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(a) Bids. All Advertisements For Bids for construction Contracts in excess of the Threshold Amount shall conform to and at a minimum require the following:
(1) Published Advertisement. The Department Head shall advertise for competitive Bids in at least one local newspaper, periodical of general circulation, or on a publically available website of the City's Office of Contract Administration and the department concerned. Such advertisement shall be published not fewer than 10 days prior to Bid opening. The department may, in its discretion, include in the published advertisement the amount of the engineer's estimate for the work to be performed.
(2) Award and Certification Required. All published advertisements and Advertisements For Bid shall contain the following language [wording in brackets should be chosen as appropriate to the department]:
In accordance with San Francisco Administrative Code Chapter 6, no Bid is accepted and no contract in excess of [the Threshold Amount] is awarded by the City and County of San Francisco until such time as [(1) for departments with boards or commissions, (a) the Department Head recommends the contract for award and (b) the board or commission then adopts a resolution awarding the contract]; or [(2) for departments under the Mayor, (a) the Mayor approves the contract for award and (b) the Department Head then issues an order of award.] Pursuant to Charter Section 3.105, all contract awards are subject to certification by the Controller as to the availability of funds.
Failure of a department to include such language in a published advertisement or Advertisement For Bids does not give rise to a contract right by a Bidder or Contractor outside of the requirements of the Charter or Administrative Code.
(3) Form of Bid. All Bids shall be sealed and directed to the Department Head advertising for Bids, in the format prescribed by the Department Head.
(4) Bid Security Requirement. All Bids shall be accompanied by a corporate surety bond, or an irrevocable standby letter of credit on a bank or trust company doing business and having an office in the State of California, having a combined capital and surplus of at least $50,000,000, and subject to supervision or examination by Federal or State authority, or a certified check on a bank or trust company doing business and having an office in the State of California, having a combined capital and surplus of at least $50,000,000, and subject to supervision or examination by Federal or State authority, payable on sight to the City and County of San Francisco, the amount of which corporate surety bond, irrevocable standby letter of credit, or certified check shall be fixed by the Department Head or officer as stated in the Advertisement For Bids, which amount shall not be less than 10% of the amount Bid for the cost of the proposed work of improvement, and no Bid shall be considered unless accompanied by a corporate surety bond or irrevocable standby letter of credit or certified check. Any irrevocable standby letter submitted pursuant to this Chapter shall be on a form provided by the City. If the amount of security required is fixed by the Department Head or officer in an amount in excess of $15,000, the form of security required shall be that of a corporate surety bond or irrevocable standby letter of credit. The requirement for a corporate surety bond, irrevocable standby letter of credit, or certified check described in this subsection shall be referred to collectively as the "bid security requirements."
Notwithstanding the above, the bid security requirements for a particular Contract may be modified by the Department Head in accordance with Administrative Code Chapter 14B.
(5) Fees. The Department Head or officer calling for Bids may specify in the Advertisement For Bids for any project a nonrefundable fee to be paid by each prospective Bidder for each set of Bidding documents (including plans and specifications), such fee to defray the cost of reproducing each set of Bidding documents as determined by the Department Head or officer, and all such fees shall be deposited as an abatement of the expenditure of the appropriation against which the cost of reproducing said Bidding documents was charged.
(6) License. The Department Head shall specify in all Advertisements For Bids and plans for Public Work projects the classification of the Contractor's license which a Contractor shall possess at the time Bids are submitted. Except as provided in California Business and Professions Code Section 7000 et seq., Bidders and their subcontractors are required to be properly licensed at the time of Bid.
(7) Qualifications. The Department Head responsible for the Public Work shall require from all Bidders information concerning their experience and financial qualifications, and shall take such information into consideration in the Award of any Contract. At a minimum the Department Head shall require (A) information concerning the Contractor's experience, financial qualifications and ability to perform the terms and conditions of the Contract, and (B) information as to whether the Contractor possesses, or can obtain in time to perform the Contract, the necessary equipment. A Department Head may satisfy this requirement through a Bidder prequalification process that meets the requirement of Section 6.20(f).
(8) Business Tax Registration Certificate. All Advertisement For Bids shall require that Bidders submit proof of a current Business Tax Registration Certificate. Failure of a Bidder to provide such proof prior to Award, or as otherwise required in the Advertisement For Bids, could, at the discretion of the Department Head, constitute a refusal to enter into the Contract and result in a forfeiture of the Bid bond.
(9) Designation of Subcontractors; Subcontracting and Subletting. All Bidders shall designate their subcontractors in accordance with and shall be subject to the Subletting and Subcontracting Fair Practices Act, at California Public Contract Code Section 4100 et seq., as amended from time-to-time. In addition to the penalties provided by Public Contract Code Section 4100 et seq., violation of this subsection 6.21(a)(9) may be grounds for a determination of nonresponsibility under Article V of this Chapter 6.
(10) Work to Be Performed by General Contractor. The Advertisement For Bids may specify the scope of work which must be performed by the General Contractor using his/her own forces, or the specification may require the General Contractor to perform with his/her own forces up to 25% of the base Contract work. Bidders must certify with their Bids that, if awarded the Contract, they will perform with their own forces the specified scope or percentage of the total bid price (excluding alternate Bid items).
(b) Quotes. All requests for Quotes for construction Contracts less than or equal to the Threshold Amount shall be posted with three-days' notice. Such requests shall at a minimum require a Contractor's license, qualifications, a Business Tax Registration Certificate, participation in an apprenticeship program and compliance with subcontractor listing laws, all in accordance with the listed provisions of Sections 6.21 and 6.22.
