§ 5-809. Purchasing Policy and Procedure.

Publisher's Note: This Section has been AMENDED by new legislation (Ord. 39-2023, enacted 4-24-2023). The text of the amendment will be incorporated below when the ordinance is codified.

[Added 8-22-2016 by Ord. No. 34-2016]

[Editor’s note: Ord. 34-2016, passed 8-22-2016, creates this new § 5-809, Purchasing Policy and Procedure, previously an appendix to Ch. 5, as set forth below. Appendices to Purchasing Policy and Procedure follow Ch. 5.]

Forward

The purpose of this manual is to provide all departments, divisions, offices and agencies with the procedures and policies to be used in the procurement of goods and services and to provide for the fair and equitable treatment of all persons involved in public purchasing by the City of Reading; to maximize the purchasing value of public funds; and to provide safeguards for maintaining a procurement system of quality and integrity.

The purchasing function involves the procurement of materials, supplies, equipment, and services at best value, consistent with the quality needed to meet the required standards established and approved by the City of Reading. Our goal is the promotion of the best interest of the City of Reading through intelligent action and fair dealings, resulting in obtaining maximum savings for the City.

Rules and regulations are necessary for the proper operation of the purchasing function and it is essential that all who are involved in the purchasing operation be well informed. This manual was developed to aid all employees directly or indirectly associated with the function of purchasing.

The objectives of the Purchasing Division are as follows:

   1.   To deal fairly and equitably with all vendors wishing to do business with the City of Reading.

   2.   To provide professional procurement services for all customers within the City.

   3.   To assure adherence to all laws, regulations, and procedures related to City procurement.

   4.   To maximize competition for all procurements of the City.

   5.   To purchase goods and services at the best value, if not lowest price, consistent with quality performance and delivery requirements, from capable vendors meeting the City's needs.

Section 1
Purchasing Division

Responsibilities, Function & Objectives

1.01 PURPOSE:

The purpose of this regulation is to formalize the City of Reading purchasing policy by delineating the specific authorities and responsibilities that are the components of the purchasing process.

1.02 APPLICABLE TO:

All departments, divisions, offices and agencies.

1.03 GENERAL PURCHASING POLICY:

   1.   Overall authority and responsibility for City Purchasing is centralized in the Purchasing office within the Finance Department.

   2.   The purchasing policy is applicable to all offices and encompasses more than just the service function of ordering and buying goods and services. Functions such as planning and scheduling purchases, seeking competition, assuring the preparation of proper specifications, and enforcing compliance with all purchasing regulations and procedures are part of the purchasing program.

1.04 PURCHASING COORDINATOR:

   1.   Authorities. The purchasing coordinator shall have the authority to:

      A.   Purchase or contract for all materials, supplies, equipment and contractual services for all City departments with the exception of:

         •   Books, subscriptions

         •   Business meeting expenses

         •   Charitable contributions

         •   Dues

         •   Items that can legitimately be purchased via the petty cash process

         •   Postage

         •   Tuition

         •   Travel - meals, mileage, transportation

         •   Utility services that are not regulated by the PUC

         (1)   In case of an emergency, purchase authority is delegated to the individual departments, divisions, offices or agencies when the purchasing coordinator is unavailable i.e., after normal working hours (see Administrative Procedures, "Emergency Purchase Procedure").

         (2)   It is a violation of this regulation for any official or employee of the City to purchase other than the commodities or services exempted, as stated above, in a way that circumvents the purchasing coordinator. Violation of this regulation will result in appropriate disciplinary action, including reimbursement to the City for any payments made for purchase in violation of this regulation.

      B.   The purchasing coordinator shall have the authority to review all requisitions for the purchase of materials, supplies, equipment and services not exempted from this regulation for quality and cost.

         (1)   The purchasing process begins with the user's formulation of specifications that identify and describe the product or service to be purchased.

         (2)   The purchasing coordinator will assure that the specifications meet the user's needs, but do not call for features or a level of quality not necessary for the item's use.

         (3)   If there is a lack of agreement between the purchasing coordinator and the department, division, office or agency concerning any specifications, the purchasing coordinator will refer the case and all supporting documentation to the Finance Director for determination.

      C.   Prepare, in cooperation with departments, divisions, offices or agencies, standard written specifications for supplies and/or services not exempted by this regulation especially those common to various City departments, divisions, offices or agencies.

      D.   Place orders for all supplies, materials, equipment or services, not exempted by this regulation, by the issuance of a purchase order.

      E.   Dispose of surplus or unused materials, supplies or equipment after they have been declared as surplus by the Finance Director.

         Disposal shall be on an annual or more frequent basis as deemed necessary by the Managing Director in accordance with City purchasing regulations. The sale of any surplus by a City employee, without the approval of the Managing Director, constitutes a violation of this regulation and will result in appropriate disciplinary action.

      F.   Enforce all purchasing regulations and procedures.

1.05 HEADS OF DEPARTMENTS, DIVISIONS, OFFICES AND AGENCIES:

   1.   Responsibilities. The individual head of a department, division, office or agency or their designees have the responsibility to:

      A.   Furnish the purchasing coordinator with all necessary information to assure that the purchase will be correct in all details.

      B.   Ensure that specifications are not restrictive and do not call for features or a level of quality unnecessary for an item's use.

      C.   Provide a valid written justification when requesting a proprietary item or issuing a restrictive specification.

      D.   Provide a list of suggested vendors. This may assist the purchasing coordinator in finding the item requested. It does not limit the purchasing coordinator to contacting those vendors.

      E.   Ensure that there is no commitment of the City to the purchase of any item, except those covered by the Emergency Purchase Procedure and Section 1.04.1.A of this Policy.

      F.   Notify the purchasing coordinator immediately if any material, supplies, or equipment is inferior in quality or in any way unsatisfactory.

      G.   Notify purchasing quarterly, of any surplus, obsolete or scrap material or equipment that exist in their departments, divisions, offices and agencies.

1.06 EXCEPTIONS TO PURCHASING POLICY:

Where these regulations conflict with requirements stipulated and/or mandated for the use of federal or other grant funds, the requirements governing the expenditure of those funds shall prevail.

Section 2
General Guidelines

2.01 REQUISITION PROCESS

   1.   Preparing a Requisition. User must determine the item/service needed and communicate an accurate and complete description. The requisition process is initiated by the user's completion of a requisition via the City's computer system.

   2.   Dollar Limits Covering Vendor Solicitation7a . With the exception of professional services, the purchasing coordinator follows the following guidelines concerning the dollar limits covering vendor solicitation.

      A.   Purchases up to $4,000.00 - Purchases in this category require one (1) verbal quote.

      B.   Purchases of $4,000.01 to $9,999.99 - Purchases in this category require three (3) verbal or written quotes.

      C.   Purchases of $10,000.00 and up - Purchases in this category require a formal solicitation.

   3.   Dollar Limits Covering Professional Services Solicitation. For professional services, the purchasing coordinator follows the following guidelines concerning the dollar limits covering vendor solicitation:

      A.   Purchases up to $4,000.00 - Purchases in this category require one (1) verbal quote.

      B.   Purchases of $4,000.01 to $9,999.99 - Purchases in this category require three (3) verbal or written quotes.

7a Per Charter Section 915 B(1) and B(2)

      C.   Purchases of $10,000.00 to $34,999.99 - Purchases in this category require three written quotes and keeping the formal bidding process as an option unless otherwise required by law.

      D.   Purchases of $35,000.00 and up - Requires a formal solicitation through advertising which requires a vendor to submit sealed bids accompanied by a bid surety, unless surety is waived at the time the solicitation is issued.

The Managing Director may waive formal bidding procedures only when purchases must be made for an emergency declared by the Mayor and authorized by Council resolution, professional services required via a list from an insurance company or arbitration agreement; repair of any public work during an emergency; patented or copyrighted property; public utilities under tariffs on file with another governmental agency.

2.02 APPROVAL AUTHORITY

   1.   Contracts of up to $34,999.99 are approved by both the Managing Director and the Mayor.

   2.   Purchases and contracts of $35,000.00 and higher must be approved by City Council.

   3.   To place an item on the City Council agenda, the department will forward all necessary documentation to the Purchasing Coordinator. The Purchasing Coordinator will prepare the request and submit it to the City Clerk for inclusion on the Council Consent Agenda.

   4.   All City contracts must be reviewed for form and content and signed by the City Solicitor before any City funds may be paid for said contract.

   5.   All City contracts must utilize the City's standard contract terms and conditions. This requirement may be waived on an individual basis if the Managing Director determines that the use of alternate contract terms and conditions are in the best interest of the City.

2.03 EXCLUSIONS

   The following purchases are excluded from competitive bidding requirements:

   1.   Procurement of dues and memberships in trade or professional organizations; subscriptions for periodicals; advertisements; postage; used equipment; abstracts of titles for real property; title insurance for real property; real property; water, sewer, and electrical utility services; copyrighted materials; patented materials; art and artistic services; employment agreements; medical services; fees and costs of job- related travel; seminars; tuition; registration; and training.

   2.   Purchases from State of Pennsylvania or Federal GSA Contracts as well as contracts awarded by any local, state, or national government agency, cooperative purchasing organizations or purchasing associations.

   3.   Items purchased for resale to the general public.

   4.   Weather related events or other undeclared emergency situations.

   Such purchases, transactions, and expenditures listed above shall be authorized by the Purchasing Coordinator. Certain procurements within the above categories may be obtained by competitive means when it is determined that adequate sources for the goods or services required are available.

Section 3
Emergency Purchase Procedure

3.01 PURPOSE:

The purpose of this procedure is to establish the proper purchasing procedure in times of emergency.

3.02 APPLICABLE TO:

All departments, divisions, offices and agencies.

3.03 DEFINITION:

   1.   An emergency is defined as an unanticipated situation requiring immediate action to avoid the loss of life, limb or property.

3.04 POLICY:

   1.   There will be no commitment of City funds to purchase goods or services outside the normal purchasing procedure, unless the need meets the criteria as defined above in Section 3.03.1.

   2.   The Mayor has the authority to declare a State of Emergency as provided for by Pennsylvania statutes and to subsequently suspend all standard operating purchasing procedures, as per Title 35 Pennsylvania Emergency Management laws and after the Declaration of Emergency has been adopted by Council.

3.05 EMERGENCY PURCHASING PROCEDURE DURING NORMAL WORK HOURS:

 

Responsibility	Action
Department, division, office or agency representative	1.   If an emergency occurs during normal working hours, the department, division, office or agency receives permission from the Managing Director to request the purchasing coordinator to order the materials and/or services necessary. The department, division, office or agency may suggest a vendor with whom he/she is familiar and considers reliable.
Purchasing Coordinator	2.   The purchasing coordinator, if time permits, will contact vendors and receive price quotes. 3.   The purchasing coordinator obtains the price for each item, the total amount, the date, and location of delivery. The purchasing coordinator verbally places the order with the vendor. 4.   The purchasing coordinator informs the vendor that a confirming purchase order will follow and that the vendor should send the invoice to accounts payable once the purchase order is received. 5.   The purchasing coordinator informs the department, division, office or agency of the vendor, prices, total amount, etc., in order that a requisition can be prepared.
Department, division, office or agency	6.   The department, division, office or agency prepares a confirming emergency requisition for processing immediately upon notification of pertinent data by the purchasing coordinator. 7.   The department, division, office or agency shall issue a memo referencing the purchase order and describing the nature of the emergency. 8.   The department, division, office or agency shall not wait for an invoice from the vendor prior to completing a requisition form.

 

3.06 EMERGENCY PURCHASING PROCEDURE AFTER NORMAL WORK HOURS:

 

Responsibility

Action

Department, division, office or agency

1.   The department, division, office or agency, or if unavailable the on-site supervisor, is responsible for authorizing an order with a vendor if an emergency occurs after normal working hours. 2.   The department, division, office or agency shall call the purchasing coordinator the following work day with details of the emergency purchase. 3.   The department, division, office or agency shall complete a confirming emergency requisition. 4.   The department, division, office or agency's action is subject to review by the purchasing coordinator and the Managing Director to determine compliance with this regulation.

