2-92-644 Emergency procurement.

   When bona fide emergencies arise, or when the Chief Procurement Officer determines that expedited procurement is necessary to address a credible, identifiable, and imminent threat to public health, public safety, or City property or operations, the Chief Procurement Officer is authorized to enter into contracts with one or more vendors for the provision of any particular good, work, or service, and to make any modifications to existing contracts that in the Chief Procurement Officer's sole discretion are necessary, to address that emergency or threat. The purchasing authorizations conferred in 65 ILCS 5/8-10-5 shall apply, but the dollar limit provided for in that section is increased to $1,000,000.00 for each such contract or modification. A report of all contracts awarded and modifications made by the Chief Procurement Officer pursuant to this section will be placed on file each quarter with the City Council Committee on the Budget and Government Operations.

(Added Coun. J. 12-8-04, p. 38063, § 1; Amend Coun. J. 12-15-04, p. 39933, § 1; Amend Coun. J. 10-5-16, p. 33570, § 1; Amend Coun. J. 11-14-18, p. 90308, Art. V, § 3; Amend Coun. J. 1-26-22, p. 44191, § 1; Amend Coun. J. 11-7-22, p. 54948, Art. I, § 9)

2-92-646 Limitation on additional items.

   In contracts for the purchase of goods, work or services ("items") that are structured as "requirements" contracts, in which the quantities for the goods identified by line item in the contract are estimates only and the city will make purchases from the contract based upon its needs, the chief procurement officer may include, in the contract, items (and prices thereof) that were omitted from the original specification or request for proposals that had been publicly advertised, subject to the following limitations: (i) the items are of the same nature as those items in the contract, (ii) the aggregated value of the city's purchases for such additional items over the term of the contract does not exceed ten percent of the original value of the contract and (iii) the chief procurement officer conducted first a survey of the price in the market for such items.

(Added Coun. J. 12-8-04, p. 38063, § 1)

2-92-649 Contracts with vendors based on reference contracts.

   (a)   As used in this section, the following terms shall be defined as follows:

   "City Contract" shall mean a contract for goods or services entered into with a vendor selected by the Chief Procurement Officer, provided such vendor has entered into a Reference Contract for the provision of the same goods or services. The terms of the City Contract and the Reference Contract shall be the same except as provided in subsection (c) of this section. A City Contract may be based upon a Reference Contract either in existence or expired at the time the City Contract is negotiated and executed.

   "Reference Contract" shall mean a contract entered into by a vendor for goods or services with a federal, state or local entity other than the City, or a group or consortium of the same, as a result of a public procurement process followed by such governmental entity or entities.

   (b)   With respect to procurements of goods or services that otherwise would be subject to Sections 10-3 or 10-4 of the "Municipal Purchasing Act for Cities of 500,000 or More Population", codified at 65 lLCS 5/8-10-3 and 5/8-10-4, as amended, the Chief Procurement Officer is authorized to enter into one or more City Contracts.

   (c)   A City Contract may contain:

      (i)   pricing or compensation terms equivalent to, or more favorable to the City than, those contained in the Reference Contract. A City Contract shall not contain higher pricing than is contained in the Reference Contract;

      (ii)   a period of duration, i.e., a term, which varies from the term of the Reference Contract;

      (iii)   such additional provisions as the Chief Procurement Officer determines to be in the best interests of the City; or

      (iv)   such insertions to or deletions from the Reference Contract as are required by law or ordinance applicable to the City.

   (d)   As a condition of entering into a City Contract, every contractor shall make such disclosures to the City as are required by law or required from other City vendors and shall comply with those requirements of the Municipal Code providing for the "Minority- Owned and Women-Owned Business Enterprise Procurement Program" (Sections 2-92-420 through 2-92-570), and "Contracts – Firms owned and operated by individuals with disabilities" (Section 2-92-586).

(Added Coun. J. 5-24-06, p. 76917, § 2)

ARTICLE VI. M.B.E. / W.B.E. CONSTRUCTION PROGRAM (2-92-650 et seq.)

2-92-650 Application of article.

   The provisions of this article shall apply with regard to city construction contracts, to the extent not subject to or inconsistent with federal or State of Illinois requirements, and such contracts shall no longer be governed by Sections 2-92-420 through 2-92-570.

(Added Coun. J. 5-26-04, p. 24585, § 3)

2-92-660 Findings of discrimination.

