§ 17-104. Prerequisites to the Execution of City Contracts. 12
   (1)   Definitions. For the purpose of this subsection, the following definitions shall apply:
      (a)   Business Entity. Any individual, domestic corporation, foreign corporation, association, syndicate, joint stock company, partnership, joint venture, or unincorporated association, including any parent company, subsidiary, exclusive distributor or company affiliated therewith, engaged in a business or commercial enterprise.
      (b)   City. The City of Philadelphia.
      (c)   City Agency. The City of Philadelphia, its departments, boards and commissions.
      (d)   City-related Agency. All authorities and quasi-public corporations which either:
         (.1)   receive appropriations from the City; or
         (.2)   have entered into continuing contractual or cooperative relationships with the City; or
         (.3)   operate under legal authority granted to them by City ordinance.
      (e)   Department. The Procurement Department.
      (f)   Doing Business in Iran. A business entity does business in Iran when it has, with actual knowledge, made an investment of twenty million dollars ($20,000,000) or more, or any combination of investments of at least ten million dollars ($10,000,000) each, which in the aggregate equals or exceeds twenty million dollars ($20,000,000) in any 12-month period, and which directly or significantly contributes to the enhancement of Iran's ability to develop the petroleum or natural gas resources of Iran.
      (g)   Doing Business in Sudan. A business entity does business in Sudan by maintaining or leasing equipment, facilities, personnel, or other apparatus of business or commerce in oil-related activities, mineral extraction activities, power production activities, or production of military equipment of Sudan, unless the business can demonstrate that it meets one of the exceptions set forth in Section 3(d) of the Sudan Accountability and Divestment Act of 2007, P.L. 110-174, 121 Stat. 2516 (2007).
      (h)   Exclusion From Disqualification. A situation in which (i) the business entity has been affirmatively excluded from the United States Government's sanctions regime relating to Sudan or Iran, as applicable; or (ii) the business entity is terminating business in Iran or Sudan, as applicable.
      (i)   Federal Override with Respect to Iran. A circumstance in which the Congress or President of the United States has affirmatively and unambiguously declared, by means including, but not limited to, legislation, executive order, or written certification from the President to Congress, that (.1) the Government of Iran is no longer seeking a nuclear weapons capability and no longer supports international terrorism; or (.2) local government laws or policies regarding economic disengagement from Iran interfere with the conduct of United States foreign policy.
      (j)   Federal Override with Respect to Sudan. A circumstance in which:
         (.1)   the Congress or President of the United States affirmatively declares that the government of Sudan has:
            (.a)   honored its commitments to abide by United Nations Security Council Resolution 1769 (2007);
            (.b)   ceased attacks on civilians;
            (.c)   demobilized and demilitarized the Janjaweed and associated militias;
            (.d)   granted free and unfettered access for delivery of humanitarian assistance; and
            (.e)   allowed for the safe and voluntary return of refugees and internally displaced persons;
         (.2)   the President of the United States rescinds or repeals Executive Order 13067, and does not replace the Order with a substantially similar Order; or
         (.3)   the Congress or President of the United States affirmatively and unambiguously declares, by means including, but not limited to, legislation, executive order, or written certification from the President to Congress, that local government laws or policies regarding economic disengagement from Sudan interferes with the conduct of United States foreign policy.
      (k)   Government of Iran. The Government of The Islamic Republic of Iran, its instrumentalities, and companies owned or controlled by the Government of Iran.
      (l)   Sudan. The government in Khartoum, Sudan that is led by the National Congress Party (formerly known as the National Islamic Front) or any successor government formed on or after October 13, 2006, including the coalition national unity government agreed on in the comprehensive peace agreement for Sudan. The term Sudan does not include the regional government of Southern Sudan.
      (m)   Terminating Business in Iran or Sudan. Has produced a plan to end doing business in Iran or Sudan, as applicable, within one year and has been implementing its plan in good faith in order to disinvest or cease business operations over the twelve month period following adoption of the plan.
   (2)   Slavery Era Business/Corporate Insurance Disclosure and Financial Reparations. 13
      (a)   Business, Corporate and Slavery Era Insurance Ordinance. This subsection shall be known and cited as the "Business, Corporate and Slavery Era Insurance Ordinance". The purpose of this subsection is to promote full and accurate disclosure to the public about any slavery policies sold by any companies, or profits from slavery by other industries (or their predecessors) who are doing business with any City Agency or City-related Agency.