 

Section 4
Sole Source Purchases

4.01 DEFINITION

   Sole source purchases are defined as purchases of supplies, or equipment that meet all of the following criteria:

   A.   It is the only item that will produce the desired results or possess a unique performance capability; and

   B.   It is available from only one source; and

   C.   It is patented or copyrighted.

Professional services, legal services and attorneys and law firms are not eligible for sole source purchasing requirements. [Amended 1-26-2015 by Ord. No. 4-2015]

4.02 PROCEDURE

   Sole source purchases are exempt from competitive requirements upon certification by the Purchasing Coordinator stating the conditions and circumstances necessitating the purchase via a Sole Source Justification Form. This certification shall set forth the purpose and need in addition to why the item is the only one that will produce the desired results. The Sole Source Justification Form must be signed by the Managing Director to be deemed "approved."

   Sole Source Justification Forms shall expire annually on December 31st. Sole Source contracts shall not be eligible for automatic renewal/extension and must be re-certified by the Purchasing Coordinator before a renewal/extension may occur.

Section 5
Blanket Purchase Orders

5.01 PURPOSE:

   The purpose of this issuance is to explain the nature of blanket order purchases and to define the specific procedures for establishing blanket orders, making purchases with blanket orders, and renewing and closing blanket orders.

5.02 APPLICABLE TO:

   All departments, divisions, offices or agencies.

5.03 BLANKET ORDER PURCHASE:

   1.   General. A blanket order purchase is a special type of purchase order issued by the purchasing coordinator and designed to reduce the administrative effort and costs of placing recurrent orders for necessary items or services, such as heating fuel or repairs to office equipment.

      Blanket orders normally call for an undetermined quantity of a product to be delivered or a service to be provided on a continuing basis from a single vendor. In some cases, the quantity may be estimated at an agreed upon unit price.

      Only one blanket order at a time may be issued to a specific vendor, from a standard account. A single blanket order may however cover one or more types of items or services.

      A blanket order may be issued any time during a calendar year, unless otherwise determined by the Director of Finance. Blanket orders will be invalid after December 31st of the year issued.

   2.   Types of Blanket Orders. Two types of blanket orders exist:

      A.   Regular Blanket Orders (B) - referred to as merely blanket orders, are established with a vendor for a fixed dollar amount, but do not necessarily indicate the specific items or services to be purchased, their quantity, or unit price. The description is to state generally what is to be purchased, i.e., "various automotive replacement parts such as but not limited to filters, spark plugs, belts." Statements such as "Supplies as may be needed from time to time" are unacceptable.

      B.   Blanket Orders with Price Agreements (BA) - Blanket orders with price agreements are regular blanket orders where the unit price of the items or services are agreed upon with the vendor for a stated period of time, i.e., fuel oil for the year. Items and prices should be clearly stated in the description along with date of quote or contract award and period of agreement.

5.04 PROCEDURES FOR ESTABLISHING BLANKET ORDERS:

   The correct procedure to establish a blanket order is defined below. Blanket order requisitions are initiated and forwarded via the City's computer system.

 

Responsibility	Action
Department, division, office or agency	1.   Determine the items or services to be purchased on a recurring basis; initiates a requisition
Controller	2.   Reviews the requisition; determines if sufficient funds are available in specified account. If specified account has insufficient funds, notifies user to request a transfer from another account.
Director of Finance	3.   Examines blanket order for budget authorization. If questions arise, contacts the department, division, office or agency for clarification or explanation. If approved, forwards to purchasing.
Purchasing Coordinator	4.   Distributes copies to appropriate offices and mails vendor copy.

 

5.05 PROCEDURES FOR BUYING ITEMS AGAINST A BLANKET ORDER:

   Once a blanket order is established, the department, division, office or agency may approve the purchase of items covered by the blanket order.

   The correct procedure to buy items against a blanket order is defined below.

 

Responsibility	Action
Department, division, office or agency	1.   Department, division, office or agency approves all blanket order purchases before they are made. Authorized employee must present proper City identification to vendor. Single item purchases over $500 must be pre-approved by the purchasing coordinator.
Accounts Payable	2.   Upon receipt of invoice from vendor, a copy is forwarded to the using department, division, office or agency.
Department, division, office or agency	3.   Confirms accuracy of invoice, including price and availability of funds. Ensures that purchase order number and code are on the invoice. Obtains signature from the department, division, office or agency and forwards with receiving slip to accounts payable for payment.
Accounts Payable	4.    Pays bill from the account used to establish the blanket order. Confirms accuracy of price with that listed on purchase or contained in contract or price agreement with vendor. Reduces blanket order amount accordingly.

 

5.06 PROCEDURES FOR RENEWING A BLANKET ORDER:

   When a purchase is desired against a blanket order and insufficient funds are available from the blanket order, there are two options:

   •   If the purchase is the last one to be made against the blanket order, the department, division, office or agency may request accounts payable to add up to $1,000 additional funds to cover the last purchase. If more than $1,000 is required, the department, division, office or agency should issue a separate requisition for the purchase.

   •   If more than $1,000 is required to make the purchase and additional purchases are desired against a blanket order on a continuing basis, a renewal must be made.

   In case of a renewal, the department, division, office or agency completes a new requisition. The procedure, herein, is the same as previously stated for requesting a new blanket order.

5.07 CLOSING A BLANKET ORDER:

   A department, division, office or agency may desire to close a blanket order even though funds are still reserved.

   To close an existing blanket order the department, division, office or agency contacts either purchasing or accounts payable with instructions to cancel it. Accounts payable removes the reservation and transfers the remaining funds into the same standard account of the department, division, office or agency.

   A department, division, office or agency shall not have more than one blanket order with the same vendor, in the same expenditure code, unless one blanket order falls below $25.

Section 6
Payment for items and services without a purchase order

6.01 PURPOSE:

   The purpose of this administrative communication is to:

   1.   Define the categories of purchases for which payment is authorized by use of the Accounts Payable Approval form.

   2.   Explain the procedure whereby payment to vendors is authorized by use of the Accounts Payable Approval form.

6.02 APPLICABLE TO:

   All departments, divisions, offices or agencies

6.03 CATEGORIES OF PURCHASES MADE NOT REQUIRING A PURCHASE ORDER:

   Certain categories of purchases do not require the department, division, office or agency to follow the requisition/purchase order process, and the orders are not placed by the purchasing coordinator as outlined in Administrative Procedure "Requisition and Purchase Order Process."

   Categories of purchases that do not require a purchase order are as follows:

   •   Arbitration costs

   •   Association dues

   •   Books and subscriptions

   •   Business meeting expenses

   •   Charitable contributions

   •   Debt service & related fees

   •   Insurance

   •   Items under one hundred dollars ($100) that can legitimately be purchased via petty cash

   •   Postage

   •   Tuition

   •   Travel expenses for job related purposes - including meals, lodging and transportation (travel policy must be followed)

   •   Utility services (e.g., heat, electricity, phone services regulated by the PUC)

   •   Worker's compensation disbursements

   Only the expenses and services listed above may be purchased with payment authorized by the Accounts Payable Approval form

6.04   SPECIFIC PROCEDURES FOR PAYMENT WITH AN ACCOUNTS PAYABLE APPROVAL FORM:

1.   Authorization to Pay by the Accounts Payable Procedure.

 

Responsibility	Action
Department, division, office or agency	1.    Determines if adequate funds are available in the appropriate account for the expense. a.   If adequate funds are not available in the appropriate account, initiates a budget transfer. 2.   Determines if items or services may be purchased by the accounts payable process. If so, contacts vendor directly and gives necessary information for purchase. 3.   Receives goods or services. 4.   After receiving goods or services and determining them to be satisfactory, completes an accounts payable approval form as an authorization for payment. 5.   Forwards copy of the accounts payable approval form and vendor invoice to the Director of Finance for authorization.
Director of Finance	6.   Reviews accounts payable approval form and if approves, signs accordingly and forwards with the invoice to Accounts Payable. Additional signature authorizations as per City policy are applied during this step.
Accounts Payable	7.   Audits accounts payable approval form to verify funds are available in the account(s) specified.    a.   Returns to the department, division, office or agency for transfer if funds are not available in account(s) specified. 8.   Insures that proper payment is made to vendor. 9.   Notifies the department, division, office or agency of payment through issuance of monthly report of payments. 10.   Forwards original copy plus vendor invoice to accounting for filing.

 

Section 7
Bid Solicitation, Evaluation and Award Procedure

7.01 PURPOSE:

   The purpose of this issuance is to define and explain the procedures followed in the invitation/solicitation, opening, evaluation and award of bids for purchases of $35,000 and greater.

7.02 APPLICABLE TO:

   The Purchasing office of the City of Reading and all departments, divisions, offices or agencies.

7.03 DEFINITIONS:

   1.   Bid - the formal offering of a price by a vendor for a specific construction project, commodity or product costing over $10,000.00 and requiring bid surety.

   2.   Bid Solicitation - a type of vendor solicitation used that requires the City to advertise for equipment, supplies and services desired and requires vendors to submit sealed bids.

   3.   Invitation to Bid - a document prepared by purchasing and sent to bidders for the purpose of soliciting bids on goods and services.

   4.   Mailing List - a current list of vendors offering supplies, equipment and services maintained by purchasing.

   5.   Public Work of the City - includes any service provided by the City on an ongoing basis for the welfare and protection of property and persons within its political bounds.

   6.   Responsible Bidder - a type of vendor that possesses at least, but not limited to, the following - adequate production facilities, sound financial standing and a sufficient experience in the business of producing and/or supplying goods or services.

   7.   Responsive Bidder - a type of vendor that complies with all specifications put forth by the invitation to bid.

   8.   Sole Source Supplier - a supplier who is the only vendor able to furnish a certain item that is copyrighted or patented, excluding any professional services.

   9.   Specifications - requirements and/or instructions that must be properly addressed and followed by bidders.

   10.   Vendor - a supplier of goods or services.

   11.   Verbal Solicitation - a type of vendor solicitation which involves an oral price statement from a vendor to the purchasing coordinator for a particular commodity or service.

   12.   Written Vendor Solicitation - a type of vendor solicitation that requires a written price quotation from the vendor to the purchasing coordinator.

7.04 GENERAL POLICY:

   1.   Central purchasing authority and responsibility in the City rests with the City purchasing coordinator and the City purchasing office.

   2.   The bidding process is a public process that is subject to public scrutiny and review. All purchasing procedures and regulations shall be written and made available for public review.

   3.   Any deviation from normal operating practices shall require proper documentation and approval by the Managing Director.

   4.   Projects or contracts which are federally funded must comply with provisions set forth by the United States Department of Labor, the United States Department of Housing and Urban Development, and the Office of Federal Contract Compliance Programs.

   5.   The Department of Community Development is responsible for monitoring contracts involving federal funds, including labor compliance.

7.05 PURCHASES REQUIRING BID SOLICITATION:

   1.   All purchases of $35,000 and up require bid solicitations except those listed below:

      A.   Public utility service under tariffs on file with the Pennsylvania Public Utility Commission.

      B.   Any items purchased through Federal or City programs that have different bidding requirements mandated by a grant program.

      C.   Purchases made through intergovernmental cooperation as governed by 1972, P.L.762, No.180:53 Pa.C.S. §§ 2301 et seq. as amended and Act 31 of 1971 the City’s cooperative purchasing program, a City law of general application.

   2.   Bid solicitations or RFP's are not mandatory for the items listed in 7.05.1 (above); however, requests by departments, divisions, offices or agencies to bypass the bid solicitation or RFP procedure must have valid justification. All such requests shall be in writing and receive approval by the Managing Director on a case by case basis.

7.06 MAILING LIST:

   1.   General. The bidders list is a current list of suppliers of various categories of commodities. The purchasing coordinator shall develop and maintain the mailing list.

   2.   Membership. The mailing list consists of:

      •   Vendors with whom there has been a satisfactory, past relationship.

      •   Vendors added by the purchasing coordinator as a result of research in trade journals, other documents or by consultation with user departments.

      •   Vendors who contact purchasing in response to newspaper advertisements or in anticipation of the City's future needs.

      •   Vendors who have never provided goods or services to the City and who request to be added to the City's mailing list, may be added on a probationary basis.

