HomeMy WebLinkAboutAGENDA REPORT 2023 0705 CCSA REG ITEM 09CCITY OF MOORPARK, CALIFORNIA
City Council Meeting
of July 5, 2023
ACTION INTRODUCED ORDINANCE NO.
516. (ROLL CALL VOTE: UNANIMOUS)
BY A. Hurtado.
C. Consider Ordinance Amending Sections 3.04.130 and 3.04.250 of Chapter 3.04 of
the Moorpark Municipal Code Increasing the Dollar Thresholds for Informal and
Formal Bid Purchases of Supplies, Materials and Equipment. Staff
Recommendation: Introduce Ordinance No. 516 for first reading, waive full
reading, and place this Ordinance on the agenda for the July 19, 2023, meeting
for purposes of providing second reading and adoption of the Ordinance. (Staff:
Roger Pichardo, Program Manager) (ROLL CALL VOTE REQUIRED)
Item: 9.C.
MOORPARK CITY COUNCIL
AGENDA REPORT
TO: Honorable City Council
FROM: Roger Pichardo, Program Manager
DATE: 07/05/2023 Regular Meeting
SUBJECT: Consider Ordinance Amending Sections 3.04.130 and 3.04.250 of
Chapter 3.04 of the Moorpark Municipal Code Increasing the Dollar
Thresholds for Informal and Formal Bid Purchases of Supplies,
Materials and Equipment
BACKGROUND/SUMMARY
On July 2, 1983, the City Council adopted Ordinance No. 2 and thereby establishing a
purchasing system for the purchase of supplies and/or equipment at the lowest possible
cost. Subsequently, on April 15, 1985, the City Council adopted Ordinance No. 43
amending certain sections related to the City’s Formal and Informal Bidding procedures
with the intention of increasing the purchasing thresholds.
The City’s purchasing ordinance for supplies and/or equipment is governed by the City of
Moorpark Municipal Code, Title 3, Chapter 3, Article I. This Ordinance has been in place
for 40 years. Since its implementation, significant changes have occurred in market
conditions, inflation rates, and the cost of supplies and equipment, which have resulted
in the City operating with outdated purchasing threshold amounts that have resulted in
reduced purchasing power, administrative onus, and ineffective resource allocation. The
ordinance amendment discussed in this report only pertain to the purchase of supplies,
materials, equipment, etc. that are not governed by state statute. Instead, they are based
solely on best practices and market conditions. Furthermore, it should be noted that the
contract value of public works projects, such as large construction projects, is regulated
by the provisions of the Public Contract Code and is not applicable to the policy changes
discussed in this report.
To better streamline the City’s purchasing processes and provide staff with the ability to
efficiently make routine purchases and to contract with service providers to carry out
certain day-to-day operations, staff is recommending the City Council consider amending
the Moorpark Municipal Code (MMC) to reflect pricing changes that have occurred since
the adoption of the City’s purchasing ordinance.
Item: 9.C.
908
Honorable City Council
07/05/2023 Regular Meeting
Page 2
DISCUSSION
Due to the absence of inflation adjustments in the City's purchasing ordinances from 1983
and 1985, the dollar amount thresholds that determine when informal and formal bidding
procedures are required have become outdated. Currently, the threshold triggering a
formal bid process is set at $15,000. To put this into perspective, $15,000 in 1983 is
equivalent in purchasing power to about $46,000 today. This indicates that the real value
of a single U.S. dollar has decreased over time, meaning it can buy fewer goods than
before. As a result, this has resulted in limited purchasing power, an increased
administrative burden, and inefficiency for small projects.
Proposed Amendment
The proposed amendment seeks to modify the purchasing threshold amounts in the MMC
that require informal bidding and formal bidding to ensure they are in line with current
market conditions and best practices, among other objectives explained below.
Article III Open Market or Informal Bid Procedure
Section 3.04.250 Generally
An informal bid is one in which the purchasing agent solicits bids by written requests to
prospective vendors. All open market purchases must, wherever possible, be based on
a minimum of three informal bids and must be awarded to the bidder offering the most
advantageous bid to the City.
The existing informal bid threshold amount for purchases of supplies and/or equipment,
as depicted in the summary table below, cannot exceed an estimated value of $15,000
for purchases made in the open market.
Staff is recommending the City Council adjust the limit to not-to-exceed $50,000.
Existing Limit Recommended Limit
≤$15,000 ≤$50,000
Furthermore, staff recommends the City Council authorize an amendment dispensing the
bidding threshold amount for purchases of supplies and equipment made in the open
market, allowing for a change in the total value maximum of less than $1,000 to a new
total value maximum of $5,000. If the proposed amendment is approved by the City
Council, for example, the purchase of goods and/or equipment made in the open market
that do not exceed $5,000 will be authorized to be administratively approved by the
Department Head.
