Loading...
HomeMy WebLinkAbout11/25/2013 B A K E R S F I E L D /s/ Steven Teglia Committee Members: Staff: Steven Teglia Willie Rivera, Chair Assistant to the City Manager Ken Weir Terry Maxwell AGENDA SUMMARY REPORT REGULAR MEETING OF THE BUDGET AND FINANCE COMMITTEE Friday, November 25, 2013 12:00 p.m. City Hall North – Conference Room A 1600 Truxtun Avenue Bakersfield, CA 93301 The meeting was called to order at 12:04 p.m. 1. ROLL CALL Committee members: Councilmember Willie Rivera, Chair Vice Mayor Ken Weir Councilmember Terry Maxwell City Staff: Alan Tandy, City Manager Rhonda Smiley, Assistant to the City Manager Steven Teglia, Assistant to the City Manager Chris Huot, Assistant to the City Manager Caleb Blaschke, Management Assistant-City Manager’s Office Virginia Gennaro, City Attorney Josh Rudnick, Deputy City Attorney Nelson Smith, Finance Director Raul Rojas, Public Works Director Nick Fidler, Assistant Public Works Director Kim Berrigan, Purchasing Officer Others present: Members of the Media AGENDA SUMMARY REPORT Budget and Finance Committee Meeting Monday, November 25, 2013 Page 2 ADOPT AUGUST 30, 2012 AGENDA SUMMARY REPORT Adopted as submitted. 2. PUBLIC STATEMENTS None 3. DEFERRED BUSINESS A. Discussion regarding Local Vendor Preference Ordinance Assistant to the City Manager Teglia stated that the item was referred to the Budget and Finance Committee by Councilmember Johnson. Finance Director Smith produced a report that had been included in the packet for the Committee meeting. As background, he said that in September of this year, 11 bids were received on an item to purchase pickup trucks. A local vendor was the third lowest bidder, and the current policy applies when the local vendor is the second lowest bidder. City Manager Tandy said that it is Councilmember Johnson’s belief that if the monetary difference does not change between the second and third lowest bids, that the local vendor should be afforded the preference. City Attorney Gennaro indicated that there had originally been some legal concerns about possible collusion with bidders. To address those concerns, three requirements were included in the policy: 1) The second lowest bid amount should fall within 3% of the lowest bid; 2) The monetary preference amount should not exceed $9,000; and 3) The local vendor should be the second lowest bidder. These conditions were intended to ensure that the integrity of process would be maintained. It was the opinion of some that if the local vendor was always given preference, it would discourage competitive bidding. Committee member Weir was a member of the Budget and Finance Committee when the policy was discussed and recommended to the City Council. While the goal is to contract with local vendors, the members did not want to discourage out- of-town vendors from bidding. He also said that the policy only applies to goods. Committee member Maxwell stated his agreement with the current policy, and his preference to leave it unchanged. He made a motion for no action. Committee Chair Rivera asked how close the third bid on the specific item being discussed was to the 3% threshold. AGENDA SUMMARY REPORT Budget and Finance Committee Meeting Monday, November 25, 2013 Page 3 Finance Director Smith said that if the local vendor had been the second lowest bidder, the bid would have been awarded to them, as the bid amount was within 3% of the lowest bid amount. Committee Chair Rivera asked for additional clarification. Finance Director Smith responded that out of the 11 bids received, the lowest and second lowest bidders were from out-of-town. The third lowest bidder was local; and if this local vendor had submitted the second lowest bid, the bid amount was within 3% of the lowest bid, so they would have been awarded the contract. The policy states that the 3% preference applies when the local bidder is in the second position. City Attorney Gennaro said that the local vendor had met the first and second conditions of the policy; but they did not meet the third requirement, which was to be the second lowest bidder. Committee Chair Rivera said that he was unsure about the concept that including a vendor outside of the second position decreases competition. Committee member Weir responded that if out-of-town bidders are continually excluded in favor of local vendors, the out-of-town vendors will eventually stop bidding. Committee Chair Rivera said that there could be an economic benefit by utilizing local vendors only, and believes there may be a method to achieve that. Committee member Weir responded that the Committee had previously discussed that issue; and in doing so, recommended a change from a 1% difference to the current 3%. Committee Chair Rivera asked about the number of local vendors who submitted a bid on the trucks, and if that was an average response. Finance Director Smith responded that out of the 11 bids received, 2 were from local vendors. The amount of bids received for the trucks was unusual, as typically there are only 2 or 3. Committee member Maxwell stated that at a subsequent Council meeting, this same local vendor was awarded a contract for vehicles. It is a demonstration that the policy does work. The rules are known up front. As a private business owner, the policy is very reasonable. Committee member Weir noted that other local vendors chose not to bid on the product. City Manager Tandy said that some vendors deem the paperwork to be cumbersome, and the low profit margin, not worthy of their effort. AGENDA SUMMARY REPORT Budget and Finance Committee Meeting Monday, November 25, 2013 Page 4 Public Works Director Rojas said that the local Dodge dealer has been approached on many occasions, and they always elect not to submit a bid on vehicles. Committee Chair Rivera said that he would not want a vendor landing as the third or fourth lowest bidder to be disqualified by a minimal bid difference. However, since it was the will of the majority of the Committee to maintain the policy in its current form, he would entertain a motion for no action. Committee member Maxwell made the motion, and it was unanimously approved. 4. COMMITTEE COMMENTS None 5. ADJOURNMENT The meeting adjourned at 12:26 p.m.