(c) Right to Reject Any or All Bids or Quotes. The Department Head shall have the right to reject any or all Bids or Quotes for any reason or no reason. All Advertisement For Bids shall reserve this right, but failure to make such reservation shall not abrogate the right to reject.
(d) Bid Protests. Only a Bidder may submit a bid protest. The Department Head concerned shall prescribe in the Advertisement For Bids procedures for submitting Bid protests. Such procedures shall set the time by which Bid protests must be received but may not require that Bid protests be submitted fewer than five business days after the date Bids are due.
(Added by Ord. 286-99, File No. 991645, App. 11/5/99; amended by Ord. 153-00, File No. 000805, App. 6/30/2000; Ord. 324-00, File No. 001919, App. 12/28/2000; Ord. 7-02, File No. 011675, App. 1/25/2002; Ord. 208-02, File No. 021221, App. 10/18/02; Ord. 58-05, File No. 041571, App. 4/1/2005; Ord. 19-10, File No. 091163, App. 2/10/2010; Ord. 108-15, File No. 150175, App. 7/2/2015, Eff. 8/1/2015; Ord. 220-20, File No. 200949, App. 11/6/2020, Eff. 12/7/2020)
All construction Contracts awarded under this Chapter 6 by the City shall contain the following minimum terms and conditions:
(a) Bonds. Before the execution of any Contract for Public Work or Improvement in excess of $25,000, the Department Head shall require the successful Bidder to file corporate surety bonds for the faithful performance thereof and to guarantee the payment of wages for services engaged and of bills contracted for material, supplies and equipment used in the performance of the Contract. Each bond shall be for a sum not less than 100% of the awarded Contract amount.
The City, acting through the City Administrator, intends to provide guarantees to private bonding assistance companies and financial institutions in order to induce those entities to provide required bonding and financing to eligible Contractors bidding on and performing City Public Work Contracts. This bonding and financial assistance program is subject to the provisions of Administrative Code Chapter 14B.
(b) Insurance. All construction Contracts awarded under this Chapter 6 must conform to the insurance requirements established by the Risk Manager. The Risk Manager shall develop uniform insurance requirements for City Contracts subject to this Chapter 6. The Risk Manager shall review and update such insurance requirements as necessary to protect the City’s interests.
Every Contractor and subcontractor shall comply with the provisions of California Labor Code Section 3700. Prior to commencing the performance of work under any Public Work Contract, the Contractor and all of its subcontractors shall file with the awarding department a certificate of insurance against liability for workers compensation or proof of self-insurance in accordance with the provisions of the California Labor Code.
(c) Indemnification. All construction Contracts awarded under this Chapter 6 shall require that the Contractor fully indemnify the City to the maximum extent provided by law, such that each Contractor must save, keep, bear harmless and fully indemnify the City and any of its officers or agents from any and all liability, damages, claims, judgments or demands for damages, costs or expenses in law or equity that may at any time arise.
This indemnification requirement may not be waived or abrogated in any way for any Contract without the recommendation of the Risk Manager and the express permission and approval of the Board of Supervisors.
(d) Assignment. No Contract shall be assigned except upon the recommendation of the Department Head concerned and with the approval of the Mayor, relative to the department under the Mayor's jurisdiction, or the approval of the board or commission concerned for departments not under the Mayor.
(e) Prevailing Wages. All Contractors and subcontractors performing a Public Work or Improvement for the City shall comply with the requirements of through of the Labor and Employment Code, as applicable.
(f) Hours and Days of Labor. Contractors and subcontractors performing a Public Work or Improvement for the City shall comply with the Hours and Days of Labor requirements of Labor and Employment Code .
(g) Local Hiring Policy. All Contracts and subcontracts for performance of Public Works or Improvements that exceed the Threshold Amount are subject to the requirements of the San Francisco Local Hiring Policy for Construction as set forth in Chapter 82 of the Administrative Code (“Local Hiring Policy”) and shall include compliance with the Local Hiring Policy as a material term of the Contract, directly enforceable by the City as described therein. As a condition of performance of Project Work, as that term is defined in Administrative Code Section 82.3, each Contractor and subcontractor agrees: to comply with all provisions of the Local Hiring Policy; that provisions of the Local Hiring Policy are reasonable and are achievable by the Contractor or subcontractor, including the reporting requirements and consequences for noncompliance described in Chapter 82 of the Administrative Code; and that the Contractor or subcontractor had a full and fair opportunity to review and understand terms of the Local Hiring Policy, in consultation with counsel if so desired.
(h) Modifications - Requirements. If it becomes necessary in the prosecution of any Public Work or Improvement Contract to make alterations or modifications or to provide for extras, such alterations, modifications or extras shall be made only on written recommendation of the Department Head responsible for the supervision of the Contract, together with the approval of the Mayor or the board or commission, as appropriate to the department, and also the approval of the Controller, except as hereafter provided. The Mayor or the board or commission, as appropriate to the department, may delegate in writing the authority to approve such alterations, modifications or extras to the Department Head, except as provided below. The Controller may delegate in writing the authority to encumber funds from prior appropriations for such alterations, modifications or extras to the Department Head prior to the certification for payment. Such authority, when granted, will clearly state the limitations of the changes to be encompassed.
