Ord 589 ORDINANCE NO. 589
AN ORDINANCE OF THE CITY OF POWAY, CALIFORNIA ADDING CHAPTER
15,30 TO THE POWAY MUNICIPAL CODE CONCERNING
PREQUALIFICATION AND DEBARMENT OF CONTRACTORS AND BIDDERS
WHEREAS, Public Contract Code section 20101 authorizes the City of Poway to
require prospective bidders for a public contract to complete and submit a standardized
questionnaire and financial statement, including a complete statement of the bidder's
experience in performing public works, and establish a process to prequalify bidders for
eligibility to bid on a public contract; and
WHEREAS, a standardized questionnaire and statement has been prepared and
adopted by the California State Department of Industrial Relations; and
WHEREAS, the Director of Development Services has heretofore informally
utilized a prequalificetion process, including an appeal process, which complies with
section 20101, and the City Council now wishes to codify such a process to assure
uniformity in its application; and
WHEREAS, California Constitution Article XI, section 7, and Article XI, section 9
authorizes the City to adopt police, sanitary and all other laws necessary for the general
welfare not in conflict with State law, and to establish and operate public works deemed
necessary for the public welfare; and
WHEREAS, the City Council finds that protection of the public welfare requires
that, in addition to a prequalification process, a process be adopted to debar contractors
from performing work on public contracts as the result of a record of specified kinds of
unsatisfactory performance or lack of business integrity.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF POWAY DOES
ORDAIN AS FOLLOWS:
Section 1: Chapter 15.30 of the Poway Municipal Code be added to read as
follows:
Chapter 15.30 CONTRACTORS AND BIDDERS
Sections:
15.30.010 Prequalification
15.30.020 Debarment
15.30.010 Prequalification.
A. The Contract Administrator, with the approval of the Director of
Development Services, may establish in the contracting procedure for a contract or
contracts requiring competitive bidding a process for prequalification of potential bidders
or subcontractors, or both bidders and subcontractors. The prequalification process
may be established for a single project or for multiple projects, which are to be subject
Ordinance No. 589
Page 2
to bid within a one year period after prequalification. The prequalification process may
be established and implemented as part of the process of another city or other public
agency, provided that notice is given in connection therewith that the process will also
establish the prequalification rating for the City of Poway and for the Poway
Redevelopment Agency. The prequalification process established shall comply with the
requirements of Public Contract Code section 20101 as implemented by the
requirements of this Section. To the extent that the Department of Industrial Relations
has developed model guidelines for rating bidders, standardized questionnaires,
financial statements, and other prequalification documents, such model documents, as
modified to apply to the contract or contracts, may be used by the Contract
Administrator. As used in this Section, the terms "applicant" and "applicants" include
prospective bidders and subcontractors for contracts to be performed for the City or
Redevelopment Agency. For the purposes of this Section, the term "Contract
Administrato¢' means the Director of the Department with primary responsibility for the
project, or a contract implementing the project, and the Contract Administrator of the
other city or public agency responsible for the prequalification process.
B. The prequalification process shall include a notice inviting the submission of
prequalification information, or a notice inviting technical proposals, or both.
C. The notice inviting prequalification information shall invite each applicant to
submit information, financial statements, and responses to a standardized questionnaire
under oath that will permit the Contract Administrator to determine pursuant to the
established guidelines for rating bidders, that a prospective bidder is responsible to
perform a proposed contract or that a prospective subcontractor is responsible to perform
specified kinds of work. Bidding shall be restricted to bidders determined by the Contract
Administrator's application of the rating guidelines to be responsible.
