Purchasing & Tendering Policy No. 12.124 District of Lake Country 10150 Bottom Wood Lake Road Lake Country, BC V4V 2M1 t: 250 766 5650 f: 250 766 0116 lakecountry.bc.ca Date The following was adopted as Policy by Resolution No. 12.01.17 at the Regular Council Meeting held on January 17, 2012. Purpose The Policy establishes and governs the principles and limits of District purchasing. Policy PREAMBLE: The District of Lake Country will seek to obtain goods or services from reliable suppliers, recognizing that although price is important, other elements of value, including quality, ability to deliver at required times, lowest life cycle cost, service and customer relations, constitute total cost to the District. In general, it is the policy of the District to buy in the open market and to seek the best value for its money. Maximizing the District s purchasing ability depends on different factors, such as ensuring good quality; taking advantage of economies of scale; defining fair project/project specifications, maximizing return on the disposal of District assets; and ensuring consistency in the application of this policy throughout the District. It is the District s intent to maintain good working relationships with the suppliers of goods and services and that it will avoid payment of service charges and interest by prompt payment of accounts when due. DEFINITIONS: Best Value Means lowest total cost to the District and includes, but is not limited to: Quality of workmanship and product; Timely delivery; Dependable service; Standardization; Ease of operation and/or administration; Low maintenance;
Purchasing & Tendering Policy No. 12.124 Page 2 Parts availability; Safety standards; Resale value; Suitability for intended use; Adherence to conditions of purchase; Adherence to specifications; Adherence to legal requirements; Lowest life cycle cost; Price. Invitational Tender Means tenders in which only certain vendors are requested by direct invitation to bid on a given contract. Newspaper advertising and electronic tendering is not used. Professional Consulting Services Means services to be provided by a person or persons who are licensed and regulated by the Province of British Columbia, Alberta and Saskatchewan in their professional capacity, and which services are provided pursuant to those regulations. Such services include, but are not necessarily limited to, engineering, surveyors, accountants, planning, landscape architecture or legal services. Procurement Means the acquisition by any means, including by purchase, rental, lease or conditional sale of goods, services or construction, but does not include: (a) any form of government assistance such as grants, loans, equity infusion, guarantees or fiscal incentives; (b) government provision of goods and services to persons or other government organizations; or (c) land purchases; Procurement value Means the estimated total financial commitment resulting from procurement, considering the entire term of the contract if the procurement is for a service. Optional renewals are not considered. Public Tender Means tenders that are open for bidding by the general public. Any qualified bidder may submit a bid. Quotation Means a verbal or written bid to provide goods and/or services. It is most applicable where the goods and/or services are standard amongst vendors; consequently, there is no need for in depth proposals or tenders outlining detailed specifications and vendor qualifications. It is also applicable in cases where the procurement value is low relative to the administrative cost of a formal tendering process. Request for Proposal (RFP) Means a document seeking the creative input of the market place. It generally details the what, the when and the why, but not the how. It seeks the best value through competition and innovation. It describes in detail the project to be undertaken, the intended result of the project and the criteria for choosing the successful contractor or consultant. Cost is usually not the primary factor. There are generally multiple ways of completing a project and the District does not require a particular solution. Due to the confidential nature of some of these proposals, details are not revealed in public. Policy.docx 2