(1) Increasing or Decreasing Price. Alterations, modifications, or extras in any Contract, which will increase or decrease the Contract cost or scope, may be made or allowed only on the written recommendation of the Department Head responsible for the supervision of the Contract stating the amount and basis for such increase or decrease. For any cumulative increase or decrease in price in excess of 10% of the original Contract price or scope, the Department Head shall obtain the approval of the Mayor or the board or commission as appropriate and also the approval of the Controller notwithstanding any delegation provided for above.
(2) Extensions of Time. Upon finding that work under a construction Contract cannot be completed within the specified time because of an unavoidable delay as defined in the Contract, the Department Head may extend the time for completion of the work. If the cumulative extensions of time exceeds 10% of the original Contract duration, the Department Head shall obtain the approval of the Mayor, board or commission, as appropriate to the department notwithstanding any delegation provided for above. The Department Head may seek such approval after completion of the work if the Department Head makes a written finding in the time extension that no basis exists to assess liquidated damages for delay against the Contractor. All time extensions shall be in writing, but in no event shall any extension be granted subsequent to the issuance of a certificate of final acceptance.
(A) Time Extension Not Waiver of City's Rights. The granting of an extension of time because of unavoidable delays shall in no way operate as a waiver on the part of the City or the Department Head, Mayor, board or commission of the right to collect liquidated damages for other delays or of the right to collect other damages or of any other rights to which the City is entitled.
(B) No Extension Granted When Contract Based on Time Estimates. When any Award of Contract has been made in consideration, in whole or in part, of the relative time estimates of Bidders for the completion of the work, no extension of time may be granted on such Contract beyond the time specified for completion, unless the liquidated damages for each day the work is uncompleted beyond the specified time shall be collected; provided, however, that this shall not apply to unavoidable delays as specified in the Contract.
(C) Avoidable and Unavoidable Delay; Limitation of Damages for Delay. The Department Head administering the Public Work or Improvement shall have the authority to specify in the Contract the delays that shall be deemed avoidable or unavoidable. The City shall not pay damages or compensation of any kind to a Contractor because of delays in the progress of the work, whether such delays be avoidable or unavoidable; provided, however, the City may pay for (1) delays caused to the Contractor by the City and (2) such unavoidable delays as may be specifically stated in the Contract. Such latter delays will be compensated for only under the conditions specified in the Contract.
(D) Notice of Delay Required. The Contractor shall promptly notify the Department Head in writing, of all anticipated delays in the prosecution of the work and, in any event, promptly upon the occurrence of a delay, the notice shall constitute an application for an extension of time only if the notice requests such extension and sets forth the Contractor's estimate of the additional time required together with a full recital of the causes of unavoidable delays relied upon. The Department Head may take steps to prevent the occurrence or continuance of the delay, may classify the delay as avoidable or unavoidable, and may determine to what extent the completion of the work is delayed thereby.
(i) Liquidated Damages. Any Contract may provide a time within which the Contract work, or portions thereof, shall be completed and may provide for the payment of agreed liquidated damages to the City for every calendar or working day thereafter during which such work shall be uncompleted.
(j) Progressive Payments Authorized; Retentions. Any Contract for construction services may provide for progressive or milestone payments, if the Advertisement For Bids shall so specify. Each progress or milestone payment shall constitute full compensation for the value of work performed and materials furnished for a specified period, less amounts withheld as a result of dispute or as required by law.
(1) For all Contracts entered into on or after the effective date of this subsection 6.22(j), from every progress payment, the City shall hold 5% in retention.
(2) Notwithstanding the subsection 6.22(j)(1) above, the City may hold greater than 5% but not more than 10% in retention if the Department Head responsible for the Public Work determines that the Public Work or Improvement is substantially complex and therefore warrants a higher retention amount, and the retention amount is specified in the Advertisement For Bids. For Contracts with retention amounts greater than 5%, if the Department Head responsible for the Public Work determines that the Contract is 50% or more complete, that the Contractor is making satisfactory progress, and that there is no specific cause for greater withholding, the Department Head, upon the written request of Contractor, may authorize one of the following two options: (A) the City shall release part of the retention to the Contractor so that the amount held in retention by the City, after release to the Contractor, is reduced to an amount not less than 5% of the total value of the labor and materials furnished, and the City shall proceed to retain 5% of any subsequent progress payment under the Contract; or (B) the City shall continue to hold the already withheld retention amount, up to 5% of the total Contract price, and shall not deduct further retention from progress payments.
(3) The Department Head shall authorize the release of retention, in whole or in part, for work completed by subcontractors certified by CMD as LBEs. The Department Head shall do so only upon a written request by the Contractor certifying (A) the work by the certified LBE subcontractor is completed and satisfactory in accordance with the plans and specifications for the project; (B) the total amount paid to the certified LBE subcontractor by the Contractor as of the date of the written request and the total amount of the subcontract; and (C) the amount of retention associated with the work performed by the certified LBE subcontractor. Following a release of such retention, and in order to calculate retention and retention withholding from further progress or milestone payments, the City will reduce the total retention required under the foregoing paragraphs (1) and (2) by the amount paid to the certified LBE subcontractor(s) for whom the City released the retention. The release of retention under this subsection 6.22(j)(3) shall not reduce the responsibilities or liabilities of the Contractor or its surety under the Contract or applicable law.