D. If the prequalification process includes a technical proposal, the notice
inviting technical proposals shall invite each applicant to submit a technical proposal,
the responsiveness of which to the specifications shall be determined by the Contract
Administrator in advance of receipt of bids. Bidding shall be restricted to bidders
determined by the Contract Administrator to have furnished a technical proposal that is
responsive to the specifications. A notice inviting technical proposals shall not be
included in the contract documents unless the Contract Administrator determines all of
the following:
1. There are not sufficiently definite or complete specifications or purchase
descriptions available to permit free competition without engineering
evaluation and discussion of the technical aspects of the procurement;
2. Criteria does exist for evaluating technical proposals, such as design,
manufacturing, testing, and performance requirements; and special
requirements for operational suitability and ease of maintenance; and
It is expected that more than one technically qualified source will be
available, both initially and after technical evaluation.
Ordinance No. 589
Page 3
E. Based upon the notice inviting prequalification information or notice inviting
technical proposals, the Contract Administrator shall determine the responsibility of
applicants in advance of receipt of bids, and that bidding shall be restricted to bidders
determined by the Contract Administrator to be responsible, or that the performance of
subcontracts shall be restricted to subcontractors determined by the Contract
Administrator to be responsible. In determining responsibility, the Contract Administrator
may consider those factors set forth in the prequalification documents developed by the
Department of Industrial Relations and, to the extent permitted by law, the following:
1. An applicant's experience in the design, construction, fabrication, assembly, or
manufacture of works or materials similar to what will be called for under the
contract documents;
2. The experience of others with the applicant in the construction, fabrication,
assembly, or operation of similar works or materials designed, constructed,
fabricated, or assembled by the applicant;
3. The physical plant, facilities, and equipment the applicant proposes to employ in
the performance of a proposed contract or subcontract;
4. The experience and expertise of an applicant's responsibility in managing
personnel, key staff members, and other employees who would be assigned to
the work if the applicant were awarded the contract or subcontract;
5. As to prospective bidders, the extent to which any pad of the contract is to be
performed by subcontractors or suppliers;
6. The financial capability, to procure appropriate insurance and bonding, and
resources of the applicant to perform the proposed contract or subcontract;
7. Any other factor bearing on the responsibility of an applicant that is specified in
the notice inviting prequalification information.
F. As a condition to submitting a bid or performing a specified portion of the
proposed contract, an applicant shall comply with any and all conditions precedent
determined by the Contract Administrator to be necessary to enable the applicant to
submit a bid.
G. The Contract Administrator may determine that an applicant is responsible
to perform more than one contract for which notices inviting bids are to be posted and
advertised after the date of the Contract Administrator's determination. In the event of
such prior determination, the Contract Administrator may, at any time thereafter, determine
that an applicant is no longer responsible, or advertise and pest additional notices inviting
prequalification information, and determine that additional applicants are responsible to
perform contracts subsequent to the contract for which prequalification information is
initially requested.
Ordinance No. 589
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H. In the event any applicant is determined by the Contract Administrator not to
be responsible, or no longer responsible after previously having been determined to be
responsible, or a prospective bidder's proposal is determined by the Contract
Administrator not to be technically responsive to the contract documents, or the Contract
Administrator determines that a bidder or an applicant has failed to comply with a condition
precedent, the Contract Administrator shall state the determination and the basis thereof in
writing. Upon request of the prospective bidder, the Contract Administrator shall deliver a
copy of such determination, the basis thereof, and any supporting evidence to the
prospective bidder. The bidder or applicant may request review of the Contract
Administrator's decision, by filing with the City Manager a written request for review not
later than 5:00 p.m. of the fifth business day following delivery of the decision. At a
minimum the review shall comply with the requirements of Public Contract Code section
20101(d). A Hearing Committee shall conduct a hearing and shall make a decision
whether to approve or reverse the determination of the Contract Administrator. The review
procedure shall provide the bidder or applicant not less than five business days notice of
the time and date of the hearing; provide the bidder or applicant the opportunity to present
oral and/or documentary evidence rebutting the determination and reasons of the Contract
Administrator; and permit the bidder or applicant to be represented by an attorney or other
designated representative. The hearing shall not be conducted according to the technical
rules relating to evidence and witnesses applicable to judicial proceedings. Any relevant
evidence, including hearsay, may be received if it is the sort of evidence on which
reasonable persons are accustomed to rely, in the conduct of serious affairs. The
submission of documentary evidence shall be encouraged. The Hearing Committee shall
have the power to limit oral testimony. The determination of the Hearing Committee shall
be made in writing, shall include findings of fact which support the determination, and shall
be served personally upon the bidder or applicant, or by registered or certified mail. The
Hearing Committee's determination shall be final.