   The City Council, after considering evidence presented to the Budget Committee, including evidence presented at trial in Builders Association of Greater Chicago v. City of Chicago, Number 96 C 1122 (N.D. Ill.), during May and June 2003 (the "B.A.G.C. Trial"); statistical evidence, not available during the B.A.G.C. Trial, of continuing discrimination against Blacks, Hispanics and women in the Chicago construction marketplace; the report of the Mayoral Task Force on M.B.E./W.B.E. as well as additional anecdotal evidence of discrimination against minorities and women in the Chicago construction marketplace; and the testimony of experts and anecdotal witnesses; and receiving and considering written reports and submissions, adopts the following findings as a strong basis in evidence supporting a narrowly tailored, remedial affirmative action program in the City's construction contracting:

   (a)   the City seeks to provide a level playing field and equal access for all contractors and subcontractors to participate in the City's contracting opportunities;

   (b)   the City has a significant impact upon the area economy through its contracting functions;

   (c)   prior to the adoption of Executive Order 85-2, the City's contracting often operated as a closed shop, such that minorities and women received fewer than the number of the City's contracts and subcontracts and contract and subcontract awards than would have been expected absent discrimination;

   (d)   City departments reduced the disparities between the availability of minority and women firms and their utilization by implementing Executive Order 85-2;

   (e)   the City engaged in a substantial good faith legislative effort in 1990, involving 18 days of hearings and debate, which identified strong historical, statistical, scholarly and anecdotal evidence of past and present discriminatory practices in the Chicago-area market, including but not limited to construction, which placed minorities and women in a position of social and economic disadvantage and imposed discriminatory barriers to the entry and continued viability of minorities and women in the Chicago market and to their participation on the City's contracts;

   (f)   based on the strong evidence presented during the hearings, the City Council on July 31, 1990, enacted an affirmative action ordinance designed to remedy discrimination in the City's contracting against minorities and women;

   (g)   the Builders Association of Greater Chicago challenged the constitutionality of Sections 2-92-420 through 2-92-570 in 1996, as applied to construction contracts;

   (h)   strong evidence was introduced at the B.A.G.C. Trial that past and current discriminatory practices continue to place racial and ethnic minorities and women in a position of social and economic disadvantage, limiting opportunities for them to form and control construction businesses, as well as reducing the level and availability of employment opportunities for minorities and women in the trade unions which serve the Chicago construction marketplace;

   (i)   strong evidence was introduced at the B.A.G.C. Trial that such current and past discriminatory practices, and the continuing effects of such discrimination, have impeded the growth and success of the businesses which minorities and women do form, as well as the level and availability of the employment opportunities in the construction trade unions;

   (j)   the evidence at the B.A.G.C. Trial demonstrated that these discriminatory practices include direct and indirect racial, ethnic and gender slurs and harassment; discrimination by lending institutions and other sources of capital; reduced opportunities for minority and women subcontractors to bid or quote to majority prime contractors; exclusion from and discriminatory treatment by the construction trade unions; exclusion from business and professional networks critical to entrepreneurial success; and discrimination by surety bonding companies, insurance companies and other entities integral to the contracting marketplace;

   (k)   following the B.A.G.C. Trial, Judge James B. Moran held that the City has a compelling interest in implementing a remedial race- and gender-conscious affirmative action program in the Chicago construction market, but that the City's 1990 ordinance is insufficiently narrowly tailored in 2003 as applied to construction contracts;

   (l)   there is ample availability of ready, willing and able minority- and women-owned firms to participate in City and private sector construction contracting and subcontracting opportunities;

   (m)   minority- and women-owned firms receive little or no work on private sector construction projects, despite their capacity, desire and efforts to participate on such projects;

   (n)   minority and women workers' participation in the relevant construction marketplace declined from 1980 to 1990;

   (o)   other jurisdictions, including Cook County, Illinois, have experienced drastic reductions in minority and women business participation, to less than their availability, after race- and gender-conscious remedial measures were terminated;

   (p)   while the City has made substantial progress in its efforts to ameliorate discrimination in its own construction contracting practices, private companies that contract on public projects continue to discriminate against minorities and women, and as a result of this discrimination, the City has been in the past a passive participant in a system of discrimination against minorities and women in the Chicago construction marketplace, and, in the absence of programs to eliminate such discrimination, would continue to be a passive participant in such a system;

   (q)   the City has a compelling interest in preventing its tax dollars from perpetuating a market so flawed by past discrimination that it restricts existing minority- and women-owned businesses from unfettered competition in the Chicago construction market;