      •   Vendor that has proven to be acceptable either through a positive experience with the City or through acceptable reference checks.

         The purchasing coordinator will review and update each commodity group at least once every two (2) calendar years.

   3.   Removal. Vendor files shall be located in purchasing. It is the responsibility of the department, division, office or agency to notify purchasing by memorandum of any supplier that does not act in a responsible manner.

   A bidder may be removed from the mailing list when:

      •   There are three (3) or more consecutive no responses to a request for quotation, within a one (1) year period.

      •   There is failure to submit a bid for an annual contract for two (2) consecutive years.

      •   Consistent inability to meet specifications and delivery dates.

      •   General failure to keep commitments, including indebtedness to the City for any taxes, liens, judgments, fees or other debts for which no written agreement or payment plan satisfactory to the City has been established. [Amended 1-27-2016 by Ord. No. 1-2016]

      •   Consistent complaints by users about the quality of the product or service.

         Evidence of such failures of performance shall be documented by the department, division, office or agency and forwarded to the purchasing coordinator and the Finance Director for review. If the Finance Director determines that removal from the list is justified, the vendor shall be notified in writing explaining the reasons for removal.

      4.   Reinstatement. A vendor can be reinstated to the mailing list upon receipt of a letter of application that explains their interest in City purchasing if the reason for removal was the vendor's failure to reply to the Invitation to Bid.

         If the vendor was removed for inability to meet specification, meet delivery dates or for offering a poor quality item, the vendor must take steps to show the purchasing coordinator that the problem has been or is being corrected. The purchasing coordinator will file the documentation submitted by the vendor in the appropriate vendor file and if acceptable will reinstate the vendor to the mailing list.

7.07 SOLICITATION PROCEDURE.

   1.   Product or Service Determination. The department, division, office or agency determines the need for a product or service and is responsible for budgeting the item. Purchasing can assist in deciding upon a reasonable figure for the particular item.

   2.   Authorization. A memo requesting the purchasing coordinator to advertise for bids for a specific item or service shall be initiated by the department, division, office or agency and approved by the Managing Director and Finance Director.

   3.   Requisition. The department, division, office or agency will initiate a requisition.

7.08 PREPARING SPECIFICATIONS. 

   The specifications that are included in the Invitation to Bid are prepared by the department, division, office or agency, with guidance from the purchasing office. Specifications are required in all bid solicitation situations, and optional based upon the need in all other cases as determined by the purchasing office. The City strongly discourages restrictive specifications that can favor certain vendors.

   1.   When the department, division, office or agency decides to prepare the specifications, the department, division, office or agency should contact various suppliers of the product or service and request manufacturer's specifications. The purchasing office can provide guidance in this part of the procedure.

      All department, division, office or agency should be wary of salespersons who may attempt to influence how the City's specifications are drafted. The department, division, office or agency should be aware that the City benefits the most when there is good competition among numerous vendors.

   2.   The department, division, office or agency reviews all the manufacturer's specifications and prepares the City specifications so that as many suppliers as possible will be able to meet the requirements without sacrificing quality. The specifications should include all essential requirements to insure that the item meets the department, division, office or agency's needs, but simultaneously containing only those features that are necessary for an item's intended use.

   3.   The department, division, office or agency attaches the drafted City specification to the manufacturers' specifications used, and forwards to the purchasing office.

   4.   Purchasing will review the drafted specifications to assure that as many vendors as possible can successfully meet the requirements and respond to the Invitation to Bid. If the purchasing coordinator feels that the specifications as drafted will not support competition, necessary changes will be made in coordination with the department, division, office or agency. If the purchasing coordinator and the department, division, office or agency cannot agree on a common ground, they will meet with the Finance Director to make the final determination of how the specifications will read.

   5.   The purchasing office may, with the cooperation of the department, division, office or agency, organize a pre-bid conference with potential vendors for the purpose of reviewing draft specifications for completeness, accuracy and fairness.

7.09 INVITATION TO BID

   1.   General. The Invitation to Bid which is issued by purchasing establishes the criteria for determining the responsive bidder by outlining the procedure bidders must follow to be considered for the bid award. The Invitation to Bid or a copy of the newspaper ad or internet posting outlining the bid solicitation may be sent to vendors in that particular category of the mailing list.

   2.   Procedural requirements included in the bid packet outline standard instructions to be followed for bidding, delivery and, completion schedules, payment, invoicing procedures, and conditions for inspections and acceptance of purchased items.

   3.   Notice Inviting Bids.

      A.   Public notice shall be given for all bid solicitations. Acceptable methods of public notice include: publishing an advertisement two times, each publication on a different day, in at least one newspaper of general publication, posting of the bid solicitation to the City website, publication in a specialty-interest publication, or other methods as may be deemed acceptable by the purchasing coordinator. The bids shall not be opened until at least ten days have elapsed after the first advertisement.

      B.   City Web Site. All bid solicitations published on the Purchasing section of the City web site shall include at least:

         •   A description of the equipment, supplies, products or services to be purchased.

         •   Where the bid form and specifications can be obtained.

         •   The deadline and location for submission.

         •   Reference to prevailing wages if applicable.

      C.   Mailing List. The purchasing coordinator shall maintain a mailing list of current suppliers. Vendors on the mailing list will be directed to the City website, where they can find relevant information on open bids.

   4.   Bid Security. Purchasing shall require a bid security that serves the purpose of protecting the interest of the City, unless otherwise determined by the Managing Director at the time of bid publication. The bid security will be required equally of all bidders.

      A.   Security Amount. All bids shall be accompanied by cash, certified check, a bond with corporate surety or at the City's option, an irrevocable letter of credit in the amount of ten percent (10%) of the bid.

7.10 BID RECEIPT, OPENING AND TABULATION.

   1.   Receipt. All bids shall be submitted in a sealed envelope, marked with the bid number and delivered to the Purchasing Office by the date and time of the bid opening or the deadline as advertised.

      Upon receipt, the bid envelope shall be stamped with the date and time received and placed in a locked filing cabinet until the time of the opening. All bids shall remain sealed until the time of the bid opening.

   2.   Opening. All bids submitted in response to the City's Invitation to Bid shall be opened by the purchasing coordinator and witnessed by the City Clerk or their designees at the time and date advertised in the legal notice. The bid opening shall be held in a public forum and may be attended by the news media, concerned citizens and interested vendors.

   3.   Tabulation. All bids shall be tabulated. The tabulation becomes a permanent record of all bids received, showing the bidder's name, items and prices. Bids considered invalid, i.e., submitted without security, will be listed on the schedule as such.

      The tabulation shall be filed in the purchasing office for seven (7) years, or as may be specified in the Records Retention Schedule, to be used as evidence of competitive practices and serve as a source of information if questions do arise.

7.11 BID EVALUATION AND AWARD:

   1.   No Bids. If a situation occurs that no bids are received by Purchasing, the purchasing coordinator shall:

      A.   Review the specifications to insure that they are not overly restrictive or unrealistic and after being duly authorized, re-issue the Invitation to Bid with or without adjusted specifications.

      B.   If again bids are not received, the City may enter into a contract for purchase of the item within forty-five (45) days of the second advertisement thereof, in accordance with PA Act 1979-78.

      Regardless of action, the purchasing coordinator shall document in writing the steps taken and reasons for the action.

   2.   Other Situations.

      A.   Late Bids. Late bids, regardless of the circumstances, are unacceptable.

      B.   Tie Bids. Only on rare occasions are bids received from responsible vendors for the same amount or unit price, with quality and service being equal. In such instances, the contract shall be made by drawing lots in a public forum.

         This tie bid procedure will only be followed when the tie bidders are all responsible bidders and equal in quality and service, as well as price.

      C.   Alternate Bids. By City policy, alternate bids are not encouraged. As a rule, if a bid is not responsive to the Invitation to Bid, it should be rejected. However, if the alternate bid reflects the only product or service the firm has to offer and if the bid is advantageous to the City through lower cost for a quality item, the purchasing coordinator shall consult with the appropriate department, division, office or agency and the purchasing committee prior to making the final recommendation. In all cases, the purchasing coordinator shall:

         Document the decision on accepting or rejecting an alternate bid with reasons for the decision.

         Be sure that all respondents to an Invitation to Bid have received opportunities equal to that of the alternate bidder.

      D.   Adjustments Due to Errors. If a mistake is discovered after opening, only those deviations that do not give a bidder an unfair advantage over his/her competitors will be permitted. These include, but are not limited to multiplication errors in completing totals from unit prices (the unit price will prevail) and an obvious misplacement of decimal points.

      E.   Withdrawal of Bids. If the bidder discovers an error after submittal, but prior to opening, he/she will be permitted to make formal changes or withdraw the bid before the bid opening without revealing the bid amount.

         A new sealed bid should be delivered in person or by mail, prior to the deadline advertised in the legal notice.

      A bidder to a construction contract may withdraw a bid from consideration after the bid opening without forfeiture of the ten percent (10%) bid surety, if the bid was submitted in good faith and the bidder submits credible evidence that a clerical mistake or an unintentional omission of a substantial quantity of work, labor, material or services was made in direct compilation of the bid and the reason for the price being substantially lower, as opposed to a judgment error.

   3.   Rejection of Bids. City Council or the Managing Director whichever applies, shall have the authority to reject a single bid or all bids for reasons including but not limited to the following circumstances:

      •   Unreasonably high bid prices

      •   Late arrival

      •   Alternate bids

      •   Error corrections that would give an unfair advantage

      •   Suspicion of collusion among bidders

      •   Substantial non-conformance with bid specifications

      •   Failure of the bid to meet the criterion of being the lowest responsive and responsible bidder

      •   For indebtedness to the City, including but not limited to any taxes, liens, judgments, fees or other debts for which no written agreement or payment plan satisfactory to the City has been established. [Amended 1-27-2016 by Ord. No. 1-2016]

   4.   Bid Award.

      A.   It is the policy of the City to make awards to the vendor who meets the specifications for the items or services to be purchased at the lowest cost. Factors such as delivery time, quality, operating and maintenance costs, service, etc., as well as initial price, should be taken into consideration in determining the lowest cost vendor.

      B.   The department, division, office or agency shall review all bids and make a recommendation to the purchasing manager by completing the "Recommendation to Award Contract" form.

         If the purchasing coordinator has technical or operational concerns regarding the recommendation of the head of the department, division, office or agency, the award will be referred to a purchasing committee, comprised of the Managing Director, the Director of Finance , and the City Solicitor or his designee, for determination. In the case where the Finance Department or Law Department has issued the bid, the Managing Director shall designate one or more neutral parties

      C.   The Director of Finance shall review the recommendation to ensure an award is compatible with the budget.

      D.   The Managing Director shall approve all recommendations.

      E.   Both the Mayor and the Managing Director shall have final approval of contracts below $35,000.

      F.   City Council shall award or reject all contracts exceeding $34,999.99.

      G.   A purchase order shall be initiated after the contract award; however, it shall not be issued until the contract documents have been finalized.

      H.   The successful vendor after receiving the contract documents has ten (10) working days to sign and return with the necessary bonds.

      I.   If the selected vendor fails to deliver a bond or items bid within the time limits specified, the purchasing coordinator may choose to recommend rescinding the award and re-advertise for bids. In such event, the delinquent bidder shall be responsible for the costs of re-bidding and the amount of any increase in the contract price thereby resulting. The purchasing coordinator shall properly document the action, the reasons for the action and retain the vendor bid surety not as a penalty, but as liquidated damages for inability to comply with the contractual agreement.

      J.   Local Preference: For all competitive solicitations in which objective factors are used to numerically evaluate the responses from vendors by the selection committee, and price is one of several of the criteria for award among otherwise qualified vendors, where a non-local business is the highest ranked proposer and the ranking of a local proposer is within ten (10%) of the ranking obtained by the non-local proposer, the highest ranked local proposer (within 10%) may be considered for negotiations with the City. If the City determines that it is, in its sole and exclusive discretion, unable to negotiate an acceptable contract, then it shall proceed to negotiate with the next highest ranked proposer, whether local or non-local.

