
Change orders will not be used to purchase items which were not contemplated
in the original invitation to bid. A purchaser order form is utilized
as a change order. The statement "Change Order to Purchase Order No."
is entered on the purchase order, along with reference to the original
purchase order number. The processing and distribution of the change
order is the same as that of the purchase order.
Requisitions and purchase orders are not required when the purchase
will not exceed $5,000 or a lower amount set by the Town Manager.
For all purchases, a payment voucher will be used to indicate receipt
of the material/service and permit the invoice to be processed for
payment. The payment voucher will be approved for payment by the department
director, Finance Director and Town Manager. Where time is of the
essence involving unscheduled repairs to vehicles and equipment, a
payment voucher may be used in lieu of the requisition/purchase order
system.
A.
An invoice represents the vendor's charges against the Town
for materials or services rendered. An invoice should have a specific
number supplied by the vendor. The original invoice is needed for
payment processing. Invoices and purchase orders contain similar information.
B.
The invoice will be mailed to the office which issues the purchase
order, i.e., the department director. The receiving department shall
attach the invoice to a payment voucher, sign it and forward to the
Finance Director for payment processing. In all circumstances, an
original invoice must be combined with the receiving report for payment
processing.
C.
The Finance Director will examine the invoice, purchase order and
payment voucher. After verification of terms, discounts and calculations,
the Finance Director will, by affixing his/her signature, approve
payment, and forward it to the Finance office for processing.
A.
General
policy. The policy of the Town is to purchase all materials, supplies
and services at the lowest possible cost while meeting minimum quality
requirements. All purchases of $1,000 or more, up to $10,000, or some
other amount set at an annual Financial Town Meeting, shall require
at least two written quotations. Copies of all written quotations
shall be transmitted to the Finance Director or his designee for the
opening and recording of all bid documents. All bid documents and
specifications for equipment or construction reasonably estimated
to cost in excess of $10,000 shall receive prior approval of the Town
Council.
B.
Bids
over $10,000.
(1)
The purchase of materials and services costing over $10,000 shall require written, sealed bids pursuant to § C-5.18 of the Town Charter. The Town Council shall award all contracts in excess of $10,000. The solicitation of contracts for professional services shall also be governed by § 81-8 of this chapter, or Subsection C of this section. Bids shall be awarded to the lowest responsible bidder, and the requesting department with the assistance of the purchasing agent shall be responsible for preparing the entire bid document, which shall include:
(2)
The standard form of these bid documents shall be promulgated by
the purchasing agent and approved by the Town Manager. Any requirements
made necessary by federal or state funding shall be specified in the
bid documents. Competitive bids in excess of $50,000 shall require
bidders to include a bid bond or other bid security in an amount equal
to 5% of the bid. The public notice shall follow standard requirements
and shall state when the bids will be opened and publicly read aloud
by the purchasing agent.
C.
Lowest
qualified evaluated bid price. Where the qualifications of the bidder
are important, the purchasing agent may determine to use lowest qualified
evaluated bid price in determining a contract award. This shall be
so stated in the bid documents and advertisement. The bid document
shall also include the objective measurable criteria to be utilized
in making the award.
D.
Exclusions.
(1)
Sole source. A contract may be awarded for a supply, service, or
construction item, without competition, when the purchasing agent
determines, in writing, that there is only one source for the required
supply, service or construction item. Any department director requesting
a purchase on a "sole source" basis shall advise the purchasing agent
in writing with justification for the request.
(2)
Emergency purchases. In the event of an emergency of sufficient gravity
that compliance with the competitive bidding requirements set forth
in this chapter endanger the health or welfare of the community, or
a portion therefor, or would involve significant financial risk or
loss to the Town, as certified by the Town Manager, a purchase in
excess of the sealed bid limit may be made without competitive sealed
bids. In all such instances, however, three or more verbal quotations
followed by a written confirmation, shall be solicited and on file
with the purchasing agent.
(3)
State contracts. The purchasing agent may satisfy the competitive
bidding requirements of this chapter by participating in cooperative
purchases with the State of Rhode Island, other municipalities or
other states, so long as the intent of this chapter is followed.
A.