      (b)   Each contractor with whom a City Agency enters into a contract, whether subject to competitive bid or not, shall, immediately following execution of the contract, complete an affidavit verifying that the contractor has searched any and all records of the company or any predecessor company regarding records of investments or profits from slavery or slaveholder insurance policies during the slavery era. The names of any slaves or slaveholders described in those records must be disclosed in the affidavit.
      (c)   The Department shall make the information contained in the affidavit available to the public, including but not limited to making the information accessible on the City's internet accessible world wide web home page and provide an annual report to the City Council.
      (d)   If a contractor fails to provide the affidavit when required or includes materially false information on such affidavit, the contract shall be voidable.
      (e)   City Related Agencies. Any contract, lease, grant condition or other agreement entered into by the City with any City-related Agency shall contain a provision requiring the City-related Agency, in the procurement of goods and services purchased pursuant to such contract, lease, grant condition or other agreement with the City, to abide by the provisions of subsection 17-104(2).
      (f)   Any City Depository authorized to receive City deposits under Section 19-201 of this Code shall: 14
         (.1)   by January 1 of each year, provide the City with an annual certification that it is in compliance with the requirements of this Section; and
         (.2)   if it has disclosed, pursuant to this subsection, slavery policies it, or its predecessor, has sold or profits from slavery it, or its predecessor, has received, provide the City with a statement of financial reparations. The reparations statement shall include a description of any new financial products or programs developed by the depository to address racial disparity in its lending and investment activities.
   (3)   Contractor Obligation to Disclose the Number of Women and Minorities Serving as Board Members and Executive Staff. 15
      (a)   Bid conditions, requests for proposals, and all other specifications for contracts awarded by the City must require that bidders and all others seeking City contracts must:
         (.1)   disclose the current percentage of female and minority executive officers in the company and the current percentage of females and minorities on the company's executive and full boards;
         (.2)   the company's aspirational goals for the inclusion of females and minorities in executive positions and on the executive and full boards; and
         (.3)   the intended efforts by the contractor to achieve the aspirational goals.
      (b)   For purposes of this subsection (3), the term "minority" shall include members of those groups identified in Section 17-1608 of the Code ("Annual Disparity Assessment of Workforce Diversity") whose employment establishes workforce diversity.
   (4)   Prohibited Contracts. 16
      (a)   Entities Doing Business in Northern Ireland. In the procurement of goods and services, no City Agency may accept any bid from, nor enter into an original or renewal contract with, nor purchase any product manufactured by any Business Entity having any investments, licenses, franchises, management agreements or operations of any kind in Northern Ireland, if such Business Entity has not implemented the fair employment principles embodied in the MacBride Principles.
      (b)   Entities Doing Business in Iran or Sudan. 17 In the procurement of goods and services, no City Agency may accept any bid from, nor enter into an original or renewal contract with, nor purchase any product manufactured by any Business Entity doing business in Iran or Sudan, unless a federal override with respect to Iran or Sudan, as applicable, is in place or unless an exclusion from disqualification applies. In the case of disqualification of a business entity from a City contract based on doing business in Sudan, the procedural requirements of Section 3(e) of the Sudan Accountability and Divestment Act of 2007, P.L. 110-174, 121 Stat. 2516 (2007), shall apply in addition to procedural requirements otherwise provided for in this Section.
      (c)   Contract Requirements. 18
         (.1)   Each City bid and contract must contain a clause stating that the Business Entity does not retain any investments, licenses, franchises, management agreements, or operations in Northern Ireland nor that any products being delivered pursuant to the contract originate in Northern Ireland, unless the Business Entity has implemented the fair employment principles embodied in the MacBride Principles.
         (.2)   Each City bid and contract must contain a clause stating that the Business Entity does not do business in Iran or Sudan, and that no products being delivered pursuant to the contract were manufactured by an entity doing business in Iran or Sudan, unless a federal override with respect to Iran or Sudan, as applicable, is in place or unless an exclusion from disqualification applies. 19
         (.3)   The false execution of a bid or contract in accordance with subsections 17-104(4)(c)(.1) or (.2) shall result in the following: 20
            (.a)   A prospective bidder shall be liable to the City in the amount of the bid surety provided by the bidder, as liquidated damages;
            (.b)   A contractor shall be deemed to be in breach of its contract, for which the remedy shall be the cancellation or termination of the contract and the withholding of voucher payments due and owing under the contract; and
            (.c)   Business Entities that falsely execute a bid or contract shall be ineligible to bid on City contracts or subcontracts for a period of up to five (5) years.