         The City has the sole discretion in determining whether a business meets the criteria to qualify for a local business preference and reserves the right to revoke this preference at any time if the City determines the business no longer meets the following criteria:

         1.   The principal place of business is located in the City of Reading; and

         2.   The business has held a valid City business license for at least one (1) year prior to the date of application; and

         3.   The business maintains its status as a local bidder throughout the term of the contract; if it fails to do so, the City, in its sole discretion, may terminate the contract.

Section 8
Purchasing of Professional Services

8.01 PURPOSE:

   The purpose of this regulation is to outline the process involved for preparing specifications, letting of Request For Proposals (RFP's), awarding contracts and payment of bills for professional services.

8.02 APPLICABLE TO:

   All departments, divisions, offices or agencies.

8.03 POLICY:

   1.   For the purpose of this regulation the term "professional" is defined as those persons or firms marketing services requiring advanced academic or technical training skills. Examples of professional services include work done by the following contractors but is not necessarily limited to these services:

      •   Accountants

      •   Architects

      •   Attorneys, including independent legal counsel as per § 5-213 and § 5-302 [Amended 1-26-2015 by Ord. No. 4-2015]

      •   Bond Underwriters

      •   Engineers

      •   Insurance Consultants, Agents, and/or Brokers

      •   Investment Advisors

      •   Physicians

   2.   Professional service contracts are not to be confused with standard contracts which seek a price or costs for particular work detailed in specifications. Professional contracts seek expertise through an RFP and pricing or cost may not be of "primary" importance.

   3.   A professional contract, while it is based upon work performed in response to task specifications and the need for a finished product as outlined by the City and agreed to by a contractor, it is one that by its very nature cannot be awarded solely based upon the selection of the lowest bidder.

   4.   Factors other than price alone must be carefully weighed in the review of proposals and the award of such contracts. These factors include the professional qualifications/ certifications, special skills, experience, and familiarity of the contractor with the work requested, all of which have impacts on the quality of the product/service to be delivered.

8.04   PREPARING REQUESTS FOR PROPOSALS (RFP'S) FOR CONTRACTS GREATER THAN $35,000.

   1.   When to prepare an RFP.

      A.   When it is estimated that the cost of a purchase of professional services shall meet or exceed $35,000, the RFP process must be initiated and the vendor must be retained through a written contract. Competitive proposals increase the ability to fully evaluate both the benefit and costs of the services being sought.

      B.   Notwithstanding any other provisions to the contrary if the Managing Director so determines, no RFP shall be required for an employee engaged in providing professional services to the City who terminates employment with the City and shall then be engaged as an independent contractor. In addition, no RFP shall be required for an independent contractor whose engagement terminates, if the Managing Director desires to continue the engagement by the City.

      C.   For all contracts expected to exceed $34,999.99 and for all contracts that are multi-phased (e.g., feasibility study and design, multiple contract renewals/extensions within a one-year period) department, division, office, agency or person designated by the Managing Director shall prepare a RFP specifically for the extent of the work effort that can be defined at that particular time. The RFP should solicit information pertaining to the contractor's qualifications and costs (including appropriate hourly rates, etc.) for as many phases as appropriate. Costs and qualification information should then be utilized to select the contractor. For any subsequent phases of the contract that have not been specifically defined in the initial RFP, a new RFP should be drafted and circulated to secure competitive proposals from interested contractors.

   2.   How to write an RFP:

      The Request For Proposal shall clearly describe the desired services and may include, but not be limited to, the following information:

      •   General background information pertinent to the requested services.

      •   Nature and scope of requested services including minimum tasks and activities to be performed together with prescribed completion schedule.

      •   Methodology and technical approach to be used in accomplishing the requested work.

      •   Description of reports required.

      •   Documentation of qualifications and experience in similar work and resumes of staff members to be assigned to the engagement.

      •   Compensation information including detailed cost information itemizing hours and rates of each class of staff to be utilized, and out-of-pocket expenses such as travel, telephone, publication and duplication.

      •   Estimated utilization of City resources necessary to complete the engagements.

      •   Information as to the City's evaluation and selection process.

      •   Minority Business Enterprise (MBE)/Woman Business Enterprise (WBE) participation.

8.05 CONTRACTS BETWEEN $10,000 AND $34,999:

   1.   The department, division, office, agency or person designated by Managing Director to handle the assignment, shall request written proposals from at least three (3) firms. Proposals shall include the fee in the form of a unit cost and the total maximum cost to be charged. After analysis, a recommendation shall be presented to the purchasing coordinator, Finance Director and Managing Director for final approval.

      In the event the Solicitor has concluded that a conflict exists between the Mayor/Administration and City Council, the RFP process for independent legal counsel shall commence. The Mayor/Administration or City Council shall review their respective proposals and prepare individual justifications that will include, at minimum: a brief explanation identifying the preferred bid, anticipated cost, and the allocation source from where the expenses will be paid. Final analysis and ultimate approval for all justifications will rest with the purchasing coordinator, Solicitor or his representative, Director of Finance and Managing Director. [Added 1-26-2015 by Ord. No. 4-2015]

   2.   Upon written request, unsuccessful firms shall be given a written explanation as to the reasons for the selection.

   3.   The department, division, office or agency should take precautions to project the total cost of professional service contracts that are multi-phased. An RFP must be prepared for those multi-phased contracts when the total cost of which could exceed $34,999.99.

   4.   Once final approval for a contract less than $35,000 has been granted by the Finance Director and the Managing Director, the department, division, office, agency or person designated by the Managing Director to handle the assignment shall meet with a representative from the City Solicitor’s office to draft the required contracts.

   5.   Multiple contracts valued below $35,000 which occur during a single year and provide for the same or a substantially similar service; or for which services are provided by the same individual or vendor shall be considered to be multi-phased. These contracts shall be subject to the approval requirements of a contract that exceeds $34,999.99.

   6.   No contract valued at less than $35,000 shall be eligible for payment by the City without the contract having been signed by the City Solicitor.

   7.   The City Solicitor shall provide final review for form and content and signature on the contract. Contracts without Solicitor signature will not be eligible for payment.

8.06 THE PURCHASING COORDINATOR'S RESPONSIBILITY: [Amended 9-8-2014 by Ord. No. 65-2014]

For purposes of consistency, the purchasing coordinator may be appointed to all committees designated to prepare RFPs, shall review all documents prior to issuance and may evaluate submissions. The purchasing coordinator shall not have the ability to vote upon submissions on which the purchasing coordinator has not performed an evaluation.

The Finance Director shall authorize the advertising or posting for professional services or RFPs by the purchasing coordinator, who will advertise, if applicable, in local newspapers of general circulation, regional metropolitan newspapers, trade journals, and, in all instances, post on the City website.

   1.   The advertisement or posting shall give notice that an RFP is available for review by interested firms. Basic information describing the requested services, where the document can be obtained and the deadline and location for submission shall be included.

   2.   At the discretion of the purchasing coordinator or the department, division, office or agency a mandatory pre-proposal conference may be held with all interested firms to clarify any questions.

8.07   SELECTION OF PROFESSIONAL SERVICE CONTRACTS GREATER THAN $34,999.99

   1.   The proposals of those firms responding to an RFP are reviewed by a selection committee designated by the Managing Director or his designee.

      In the event the Solicitor has concluded that a conflict exists between the Mayor/Administration and City Council, the RFP process for independent legal counsel shall commence. The Mayor/Administration or City Council shall review their respective proposals and prepare individual justifications that will include, at minimum: a brief explanation identifying the preferred bid, anticipated cost, and the allocation source from where the expenses will be paid. The justifications will then be submitted to a Panel composed of the Solicitor, Managing Director, and Auditor for their review and recommendation. The Panel shall offer their recommendation for final approval to City Council once they have reached a two-thirds majority vote. Failure to secure a majority vote by either the Mayor/Administration or City Council will require supplemental information or additional information as requested by the Panel. [Added 1-26-2015 by Ord. No. 4-2015]

      A.   The selection committee shall consist of the purchasing coordinator (advisory and oversight when not an evaluator), the City Solicitor (non-voting member), three designees of the department, division, office or agency, and the designee of the Finance Director. All committee members must sign and return, to the purchasing coordinator, the Confidentiality Statement and No Conflict of Interest Statement prior to receiving any non-public information regarding the applicable RFP. [Amended 9-8-2014 by Ord. No. 65-2014]

      B.   The selection process shall be based on the objective criteria contained in the RFP (Section 8.04.2) and not on the lowest bid.

         Examples of the evaluation criteria include: size and experience of the firm on similar projects, client references, demonstrable understanding of the requested work, the ability and/or commitment to meet the prescribed completion schedule, and the cost estimates.

      C.   The recommendation of the selection committee shall be to the firm with highest total points.

      D.   The selection committee has the responsibility to negotiate the most favorable cost, terms and conditions to the City of Reading. The negotiating process may involve one or more RFP responses, and may continue until the actual award of the contract.

      E.   A meeting with the purchasing coordinator and the representative of the Solicitor's office will be available for a firm who is dissatisfied after not being recommended for award of the contract.

   2.   The selection committee shall submit a written report on the process and its recommendation, to be reviewed with the Finance Director.

   3.   Prior to formal acceptance, the RFP and the proposal shall be submitted to the Solicitor’s staff for review.

   4.   The Finance Director and the selection committee will prepare a recommendation for the Managing Director to present to City Council for final approval where such approval is required by the Charter and/or by the Administrative Code.

   5.   The Finance Director shall advise the purchasing coordinator to formally notify the successful firm.

   6.   No contract valued at greater than $34,999.99 shall be eligible for payment by the City unless the contract is approved by Council and signed by the Mayor and City Solicitor.

   7.   The City Solicitor shall provide final review of the contract for form and content. The City Solicitor’s signature shall only be affixed to the contract after this review is complete. Contracts lacking Solicitor approval will not be eligible for payments.

8.08 RENEWAL OF PROFESSIONAL SERVICE CONTRACTS:

The City shall have the option to renew a professional services contract for one (1) year beyond the established contract period, based upon a continuation of the current contract price or the re- negotiation of a new price. This does not preclude the City from requesting a term contract with multiple 1-year renewal periods, as long as the total contract term does not exceed five (5) years. However, if a contract does not originate with multiple 1-year renewal periods, it shall only be eligible for a one (1) year extension at the current or re-negotiated price.

Section 9
Non-Collusion and Bid Rigging

9.01   DEFINITION OF BID-RIGGING - The concerted activity of two or more persons to influence the winning bidder of a contract.

9.02   PROHIBITED ACTIVITIES - It is unlawful for any person to conspire, collude, or combine with another in order to commit or attempt to commit bid-rigging. Unlawful bid-rigging includes but is not limited to:

      A.   Agreeing to sell items or services at the same price.

      B.   Agreeing to submit identical bids.

      C.   Agreeing to rotate bids.

      D.   Agreeing to share profits with a contractor who does not submit the low bid.

      E.   Submitting prearranged bids, agreed-upon higher or lower bids or other complementary bids.

      F.   Agreeing to set up territories to restrict competition.

      G.   Agreeing not to submit bids.

9.03   SIMULTANEOUS BIDS - It is not unlawful for the same person to simultaneously submit bids for the same work or a portion thereof, as a proposed prime contractor and subcontractor.

9.04   NON-COLLUSION AFFIDAVITS - All Bids and RFP's should include the requirement for bidders and vendors to provide a non-collusion affidavit with their bids/proposals. A form of a non-collusion affidavit is found in the Appendix of Forms. The non-collusion affidavit must state whether or not the person has been convicted or found liable for any act prohibited by federal or state law in any jurisdiction involving conspiracy or collusion with respect to bidding on any public contract within the last five years. The non- collusion affidavit should provide that the person's statement on the affidavit that he has been convicted or found liable for any act prohibited by federal or state law in any jurisdiction involving conspiracy or collusion with respect to bidding on any public contract within the last five years does not prohibit the City from accepting a bid from or awarding a contract to that person but it may be grounds for:

      A.   Rejection of the bid/proposal on the basis of lack of responsibility; and/or

      B.   Suspension or disbarment

9.05   INVESTIGATION. If suspicion exists that a bidder may have engaged in bid-rigging or collusion activity, the purchasing coordinator will refer the matter to the City Solicitor who may, if the Solicitor also finds suspicious facts, forward the matter to the Office of the Berks County District Attorney.