Alternative
methods for competition. The Town shall use either a competitive sealed
bid process with the award based on the lowest qualified evaluated
bid price, or the competitive negotiation process set forth in this
section in selecting professional services to include architectural
and engineering services, planning and design services and other related
professional services and property, casualty, and workers compensation
insurance obtained pursuant to G.L.§ 45-5-20.1, specifically
excluding legal services, which are exempt from this chapter. The
Town Manager shall decide which process to follow, based on consultation
with the appropriate department director and the purchasing agent.
B.
Request
for proposals. The competitive negotiation process is initiated by
the requisition submitted to the purchasing agent by the department
director who will directly manage the professional services requested.
In consultation with the department director, the purchasing agent
shall make a reasonable estimate of the professional services and
convene a meeting with the Town Manager and appropriate department
director to determine which process to follow in selecting the best
professional services at the lowest price. The department director
with the assistance of the purchasing agent shall be responsible for
preparing the request for proposals (RFP). The RFP shall indicate
that the professional services will be awarded on a competitive negotiation
basis and shall state the general criteria for selection, specific
professional information about the offer to be submitted, scope of
work, offeror's approach and other information deemed appropriate
by the purchasing agent. The normal public notice requirements for
competitive bidding shall be followed. Proposals may also be directly
solicited from potential offerors in order to obtain the largest number
of qualified offerors. Proposals submitted shall be sealed and opened
on the date and time specified in the RFP notice.
C.
Selection
committee. Where the cost of professional services is reasonably estimated
to equal or exceed $50,000, a selection committee shall be formed
by the Town Manager to include the Town Manager or designee, the applicable
department director, purchasing agent, director of finance, and a
Council member selected by the Council, unless waived by the Council.
Professional services estimated to cost less than $50,000 require
a selection committee composed of the purchasing agent, Finance Director
and applicable department director. Additional members may be appointed
by the Town Manager.
D.
Pre-proposal
conference. The purchasing agent may require a pre-proposal conference
where all potential offerors, who have obtained a copy of the RFP,
are invited to discuss the professional services with the purchasing
agent and applicable department director. This generally occurs when
an on-site review of the area or facility to benefit from the professional
services would be helpful.
E.
Selection
process.
(1)
The selection committee may interview one or more of the offerors
to help determine the most qualified offeror. While the RFP shall
require the submittal of tentative price for the services solicited,
the RFP shall also provide that the Town shall reserve the right to
negotiate price with the offeror it deems most qualified, based on
professional competence, technical merit, experience with similar
work and price.
(2)
The Town Manager and purchasing agent shall negotiate compensation
which they determine to be fair and reasonable with the most qualified
offeror, as determined by the selection committee. This amount shall
be reported back to the committee, and if acceptable, shall be recommended
to the Town Council for approval, subject to the contract language,
acceptable to the Town Solicitor. If the manager and purchasing agent
or committee are unable to negotiate a satisfactory contract, the
negotiation shall be terminated, and negotiations begun with the second
most qualified offeror, until a satisfactory contract is recommended
or the number of qualified offerors is exhausted. The Town Council
shall be responsible for the final decision to select the most qualified
offeror and to award the contract.
A.
Disposal
of surplus and obsolete personal property valued below $10,000.
(1)
Occasionally, a department may have materials or equipment which
are surplus to its needs or which may have become obsolete. The Town
Manager will dispose of surplus personal property items valued below
$10,000 in a manner which provides the maximum return to the Town.
(2)
The purchasing agent will periodically request a report of any obsolete,
surplus, or worn-out material and equipment. A summary of these items
will then be made available to department directors to determine if
they might have use of any of this material or equipment. After this
interdepartmental screening, surplus material will be offered for
sale through advertisement and competitive bidding. For material without
significant residual value, the purchasing agent will discard the
material and maintain a record of all such disposals.
(3)
In advertising and accepting bids for surplus or obsolete property,
the purchasing agent will insure that the practices of competitive
bidding are followed. The use of electronic advertising for the electronic
auction of personal property valued below $10,000 is permitted under
this chapter. The highest, qualified bid will be sought in all cases.
A public bid opening will be scheduled. When necessary, a bid surety
may be required of prospective bidders. The amount of this surety
may be designated by the purchasing agent. Determination of the highest
and best bidder will be made by the purchasing agent.