Raising the bidding threshold amounts, which were established approximately 40 years
ago, will enable the City to adapt to economic changes, attract qualified bidders, improve
efficiency by making the purchasing process faster for small projects, and make more
informed decisions based on best value considerations.
909
Honorable City Council
07/05/2023 Regular Meeting
Page 3
Article II Formal Bidding Procedure
Section 3.04.130 Generally
A formal bid is one in which the department staff prepares notices inviting bids for
purchase of supplies and/or equipment that exceed a certain threshold amount. The
notice includes a general description of the goods or equipment to be purchased,
indicates where the bid documents and specifications may be obtained, and specifies the
time and place for opening bids. It is posted on the City’s website and published at least
once in a newspaper of general circulation and, if applicable, in appropriate trade
publications. All formal bids must be submitted to the City’s purchasing agent in a sealed
envelope and publicly opened and read at the date, time, and place stated in the
published notice. Subsequently, when the purchasing amount exceeds $50,000, staff
recommends contract(s) to the City Council, who may then award to the lowest
responsible bidder.
The existing formal bid threshold amount for purchases of supplies and/or equipment, as
depicted in the summary table below, greater than $15,000 must be awarded to the lowest
responsible bidder.
Staff is recommending City Council raise the limit to greater than $50,000 for purchases
of supplies and/or equipment that must be awarded to the lowest responsible bidder.
Existing Limit Recommended Limit
>$15,000 >$50,000
Raising the bidding threshold amount, which was established 40 years ago, will enable
the City to adapt to economic changes, attract qualified bidders, improve efficiency by
making the purchasing process faster for small projects, and make more informed
decisions based on best value considerations.
Neighboring Cities Survey
Staff surveyed neighboring cities and conducted a comprehensive review of their
purchasing ordinance threshold amounts. The analysis presented below was utilized by
staff in determining the most suitable and efficient purchasing threshold amounts, which
are now being recommended to the City Council.
City Informal Bid Formal Bid
Moorpark (Existing) $999 to $15,000 >$15,000
Camarillo $5,000 to $30,000 >$30,000
Moorpark (Proposed) $5,000 to $50,000 >$50,000
Ventura $5,000 to $50,000 >$50,000
Santa Paula $9,999 to $50,000 >$50,000
Thousand Oaks $5,000 to $75,000 >$75,000
Port Hueneme $10,000 to $25,000 >$25,000
Simi Valley $45,001 to $175,000 >$175,000
Average of six cities $13,333 to $67,500 >$80,000
910
Honorable City Council
07/05/2023 Regular Meeting
Page 4
For the aforementioned reasons, staff is recommending that the City Council approve
amendments to Sections 3.04.130 and 3.04.250 of Chapter 3.04 of the MMC pertaining
to purchasing limits for formal and informal bidding applicable to supplies and equipment.
The draft ordinance is attached to this staff report. Furthermore, at a future date, staff will
prepare and present a comprehensive update to the purchasing ordinance for City
Council consideration.
ENVIRONMENTAL DETERMINATION
Section 15273 of the California Environmental Quality Act (CEQA) provides that CEQA
does not apply to the establishment, modification, structuring, restructuring, or approval
of rates, tolls, fares, or other charges by public agencies which the public agency finds
are for the purpose of: (1) Meeting operating expenses, including employee wage rates
and fringe benefits, (2) Purchasing or leasing supplies, equipment, or materials, (3)
Meeting financial reserve needs and requirements, (4) Obtaining funds for capital
projects, necessary to maintain service within existing service areas, or (5) Obtaining
funds necessary to maintain such intra-city transfers as are authorized by city charter.
Therefore, no environmental review is required.
FISCAL IMPACT
There is no fiscal impact as a result of this action.
COUNCIL GOAL COMPLIANCE
This action does not support a current strategic directive.
STAFF RECOMMENDATION (ROLL CALL VOTE REQUIRED)
Introduce Ordinance No. ___ for first reading, waive full reading, and place this Ordinance
on the agenda for the July 19, 2023, meeting for purposes of providing second reading
and adoption of the Ordinance.