(4) The Department Head shall authorize the release of retention, in whole or in part, for work completed by subcontractors under any Public Work Contract awarded under this Chapter 6 with a duration of more than two years. The Department Head shall do so only upon a written request by the Contractor certifying (A) the work by the subcontractor is completed and satisfactory in accordance with the plans and specifications for the project; (B) the total amount paid to the subcontractor by the Contractor as of the date of the written request and the total amount of the subcontract; and (C) the amount of retention associated with the work performed by the subcontractor. The City may issue or authorize the release of retention within six months of the date of the request. Following a release of such retention, and in order to calculate retention and retention withholding from further progress or milestone payments, the City will reduce the total retention required under the foregoing subsections (1) and (2) by the amount paid to the subcontractor(s) for whom the City released retention. The release of retention under this subsection 6.22(j)(4) shall not reduce the responsibilities or liabilities of the Contractor or its surety under the Contract or applicable law.
(5) Retention shall be withheld solely for the benefit and protection of the City.
(6) When the Department Head responsible for the Public Work determines that the Contract is 98% or more complete, the Department Head may reduce retention funds to an amount equal to 200% of the estimated value of work yet to be completed, plus any amount necessary to cover offsets by the City for liquidated damages, defective work, stop notices, forfeitures, and other charges. The City shall release retention to the Contractor upon the following conditions: (A) the Contractor has reached final completion under the Contract terms and conditions and (B) the Contract is free of offsets by the City for liquidated damages, defective work and the like, and is free of stop notices, forfeitures, and other charges.
(7) For all Contracts awarded under this Chapter 6, in no event shall the City be liable for interest or charges arising out of or relating to the date the City issues any progress, milestone, or other payment, or the date the City releases all or part of the retention, except that the City will pay interest at the legal rate, as set forth in Section 685.010(a) of the California Code of Civil Procedure, as may be amended from time to time, on any improperly withheld amounts commencing no earlier than 90 days after the date the City should have made any progress payment or released all or part of the retention. Under no circumstances shall the legal rate of interest paid by the City under this provision exceed 10% per annum. The payment of interest under this provision is the limit of the City's liability with respect to any claim for interest on improperly withheld amounts.
(k) Inspection and Acceptance of Completed Work; Final Payment. The Department Head shall be responsible for the inspection and acceptance of Public Works or Improvements on completion. Such acceptance shall be in writing and shall include the certificate of the Department Head concerned that the work covered by the Contract has been fully and satisfactorily completed in accordance with the plans and specifications therefor. Receipt of copy of such acceptance in writing shall constitute the Controller's authority to complete any payments due the Contractor under the Contract; provided that the Controller may make such additional investigation or inspection as is provided by Administrative Code Section 10.07.
(l) Termination for Convenience. In all Contracts for the construction of any Public Work or Improvement, the Department Head may include in the specifications setting forth the terms and conditions for the performance of the Contract a provision that the City may terminate the performance of work under the Contract whenever the Department Head shall determine, with the approval of the Mayor or the board or commission concerned, that such termination is in the best interest of the City. Any such termination shall be effected by delivery to the Contractor of a notice of termination specifying the extent to which performance of work under the Contract is terminated and the date upon which such termination becomes effective. The Department Head is hereby authorized to include within such construction Contract the appropriate language to implement this subsection 6.22(l).
(m) Articles Not to be Prison Made. No article furnished under any Contract awarded under the provisions of this Chapter 6 shall have been made in a prison or by convict labor except for articles made in prisons or by convicts under the supervision and control of the California Department of Corrections and limited to articles for use by the City's detention facilities.
(n) Employment of Apprentices. All construction Contracts awarded under this Chapter 6 shall require the Contractor to comply with the requirements of the State Apprenticeship Program (as set forth in the California Labor Code, Division 3, Chapter 4 [commencing at Section 3070] and Section 1777.5), as it may be amended from time to time, and shall require the Contractor to include in its subcontracts the obligation for subcontractors to comply with the requirements of the State Apprenticeship Program.
(o) Safety. All construction Contracts awarded under this Chapter 6 shall require the Contractor and all of its subcontractors to abide by the applicable Occupational Safety and Health statutes and regulations.
(p) Claims. The City shall consider only those claims for additional payment under a Contract that are certified and that conform to the Contract requirements for claims, pricing, and schedule.
(1) Claims by Contractors. The Contractor shall certify under penalty of perjury that (A) the claim is made in good faith; (B) the supporting data are accurate and complete to the best of Contractor's knowledge and belief; and (C) the amount request accurately reflects the Contract adjustment for which the Contractor believes the City is liable. An individual or officer authorized to act on behalf of the Contractor shall execute the certification.
(2) Claims by Subcontractors. Subcontractors at any tier are not third-party beneficiaries of any Contract awarded under this Chapter. The City shall not consider a direct claim by any subcontractor. A Contractor presenting to the City any claim on behalf of a subcontractor must certify the subcontractor's claim in the same manner the Contractor would certify its own claim under the foregoing subsection 6.22(p)(1).
(q) Contractor Prompt Payment. All construction Contracts under this Chapter 6 shall require the Contractor to pay its subcontractors within seven calendar days after receipt of each progress payment from the City, unless otherwise agreed to in writing in advance by both Contractor and subcontractor. In the event that there is a good faith dispute over all or any portion of the amount due on a progress payment from a Contractor to a subcontractor, the Contractor may withhold the disputed amount but shall pay the undisputed amount.
Any Contractor who violates this subsection 6.22(q) shall pay to the subcontractor a penalty of 2% of the amount due per month for every month or portion thereof that payment is not made. This subsection 6.22(q) is enforceable in a court of competent jurisdiction, and is not intended to create a private right of action against the City.