      (d)   Notice. All invitations to bid, bid specifications, and contracts shall contain an appropriate notice and description of the duties, obligations, responsibilities, requirements, penalties, and sanctions imposed by this subsection. 21
      (e)   Waivers. 22
         (.1)   The Department may waive compliance with the provisions of subsection 17-104(4)(a) or (b) on one or more of the following grounds: 23
            (.a)   The contract is for the purchase of goods and services from a sole source where there are no other sources available following extensive search certified to by the Procurement Commissioner;
            (.b)   The purchase or contract during any fiscal year is less than or equal to the City's formal contract amount;
            (.c)   The contract involves amendments to, or modifications of, contracts in existence on March 17, 1995 (with respect to the restrictions of subsection (a)) or January 1, 2010 (with respect to the restrictions of subsection (b)), and said amendments or modifications do not significantly alter the scope or extend the duration of the contract; 24
            (.d)   The contract is for the purchase of goods and services which are needed for the continued operation of equipment, mechanical or other systems that were purchased by the City prior to March 17, 1995 (with respect to the restrictions of subsection (a)) or January 1, 2010 (with respect to the restrictions of subsection (b)), and cannot be procured from any other source and is so certified by the Procurement Commissioner; 25
            (.e)   The contract is for the purchase of goods and services which are necessary and essential to the protection of the public health and safety and cannot be procured from any other source and is so certified by the Procurement Commissioner;
            (.f)   The contract is for the acquisition of news publication services, or for the acquisition of books, magazines or other publications;
            (.g)   The contract is for the acquisition of long distance telephone, telegraph or mail services;
            (.h)   The City may waive the prohibitions contained in subsection 17-104(4)(a) or (b) if the Procurement Commissioner certifies that the added cost to the City as a result of applying said prohibition exceeds ten percent (10%) of the otherwise lowest responsible bidder; 26
            (.i)   The City may waive the prohibitions contained in subsection 17-104(4)(a) or (b) if the Procurement Commissioner certifies that applying said prohibition may result in the loss of federal, state or similar funds or grants. 27
         (.2)   All waiver decisions including supporting documentation, shall be matters of public record. Copies of certifications by the Procurement Commissioner shall be forwarded to the President of City Council no later than one (1) week following award.
      (f)   Contracts with a federal or state chartered bank or holding or trust company or federal or state savings or building and loan association, thrift institution or any other institution permitted by state or federal law to receive deposits of money and to pay out such money through loans, draft accounts or the sale of financial institution securities shall not be subject to this subsection 17-104(4)(a) or (b), but shall be subject to Section 19-201 of The Philadelphia Code. 28
      (g)   Grievances. Any Business Entity aggrieved by the decision of the Department that the City may not contract with the Business Entity pursuant to subsection 17-104(4)(a) or (b), or that action shall be taken pursuant to subsection 17-104(4)(a) or (b), may request a hearing before the Department. Such request shall be in writing and shall be filed within twenty-four (24) hours after receipt of written notification by the Department of its decision. 29
      (h)   Rules and Regulations. The Department shall promulgate such rules, regulations and procedures as it may deem necessary to aid in the administration and enforcement of the provisions of this subsection 17-104(4). Such rules and regulations shall include, but not be limited to, the following: 30
         (.1)   Standards, guidelines and procedures for the granting of waivers in accordance with subsection 17-104(4)(e); 31
         (.2)   Pre-qualification procedures for Business Entities that bid on contracts on a regular basis;
         (.3)   Procedures for investigating Business Entities bidding on, or awarded, contracts in order to ascertain the origins of their goods and products and determine whether the City may contract with said Business Entities pursuant to subsection 17-104(4)(a) or (b), including the gathering and interpretation of information received from public and private sources. 32
      (i)   Professional Service Contracts. The provisions of subsection 17-104(4) apply to contracts for the rendering of professional services. However, the enforcement of the provisions of this subsection 17-104(4) with respect to such contracts shall be the duty of the Director of Finance, and any powers and duties of the Procurement Department under this subsection 17-104(4) shall also constitute the powers and duties of the Director of Finance with respect to professional service contracts. 33
      (j)   City Related Agencies. Any contract, lease, grant condition or other agreement entered into by the City with any City-related Agency shall contain a provision requiring the City-related Agency, in the procurement of goods and services purchased pursuant to such contract, lease, grant condition or other agreement with the City, to abide by the provisions of subsection 17-104(4). Such provision shall require City approval for any waivers from compliance with the provisions of subsection 17-104(4)(a) or (b). 34
