[HISTORY: Adopted by the City Council of the City of Lackawanna 5-1-2000. Amendments noted where applicable.]
Goods and services which are not required by law to be procured 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, 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 Lackawanna City Council is adopting 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 General Municipal Law § 103, or of any other general, special or local law.
The procedures for determining whether a procurement of goods and services is subject to competitive bidding and documenting the basis for any determination that competitive bidding is not required by law are as follows:
A. 
The first step in analyzing proposed procurements is determining whether a proposed procurement is subject to competitive bidding. These initial issues must be examined: Is the proposed procurement a purchase contract or a contract for public work? If it is, is the amount above the applicable threshold and, if so, do any exceptions apply? If it's 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 by the appropriate department head and a written determination made in the form of a memorandum addressed to the Director of Administration and Finance as to what kind of contract is involved. As a general rule, if the contract involves a substantial amount of services, such that it is the focal point and the acquisition of goods is incidental, it will be considered a contract for public work. Conversely, if services or labor are only minimal or incidental to the acquisition of goods, it is considered a purchase contract.
C. 
Next, the department head must determine whether a proposed procurement is below the bidding limits and document (including evidence of written or verbal quotes, telephone logs, etc.) that the price of the item or service does not exceed the bidding limits. In addition, since similar procurements to be made in a fiscal year must be grouped together for purposes of determining whether a particular item must be bid, the department head should document the amount expended in previous years and that the monetary thresholds are not anticipated to be exceeded this year and, therefore, bidding would not be required. In this process, the amount anticipated to be spent this year should be documented because the amount involved may affect the method of competition to be sought.
D. 
For those items not subject to competitive bidding, such as professional services, emergencies, purchases under state or county contracts or procurements from sole sources, the department head should prepare a memo to the Director of Administration and Finance which details why the procurement is not subject to competitive bidding and including the following, whichever is applicable:
(1) 
A description of the facts giving rise to the emergency and that they meet the statutory criteria.
(2) 
A description of the professional services.
(3) 
Copies of state or county contracts.
(4) 
A description of sole source items and how such determinations were made.
E. 
In summary, documentation should show the category of procurement that is being made (consult chart below) and what method of procurement is specified.
Bidding
104-b
Purchase contract - above $10,000
X
Purchase contract - below $10,000
X
Contract for public work - above $20,000
X
Contract for public work - below 20,000
X
Agencies for blind or severely handicapped (State Finance Law § 175-b)
X*
Correctional institutions (Correction Law §§ 184, 185)
X*
State contract (GML § 104)
X*
County contract (GML § 103[3])
X*
Emergencies (GML § 103[4])
X
Sole source (for example, patented or monopoly item)
X
Professional services
X
True leases
X
Insurance
X
Secondhand equipment from another government (GML § 103[6])
X
Certain food and milk purchases (schools) (GML § 103(a)[10])
X
Certain municipal hospital purchases (GML § 103[8])
X
*
Although § 104-b exempts these purchases from the requirement of verbal quotations or proposals, the City should ensure that use of the exception is documented and in the case of state or county contracts that procurements from these sources are in the best interest of the City. This could be accomplished by comparisons of prices to catalogs or other market price comparisons.
[Amended 9-9-2015]
Except for procurements made pursuant to General Municipal Law, § 103(3) (through county contracts) or § 104 (through state contract); State Finance Law § 175-b (from agencies for the blind or severely handicapped); Correction Law § 185 (articles manufactured in correctional institutions), or the items excepted herein (see below), alternative proposals or quotations for goods and services shall be secured by use of written requests for proposals, written quotations, verbal quotations or any other method of procurement which furthers the purposes of General Municipal Law § 104-b.
Methods of Competition to be Used for Non-Bid Procurements
The methods of procurement to be used are as set forth on the following chart:
Verbal Quotes
Written Quotes
RFP
Other
0
3
More than 3
3
More than 3
Purchase Contracts Below $10,000
Under $500
X
$500-2,000
X
$2,000-9,999
X
Contracts for Public Work Below $20,000
Under $2,000
X
$2,000-5,000
X
$5,000-10,000
X
$10,000-19,999
X
Emergencies
(a)
Insurance
X
Professional Services
X
True Leases (other than school districts)
X
Secondhand Equipment from Other Governments
(a)
Certain Food and Milk Purchases (schools)
(a)
Certain Municipal Hospital Purchases
(a)
Source (for example, patented or monopoly item)
(a)
(a)
The methods of solicitation for these types of procurements may vary depending on the circumstances encountered.