(Added by Ord. 286-99, File No. 991645, App. 11/5/99; amended by Ord. 153-00, File No. 000805, App. 6/30/2000; Ord. 237-00, File No. 001207, App. 10/20/2000; Ord. 7-02, File No. 011675, App. 1/25/2002; Ord. 208-02, File No. 021221, App. 10/18/2002; Ord. 58-05, File No. 041571, App. 4/1/2005; Ord. 107-05, File No. 050215, App. 6/10/2005; Ord. 131-06, File No. 060444, App. 6/22/2006; Ord. 119-08, File No. 080277, App. 7/11/2008; Ord. 19-10, File No. 091163, App. 2/10/2010; Ord. 23-10, File No. 091233, App. 2/11/2010; Ord. 311-10, File No. 101311, App. 12/23/2010; Ord. 79-11, File No. 110330, App. 5/19/2011, Eff. 6/18/2011; Ord. 225-12, File No. 120750, App. 11/1/2012, Eff. 12/1/2012; Ord. 27-13
, File No. 121200, App. 2/19/2013, Eff. 3/21/2013; Res. 80-14, File No. 140091, App. 3/21/2014; Ord. 32-14
, File No. 140090, App. 3/27/2014, Eff. 4/26/2014, Oper. 6/25/2014; Ord. 85-14
, File No. 140151, App. 6/19/2014, Eff. 7/19/2014, Oper. 9/17/2014 (part); Ord. 108-15, File No. 150175, App. 7/2/2015, Eff. 8/1/2015; Ord. 224-15, File No. 150817, App. 12/22/2015, Eff. 1/21/2016, Oper. 4/20/2016; Ord. 84-17, File No. 170004, App. 3/30/2017, Eff. 4/29/2017, Retro. 3/25/2017; Ord. 220-20, File No. 200949, App. 11/6/2020, Eff. 12/7/2020; Ord. 164-23, File No. 230647, App. 7/28/2023, Eff. 8/28/2023; Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)
(a) Public Works Less Than or Equal to the Threshold Amount. Any Public Work or Improvement estimated to cost less than or equal to the Threshold Amount may be performed by the employment of the necessary labor and purchase of the necessary materials and supplies directly by the City.
(b) Bids or Quotes by City Departments. Appropriate City departments may file Bids or submit Quotes for the execution of any work to be performed under a Contract and shall not be required to furnish security or submit information relative to financial qualifications as provided in this Chapter 6. Any Bid submitted by a department of the City, if it is the lowest Bid, must be approved by the Controller before the Award of the Contract. If the Bid of a City department, as investigated and approved by the Controller, is the lowest, the Contract shall be awarded to the department which shall record accurate unit costs of all direct and indirect charges incurred under any such Contract. Such unit costs shall be reported to and audited by the Controller monthly and on completion of the work.
The Controller shall maintain records of Bids filed by departments in relation to the total direct and indirect cost of each such work and shall report thereon periodically to the Mayor. The Controller may refuse to approve Contracts with a department shown to be repeatedly underbidding on Contract work and failing to complete same within the Contract price or time.
(c) Procedure Upon Rejection or Failure of Bids. When Bids have been advertised pursuant to the required procedures and a department receives no Bids, or only one Responsive Bid from a Responsible Bidder, the Department Head shall take the following actions, as appropriate:
(1) No Bids Received. If no Bids are received, the Department Head shall determine (A) whether further outreach efforts would result in Contractors submitting Bids and/or (B) whether removal or modification of certain requirements in the Contract would result in Contractors submitting Bids, provided that such requirements are not required by statute or law and their removal or modification would not compromise the interests of the City. If the Department Head determines that steps (A) and/or (B), above, would likely result in Contractors submitting Bids, then the Department Head shall re-bid the work. If the Department Head determines that neither step (A) nor (B), above, would likely result in Contractors submitting Bids, then the Department Head, with the approval of the Mayor or the board or commission concerned, as appropriate, may negotiate with any qualified Contractor or may order the work to be executed by the City.
(2) One Responsive Bid Received; No Other Bids Received. If only one Responsive Bid is received from a Responsible Bidder, and no other Bids are submitted for the same work, the Department Head may recommend the Award of a Contract to the sole Bidder at the bid price received, provided that the bid price does not exceed the engineer's estimate for the work. If the bid price received exceeds the engineer's estimate, the Department Head shall determine (A) whether further outreach efforts would result in more than one Bid and/or (B) whether removal or modification of certain requirements in the Contract would result in more than one Bid, provided that such requirements are not required by statute or law and their removal or modification would not compromise the interests of the City. If the Department Head determines that steps (A) and/or (B), above, would likely result in more than one Bid at bid prices substantially lower than the bid price received, then the Department Head shall re-bid the work. If the Department Head determines that neither step (A) nor (B), above, would likely result in more than one Bid at bid prices substantially lower than the bid price received, then the Department Head, with the approval of the Mayor or the board or commission for the department concerned, as appropriate, may negotiate with the sole Bidder or any qualified Contractor, or may order the work to be executed by the City. The cost of negotiated work or the cost of work executed by the City shall not exceed any bid price received for the same work.