Purchasing & Tendering Policy No. 12.124 Page 3 SECTION 1 PROCUREMENT PRINCIPLES 1.1 Purchasing Responsibilities a) The District has a decentralized purchasing practice, and consequently, each department is responsible for obtaining prices, quotations and/or bids for contractors, consultants and materials on projects under their direction. In addition, each department is responsible for ensuring the appropriate advertisements. b) All departments must ensure that budget funds are available within their approved budget. Departments must be consistent in following the guidelines set out in this Purchasing and Tendering Policy. 1.2 Budget Authority a) Through budget discussions and the culmination of the final budget, Council sets operating service levels and capital project priorities, together with the necessary funding. To enable departments to operate efficiently and effectively in the performance of those service levels set by Council, Department Directors have the authority to reallocate funds within their Operating Budget for which they are responsible. Along with this flexibility comes the responsibility to manage and ensure that the gross and net expenditures remain within the budget for which Department Directors are responsible. b) Council delegates to staff the authority to commit or expend funds within the budget, subject to the limitation authorized in Appendix A. c) With such delegated authority, it carries with it the responsibility to ensure that: i. the works, goods supplied or services rendered have met the standard contracted. ii. Contracts will be let through a tender process, where appropriate; iii. the price charged is that contracted for; iv. all terms and conditions of the contract are fulfilled; v. funds are available in the particular budget; and vi. the commitment or expenditure is a real charge against the activity to which it is coded. 1.3 Procurement Guidelines a) The following procurement guidelines are to be followed for the purchase of goods, services or construction projects. Professional consulting services are exempt from these guidelines and shall follow the guidelines illustrated under section 1.4. b) Where the guidelines require a tendering process, tendering may only be waived if approved by Council resolution. Policy.docx 3
Purchasing & Tendering Policy No. 12.124 Page 4 Project Type Estimated Value of Procurement (excl. taxes) Minimum Procurement Process Construction Projects $200,000 or greater Public Tender or RFP Construction Projects $100,000 to $200,000 Invitational Tender or RFP Construction Projects $25,000 to $100,000 3 written quotations or proposals Construction Projects Under $25,000 3 verbal quotations Goods or Services $75,000 or greater Public Tender or RFP Goods or Services $25,000 to $75,000 3 written quotations or proposals Goods or Services $15,000 to $25,000 3 verbal quotations Goods or Services Less than $15,000 obtain best value 1.4 Professional Consulting Services a) For professional consulting services less than $75,000, a single source selection process may be conducted. The Department Director is authorized to approve the selection, in consultation with the Chief Administrative Officer, but must seek Best Value. b) For consulting services greater than or equal to $75,000, a tender or RFP will be issued for the project in a competitive process. The District may elect to undertake a pre qualification process to short list qualified firms. c) From time to time, the District may single source assignments greater than or equal to $75,000 in value under the following criteria. Council approval is required prior to the award of the contract. i. The firm has done all the pre design and possibly design work as part of previous assignments; ii. The firm is conducting work for a developer immediately adjacent to or involving part of the District project work; iii. There is extreme urgency in completion of the work; iv. A non competitive situation exists; or v. Known workload volume; SECTION 2 TENDERS/REQUESTS FOR PROPOSAL 2.1 Tender or Request for Proposal Approval a) The Chief Administrative Officer is delegated the authority to award any tender or RFP, subject to the following: i. The construction project, good or service, or professional consulting service is identified within the approved budget and the bid is on or under budget; and ii. The construction project, good or service, or professional consulting service is awarded to the lowest bidder; In all other cases, the award shall be authorized by Council. 2.2 Tender or Request for Proposal Opening a) A minimum number of two District representatives must be in attendance at a tender opening, one of which shall be an officer of the District, or their deputy. Policy.docx 4