Section 10
Allowable Contract Types

10.01 GENERAL.

   1.   The selection of an appropriate type of contract and contract costs are related and should be considered together. The objective is to negotiate a contract type and price that includes reasonable contractor risk and provides the contractor with the greatest incentive for efficient and economical performance. When there is a need for using other than a firm fixed-price contract, it must be determined, before award of the contract, whether the contractor's accounting system will permit timely development of all necessary cost data in the form required by the specific contract type contemplated and is adequate to allocate costs in accordance with generally accepted accounting principles. This may be particularly critical where a cost-reimbursement type of contract is being considered and all current or past experience with the contractor has been on a fixed-price basis.

      A contract may be one of the following types or a combination of the types identified below. COST-PLUS-A-PERCENTAGE-OF-COST CONTRACTS ARE PROHIBITED.

10.02   FIRM, FIXED-PRICE CONTRACTS. Firm, fixed-price contracts are of several types designed to facilitate proper pricing under varying circumstances.

      1.   Established-Price Types. The established-price type of contract provides for a firm price or, under appropriate circumstances, may provide for an adjustable price for the supplies, services, or construction which are being procured. In providing for an adjustable price, the contract may fix a maximum or minimum price. Unless otherwise provided in the contract, any such maximum or minimum price is subject to adjustment only if required by the operation of any contract clause which provided for equitable adjustment, escalation, or other revision of the contract price upon the occurrence of an event or contingency. Established-price contract types are generally created through line item specific bid pricing or established catalog bid pricing.

      2.   Basic Established-Price Contract. The basic established-price contract provides for a price which is not subject to an adjustment by reason of the cost experience of the contractor in the performance of the contract. This type of contract places maximum risk upon the contractor. Because the contractor assumes full responsibility, in the form of profits or losses, for all costs under or over the firm fixed-price, he or she has a maximum profit incentive for effective cost control and contract performance. Use of the basic established-price contract is suitable for use in procurements when reasonably definite work statements, specifications, and performance requirements are available and whenever fair and reasonable costs can be established at the outset.

      3.   Established-Price Contract With Escalation. The established-price contract with escalation provides for the upward and downward revision of the stated contract price upon the occurrence of certain contingencies which are specifically defined in the contract. The risks in a basic established-price contract are reduced by the inclusion of escalation provisions in which the parties agree to revise the stated price upon the happening of a prescribed contingency. Where escalation is agreed upon, upward adjustments shall be limited to the establishment of a reasonable ceiling, and provisions will be included for downward adjustments in those instances where the prices or rates shall fall below the base levels provided in the contract. The escalation generally covers the increase in labor costs due to an increase in the minimum wage or union contract negotiations, or other costs such as fuel, which are beyond the direct control of the contractor.

      4.   Established-Price Plus Incentive Contract. The established-price plus incentive contract is a firm, fixed-price type of contract with provisions for adjustment of profit and establishment of the final contract price by a formula based on the relationship which final negotiated total cost bears to total target costs. Established- price plus incentive contracts are appropriate when the supplies, services, or construction being procured are of such a nature that assumption of a degree of cost responsibility by the contractor is likely to provide him with a positive profit incentive for effective cost control and contract performance.

      5.   Prospective Price Redetermination at a Stated Time or Times During Performance Contract. This type of contract provides for an established-price for an initial period of contract performance and for prospective price redetermination either upward or downward at a stated time or times during the performance of the contract. This type of contract is appropriate in the procurement of supplies, services, or construction where it is possible to negotiate fair and reasonable established prices for an initial period but not for subsequent periods of contract performance.

         This type of contract should not be used unless:

         1.   It has been established through negotiations that a basic established-price contract does not fulfill the requirements established by the conditions surrounding the procurement.

         2.   The contractor's accounting system is adequate for price redetermination purposes.

         3.   The prospective pricing period can be made to conform with the operations of the contractor's accounting system.

         4.   Reasonable assurance exists that price redetermination action will be taken promptly at the time or times specified.

         5.   It has been approved by the Finance Director.

10.03   TIME AND MATERIALS CONTRACT.

      The time and materials contract provides for the procurement of supplies, services, or construction on the basis of:

      1.   Direct labor hours at specified fixed hourly rates (which rates include direct and indirect labor, overhead, and profit).

      2.   Material at cost which could include handling and administrative expenses. This type of contract does not afford the contractor any positive profit incentive to control the cost of the materials or to manage his labor force effectively. The time and materials contract is used only where it is not possible at the time of placing the contract to estimate the extent or duration of the work or to anticipate costs with any reasonable degree of confidence. This type of contract is usually used for procurement of repairs, maintenance or overhaul work, and work to be performed in emergency situations. If this type of contract is used, the contract must show a ceiling price which the contractor exceeds at his own risk. For all agreed upon work not completed at the ceiling price, the Contractor must complete the agreed upon work at their own expense.

      3.   Labor-Hour Contract. The labor-hour type of contract is a variant of the time and materials type of contract differing only in that materials are not supplied by the contractor.

      4.   Unit Price Contract. The unit prices for the supplies, services, or construction to be provided are established in the contract with an estimated total amount. The contractor is paid in accordance with the unit price.

      5.   No-Fee Contract. A contract where supplies, services, or construction are provided at no cost to the City.

10.04 COST-REIMBURSEMENT CONTRACT.

   The cost-reimbursement type of contract provides for payment to the contractor of allowable costs incurred in the performance of the contract to the extent prescribed in the contract. This type of contract establishes an estimate of total cost for the purpose of obligation of funds and a ceiling which the contractor may not exceed (except at his own risk) without prior approval and subsequent amendment of the contract. The cost- reimbursement contract is suitable for use only when the uncertainties involved in contract performance are of such magnitude that cost of performance cannot be estimated with sufficient reasonableness to permit use of any type of fixed-price contract. In addition, it is essential that the contractor's cost accounting system is adequate for the determination of costs applicable to the contract and appropriate surveillance by agency personnel during performance will give reasonable assurance that inefficient or wasteful methods are not being used.

   1.   Cost-Sharing Contract. A cost-sharing contract is a cost-reimbursement type contract under which the contractor receives no fee but is reimbursed only for an agreed portion of its allowable costs. A cost-sharing contract is suitable for those procurements which cover research projects which are jointly sponsored by the City and the contractor with benefit to the contractor in lieu of full monetary reimbursement of costs. In consideration of this benefit, the contractor agrees to absorb a portion of the costs of performance. This type of contract is used for jointly sponsored research and development work with nonprofit educational institutions or other nonprofit organizations or other research and development work where the results of the contract may have commercial benefit to the contractor.

   2.   Cost-Plus-Incentive-Fee Contract. The cost-plus-incentive-fee contract is a cost- reimbursement type contract with provisions for a fee which is adjusted by formula in accordance with the relationship which total allowable costs bear to target costs. Under this type of contract, there is negotiated initially a target cost, a target fee, a minimum and maximum fee, and a fee adjustment formula. After performance of the contract, the fee payable to the contractor is determined in accordance with the formula. The provision for increase or decrease of fee is designed to provide an incentive for maximum effort on the part of the contractor to manage the contract effectively.

   3.   Cost-Plus-A-Fixed-Fee Contract. The cost-plus-a-fixed-fee contract is a cost reimbursement type of contract which provides for the payment of a fixed fee to the contractor. The fixed fee, once negotiated, does not vary with actual cost, but may be adjusted as a result of any subsequent changes in the work or services to be performed under the contract. Because the fixed fee does not vary in relation to the contractor's ability to control costs, the cost-plus-a-fixed-fee contract provides the contractor with only a minimum incentive for effective management control of costs. This type of contract is usually used for the performance of research or preliminary exploration or study where the level of effort required is unknown. The fixed fee shall not exceed 10 percent of the estimated cost of the contract, exclusive of the fee, as determined at the time of entering into such contract. Payment schedules for reimbursing contractors will be designed to provide the City with a measure of assurance that contractor performs the work or services satisfactorily before complete payment is made.

10.05   PERFORMANCE BASED CONTRACT. The performance based contract is one which incorporates an incentive to the contractor to surpass stated performance targets by providing for increases in fee or profit to the extent such targets are surpassed and for decreases to the extent such targets are not met. The incentive feature (providing for increases or decreases, as appropriate) is applied to performance targets rather than performance requirements. The incentive should relate to specific performance areas or milestones which have been very carefully established and specified in the contract. Performance incentives present complex problems in contract administration and should be approached with caution.

Section 11
Bid Protests

11.01   WHO MAY FILE THE PROTEST. Any bidder, offeror, prospective bidder, prospective offeror, or a prospective contractor who is aggrieved in connection with the solicitation or award of a contract may file a protest. Protests relating to cancellation of invitations for bids or requests for proposals and protests relating to the rejection of all bids or proposals are not permitted.

11.02   TIME FOR FILING.

      1.   If a protest is submitted by a prospective bidder or prospective offeror, the protest must be filed before bid opening time or proposal receipt date.

      2.   If a protest is filed by a bidder or offeror or a prospective contractor, the protest must be filed within seven days after the protesting bidder or offeror or prospective contractor knew or should have known of the facts giving rise to the protest EXCEPT THAT IN NO EVENT MAY A PROTEST BE FILED LATER THAN SEVEN DAYS AFTER THE DATE THE CONTRACT WAS AWARDED. Date of filing is the date of receipt of protest.

      3.   Untimely filed protests must be disregarded by the purchasing coordinator.

11.03 FORM OF PROTEST.

      1.   A protest must be in writing and filed with the purchasing coordinator.

      2.   A protest must state all grounds upon which the protesting party asserts that the solicitation or award was improper. Issues not raised by the protesting party before the purchasing coordinator are deemed waived and may not be raised on appeal.

      3.   The protesting party may submit with the protest any documents or information deemed relevant.

      4.   The written protest shall be accompanied by a cashier's check in the amount of five percent (5%) of the contract award amount, or if the amount of the contract cannot be reasonably determined at the time, then in the amount of One Thousand Two Hundred Fifty Dollars ($1,250.00), made payable to the City of Reading. The purpose of this protest bond shall be to reimburse the City for all administrative costs associated with the appeal process. Failure to submit a protest bond shall be deemed a waiver of the bid protest and is a jurisdictional deficiency in the protest that will forfeit the right of the bidder to maintain the protest.

11.04   NOTICE OF PROTEST. If award has been made, the purchasing coordinator shall notify the successful bidder or contractor of the protest. If the protest is received before award and substantial issues are raised by the protest, all bidders and offerors who appear to have a substantial and reasonable prospect of winning the award shall be notified and may file their agreement/disagreement with the purchasing office within five days after receipt of notice of protest.

11.05   STAY OF PROCUREMENT. The purchasing coordinator shall immediately decide upon receipt of the protest whether or not the solicitation or award shall be stayed, or if the protest is timely received after the award, whether the performance of the contract should be suspended. The purchasing office shall not proceed further with the solicitation or with the award of the contract, and shall suspend performance under the contract if awarded, unless theFinance Director makes a written determination that the protest is clearly without merit or that award of the contract without delay is necessary to protect the substantial interests of the City.

11.06   PROCEDURES.

      1.   Purchasing Coordinator Response. Within 15 days of the receipt of a protest, the purchasing coordinator shall submit a written response to the Finance Director. The response may include any documents or information that the purchasing coordinator deems relevant to the protest.

      2.   Protesting Party Reply. Within 10 days of the date of the purchasing coordinator response, the protesting party may file a written reply.

      3.   Review. The Director of Finance or designee shall:

         A.   Review the protest and any response or reply.

         B.   Request and review any additional documents or information deemed necessary to render a decision.

         C.   Give the protesting party and the department head reasonable opportunity to review and address any additional documents or information requested.

         D.   In their sole discretion, conduct a hearing.

         E.   Within 60 days of the receipt of the protest, issue a written determination stating the reasons for the decision.

         F.   If additional time is required to investigate the protest, inform the protesting party of the additional time needed to render a determination and obtain the protesting party's consent.

      4.   “Clearly Without Merit” determinations. If the Finance Director determines, upon receipt, that the protest is clearly without merit and does not stay the procurement, the purchasing coordinator shall immediately issue the decision as required by 11.08, below.