Attachment: Draft Ordinance No. ___
911
ORDINANCE NO. ___
AN ORDINANCE OF THE CITY OF MOORPARK,
CALIFORNIA, AMENDING SECTIONS 3.04.130 AND
3.04.250 OF CHAPTER 3.04 (PURCHASING) OF TITLE 3
(REVENUE AND FINANCE) OF THE MOORPARK
MUNICIPAL CODE INCREASING THE DOLLAR
THRESHOLDS FOR INFORMAL AND FORMAL BID
PURCHASES OF SUPPLIES, MATERIALS AND
EQUIPMENT
WHEREAS, the City Council adopted Ordinance No. 2 on July 20, 1983, creating
a purchasing system for the purchase of supplies and equipment at the lowest possible
cost; and
WHEREAS, the City Council adopted Ordinance No. 43 on April 15, 1985, to
amend certain sections (3.12.120 and 3.12.230) regarding the formal (sealed) bid
procedure and open market or informal bid procedures respectively, to increase the
purchasing thresholds; and
WHEREAS, Moorpark Municipal Code Chapter 3.12 (Purchases) was renumbered
as Chapter 3.04 (Purchasing) during updates to the Municipal Code; and
WHEREAS, due to the increases in the cost of purchasing supplies and equipment
since 1985, it is appropriate to amend the Moorpark Municipal Code to update the existing
purchasing thresholds in order reflect market changes and streamline formal and informal
bidding procedures; and
WHEREAS, City staff has reviewed this ordinance and determined that its approval
is exempt from the California Environmental Quality Act (CEQA) on the basis that the
change in the dollar thresholds of purchasing limits for formal and informally bid items is
an administrative and financial action of the City that does not have any possibility of
having any effect on the environment, and on that basis does not constitute a project
requiring environment review, as defined by Section 15273 of the State CEQA Guidelines.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK DOES
ORDAIN AS FOLLOWS:
SECTION 1. The City Council concurs with City staff’s determination that the
approval of this Ordinance is exempt from the California Environmental Quality Act
(CEQA) on the basis that the change to the dollar thresholds of purchasing limits for
formal and informally bid items is an administrative and financial action of the City that
does not have any possibility of having any effect on the environment, and on that basis,
does not constitute a project requiring environment review, as defined by Section 15273
of the State CEQA Guidelines.
ATTACHMENT
912
Ordinance No. ___
Page 2
SECTION 2. Section 3.04.130 of Article II (Formal Bid Procedure) of Chapter 3.04
(Purchasing) of Title 3 of the Moorpark Municipal Code is hereby amended to read as
follows:
“3.04.130 Generally.
Except as otherwise provided in this chapter, purchases of supplies and
equipment of an estimated value greater than fifteen thousand fifty
thousand dollars ($15,000.00 50,000.00) shall be awarded to the lowest
responsible bidder pursuant to the formal bid procedure hereinafter
prescribed. Public projects, as defined in Section 20161 of the Public
Contract Code of the state shall be awarded pursuant to applicable
provisions of the Public Contract Code.”
SECTION 3. Section 3.04.250 of Article III (Open Market or Informal Bid
Procedure) of Chapter 3.04 (Purchasing) of Title 3 of the Moorpark Municipal Code is
hereby amended to read as follows:
“3.040.250 Generally.
Purchases of supplies and equipment of an estimated value in the amount
of fifteen fifty thousand dollars ($15,000.00 50,000.00) or less may be made
by the purchasing agent in the open market pursuant to the procedure
prescribed in Sections 3.04.260 through 3.04.280 of this chapter and
without observing the procedure prescribed in Sections 3.04.130
through 3.04.240 of this chapter; provided, however, all bidding may be
dispensed with for purchases of supplies and equipment having a total
estimated value not-to-exceed of less than one five thousand dollars
($1,000.00 5,000.00).”
SECTION 4. If any section, subsection, sentence, clause, phrase, part or portion
of this ordinance is for any reason held to be invalid or unconstitutional by any court of
competent jurisdiction, such decision shall not affect the validity of the remaining portions
of this ordinance. The City Council declares that it would have adopted this ordinance
and each section, subsection, sentence, clause, phrase, part or portion thereof,
irrespective of the fact that any one or more section, subsections, sentences, clauses,
phrases, parts or portions be declared invalid or unconstitutional.
SECTION 5. This ordinance shall become effective thirty (30) days after its
passage and adoption.
913
Ordinance No. ___
Page 3
SECTION 6. The City Clerk shall certify to the passage and adoption of this
ordinance; shall enter the same in the book of original ordinances of said City; shall make
a written record of the passage and adoption thereof in the minutes of the proceedings of
the City Council at which the same is passed and adopted; and shall publish notice of
adoption in the manner required by law.
PASSED AND ADOPTED this ____ day of __________, 2023.
______________________________
Chris R. Enegren, Mayor
ATTEST:
___________________________________
Ky Spangler, City Clerk
914