In the alternative to the above, if the Contract Administrator is administering the
prequalification process on behalf of another city or public agency who is the principal or
lead agency for the process, the Contract Administrator shall comply with the requirements
of that agency and the bidder's or applicant's remedies shall be those made available by
that agency.
I. Records of the names of prequalification applicants are public records
subject to disclosure under the Public Records Act. All other prequalification records
submitted by an applicant shall not be open to public inspection in accordance with
Public Contract Code section 20101(a).
15.30.020 Debarment.
A. Debarment is an administrative sanction to be imposed only in the public
interest or for the City's or Redevelopment Agency's protection, and not for purposes of
punishment. Debarment is designed to protect the agency by ensuring full and open
competition by granting awards only to responsible contractors. This section establishes
debarment and the procedure for imposition of debarment.
Ordinance No. 589
Page 5
B. Unless from the context a different interpretation is plainly indicated, the
definitions contained in this subsection govern the interpretation of this Section. The
definitions shall apply regardless of whether the term is capitalized.
1. "Affiliate" means business entities, organizations, or individuals that either
directly or indirectly, control one another or have the power to control one
another, or are controlled by a third party, or are subject to control by a third
party.
2. "Affiliates" include chief executive officers and members of boards of directors
or their equivalents.
3. "Bidder" means any individual, organization, legal entity, company or affiliate
submitting a bid or proposal in response to a solicitation or other request by the
agency for bids or proposals.
4. "Claim" includes any request or demand for money or damages submitted or
made, pursuant to a contract, statute, or law, to the agency, or an officer,
employee or agent of the agency.
5. "Contractor" means any individual or other legal entity that either (i) directly or
indirectly, for example, through an affiliate, submits offers for, or is awarded, or
reasonably may be expected to submit offers for, or be awarded, an agency
contract for works, supplies or services; or (ii) conducts business or reasonably
may be expected to conduct business with the authority as an agent or
representative of another contractor. Contractor includes bidder.
6. "Debarment" means action taken by the City Council to exclude a contractor
from contracting with the agency for a reasonable, specified period.
7. "Person" includes a natural person, corporation, firm association, organization,
partnership, limited liability partnership, limited liability company, business, trust
or affiliate.
C. In addition to all other remedies permitted by law, upon a finding of
grounds as set forth in this section, the City Council may declare by resolution that a
contractor is ineligible to bid on, submit a proposal for, or be awarded a service,
procurement, public works, or other contract with the City or Redevelopment Agency for
a period not to exceed three years for any of the following reasons:
1. Two or more claims of computational or other error in bid submission within a
two-year period;
2. Unjustified failure or refusal to timely provide or properly execute contract
documents;
3. Unsatisfactory performance of contract;
Ordinance No. 589
Page 6
4. Two or more occasions within a two-year period of failure to submit bond or
insurance documents acceptable to the agency in the time periods required;
5. Unjustified refusal to properly perform or complete contract work or warranty
performance;
6. Unjustified failure to honor or observe contractual obligations or legal
requirements pertaining to the contract;
7. Conviction under a state or federal statute or municipal ordinance for fraud,
bribery, theft, falsification or destruction of records, receiving stolen property,
or of any other similar crime;
8. Any offense or action which indicates a lack of business integrity and which
could directly affect the reliability and credibility of performance of the
contractor on future contracts with the City or Redevelopment Agency;
9. Submission of a false or fraudulent claim;
lQ Any debarment of the contractor by another governmental agency on
grounds justifying debarment under this section, during the period of such
debarment;
D. The City Council may permanently debar any contractor that has been
permanently debarred by another governmental agency.