11.07   SETTLEMENT. The Director of Finance, in consultation with the City Solicitor, has the authority to settle and resolve bid protests.

11.08   DECISION. The Director of Finance or designee shall promptly, but in no event later than 60 days from the filing of the protest, issue a written decision. The decision shall:

      1.   State the reasons for the decision.

      2.   If the protest is denied, inform the protesting party of its right to file an appeal in Berks County Court within 15 days of the mailing date of the decision.

      3.   If it is determined that the solicitation or award was contrary to law, enter an appropriate order under 11.09. or 11.10., below.

      4.   The purchasing coordinator shall send a copy of the decision to the protesting party and any other person determined by the Finance Director to be affected by the decision.

11.09   REMEDY BEFORE EXECUTION OF CONTRACT. If, before execution of a contract, it is determined that a solicitation or proposed award of a contract was in violation of law, the purchasing coordinator may do one of the following:

      1.   Cancel the solicitation;

      2.   Change the solicitation to comply with law;

      3.   Reject all bids or proposals or those parts of the bids or proposals which were affected by the violation; or

      4.   Change or cancel the award to comply with law.

11.10   REMEDIES AFTER EXECUTION OF CONTRACT. If, after the execution of a contract, it is determined that a solicitation or award of a contract was in violation of law:

      1.   If the contractor did not act fraudulently or in bad faith, the contract may be:

         A.   Ratified and affirmed provided it is determined by the purchasing agency that doing so is in the best interest of the City.

         B.   Modified to comply with the law with the consent of all parties.

         C.   Cancelled and the contractor shall be compensated for the actual expenses reasonably incurred under the contract prior to termination. Such compensation shall not include loss of anticipated profit, loss of use of money, or administrative or overhead costs.

      2.   If the contractor has acted fraudulently or in bad faith, the contract may be:

         A.   Declared void.

         B.   Modified to comply with law with the consent of all parties.

         C.   Ratified and affirmed, provided it is determined by the purchasing coordinator, if that action is in the best interests of the City and without prejudice to the right of the City to damages, as may be appropriate.

Section 12
Petty Cash Funds

12.01 PURPOSE:

   The purpose of this regulation is to establish the policy for the use of petty cash funds and to establish the procedure for replenishing these funds.

12.02 APPLICABLE TO:

   All departments, divisions, offices or agencies.

12.03 GENERAL POLICY:

   1.   Petty cash funds exist to permit departments, divisions, offices or agencies to reimburse employees for incidental purchases. Petty cash is strictly for the purpose of reimbursing employees for out-of-pocket business expenses. There will be no petty cash advances.

   2.   Petty cash funds shall not be used to pay invoices. All invoices shall be paid through the accounts payable system.

   3.   A petty cash purchase shall not exceed one hundred ($100) dollars. At no time shall expenditures be fragmented to stay within the one hundred ($100) dollar limit.

      Departments, divisions, offices or agencies approving petty cash expenditures shall keep in mind that the City may pay higher prices by purchasing items through a number of small petty cash expenditures, rather than through a single bulk purchase via purchasing.

   4.   Items such as office supplies that are available from or through the purchasing office shall not at any time be purchased with petty cash funds.

      Petty cash shall not be used as a substitute to the Emergency Purchase Procedure.

   5.   All petty cash vouchers must have valid vendor receipts attached for the exact amount to be reimbursed. For mileage reimbursement, the travel expense report form must be used. Departments, divisions, offices or agencies shall not approve petty cash vouchers without proper receipts and shall inform employees that reimbursement will not occur if the proper procedure is not followed. Employees should be aware that the City is exempt from Pennsylvania sales tax, and that such tax should not be paid.

   6.   A brief statement justifying the petty cash expenditure shall be included on the petty cash voucher or petty cash ledger form. Petty cash expenditures shall be charged to the correct budget account number.

12.04 PETTY CASH FUNDS:

   The Director of Finance shall authorize the location and amount of petty cash funds. The following departments, divisions, offices and agencies maintain petty cash funds for the personnel in their offices:

   •   Treasurer's office for all City Hall departments, divisions, offices or agencies unless listed below:

      •   Public Works

      •   Police

      •   Sewage Treatment

12.05 RESPONSIBILITY FOR PETTY CASH FUNDS:

A specific employee, designated as custodian, shall be assigned to each petty cash fund. The custodian is responsible for the accurate accounting and control of the department, division, office or agency's fund, including following the procedure to replenish the petty cash funds.

The City Auditor shall be responsible for the annual review of petty cash purchases and, when appropriate, make recommendations to the department, division, office or agency as to what purchases should be directed through the purchasing office.

12.06 PETTY CASH FUND PROCEDURES:

   1.   Reimbursement of Employee. The employee shall make a petty cash purchase with his/her own money. The employee shall be reimbursed the same day or the following work day by following the proper petty cash procedure:

      A.   The employee shall first obtain permission from her/his immediate supervisor to purchase the required items or services. Any questionable petty cash expenditures shall be cleared with the department, division, office or agency before making the purchase.

      B.   The employee shall purchase the items or services from a vendor at a reasonable price. The purchasing office may assist in selecting a vendor.

      C.   For those departments, divisions, offices or agencies that maintain a petty cash fund, the employee shall submit his/her receipt, which has been signed by the immediate supervisor to the custodian for reimbursement from the petty cash fund.

      D.   For those departments, divisions, offices or agencies that do not maintain a petty cash fund, the signed receipt shall be presented to the Finance Director’s office where a petty cash voucher will be prepared in duplicate and the proper code assigned.

      E.   The Finance Director’s office shall retain the duplicate copy of the voucher for audit purposes. The employee shall submit the original with the attached receipt to the City Treasurer for reimbursement.

      F.   The employee signature on the voucher acknowledges only receipt of the money, not responsibility for the purchase.

      G.   The employee shall submit the original with the necessary receipt attached to the custodian for reimbursement.

   2.   Replenishing the Petty Cash Fund Other than City Treasurer. The custodian of the petty cash fund shall replenish the fund as needed through the Accounts Payable system.

      A.   The custodian shall verify that the account being charged for the petty cash funds has a sufficient balance.

      B.   The custodian shall complete an Authorization to Reimburse Petty Cash Fund form.

      C.   The custodian shall keep the duplicate copy, attach all petty cash vouchers with receipts to the original, and submit to the City Accountant with a completed Accounts Payable Approval form.

      D.   The City accountant shall confirm accuracy of information, verify that there are sufficient funds in account, and submit to Accounts Payable for processing.

      E.   Accounting shall retain and file the original copy of the reimbursement form, the petty cash voucher and receipts.

      F.   Accounts Payable shall process the forms and generate a check payable to the office as a reimbursement to the respective petty cash fund, treating the reimbursement as a payment to a vendor.

   3.   Replenishing the City Treasurer Petty Cash Fund. The City Treasurer shall replenish the fund on a monthly basis through the Accounts Payable system.

      A.   On a monthly basis, the City Treasurer shall segregate all petty cash vouchers by fund and submit to the city accountant for reimbursement.

      B.   The accounting office shall confirm the accuracy of the information, breakdown the expenditures by line item, confirm that sufficient funds are in the accounts, and submit the vouchers and an Accounts Payable Approval form to Accounts Payable for processing.

      C.   Accounts Payable shall generate a check payable to the City Treasurer as reimbursement.

Section 13
Sale and Lease of City Owned Land and Property

[Added 11-23-2015 by Ord. No. 82-2015; amended 4-24-2023 by Ord. No. 39-2023]

13.01   BACKGROUND:

   1.   Introduction

      The City of Reading periodically offers properties for sale or lease to prospective buyers and/or lessees, as a way of providing property development and improvement opportunities that will strengthen the city's downtown and neighborhood real estate markets. The proceeds from the sale of properties shall be used either to fund capital repairs/projects or to support the City's reserve funding.

      The policies included in this document are intended to provide prospective buyers and/or lessees with clear information about how to pursue opportunities to purchase or lease city-owned properties and how the city administration solicits, reviews, and responds to purchase offers.

   2.   Qualified Buyers and Bids

      In order to be considered qualified to purchase or lease a city-owned property, a prospective buyer:

         •   Must be current with respect to property taxes and other city obligations or have entered into a payment agreement to fulfill these obligations.

         •   Must not own or have an interest in any property with any significant unremediated violation of city codes and ordinances.

         •   Must not own a property that was subject to a completed Berks County tax foreclosure proceeding within the previous five years.

      A prospective buyer and/or lessee must submit the disclosure information described in this document. Failure to submit disclosures or to provide other requested information will result in disqualification.

      The City will require a prospective buyer and/or lessee to submit an application that describes development or improvement plans proposed for the property and that includes evidence that the prospective buyer has the financial and operational capacity to implement the plans as proposed. The amount of detailed information to be included in the application will depend on the proposed use of the property. For example, the development/improvement plan and documentation of financial/operational capacity associated with the purchase of a side yard will be different from that associated with the purchase of a large parcel proposed for a major commercial or residential development.

   3.   Appropriate and Timely Development

      The City expects that properties will be developed in an appropriate and timely manner, based on documentation submitted by a prospective buyer and/or lessee. Generally, the City will require that development or improvement activities begin within six months after the date of sale and that these activities be completed as documented in the prospective buyer's and/or lessee's application. To the extent needed in order to ensure that its expectations are met, the City will place conditions on certain property sales and/or leases and will monitor the status of the property following the sale or lease until the proposed activities have been completed.

      Proposed uses of purchased or leased property must be consistent with the City's Comprehensive Plan and with other city-approved and accepted plans. Purchasers are required to comply with all city, state and federal codes, regulations and statutes.

   4.   Documentation of Site Control

      The City recognizes that developers often require legally recognizable site control as part of the development process. In order to respond to this need, the City may execute contingent agreements of sale, property reservation letters or option agreements in order to allow developers to pursue financing and other approvals necessary for development.

      Agreements or contracts proposed to be executed for this purpose must meet the following conditions.

         •   The applicant must be a qualified buyer by fulfilling the requirements described in section II above.

         •   The agreement or contract must be limited to one year or less, with any subsequent renewal or extension solely at the City's discretion.

         •   The applicant may not use or move into the property without the City's authorization.

         •   Anon-refundable option fee will be due upon execution (not-for-profit organizations and city-supported projects may be exempted from the fee).

         •   The terms of the agreement or contract will be public information.

   5.   Ethics

      The City of Reading is committed to ethical and transparent processes for the sale and conveyance of its properties. All real estate transactions are governed by City and State laws and rules that generally prohibit, among other things, conflicts of interest, the disclosure of confidential information, and the representation of a person or organization by a City official or employee in a transaction with the City.

   6.   City Council

      All sales, and leases, and conveyances of city-owned property are subject to approval by the City Council of Reading regardless of the price of the sale or lease. Following the city administration's favorable review of an offer to purchase a particular property, the Managing Director will submit documentation in support of the property sale to Council. The proceeds from the sale of properties shall be used either to fund capital repairs/projects or to support the City's reserve funding.

13.02   PROPERTY SALES PROCESS:

   The City offers properties for sale in several ways.

   1.   General Sales

      The City may publish information about one or more properties in its inventory online, in some instances with a listing price. Offers from prospective buyers are accepted and reviewed on an ongoing basis.

      If the City receives more than one qualified offer for a property, the City may provide first preference to an applicant that proposes to develop the property for a public purpose, as described below. If no public purpose is proposed, the City will determine the most qualified applicant. In some instances, the City may use a Competitive Sales approach to obtain the best offer for the property.

      The City's Real Estate Review Committee must approve the final sales price of any property that to be sold in this manner.

   2.   Competitive Sales

      The City may offer a property for sale through broker listings, the use of the Multiple Listing Service, web sites or other methods of advertising in order to encourage broad participation in the sale of certain properties.

      Properties will be placed on the market long enough to allow for broad engagement by potential buyers. The City retains the right to approve or reject an offer, based on price or other criteria. The Real Estate Review Committee will approve the asking price and will recommend approval of an offer for each such property to the Managing Director.