The telephone log or other record should record at a minimum: date, item or service desired, price quoted, name of vendor, name of vendor's representative.
Vendors should provide at a minimum: date, description of item or details of service to be provided, price quoted, name of contract.
A. 
An effective way to award contracts for some professional services is to award them only after a minimum number of professionals are contacted and asked to submit written proposals. Requests for proposals (RFPs) are traditionally used as a means of obtaining all types of professional services. RFPs are used to obtain the services of architects, engineers, accountants, underwriters, fiscal consultants, and other professionals.
B. 
A request for proposals and evaluation of proposals can consider price plus other factors, like experience, staffing and suitability for needs, and may include negotiations on a fair and equal basis. The award should be the most advantageous to the City.
C. 
The process involves making a request for proposals from various firms or professionals, and then evaluating the proposals received.
A. 
An exception to the competitive bidding requirements exists for emergency situations. There are three basic statutory criteria to be met in order to fall within this exception. These are that: 1) the situation arises out of an accident or unforeseen occurrence or condition; 2) public buildings, public property or the life, health, safety or property of the political subdivision's residents are affected; and 3) the situation requires immediate action which cannot await competitive bidding. Even when a governing 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.
B. 
Documentation should include verbal quotes, etc.
C. 
There shall be an established list of preapproved contractors and service providers which shall be contacted and retained as necessary in emergency situations. The Mayor or his designee shall be authorized to enter into contracts with said contractors and service providers during emergencies. The provisions of this section shall not preclude the hiring of contractors and service providers which are not on the list if deemed necessary due to the nature of the emergency.
[Added 12-16-2014[1]]
[1]
Editor's Note: The ordinance adopted this date also repealed former Ch. 83, Buildings, Unsafe, adopted 12-7-1987 as Ch. 33 of the 1987 Code.
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. However, notwithstanding the judicial interpretation of § 103, leases of personal property by school districts are subject to the competitive bidding requirements of General Municipal Law § 103 for purchase contracts (Education Law § 1725).
B. 
Documentation should include written quotes, cost-benefit of leasing versus purchasing, etc.
A. 
There is a statutory exception to competitive bidding requirements which permits the purchase of surplus and secondhand supplies, materials or equipment without competitive bidding from the federal or state government or from any other political subdivision or public benefit corporation within the state. 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.
B. 
Documentation should include market price comparisons (verbal or written quotes), and name of government.
A. 
Competitive bidding is not required under § 103 of the General Municipal Law in those limited situations when there is only one possible source from which to procure goods and services required in the public interest, such as in the case of certain patented goods or services or public utility services (see, gen. 1986 Opns St Comp No. 86-25, p. 41). Thus, for example, the City, 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 City should document, among other things, the unique benefits of the patented item as compared to other items available in the marketplace; that no other item provides a substantially equivalent or similar benefits; and that, considering the benefits received, the cost of the item is reasonable when compared to conventional methods; in addition, the political subdivision should document that, as a matter of fact, there is no possibility of competition for the procurement of the goods.
A. 
Anytime a purchase is made from other than the lowest responsible vendor or contractor submitting a quotation or proposal, there must be justification and documentation of the reason why the purchase was in the best interest of the City and otherwise furthers the purposes of § 104-b.
B. 
For example, if a vendor submitting the lowest proposal has a history of not making deliveries on time or of delivering goods of inferior quality, such facts might be justification for taking other than the lowest offer, but such decision must be documented with facts.
A. 
Section 104-b, Subdivision 2, paragraph (f) allows the City Council to set forth any circumstances when, or types of procurements for which, in the sole discretion of the governing body, the solicitation of alternative proposals or quotations will not be in the best interest of the City.
B. 
The City Council hereby sets forth the following circumstances, and/or types of procurements that it determines would not be in the best interests of the City to solicit alternative proposals or quotations.
(1) 
Emergencies where time is crucial factor.
(2) 
Procurements for which there is no possibility of competition (sole source items).