E. The administrative procedure for debarment is as follows:
1. Proceedings may be commenced upon the issuance by the City Manager of a
Notice of Intent to Debar stating the grounds and factual basis for proposed
debarment.
2. The Notice of Intent to Debar shall be given in the manner specified by State
law for the service of process. The Contractor shall have ten days following
service of the notice to file with the City Manager a written request for an
administrative hearing on the proposed debarment. If no such request is timely
filed, the Notice of Intent to Debar shall be deemed a final order for debarment.
Such final order shall not be subject to appeal. The final order of debarment
shall be submitted by the City Manager to the City Council in the form of a
resolution for adoption without a hearing.
3. Upon receipt of a timely request for an administrative hearing, the City Manager
shall set the time and date for the administrative hearing by the Hearing
Committee. The Contractor shall be given not less than 30 days written notice
of the time and date set for the hearing. Such notice may be given in the
manner specified by state law for the service of process.
Ordinance No. 589
Page 7
4, In proceedings under this section, an individual contractor may appear in
person, or be represented by an agent with written authorization, a contractor
that is not an individual person may be represented by an authorized officer,
employee, member, or agent. The City Manager may also designate a
representative. In addition, any party may be represented by a member in good
standing with the State Bar of California.
5. No later than 5:00 p.m., six days prior to the date set for hearing, the Contractor
and the City Manager shall file with the City Clerk a list of all witnesses to be
presented by such party and three copies of each written or graphic item such
party intends to offer into evidence during the hearing, and shall exchange one
copy of such list and written or graphic items. The written recommendation of
the City Manager described in paragraph (1) above, shall be admitted into
evidence and copies of the recommendation need not be filed or exchanged as
provided in this paragraph. Any contract, document incorporated by reference
into a contract, notice inviting bids, request for proposals, bid, or response to
request for proposals, referenced in the written recommendation of the City
Manager shall be admitted into evidence and copies of such documents need
not be filed or exchanged as provided in this paragraph. Only the Contractor,
the City Manager, the designated representative of the Contractor or of the City
Manager, or a person whose name appears on a witness list filed with the City
Clerk shall be permitted to present oral evidence. Only those documents and
graphic items filed with the City Clerk, or otherwise required by this paragraph to
be admitted, shall be considered for admission into evidence.
6. Oral evidence shall be taken only under oath or affirmation. The hearing shall
not be conducted according to technical rules relating to evidence and
witnesses applicable to judicial proceedings. Subject to the limitation of
paragraph (5), above, any relevant evidence, including hearsay, shall be
admitted if it is the sort of evidence on which responsible persons are
accustomed to rely in the conduct of serious affairs; provided, however, that a
determination of debarment shall not be based solely on hearsay evidence.
The presiding Hearing Committee may set reasonable limitations on the time for
presentation of evidence.
7. Continuances or extensions of time may be granted by the Hearing Committee
for good cause or upon agreement of the Contractor and the City Manager.
8. The order of the hearing shall be as set forth in this paragraph unless the
Contractor and City Manager agree to some other order, with the consent of the
Hearing Committee. First, the City Manager and Contractor shall each have an
opportunity to make a brief opening statement. Second, the City Manager shall
present the grounds and evidence for debarment. Third, the Contractor may
present evidence in explanation or rebuttal. Fourth, the City Manager may
present evidence in rebuttal. Fifth, the Contractor may present evidence in
rebuttal. Sixth, the Contractor may make a closing argument. Seventh, the City
Manager may make a closing argument. During the presentation of evidence
Ordinance No. 589
Page 8
each party may cross-examine the witnesses for the other party, subject to
reasonable limitation imposed by the presiding Hearing Committee, including a
limitation to cross-examination conducted through the presiding Hearing
Committee. The Hearing Committee may also ask questions of any witness
during the presentation of evidence. Arguments of representatives of the
Contractor or the City Manager shall not be considered.