   3.   Direct Sales

      The City may determine that certain properties will be sold to a specific party. Prior to the introduction of the ordinance required under the Charter for all sales of City-owned property, the Mayor, the Managing Director, and the Finance Director must all approve the proposed sale in writing.

   4.   Requests for Proposals/Requests for Qualifications

      Under circumstances in which the City has a specific planned use for a parcel, the City may issue a Request for Proposals (RFP) or Request for Qualifications (RFQ) in order to identify and select a potential developer. Offering a property for sale in this manner provides the City with an opportunity to explain the planned use and any restrictions that might be placed on the developer or successive owners of the property. An RFP/RFQ may be issued by a designated city agency and may be developed in consultation with other parties, as appropriate.

      Any RFP or RFQ issued by the City for this purpose will be advertised in order to encourage broad participation. Selection criteria will be published as part of the RFP/RFQ documentation. These criteria may include factors such as developer capacity, anticipated development outcomes, and price. Issuance of an RFP or RFQ does not obligate the City to select a developer or a purchaser.

   5.   Sale of Small Vacant Lots for Side or Rear Yards

      The City will review and respond to a request for the purchase of a small vacant lot for improvement as a side or rear yard under the following circumstances.

         •   The applicant must be the owner of an adjacent property and must be using that property as a primary residence.

         •   The property to be acquired must share a common boundary at either the side or back of the applicant’s property.

         •   The block on which the applicant and the property are located must consist primarily of occupied properties.

         •   An applicant may acquire up to two adjacent lots, as long as one of those lots shares a common boundary with the applicant’s primary residence.

         •   The City reserves the right not to convey properties that are adjacent to or near other vacant properties.

         Once an application for property for a side or rear yard has been submitted, the City will give notice to any other property owners whose property shares a common boundary with the proposed yard. Those property owners will be offered the opportunity to submit an application for the property. If more than one adjacent property owner submits an offer to purchase the property, the City may sell the property to the highest bidder, subdivide the lot (if the applicants and the Planning Commission agree and if the applicants take full responsibility for the subdivision), or pursue another approach to resolving this situation.

13.03   PROPERTY LEASE PROCESS: (Reserved)

13.04   PRICING:

   1.   Listing Price

      The City will publish list prices for all properties. The City may use an appraisal to establish the price of any property. For vacant structures, the cost of repair may be considered in determining price.

   2.   Discounted Pricing

      The City may choose to support certain projects that serve a public purpose by conveying a property at a discounted price. If a property is identified for one of the following uses, the City will evaluate the proposal and property request to determine whether the proposed project provides significant, visible community benefits that would merit city support in the form of the reduction in price.

      a.   The price of property being acquired for a housing development venture defined as affordable by local, state, or federal government entities may be discounted. Affordable housing projects do not have to be directly subsidized by the city, state or federal government to qualify for discounted pricing.

      b.   Development projects that advance the City's economic development goals as articulated in the Comprehensive Plan and other City-approved and accepted plans may be eligible for discounted pricing. Eligible projects include but are not limited to:

         1.   Leveraging of previous public investments in infrastructure, job creation, and economic development;

         2.   Projects with the potential to spur additional private investment in underperforming commercial corridors, neighborhood centers, and areas of regional economic significance as identified in the city's Comprehensive Plan and other city-approved and accepted plans;

         3.   Projects that return industrial land to productive use in areas identified as appropriate for industrial development; and

         4.   Projects that support the completion of significant public improvements, including but not limited to the upgrading of public utilities and the rehabilitation or provision of new public infrastructure.

      c.   Community development projects that provide significant incremental benefits may be eligible for discounted pricing. Eligible projects include but are not limited to:

         1.   Support for existing community facilities or the provision of space for new community facilities such as libraries, recreation centers, health centers, computing centers, and playgrounds;

         2.   Significant improvements to community infrastructure including the greening of schoolyards or recreation center yards or other publicly- owned parcels to achieve storm water management, public recreation, or community gardening goals;

         3.   Creation of new infrastructure or support for existing infrastructure to improve safety and mobility for children, seniors, and other pedestrians, including sidewalk improvements, pedestrian plazas, traffic medians, or easements for trails; and

         4.   Urban agriculture - the cultivation of fruits, herbs, and vegetables - and complementary activities, such as processing and distributing food, collecting and reusing food waste and rainwater, and educating, organizing, and employing local residents.

      Although religious institutions are not eligible for discounted pricing, community development projects sponsored by non-profit organizations affiliated with religious institutions may be eligible.

      d.   For properties priced at $25,000 or less that are proposed to be used as side or rear yards, up to $15,000 of the value may be deferred or forgiven.

13.05   DISCOUNTED PRICING AND SELF-AMORTIZING MORTGAGES:

   For properties conveyed at a discounted price, the City may require the buyer to enter into a ten-year, self-amortizing mortgage for the amount of the discount, in order to ensure that, in the event that the property is resold to another party within 10 years, the buyer will not unduly benefit from the discounted price.

   The characteristics of the self-amortizing mortgage are as follows:

   a.   The length of the mortgage will be 10 years from the date of conveyance;

   b.   The value of the mortgage is the amount of the price reduction agreed to by the City;

   c.   The buyer is not required to make payments on the mortgage so long as the property is used in conformance with the agreed-upon use for the ten-year period;

   d.   The mortgage balance will decrease by 10% each year for 10 years (for example, after one year, the balance remaining on a $10,000 mortgage will be $9,000; after two years, the balance will be $8,000, and so on);

   e.   Upon satisfactory completion of the ten-year period, the City will satisfy the mortgage.

   f.   In the event that the buyer wishes to sell the property before the ten-year expiration date of the mortgage, the City must receive the remaining amount owed on the mortgage before the mortgage will be satisfied;

   g.   The mortgage may be assumed by heirs to the original buyer.

13.06   URBAN AGRICULTURE:

   The City supports the use of vacant land for three categories of urban agriculture.

      a.   Individual Gardens.

         Definition: An individual garden is a property for which an individual or household is given temporary access to garden and maintain for their personal use. The intent is to provide an interim use for the land to eliminate blight and improve safety until development is possible.

         The City expects that the majority of individual gardens will be temporary, and the land will still be available for development.

         Terms: An Individual Garden Agreement (IGA) executed by the City with the individual or household will last for one year, and may begin and end at any time throughout the year. IGAs are time-limited agreements that both the City and gardener may terminate at any time, with or without cause, upon prior written notice to the other party. The City will use reasonable efforts to avoid terminating the urban garden agreement between April 1 and November 1. The City will provide as much notice as possible if a license is to be terminated.

         Pricing: IGAs will be executed at nominal cost.

         Renewal: IGAs may be renewed annually at the request of the applicant and at the discretion of the City.

         Additional requirements: The City expects that individual gardens will be maintained throughout the term of the IGA. Maintenance standards will be provided in writing to all applicants.

         Acceptable Uses: The gardener may enter and use the property only for the following non-commercial, gardening purposes: to grow food, flowers, ornamental plants, and other landscaping, to compost in rodent-resistant containers, and to complete associated construction, with the written approval of the City.

      b.   Community Gardens and Open Space.

         Definition: A community garden is defined as one or more properties managed and maintained by a group of individuals to grow and harvest food crops or non-food crops (such as flowers) for personal or group consumption, for donation, or for sale that is incidental in nature. A community garden area may be divided into separate garden plots or orchard areas for cultivation by one or more individuals or may be farmed collectively by members of the group. A community garden may include common areas (such as hand tool storage sheds) maintained and used by the group. Community gardens may be used for recreational purposes, and improvements to facilitate such purposes may be allowed on a case-by-case basis upon review by the City and with community support.

         Terms: Community gardens and community-managed open spaces are eligible for Community Garden licenses or leases of up to five years in length, subject to renewal. Leases and licenses of longer than one year, lease and license renewals, and purchase options are available at the discretion of the city administration and subject to the approval of City Council. The City shall provide as much notice as possible if a license is to be terminated or a lease not renewed.

         Pricing: Community Garden licenses and leases are to be made available at nominal cost in recognition of the beneficial community impact.

         Additional Requirements for Community Gardens:

            •   Sponsorship by a local neighborhood, civic association, or institution.

            •   Insurance in a form acceptable to the City.

            •   Maintenance plan and description of community benefits and any related programming.

         Acceptable Uses:

         The gardeners may enter and use the property only for the following non- commercial, gardening purposes: to grow food, flowers, ornamental plants, and other landscaping, to compost in rodent-resistant containers, and to complete associated construction, with the written approval of the City.

      c.   Market and Community-Supported Farms

         Definition: A market farm is defined as an area managed and maintained by an individual or group of individuals to grow and harvest food crops or non- food crops (such as flowers) for sale or distribution that is not incidental in nature. Market farms include both for-profit and nonprofit enterprises.

         Terms: Lease terms are to be variable and are to be established by the City on an individual basis.

         Pricing: Market and Community-supported Farm Leases may be available for nominal or reduced price at the discretion of the City.

         Additional Requirements for Market and Community-Supported Farms:

            •   Insurance in a form acceptable to the City.

            •   City approval of a business plan/feasibility study.

            •   Written city approval for any constructed improvements.

         Acceptable Uses: A market or community-supported farm may use the property to grow food, flowers, ornamental plants, and other landscaping, to compost in rodent-resistant containers, and to complete associated construction, with the written approval of the City.

Section 14
Receiving shipments of materials, supplies and equipment

14.01   PURPOSE:

   The purpose of this issuance is to outline the required procedures for the receipt of materials delivered by vendors after procurement by purchase order.

14.02   APPLICABLE TO:

   All departments, divisions, offices or agencies.

14.03   RECEIVING ORDERED MATERIAL:

   1.   Responsibility. Each item received must be inspected for damage and received in order to properly pay bills. These duties are the responsibility of the using department, division, office or agency personnel.

   2.   Receiving Shipments in Full or in Part. The receiver should check the packing slips to insure that all items were shipped as ordered. If the order is received in full, the packing slip should be signed, dated and filed with the department, division, office or agency copy of the purchase order. The signature and date is confirmation that the order was received as indicated.

      If a partial shipment is received, the packing slip should indicate that the remainder of the order is on backorder. If so, the slip should be signed, dated and forwarded to Accounts Payable with a copy of the purchase order for payment. A copy of the receiving should be filed with the department, division, office or agency. If a backorder is not indicated or the complete order is not received by the agreed upon date, the purchasing coordinator should be notified within one (1) working day for follow up with the vendor.

   3.   Incorrect or Damaged Shipments. The person receiving items inspects them for damage and correctness of order. If an order is delivered not as specified, the department, division, office or agency shall contact the purchasing office within one (1) working day of receipt of the order. The department, division, office or agency will explain why the delivery was unacceptable and request that provisions be made for a satisfactory replacement or a supplemental delivery. The purchasing coordinator shall also be contacted immediately if the vendor cannot comply with the original order.

   4.   Invoices. Although the vendor is directed to send all invoices to Accounts Payable, occasionally they may be included with a shipment. The department, division, office or agency shall forward all invoices to Accounts Payable immediately for proper payment, if they are included in the shipment.

Section 15
Procedures Related to the Solicitation and Award of Public Contracts

[Added 12-19-2022 by Ord. No. 143-2022]

Whereas, the City recognizes that there is a need to ensure that all work on public construction and maintenance contracts is performed by responsible, qualified firms that maintain the capacity, expertise, personnel and other qualifications and resources necessary to successfully perform public contracts in a timely, reliable and cost-effective manner.

Whereas, to effectuate the purpose of selecting responsible contractors for public contracts and to protect the City's investments in such contracts, prospective contractors and subcontractors should be required to meet pre-established, clearly defined, minimum standards relating to contractor responsibility, including requirements and criteria concerning technical qualifications, competency, experience, adequacy of resources, including equipment, financial and personnel resources, and satisfactory records regarding past project performance, safety, law compliance and business integrity.

Whereas, due to the critical impact that skilled construction craft labor has on public works projects, and due to the limited availability of skilled construction craft labor and imminent craft labor skill shortages, it is necessary to require contractors and subcontractors to participate in established, formal apprenticeship training programs as a condition of bidding, for the purpose of both promoting successful project delivery and ensuring future workforce development.