(3) One Responsive Bid Received; Other Nonresponsive Bids Received. If only one Responsive Bid is received from a Responsible Bidder and other, nonresponsive Bids and/or Bids by nonresponsible Bidders are submitted for the same work, the Department Head may recommend the Award of a Contract to the sole Responsive, Responsible Bidder at the bid price received, provided that the bid price does not exceed the engineer's estimate for the work. If the Responsive bid price received exceeds the engineer's estimate, the Department Head shall determine (A) whether the qualifications for Bidders were too onerous and not necessary for the work and/or (B) whether one or more of the nonresponsive Bids could be easily cured and whether the Bidders that submitted such Bids are still interested in bidding on the work. If the Department Head determines that steps (A) and/or (B), above, would likely result in more than one Responsive Bid by Responsible Bidders, at bid prices substantially lower than the bid price received, then the Department Head shall re-bid the work. If the Department Head determines that neither step (A) nor (B), above, would result in more than one Responsive Bid by Responsible Bidders at bid prices substantially lower than the bid price received, then the Department Head, with the approval of the Mayor or the board or commission concerned, as appropriate, may negotiate with the sole Responsible Bidder or any qualified Contractor, or may order the work to be executed by the City. The cost of negotiated work or the cost of work executed by the City shall not exceed any bid price received for the same work.
(4) All Contracts awarded under this subsection 6.23(c), including negotiated Contracts, shall require that the substitution of subcontractors be in accordance with California Public Contract Code Section 4107.
As set forth in of the Labor and Employment Code, the Labor Standards Enforcement Officer has, without limitation, the authority to administer, develop, and/or enforce the labor standards imposed by the Charter and this Chapter 6.
(Added by Ord. 237-00, File No. 001207, App. 10/20/2000; amended by Ord. 208-02, File No. 021221, App. 10/18/2002; Ord. 8-03, File No. 021856, App. 1/31/2003; Ord. 5-06, File No. 051652, App. 1/20/2006; Ord. 108-15, File No. 150175, App. 7/2/2015, Eff. 8/1/2015; Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)
(a) All work performed on a Major Construction Project, as defined in Environment Code Section 2503, shall be carried out in compliance with the Clean Construction requirements of Environment Code Chapter 25. The Department Head or officer calling for Bids for contracts for work to be performed on a Major Construction Project shall specify in the Advertisement for Bids that Clean Construction is required for the performance of all work unless a waiver of all or part of the requirements of that Chapter has been granted under Sections 2505 or 2507.
(b) Every Contract for work to be performed on a Major Construction Project shall contain provisions, in a form to be approved by the City Attorney: (A) requiring that the Contractor comply with Chapter 25 of the Environment Code, (B) authorizing waivers as set forth in Environment Code Sections 2505 and 2507, and (C) specifying liquidated damages in the amount of $100 per day per each piece of off-road equipment and each off-road engine utilized to complete work on the project in violation of Environment Code Chapter 25.
(a) Each Department Head or Director authorized to enter into Contracts for Public Works or Improvements under Article IV of this Chapter 6 shall document, evaluate, and report the performance of all Contractors awarded construction Contracts under this Chapter 6.
(b) The awarding departments shall work with the Office of the Controller to create and maintain a database to collect the Contractor performance evaluations.
(c) This Section 6.26 shall become operative on March 31, 2017 and shall apply to all Contracts first advertised or initiated on or after this date.
(d) Within one year of the effective date of this Section 6.26, the Department Heads referenced in subsection (a) shall submit to the Board of Supervisors a report that describes the departments' implementation of this contractor performance evaluation program and database. The report shall include each department's outreach with different stakeholders including the Contract Monitoring Division. Concurrent with the report, the Department Heads shall submit to the Board of Supervisors a proposed resolution to accept the report.
(a) Short Title. This Section 6.27 shall be known and may be cited as the Citywide Project Labor Agreement Ordinance.
(b) Findings and Purpose.
(1) Certain public work and improvement projects can involve numerous contractors and employees in different trades, have critical timelines for completion, and require a skilled and properly-trained workforce to successfully complete the work in a proper and timely manner. To avoid costly delays and additional expense to the City, it is essential that construction on such projects proceed without the labor disruptions that can occur on long-term projects, both from external labor relations problems and from the frictions that often arise when a large number of contractors and their employees and subcontractors work in proximity to one another on a job site.
(2) Additionally, in a complex and highly developed urban environment such as San Francisco, many smaller projects can be of substantial importance to City residents, whether through provision of basic services or through the establishment or maintenance of conditions for economic, physical, or emotional well-being, such that it is highly desirable and even essential to avoid the delay in their completion that might result from labor disruptions.
(3) In the private sector, project labor agreements have been used for many years on numerous construction projects to achieve satisfactory performance and the economic benefits that result from having a guaranteed source of skilled workers and from avoiding work disruptions.
(4) In San Francisco, project labor agreements have been and are being used successfully by public entities including the San Francisco Public Utilities Commission, the San Francisco Community College District, the San Francisco Unified School District, the Transbay Joint Powers Authority, and the United States General Services Administration, as well as by many private entities, for construction in both large and small scale projects, including hospitals, reservoirs, water treatment and transmission facilities, schools, offices, and residences, and for the retrofit and remodel of existing buildings and facilities. Such agreements have been a major factor in producing quality construction work and projects completed on time, within budget, without labor strife or disruptions.
(5) Beyond San Francisco, throughout the Bay Area and Northern California, project labor agreements have been used successfully on numerous public and private construction projects, and public entities such as the County of Contra Costa, the Bay Area Rapid Transit District, the Oakland Unified School District, the City of Berkeley, and others, maintain Project Labor Agreement Ordinances and Policies requiring the use of project labor agreements on their publicly funded construction projects. The same is true of the San Francisco International Airport, a City entity located in the County of San Mateo.