9. The Hearing Committee shall announce its final decision in writing, and shall
direct the City Manager to prepare a resolution containing the decision and
findings of the Hearing Committee for the City Council to adopt as its decision.
The Hearing Committee shall approve the proposed resolution prior to its
submittal to the City Council. The Hearing Committee may direct the
preparation of a proposed decision and proposed findings prior to announcing
its final decision. The City Council shall adopt the resolution without a hearing if
there is no appeal of the decision.
10. The Contractor or the City Manager may appeal an adverse decision to the City
Council by filing a written appeal stating with particularity the exceptions to the
decision, or the findings of the Hearing Committee. The written appeal shall be
filed with the City Clerk within ten days following the final decision of the
Hearing Committee. Within ten days following the submission of the written
appeal, the City Manager may file a response with the City Clerk. The City
Council shall consider the appeal based upon the written appeal and any written
statement of the Contractor in support thereof, the written response of the City
Manager, and the record of the proceedings before the Hearing Committee.
The City Council by resolution, may affirm, modify, or reverse the decision of the
Hearing Committee.
F. Effect of Debarment. Debarment prohibits the awarding of contracts to, and
the execution of contracts with a debarred contractor. Debarment constitutes debarment
of all divisions or other organizational elements of the contractor, unless the debarment
decision is limited by its terms to specific divisions, organizational elements, or
commodities. City officers, employees and agents shall not solicit offers from, or award
contracts to, debarred contractors. Debarred contractors are also excluded from
conducting business with the City or Agency as agents or representatives of other
contractors. The City may extend the debarment decision to include any affiliate of the
contractor if the affiliate is both specifically named and given written notice of the proposed
debarment and an opportunity to respond.
G. List of Debarred Contractors. The City Manager shall compile and
maintain a current, consolidated list of all debarred contractors. The list shall indicate
the names and addresses of all debarred contractors, the ground(s) for debarment, and
the termination date for each listing. After the opening of bids or receipt of proposals,
the contracting officer shall review the list of debarred contractors. Bids received from
any listed contractor in response to an invitation for bids shall be recorded as received,
and then rejected by reason of debarment. Proposals, quotations, or offers received
from any listed contractor shall not be evaluated for award or included in the competitive
process during the period the contractor is on the list. Immediately prior to award of a
contract, the City Manager shall again review the debarred contractors list to ensure
that no award is made to a listed contractor.
Ordinance No. 589
Page 9
H. Continuation of Existing Contracts. Debarment shall be deemed a material
breach of any other contract between the City or Agency and the contractor, and any
existing contracts between the City or Agency and the contractor shall be terminated
immediately upon debarment. Nob,vithstanding the foregoing, however, the City may
continue contracts in existence at the time the contractor is debarred, upon a
determination by the City Council, after receiving advice from the City Manager and City
Attorney as to the effects of termination of an existing agreement.
I. Effect of Debarment by Another Governmental Agency. A contractor
lawfully debarred by another governmental agency shall be deemed automatically
debarred by the City and Redevevelopment Agency, and shall be added to the list of
debarred contractors for the balance of the term of its debarment by such other agency.
Section 2: If any portion of this ordinance is determined to be unconstitutional or
otherwise contrary to law, that portion shall be severed and the remainder shall remain
in full force and effect.
EFFECTIVE DATE: This ordinance shall take effect and be in force thirty (30)
days after the date of this passage; and before the expiration of fifteen (15) days after
its passage, it shall be published once with the names and members voting for and
against the same in the Poway News Chieftain, a newspaper of general circulation
published in the City of Poway.
Introduced and first read at a regular meeting of the City Council of the City of
Poway held this 21st day of October, 2003, and thereafter PASSED AND ADOPTED at
a regular meeting of said City Council held the 4th day of November, 2003, by the
following roll call vote.
AYES: EMERY, GOLDBY, HIGGINSON, REXFORD, CAFAGNA
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE
ATTEST:
Lorl Anne l:'66~les, (~it~-(Z~erk--