Whereas, the City shall require compliance with the provisions of this ordinance by business entities seeking to provide services to the City as specified herein. The requirements of this ordinance are intended to supplement, not replace, existing contractor qualification and performance standards or criteria currently required by law, public policy or contracting documents. However, in the event that any of the provisions of this ordinance conflict with any law, public policy or contracting documents of the City, this ordinance shall prevail.

15.01   RESPONSIBLE CONTRACTOR REQUIREMENTS

   (a)   This ordinance shall apply to public works projects undertaken by the City for the construction, demolition, alteration, renovation, modernization, service or maintenance of buildings, structures or facilities valued at $250,000 or more. All contractors and subcontractors that perform on such projects, regardless of the value of individual contracts or subcontracts, shall satisfy the requirements of this ordinance in all respects.

   (b)   All firms engaged in contracts covered by this ordinance shall be qualified, responsible contractors or subcontractors that have sufficient capabilities in all respects to successfully perform contracts on which they are engaged, including the necessary experience, equipment, technical skills and qualifications and organizational, financial and personnel resources. Firms bidding on public contracts shall also be required to have a satisfactory past performance record and a satisfactory record of law compliance, integrity and business ethics.

15.02   CONTRACTOR RESPONSIBILITY CERTIFICATIONS

   (a)   As a condition of performing work on a public works contract subject to this ordinance, a general contractor, construction manager or other lead or prime contractor seeking award of a contract shall submit a Contractor Responsibility Certification.

   (b)   The Contractor Responsibility Certification shall be completed on a form provided by the City and shall reference the project for which a bid is being submitted by name and contract or project number.

   (c)   In the Contractor Responsibility Certification, the construction manager, general contractor or other lead or prime contractor shall confirm the following facts regarding its past performance and work history and its current qualifications and performance capabilities:

      (1)   The firm will pay all craft employees on the project, at a minimum, the applicable wage and fringe benefit rates, as established for the classification in which the worker is employed, in accordance with the Pennsylvania Prevailing Wage Act and/or the Federal Davis Bacon Act, 40 U.S.C. § 276a et. seq. These wages shall also be paid to employees performing any custom fabrication work for the project. For purposes of this subsection, custom fabrication shall mean the fabrication, assembly modification or other production of non-standard goods, or materials, including components, fixtures, or parts thereof, that are fabricated assembled or modified offsite, but produced specifically for a project covered by this ordinance. This requirement shall include, but not be limited to custom fabrication for electrical, plumbing, mechanical, refrigeration, heating, cooling, ventilation, sheet metal or other duct systems, mechanical insulation, ornamental iron work or boiler systems. Fabrication shall also include the fabrication, assembly or other production of components or structures prefabricated to specifications for a particular project covered by this ordinance.

      (2)   The firm will ensure that all craft labor it employs on the project will have completed, prior to working on the project the OSHA 10-hour training course for safety established by the U.S. Department of Labor. If the firm is a prime contractor, it shall also ensure that at least one person on the project has completed the OSHA 30-hour construction training course established by the U.S. Department of Labor.

      (3)   The firm participates in a Class A Apprenticeship Training Program, as defined below, for each separate trade or classification in which it employs craft employees.

         A.   For purposes of this section, a Class A Apprenticeship Program is an apprenticeship program registered with and approved by the U.S. Department of Labor or a state apprenticeship agency and has graduated apprentices to journey person status for at least three of the past five years. This may be an apprenticeship program subject to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. ("ERISA"), or a non-ERISA program.

         B.   To demonstrate compliance with this section, the firm shall provide, with this certification, a list of all trades or classifications of craft employees it will employ on the project and documentation verifying it participates in a Class A Apprenticeship Program for each trade or classification listed.

         C.   The requirements of this section and subsection (4) below help ensure that the bulk of the craft labor workforce employed on the project will have sufficient skills and training to correctly perform work assigned to them.

      (4)   The construction manager, general contractor or other lead or prime contractor responsible for the project shall ensure that at least 70 percent of the craft labor workers employed on the project shall be comprised of either journey person workers who have successfully completed a Class A Apprenticeship Program as defined in this ordinance or apprentices registered in such programs. The apprenticeship participation of specified by this section must be in the same trade or craft for which the workers are employed on the project.

      (5)   The firm has all other technical qualifications and resources, including equipment, personnel and financial resources, to perform the referenced contract, or will obtain same through the use of qualified, responsible subcontractors.

      (6)   The firm will maintain all qualifications, resources and capabilities referenced in this certification throughout the duration of the project.

      (7)   The firm shall assign craft labor personnel only work in the craft or trade in which they are employed.

      (8)   The firm shall notify the City within seven (7) days of any material changes to all matters attested to in this certification.

      (9)   The firm understands that the Contractor Responsibility Certification required by this section shall be executed by a person who has sufficient knowledge to address all matters in the certification and shall include an attestation stating, under the penalty of perjury, and/or Unsworn Falsification to Authorities, that the information submitted is true, complete and accurate.

   (d)   Execution of the Contractor Responsibility Certification required by this ordinance shall not establish a presumption of contractor responsibility and the City may require any additional information it deems necessary to evaluate a firm's status as a responsible contractor, including technical qualifications, financial capacity or other resources and performance capabilities. The City may require that such information be included in a separate Statement of Qualifications and Experience or as an attachment to the Contractor Responsibility Certification.

   (e)   The submitting firm shall stipulate in the Contractor Responsibility Certification that, if it receives a Notice of Intent to Award Contract, it will provide a Subcontractor List and required subcontractor information as specified in Section 15.06 of this ordinance.

   (f)   If the submitting firm has ever operated under another name, or is controlled by another company or business entity, or in the past five (5) years controlled or was controlled by another company or business entity, whether as a parent company, subsidiary or in any other business relation, it shall attach a separate statement to its Contractor Responsibility Certification that explains in detail the nature of any such relationship. Additional information may be required from such an entity if the relationship in question could potentially impact contract performance.

   (g)   If a firm fails to provide a Contractor Responsibility Certification required by this section, it shall be disqualified from bidding. No action of any nature shall lie against the City because of its refusal to accept a bid for failing to provide information required by this section.

15.03   NOTICE OF INTENT TO AWARD CONTRACT

   (a)   After it has received bids for a project, the City shall issue a Notice of Intent to Award Contract to the firm offering the lowest responsible bid.

   (b)   Such Notice shall be issued immediately or as soon as practicable after bids are opened and Notice of Intent to Award Contract is issued. The Notice shall stipulate that the contract award is conditioned on the issuance of a written Contractor Responsibility Determination, as required by Section 15.05 and any other conditions deemed appropriate by the City.

15.04   SUBCONTRACTOR LISTS, SUBCONTRACTOR RESPONSIBILITY CERTIFICATIONS

   (a)   A prospective awardee shall submit to the City a Subcontractor List containing the names of any subcontractors that will be used for the referenced project, their addresses, and a description of the work each listed subcontractor will perform on the project.

   (b)   At the time a perspective awardee submits the Subcontractor List, it shall also submit Subcontractor Responsibility Certifications for all listed subcontractors to the City. Subcontractor Responsibility Certifications shall be executed by the respective subcontractors on forms prepared by the City and shall contain the same information and representations required in Contractor Responsibility Certifications, including verification of apprenticeship qualifications as required by Section 15.02(c), for each trade or classification of craft workers it will employ on the project.

   (c)   Subcontractor Responsibility Certifications shall be executed by a person having sufficient knowledge to address all matters in the certification and shall include an attestation stating, under the penalty of perjury and/or Unsworn Falsification to Authorities, that all information submitted is true, complete and accurate.

15.05   CONTRACTOR RESPONSIBILITY REVIEW AND DETERMINATION

   (a)   After the receipt of bids, the City shall undertake a review process to determine whether the prospective awardee is a qualified, responsible contractor in accordance with the requirements of this ordinance and other applicable laws and regulations and has the resources and capabilities to successfully perform the contract. The time of the review process shall be as determined necessary by the City.

   (b)   As part of this review process, the City shall ensure that the Contractor Responsibility Certification, the Subcontractor List and the Subcontractor Responsibility Certifications, as required by this ordinance, have been submitted and properly executed.

   (c)   The City may conduct any additional inquiries to verify that the prospective awardee and its subcontractors have the technical qualifications and performance capabilities necessary to successfully perform the contract and that the firms have a sufficient record of law compliance and business integrity to justify the award of a public contract. In conducting such inquiries, the City may seek relevant information from the firm, its prior clients or customers, its subcontractors or any other relevant source.

   (d)   If at the conclusion of the review process the City determines that all responsibility certifications have been properly completed and executed, and if it concludes that the qualifications, background and responsibility of the prospective awardee and the firms on its Subcontractor List are satisfactory, it may issue a formal written Contractor Responsibility Determination verifying that the prospective awardee is a qualified, responsible contractor. In the event a firm is determined to be non-responsible, the City shall proceed to conduct a responsibility review of the next lowest, responsive bidder or, if necessary, rebid the project.

   (e)   A Contractor Responsibility Determination may be issued after the conclusion of the review process under this Section and Section 15.06. A Responsibility Determination may be revoked or revised in any manner at any time if the City obtains relevant information warranting any such revocation or revisions.

15.06   SUBCONTRACTOR RESPONSIBILITY REVIEW REQUIREMENTS

   (a)   A construction manager, general contractor or other lead or prime contractor shall not be permitted to use a subcontractor on any work performed for the City unless it has identified the subcontractor on its Subcontractor List and provided a Subcontractor Responsibility Certification in accordance with the requirements of Section 15.05.

   (b)   A subcontractor listed on a firm's Subcontractor List shall not be substituted unless written authorization is obtained from City and a Subcontractor Responsibility Certification is provided for the substitute subcontractor.

   (c)   In the event that the City determines that a prospective subcontractor listed by the apparent low bidder does not meet the responsibility standards of this ordinance, it may, after informing the prospective awardee, exercise one of the following options:

      (1)   permit the awardee to substitute a qualified, responsible, subcontractor in accordance with the requirements of this section;

      (2)   require the awardee to self-perform the work in question if the firm has the required experience, licenses and other qualifications to perform the work in question; or

      (3)   disqualify the prospective awardee.

   (d)   In the event that a subcontractor is disqualified under this ordinance, the general contractor, construction manager or other lead or prime contractor shall not be permitted to make any type of contractual claim against the City on the basis of a subcontractor disqualification.

15.07   FALSE OR MISLEADING RESPONSIBILITY CERTIFICATIONS

   If the City determines that a Contractor or Subcontractor Responsibility Certification contains false or misleading material information that was provided knowingly or with reckless disregard for the truth, or omits material information knowingly or with reckless disregard of the truth, the firm for which the certification was submitted shall be prohibited from performing work for the City for a period of three (3) years, and shall be subject to any other penalties and sanctions, including contract termination, available to the City under law. A contract terminated under these circumstances shall further entitle the City to withhold payment of any monies due to the firm as damages.

15.08   EXECUTION OF FINAL CONTRACT

   (a)   A contract subject to this ordinance shall not be executed until all requirements of this ordinance have been fulfilled and until Contractor and Subcontractor Responsibility Certifications have been issued by the City under Section 15.0S(d). Upon completion of all requirements under this ordinance, the City may execute a final contract based upon the Notice of Intent.

   (b)   Prior to the execution of a final contract under this Section, the City shall publicly post the Notice of Intent to Award, Contractor and Subcontractor Responsibility Certifications, Subcontractor Lists and Contractor Responsibility Determination on the City website for public inspection for a period of five (5) calendar days after the issuance of the Contractor Responsibility Determination.

15.09   WAIVER OF RESPONSIBLE CONTRACTOR REQUIREMENTS

   The requirements listed in Section may only be waived by resolution of the City Council under the following conditions:

      (1)   After soliciting bids through the City's purchasing process, no bids that meet the requirements of this ordinance and are otherwise qualified have been received for the project by the close of the bidding periods;

      (2)   Bid materials and waiver resolution are provided to the City Council Clerk no later than 12:00 PM on the Thursday before the next scheduled City Council meeting;

      (3)   The waiver may only apply for the specific project;

      (4)   The resolution shall identify the basis for the waiver, which provisions of this Section are to be waived, and whether the project shall be re-bid.