Purchasing & Tendering Policy No. 12.124 Page 5 2.3 Tender Evaluation a) The tender documents shall clearly identify the requirements of the procurement, the criteria that will be used in the evaluation of bids and the methods of weighting and evaluating the criteria. 2.4 Request for Proposal Evaluation a) A Request for Proposal shall clearly identify the requirements of the procurement, the criteria that will be used in the evaluation of the proposals and the methods of weighting and evaluating the criteria. Cost is not the primary factor. b) Due to the confidential nature of some of these proposals details are not revealed in public. 2.5 Contract Award Tender or RFP a) Council meeting dates should be considered when setting tender or proposal award deadlines in the event that Council approval is required. 2.6 Contract Award Non Competitive Situations a) Notwithstanding the above procurement guidelines, the District will not procure by seeking tenders, quotations, or proposals in order to meet its requirements for goods and/or services where a noncompetitive situation exists. In such cases, the Department Director, in consultation with the Chief Administrative Officer, may award the contract, subject to the limitation of b). Non competitive situations exist when: i. True competition does not exist (e.g.: sole source items); ii. Prices or sources of supply are determined by District authorities or other regulatory bodies; iii. District objectives (standardization), operational requirements or administrative costs preclude competitive alternatives; iv. Where an unforeseeable situation of urgency exists and the goods, services or construction cannot be obtained in time by means of open procurement procedures; v. For the procurement of real property; vi. No tender or only one tender is received; vii. In cases of pressing emergency injurious to public interest. b) Where the above procurement guidelines require a tender or RFP, but a non competitive situation exists, the contract award must be authorized by Council. SECTION 3 QUOTATION 3.1 Quotation Approval a) Staff may proceed with authorizing expenditures based on quotations received providing the following criteria have been met: i. The funds for the quoted expenditures in question have been approved as part of the annual budget or capital plan. ii. The quotation is within the amount budgeted for the work in question. SECTION 4 VENDORS 4.1 Vendor Selection a) Suppliers and contractors will be selected to ensure a high degree of flexibility, a good level of competition and a constant awareness of product development and technical improvements. They Policy.docx 5
Purchasing & Tendering Policy No. 12.124 Page 6 must possess high ethical standards, quality service, a valid District of Lake Country business licence or Mobile Business Licence, if conducting business in Lake Country, and a good record of adhering to specifications and maintaining deliveries. 4.2 Sourcing Priorities a) Lake Country based suppliers and contractors should be used to the greatest extent possible with the governing constraints of availability, legislation, quality of material or service, experience and convenience of servicing and competitive pricing; SECTION 5 EMERGENCY EXPENDITURES 5.1 Public Emergency a) Notwithstanding any of the foregoing, in the event of a public emergency, the Chief Administrative Officer has the authority to expend whatever funds reasonably necessary to deal with the situation. Prior to expending or committing such funds, the Chief Administrative Officer shall use his best efforts to contact the Mayor or the Deputy Mayor and advise them of the nature of the emergency and the amount of funds to be committed or expended. b) In the event of an operations emergency where public safety is jeopardized or services disrupted, the Department Head or Supervisor may purchase whatever is required to rectify the situation. SECTION 6 DISPOSAL OF GOODS & EQUIPMENT 6.1 Reasons for Disposal a) Certain District goods and equipment may be disposed of if they are: i. obsolete; ii. worn out; iii. too costly to maintain; or iv. no longer used. 6.2 Disposal Methods a) Disposal of surplus or obsolete items will be accomplished by way of trade in, return to supplier for credit, advertised sale or tender, public auction, or by write off and disposal of as scrap. 6.3 Approval to Dispose a) The write off and disposal of surplus or obsolete items must be approved by the Chief Financial Officer, or designate. 6.4 Transfer of Surplus/Obsolete Equipment to Non Profit Groups a) Council may, by resolution, provide for the transfer of certain surplus or obsolete items to community groups or other organizations within the District, as they see fit. SECTION 7 OPERATIONAL GUIDELINES 7.1 Operational Guidelines Approval a) The Chief Administrative Office and/or Chief Financial Officer will approve operational guidelines to execute Council s purchasing policy. original signed by James Baker Mayor original signed by Hazel Christy Corporate Officer Policy.docx 6
Purchasing & Tendering Policy No. 12.124 Page 7 District of Lake Country Appendix A Procurement Authority Limits Chief Administrative Officer & Deputy CAO Chief Financial Officer Final Budget as approved by Council Final Budget as approved by Council Department Directors $100,000 Department Managers $50,000 Other positions and limits shall be set by operational guidelines and procedures as approved by the Chief Administrative Officer and/or Chief Financial Officer. Policy.docx 7