(3) 
Procurements of professional services which, because of the confidential nature of the services, do not lend themselves to procurement through solicitation.
(4) 
Very small procurements for which solicitations of competition would not be cost effective. For example, purchase contracts below X dollars and contracts for public work below Y dollars.
A. 
Section 104-b, Subdivision 3 requires that comments concerning the policies and procedures shall be solicited from officers of the City involved in the procurement process prior to the enactment of the policies and procedures, and from time to time thereafter.
B. 
The comments from such officers will assist the Council in adopting a meaningful procurement policy and in amending that policy when time and circumstances warrant changes. Accordingly, these policies will be reviewed every January by the City officers involved in the procurement process.
In deliberating upon the responsibility of a bidder or a subcontractor, all contracting agencies shall give due consideration to any credible evidence or reliable information that the past or current record of a bidder or proposed subcontractor includes any of the following:
A. 
Lack of adequate expertise, prior experience with comparable projects, or financial resources to perform the work of the contract or subcontract in a timely, competent and acceptable manner. Evidence of such a lack of ability to perform may include, but shall not be limited to, evidence of suspension or revocation for cause of any professional license of any director or officer, or any holder of 5% or more of the bidder's proposed subcontractor's stock or equity; failure to submit satisfactory evidence of insurance, surety bonds or financial responsibility; or a history of termination of prior contracts for cause.
B. 
Criminal conduct in connection with government contracts or the conduct of business activities involving: a) the infliction, attempted infliction, or threat of death, intentional personal injury, or intentional property damage, in connection with involvement in a pattern of racketeering, labor racketeering, extortion, obstruction of justice, or other comparable crimes; b) bribery, fraud, bid-rigging, embezzlement, or other comparable crimes; or c) serious moral turpitude, fundamental lack of integrity, or knowing disregard for the law. Evidence of such conduct may include a judgment of conviction, pending criminal indictment, or formal grant of immunity in connection with a criminal prosecution, of the bidder or proposed subcontractor, any director or officer, or any holder of 5% or more of the shares or equity of the bidder or proposed subcontractor, or any affiliate of the bidder or proposed subcontractor.
C. 
Grave disregard for the personal safety of employees, state personnel, or members of the public. Due consideration shall be given to whether available evidence concerning the training of employees, equipment actually in use at the work site, and company practices for identifying and addressing deficiencies and securing employee compliance, demonstrates a genuine commitment to safety or lack of same.
D. 
Willful noncompliance with the prevailing wage and supplements payment requirements of the Labor Law, including consideration of any pending violations of the bidder or proposed subcontractor, or any affiliate of the bidder or proposed subcontractor.
E. 
Any other significant Labor Law violations, including but not limited to child labor violations, failure to pay wages, or unemployment insurance tax delinquencies.
F. 
Any significant violation of the Workers' Compensation Law, including but not limited to the failure of a bidder or proposed subcontractor to provide proof of workers' compensation or disability benefits coverage.
G. 
Any criminal conduct involving violations of the Environmental Conservation Law or other federal or state environmental statutes, or repeated or significant civil violations for federal or state environmental statutes or regulations.
H. 
The failure of a bidder or contractor to demonstrate good faith efforts to comply with applicable federal or state statutes and regulations requiring efforts to solicit and utilize minority-owned and women-owned business enterprises and disadvantaged business enterprises as potential subcontractors, in connection with a pending bid for the performance of a federal-aid or state funded or assisted project subject to such statutory and regulatory requirements.
I. 
The failure of a bidder, contractor, or proposed subcontractor to comply with federal or state statutes or regulations requiring the hiring, training and employment of persons presumed to be disadvantaged in accordance with federal and state definitions to meet federal and state equal employment opportunity requirements.
J. 
The submission of a bid which is mathematically or materially unbalanced.
K. 
The submission of a bid which is so much lower than the agency's confidential engineers' estimate of the cost of, or anticipated bids for, the contract, that it appears unlikely that the bidder will be able to perform the contract satisfactorily at the price bid.
L. 
Any other cause of so serious or compelling a nature that it raises questions about the present responsibility of a contractor or subcontractor, including but not limited to submission to a contracting agency of a false or misleading statement on a uniform questionnaire, or in some other form, in connection with a bid for or award of a contract or a request for approval of a subcontractor.