(6) The cyclical nature of our economy has led and will lead to high levels of unemployment and underemployment of San Francisco residents, particularly in certain neighborhoods and communities. Statistics also indicate that high levels of unemployment or underemployment correlate to a higher number of families living at or near the poverty line. As a result, it is the policy of the City to increase and improve the employment of persons living in San Francisco in an attempt to counteract the grave economic ills associated with the unemployment and underemployment levels that have existed and will exist within San Francisco.
(7) There is a need to provide San Francisco residents with more opportunities to participate in workforce development and pre-apprenticeship programs that include life skills training and job readiness training. To this end, the City has funded the CityBuild Academy established by the Office of Economic and Workforce Development and has funded and may in the future fund additional programs such as the Mario DeLaTorre Academy. Such pre-apprenticeship programs increase the capacity of San Francisco residents to succeed later in formal apprenticeship programs and hence reduce unemployment and underemployment and accompanying poverty and economic conditions.
(8) The construction crafts that work on City-funded projects require a supply of new apprentices to perpetuate the crafts into the future. Through their apprenticeships, these crafts provide genuine opportunities for long-term, well-paid careers in the construction industry. Entry into and employment through these apprenticeships can be facilitated by formal understandings between the City and the labor organizations affiliated with the San Francisco Building and Construction Trades Council.
(9) In addition, large numbers of returning veterans will be seeking employment on City-funded construction projects and training opportunities for entrance into the construction industry. Such training opportunities are available through a program known as “Helmets to Hardhats,” a program that current City project labor agreements require contractors and subcontractors to use.
(10) In addition, economic exclusion and the City’s housing crisis have led and will continue to lead to significant displacement and out-migration of San Francisco residents, particularly from historically African-American neighborhoods, which have suffered steady and disproportionate population decline since 1970. There is a need to provide economic opportunities to enable such displaced residents to return to San Francisco.
(11) The use of project labor agreements has proven to be a valuable vehicle for accomplishing all of the goals set out above.
“Core Employee” means an employee of a Contractor who has not previously had a relationship with the Unions who demonstrates the following qualifications: (1) possesses any license required by state or federal law for the Project work to be performed; (2) has worked a total of at least 1,000 hours in the construction craft during the prior three years; (3) has been on the Contractor’s active payroll for at least 500 hours during a time period to be determined in the Project Labor Agreement; and (4) has the ability to perform safely the basic functions of the applicable trade.
“Cost” means the amount of money the Department Head estimates the City will spend on construction work. “Cost” does not include money the Department Head projects the City will spend on City employees, project managers, program managers, construction managers, and design teams (including, but not limited to, architects and engineers, or any other consultant employed by a City Department and their respective sub-consultants, and other employees of professional service organizations, unless performing craft work).
“Covered Project” means a project performed under a Contract involving Public Work or Improvement as those terms are defined in Administrative Code Section 6.1, if either: (1) the Contract is funded in whole or in part by a General Obligation Bond or Revenue Bond and the Department Head estimates the Cost of the Contract to exceed the following threshold amounts: $5,000,000 for Covered Projects where the Advertisement for Bid is released in the first year after the City and Unions sign a Project Labor Agreement, $3,000,000 for Covered Projects where the Advertisement for Bid is released in the second year after the City and Unions sign a Project Labor Agreement, and $1,000,000 thereafter, or (2) the project is funded by a source other than a General Obligation Bond or Revenue Bond and the Department Head estimates the Cost of the Covered Project to exceed $10,000,000, or (3) the Department Head has determined that delay in completing the Covered Project may lead to interruption or delay of services or use of facilities that are important to the essential operations or infrastructure of the City. Notwithstanding the foregoing sentence, “Covered Project” does not include any Public Work or Improvement projects undertaken by the San Francisco International Airport, the San Francisco Public Utilities Commission, the Port of San Francisco, or the San Francisco Municipal Transportation Agency. “Covered Project” also does not include any Public Work or Improvement project where application of the citywide PLA would violate the conditions of a state, federal, or other public funding source.
“Project Labor Agreement” or “PLA” means a multi-craft collective bargaining agreement between the City and the San Francisco Building and Construction Trades Council and affiliated labor unions that will refer workers to Covered Projects, and which governs the construction services on the Covered Project.
“Subcontractor” means any person, firm, partnership, owner-operator, limited liability company, corporation, joint venture, proprietorship, trust, association, or other entity providing services to a Contractor or other Subcontractor in fulfillment of the Contractor’s or other Subcontractor’s obligations arising from a contract with the City for construction work on a Covered Project.
“Unions” means the San Francisco Building and Construction Trades Council and its affiliated local unions. These affiliated local unions are listed in a document that is on file in Board of Supervisors File No. 181043 and incorporated by reference as if set forth herein, and the City Administrator and San Francisco Building and Construction Trades Council may update the list by mutual agreement at any time. Nothing in this Section 6.27 is intended to imply that the City has the authority to approve local unions may affiliate with the San Francisco Building and Construction Trades Council.1
(d) Project Labor Agreement Requirement. Not later than September 1, 2019, the City Administrator shall negotiate with the Unions and sign on behalf of the City, a citywide Project Labor Agreement that shall apply to all Covered Projects. In the City Administrator’s discretion, the City Administrator may extend this deadline once for up to three months, to no later than December 1, 2019, by providing written notice to the Unions, the Mayor, and the Board of Supervisors. For all Covered Projects advertised after the City Administrator signs the PLA on behalf of the City, each Department Head shall set as a precondition to the award of the contract that the Contractor and its Subcontractors sign an agreement to be bound by the citywide Project Labor Agreement. The Contractor shall execute the Project Labor Agreement on file with the City Administrator. Nothing in this provision shall impact or otherwise impair the terms of any existing Project Labor Agreement. The City is not bound by the requirements of subsection (e) unless and until the City and all Unions have executed a final Project Labor Agreement.