   (r)   the City has a compelling interest in not having its construction projects return to near monopoly domination by white male firms, as was the case prior to Executive Order 85-2 and the City's current affirmative action program in procurement;

   (s)   although the City has undertaken since 1990 a variety of race- and gender-neutral measures such as technical assistance and small business loan programs, such programs have not been sufficient to ameliorate the effects of racial and gender discrimination in the construction marketplace;

   (t)   evidence at the B.A.G.C. Trial demonstrated that flexible race- and gender-conscious remedial measures do not overly burden construction firms owned by majority males;

   (u)   the remedies adopted herein will be periodically reviewed to ensure that the City continues to have a compelling interest in remedying discrimination in the Chicago construction market and that the measures remain narrowly tailored to accomplish that objective; and

   (v)   following a comprehensive review of the relevant data conducted in 2009, the City determined to extend this article to December of 2015 and make other changes to this article, and following a subsequent comprehensive review of the relevant data conducted in 2015, the City determined to further extend this article to December 31, 2020. Due to the coronavirus pandemic and to allow for completion of the comprehensive review of the relevant data, the City determined to temporarily extend this article to September 30, 2021, and in 2021, following a comprehensive review of the relevant data, the City determined to extend this article to December 31, 2027 and make other changes to this article.

(Added Coun. J. 5-26-04, p. 24585, § 3; Amend Coun. J. 7-29-09, p. 67484, § 1; Amend Coun. J. 12-9-15, p. 15382, § 1; Amend Coun. J. 2-10-16, p. 18343, § 1; Amend Coun. J. 9-14-21, p. 35424, § 1)

2-92-670 Definitions.

   As used in this article, the following terms shall have the following meanings:

   (a)   "Affiliate" means a person or entity that directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the person or entity. In determining whether persons or entities are affiliates, the City shall consider all appropriate factors, including common ownership, common management and contractual relationships. Affiliates shall be considered together in determining whether a firm is a Small Business Enterprise.

   (b)   "Broker" means a person or entity that fills orders by purchasing or receiving supplies from a third party supplier rather than out of existing inventory, and provides no commercially useful function other than acting as a conduit between a supplier and a customer.

   (c)   "Contracting Equity officer" has the meaning ascribed to this term in Section 2-92-070.

   (d)   "Chief Procurement Officer" or "CPO" means the Chief Procurement Officer of the City of Chicago.

   (e)   "Commercially useful function" means responsibility for the execution of a distinct element of the work of the contract, which is carried out by actually performing, managing and supervising the work involved, or fulfilling responsibilities as a joint venturer.

   (f)   "Construction contract" means a contract, purchase order or agreement (other than a lease of real property) for the construction, repair or improvement of any building, bridge, roadway, sidewalk, alley, railroad or other structure or infrastructure, awarded by any officer or agency of the City other than the City Council, and whose cost is to be paid from funds belonging to the City.

   (g)   "Contract specific goals" means the subcontracting goals for M.B.E. and W.B.E. participation established for a particular contract based upon the availability of M.B.E.s and W.B.E.s to perform the anticipated scopes of work of the contract, and the City's progress towards meeting the aspirational goals.

   (h)   "Contractor" means any person or business entity that seeks to enter into a construction contract with the City, and includes all partners, affiliates and joint ventures of such person or entity.

   (i)   "Department of Procurement Services" or "D.P.S." means the Department of Procurement Services of the City of Chicago.

   (j)   "Economically disadvantaged" means an individual whose personal net worth is less than $2,379,730.00, adjusted annually for inflation, such annual adjustment to begin January 2022, based on the Consumer Price Index – Urban Wage Earners and Clerical Workers (Chicago All Items) published by the United States Bureau of Labor Statistics.

   (j-5)   "Established business" means a business which is not a "small business enterprise" as determined according to subsection (t) of this section, or a business whose owners of 50 percent or more are persons who are not "economically disadvantaged" as determined pursuant to subsections (i) and (q) of this section.

   (k)   "Good faith efforts" means actions undertaken by a contractor to achieve a contract specific goal that, by their scope, intensity and appropriateness to the objective, can reasonably be expected to fulfill the program's requirements.