      (k)   Penalties. A vendor's failure to comply with any of the requirements of this subsection, or of any contract clause mandated by this subsection, shall be deemed a material breach by such vendor of its contract and the following sanctions and penalties shall be applied: 35
         (.1)   The cancellation or termination of the contract or subcontract and the withholding of voucher payments due and owing under the contract or subcontract; and
         (.2)   For a first offense, the imposition of a fine or penalty of not less than fifty dollars ($50) nor more than one hundred dollars ($100) per day for each day the violation persists; or
         (.3)   For a second offense, the imposition of a fine or penalty of not less than one hundred dollars ($100) nor more than two hundred dollars ($200) per day for each day the violation persists; or
         (.4)   For a third offense, the imposition of a fine of not less than three hundred dollars ($300) per day for each day the violation persists and denial of eligibility to bid on City Agency contracts for a period of not less than three (3) nor more than five (5) years. 36
      (l)   Enforcement. For the purpose of enforcement of the provisions of this ordinance, the Department shall subscribe to information reporting services on the Investor Responsibility Research Center (Washington, D.C.). Such reporting services shall be used by the Department to periodically review the degree of compliance by City contractors with the provisions of this ordinance. This report shall be made available to the public free of charge by request of the Procurement Department. 37
      (m)   Repeat Offenders. A vendor who, on more than two (2) occasions, fails to comply with any of the requirements of this subsection, or of any contract clause mandated by this subsection, shall be guilty of a separate offense of Repeat Violation, and for such Repeat Violation, shall be subject to a fine of not more than three hundred dollars ($300), or both. A person shall be guilty of a Repeat Violation regardless whether the third or subsequent violation occurs before or after a judicial finding of a previous violation, but only if the third or subsequent violation was intentional. Each violation, after the second, shall constitute a separate Repeat Violation offense. 38

 

Notes

12
   This Section, with former subsection (1), was originally enacted with the Code in 1956. Former subsection (2) was added in 1989 (1989 Ordinances, p. 1160) and amended in 1991 (1991 Ordinances, p. 988). In 1994 two Ordinances were approved: 1994 Ordinances, p. 904 deleted subsection (2); 1994 Ordinances, p. 914 repealed Section 17-104 altogether. In 1995, Bill No. 890 (approved March 29, 1995), 1995 Ordinances, p. 161, added a new subsection (2), assuming the existence of the Section itself. Bill No. 040133-A (approved March 31, 2005), effective June 29, 2005, renumbered subsection (2) as subsection (1), added a new subsection (2), and renumbered much of former subsection (2) as subsection (3). Caption amended, Bill No. 050615 (approved December 15, 2005); subsections (1)(f) through (1)(m) added by Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
13
   Added, Bill No. 040133-A (approved March 31, 2005). Caption amended, Bill No. 050615 (approved December 15, 2005).
14
   Subsection (2)(f) added, Bill No. 050615 (approved December 15, 2005).
15
   Added, Bill No. 130457 (approved September 6, 2013); amended, Bill No. 180133 (approved June 20, 2018).
16
   Caption for subsection (3) added, and subsection renumbered, Bill No. 040133-A (approved March 31, 2005); renumbered, Bill No. 130457 (approved September 6, 2013). All internal references to subsection 17-104(3) renumbered as subsection 17-104(4) by the Code editor.
17
   Added, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
18
   Renumbered, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
19
   Added, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
20
   Renumbered and amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
21
   Renumbered, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
22
   Renumbered, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
23
   Amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
24
   Amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
25
   Amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
26
   Amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
27
   Added, Bill No. 960405 (approved February 7, 1997); amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
28
   Renumbered and amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
29
   Renumbered and amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
30
   Renumbered and amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
31
   Amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
32
   Amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
33
   Renumbered and amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
34
   Renumbered and amended, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
35
   Renumbered, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
36
   Amended, 1995 Ordinances, p. 1081.
37
   Renumbered, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.
38
   Added, 1995 Ordinances, p. 1081; renumbered, Bill No. 080746 (approved December 16, 2009), effective June 16, 2010.