(e) Required Terms for citywide Project Labor Agreement. The citywide Project Labor Agreement shall include the following terms:
(1) The Project Labor Agreement is binding on all Contractors and Subcontractors at all tiers of a Covered Project, except as provided in subsection (e)(10);
(2) Unions, Contractors, and Subcontrac- tors are bound by the requirements of Administrative Code Chapters 6, 14B, 82 and 83 and Labor and Employment Code , as they may be amended from time to time, including but not limited to the provisions addressing Local Hire and Local Business Enterprise;
(3) Contractors will condition the engagement of each Subcontractor on the Subcontractor agreeing to be bound by and comply with all the terms of the Project Labor Agreement, unless the Subcontractor is a Local Business Enterprise that has not received over $5,000,000 for work on Covered Projects cumulatively over the entire duration of the PLA;
(4) Contractors and Subcontractors to whom construction services are awarded for a Covered Project will use the hiring halls operated by signatory Unions for all labor on the Covered Project except for (A) the services provided by non-craft managerial, executive, and clerical employees, (B) supervisory employees above the level of general foreman; (C) at least two Core Employees per Covered Project, as further determined in Project Labor Agreement negotiations, or (D) LBEs that meet the requirements set forth in subsection (e)(10)
(5) Contractors and Subcontractors will hire apprentices indentured in the State-approved joint apprenticeship program for the applicable craft or trade for work on the Covered Project in accordance with the apprentice ratios contained in California Labor Code Section 1777.5, as it may be amended from time to time;
(6) Unions will use the “Helmets to Hardhats” Program to assist returning veterans in obtaining employment and training opportunities on the project;
(7) Within three years of the City Administrator executing the PLA on behalf of the City, all of the Unions shall enter into agreements, or modify existing agreements, with CityBuild Academy to ensure graduates of CityBuild Academy have a pathway for direct entry into the Union’s apprenticeship program;
(8) a single jurisdictional dispute resolution process for resolving all disputes between Unions, as adopted by the North America’s Building Trades Unions, or any subsequent plan or dispute resolution procedure that the North America’s Building Trades Unions may adopt thereafter;
(9) an agreement by all Unions to refrain from strikes, picketing, and other labor disruptions related to the Covered Project, and that Union members will continue work on a Covered Project despite the expiration of any applicable collective bargaining agreement;
(10) the PLA does not apply to Contractors performing work on Covered Projects that are certified as Local Business Enterprises (LBEs) under Administrative Code Chapter 14B.3, until the LBE has received the value of contracts awarded for work on Covered Projects in an amount exceeding $5,000,000 cumulatively over the entire duration of the PLA;
(11) the PLA’s coverage does not extend to the Contractors’ or Subcontractors’ parent companies, subsidiaries, or affiliates except to the extent those entities are performing work on a Covered Project;
(12) the PLA does not apply to any work performed on or near or leading to or into the Covered Project site by federal, state, local, or other governmental entities or their contractors or subcontractors, or by utilities or their contractors or subcontractors, or by the City or its contractors or subcontractors if that work that is not part of the Covered Project; and
(13) a prohibition against discrimination on any and all bases that City, state or federal law prohibits.
(f) Annual Reporting. Beginning on the effective date of the ordinance in Board File No. 181043 enacting this Section 6.27, the Office of the Controller shall, in collaboration with the Contract Monitoring Division, collect utilization rates for LBEs on current Contracts covered by this Section 6.27. Within one year after the City Administrator executes the PLA on behalf of the City, and annually thereafter, the Controller shall conduct annual reviews of the PLA to evaluate whether the PLA has promoted the efficient, economical, and timely completion of Covered Projects, the costs of Covered Projects, and the PLA’s impact on LBEs and the local workforce.
(g) No later than July 31, 2023, the Controller shall submit to the Clerk of the Board and all members of the Board of Supervisors a request for a public hearing regarding the annual reports described in subsection (f).
(h) The Project Labor Agreement shall automatically expire 20 years from the date it is initially signed by the City and the Unions, at which point the City and Unions shall no longer be bound by the citywide Project Labor Agreement, except on Covered Projects for which contracts are awarded before expiration of the Project Labor Agreement.
(i) Severability. If any subsection, sentence, clause, phrase, or word of this Section 6.27, or any application thereof to any person or circumstance, is held to be invalid or unconstitutional by a decision of a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions or applications of the Section. The Board of Supervisors hereby declares that it would have passed this Section and each and every subsection, sentence, clause, phrase, and word not declared invalid or unconstitutional without regard to whether any other portion of this Section or application thereof would be subsequently declared invalid or unconstitutional.
(j) No Conflict with Federal or State Law. Nothing in this Section 6.27 shall be interpreted or applied so as to create any requirement, power, or duty in conflict with any federal or state law.
(Added by Ord. 1-19, File No. 181043, App. 1/18/2019, Eff. 2/18/2019)
CODIFICATION NOTE
1. So in Ord. 1-19.
Competitive Procurement of Professional Services for Public Work Projects. | |
Requests for Competitive Proposals or Qualifications. | |
Professional Services Contract Terms. | |
As-needed Professional Services Contracts. |
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