   (l)   "Joint venture" means an association of two or more persons or entities, or any combination of types of business enterprises and persons numbering two or more, proposing to perform a single for-profit business enterprise, in which each joint venture partner contributes property, capital, efforts, skill and knowledge, and in which the M.B.E. or W.B.E. is responsible for a distinct, clearly defined portion of the work of the contract and whose share in the capital contribution, control, management, risks and profits of the joint venture is equal to its ownership interest. Joint ventures must have an agreement in writing specifying the terms and conditions of the relationships between the partners and their relationship and responsibilities to the contract.

   (m)   "Local business enterprise" means a business entity located within the counties of Cook, DuPage, Kane, Lake, McHenry or Will in the State of Illinois (the "Six County Region").

   (n)   "Minority" means:

      (i)   any individual in the following racial or ethnic groups, members of which are rebuttably presumed to be socially disadvantaged:

         (A)   African-Americans or Blacks, which includes persons having origins in any of the Black racial groups of Africa;

         (B)   Hispanics, which includes persons of Spanish culture with origins in Mexico, South or Central America or the Caribbean Islands, regardless of race;

         (C)   Asian-Americans, which includes persons whose origins are in any of the original peoples of the Far East, Southeast Asia, the islands of the Pacific or the Northern Marianas, or the Indian Subcontinent;

         (D)   American Indians, which includes persons having origins in any of the original peoples of North and South America (including Central America) and who maintain tribal affiliation or community attachment; and

      (ii)   individual members of other groups, including but not limited to Arab-Americans, found by the City to be socially disadvantaged by having suffered racial or ethnic prejudice or cultural bias within American society, without regard to individual qualities, resulting in decreased opportunities to compete in Chicago area markets or to do business with the City.

   (o)   "Minority-owned business enterprise" or "M.B.E." means a small local business enterprise which is at least 51 percent owned by one or more economically disadvantaged minority persons, or in the case of a publicly held business, at least 51 percent of all classes of the stock of which is owned by one or more economically disadvantaged minority persons, whose management, policies, major decisions and daily business operations are independently managed and controlled by one or more economically disadvantaged minority persons.

   (p)   "Owned" means having all of the customary incidents of ownership, including the right of disposition, and sharing in all of the risks, responsibilities and profits commensurate with the degree of ownership.

   (p-5)   "Participating established business" means an established business which is eligible to participate in the City's minority- and women-owned business enterprise construction procurement program as set forth in Section 2-92-725 of this Code.

   (q)   "Personal net worth" means the net value of the assets of an individual after total liabilities are deducted. An individual's personal net worth does not include the individual's ownership interest in an applicant or other business that is not publicly held, or the individual's equity in any real estate and any related fixtures or furnishings. An individual's net worth also does not include the value of the individual's interest in any pension plans, Individual Retirement Accounts, 401(k) accounts, or other retirement savings or investment programs. As to assets held jointly with his or her spouse, an individual's personal net worth includes only that individual's share of such assets.

   (r)   "Private sector credit program" means the program provided for in Section 2-92-720 of this chapter.

   (s)   "Program" means the minority- and women- owned business enterprise construction procurement program established in this article.

   (t)   "Small business enterprise" means a business that has gross receipts, averaged over its previous seven fiscal years, that do not exceed one and half times the size standards of the U.S. Small Business Administration set forth in 13 C.F.R. Part 121, relevant to the scope(s) of work the firm seeks to perform on the City's contracts.

   (u)   "Small local business enterprise" means a business that is a small business enterprise and a local business enterprise.

   (v)   "Woman" means a person of the female gender, who is presumed to be socially disadvantaged.

   (w)   "Women-owned business enterprise" or "W.B.E." means a small local business enterprise which is at least 51 percent owned by one or more economically disadvantaged women, or in the case of a publicly owned business, at least 51 percent of all classes of the stock of which is owned by one or more economically disadvantaged women, whose management, policies, major decisions and daily business operations are independently managed and controlled by one or more economically disadvantaged women.

(Added Coun. J. 5-26-04, p. 24585, § 3; Amend Coun. J. 11-1-06, p. 89853, § 1; Amend Coun. J. 4-11-07, p. 102570, § 1; Amend Coun. J. 7-29-09, p. 67484, § 1; Amend Coun. J. 12-2-09, p. 78837, Art. 4, § 1; Amend Coun. J. 11-16-11, p. 13798, Art. IV, § 3; Amend Coun. J. 3-14-12, p. 22581, § 2; Amend Coun. J. 6-27-18, p. 80801, § 2; Amend Coun. J. 9-14-21, p. 35424, § 1; Amend Coun. J. 10-27-21, p. 39543, Art. III, § 2)