DENALI BOROUGH, ALASKA

ORDINANCE NO. 93-01A

INTRODUCED BY: Mayor Rick S. Brewer

AN ORDINANCE PROVIDING FOR FEDERAL PROCUREMENT

AND CONTRACTING STANDARDS FOR THE DENALI BOROUGH.

BE IT ENACTED by the Assembly of the Denali Borough, Alaska that:

Section A. Classification: This ordinance is of a general and permanent nature.

Section B. General Provisions:

A. These standards are applicable for the expenditure of Federal financial assistance for the procurement of services, supplies and other property.

B. These standards are furnished to ensure that such material and services are obtained efficiently and economically.

C. Written records of all procurement activities will be maintained that include an explanation for the method of procurement, selection of contract type, contractor selection or rejection, and basis for cost or price.

Section 1. Selection Procedures:

A. Solicitations of offers, whether by competitive sealed bids or competitive negotiation shall:

1. Incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured. Such description shall not, in competitive procurements, contain features which unduly restrict competition. The description may include a statement of the qualitative nature of the material, product or service to be procured, an when necessary, shall set forth those minimum essential characteristics and standards to which it must conform if it is to satisfy its intended use. Detailed product specifications should be avoided if at all possible. When it is impractical or uneconomical to make a clear and accurate description of the technical requirements, a "brand name or equal" description may be used as a means to define the performance or other salient requirements of a procurement. The specific features of the named brand which must be met by offerors shall be clearly stated.

2. Clearly set forth all requirements which offerors must fulfill and all other factors to be used in evaluating bids or proposals.

B. Awards shall be made only to responsible contractors that possess the potential ability to perform successfully under the terms and conditions of a proposed procurement. Consideration shall be given to such matters as contractor integrity, compliance with public policy, record of past performance, and financial and technical resources.

Section 2. Procurement Methods:

The following procurement methods will be used when applicable:

A. Small purchase procedures:

1.) Applicable for the procurement of services, property or contracts for supplies costing between $500.00 and $10,000.00.

2.) Price or rate quotations shall be obtained from at least three (3) qualified sources.

B. Competitive sealed bids (formal advertising):

1.) Applicable for the procurement of services, supplies or other property exceeding $10,000.00.

2.) Sealed bids may be publicly solicited by formal advertising and a firm fixed-price contract (lump sum or unit price) shall be awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest price.

3.) a. In order for formal advertising to be feasible, appropriate conditions must be present, including, as a minimum, the following:

(i) A complete, adequate and realistic specification or purchase description is available.

(ii) Two or more responsible suppliers are willing and able to compete effectively for the Denali Borough's business.

(iii) The procurement lends itself to a firm fixed-price contract, and selection of the successful bidder can appropriately be made principally on the basis of price.

3.) b. If formal advertising is used for a procurement under a grant the following requirements shall apply:

(i) At a sufficient time prior to the date set for opening of bids, bids shall be solicited from an adequate number of known suppliers. In addition, the invitation shall be publicly advertised in a newspaper of general circulation in the Denali Borough.

(ii) The invitation for bids, including specifications and pertinent attachments, shall clearly define the items or services needed in order for the bidders to properly respond to the invitation.

(iii) All bids shall be opened publicly at the time and place stated in the invitation for bids.

(iv) A firm fixed-price contract award shall be made by written notice to that responsible bidder whose bid, conforming to the invitation for bids is lowest. Where specified in the bidding documents, factors such as discounts, transportation costs and life cycle costs shall be considered in determining which bid is lowest. Payment discounts may only be used to determine low bid when prior experience of the Denali Borough indicates that such discounts are generally taken.

(v) Any or all bids may be rejected when there are sound documented business reasons in the best interest of the program.

C. Competitive negotiation:

1.) Applicable for the procurement of services, supplies or other property exceeding $10,000.00 where conditions are not appropriate for use of formal advertising.

2.) Proposals will be requested from at least three (3) qualified sources.

3.) Request for proposal shall identify all significant evaluation factors, including price or cost, where required, and their relative importance.

4.) If competitive negotiation proposals are used, negotiations shall be conducted with more than one of the sources a fixed-price or cost reimbursable type contract should be awarded, as appropriate. If competitive negotiation is used for a procurement under a grant, the following requirements shall apply:

(i) Proposals shall be solicited from an adequate number of qualified sources to permit reasonable competition consistent with the nature and requirements of the procurement. The Request for Proposal shall be publicized and reasonable requests by other sources to compete shall be honored to the maximum extent practicable.

(ii) The Request for Proposal shall identify all significant evaluation factors, including price or cost where required, and their relative importance.

(iii) The Denali Borough shall provide mechanisms for technical evaluation of the proposals received, determination of responsible offerors for the purpose of written or oral discussions, and selection for contract award.

(iv) Award may be made to the responsible offeror whose proposal will be most advantageous to the procuring party, price and other factors considered. Unsuccessful offerors should be notified promptly.

(v) The Denali Borough may utilize competitive negotiation procedures for procurement of architectural/engineering, and professional services, whereby competitors' qualifications are evaluated and the most qualified competitor is selected, subject to negotiation of fair and reasonable compensation.

D. Noncompetitive negotiation:

1.) Applicable for the procurement of services, supplies or other property exceeding $10,000.00 and one of the following conditions exists:

(i) The item is available only from a single source;

(ii) A public exigency or emergency exists when the urgency for the requirement will not permit a delay incident to competitive solicitation;

(iii) The Federal grantor agency authorizes noncompetitive negotiation; or

(iv) After solicitation of a number of sources, competition is determined to be inadequate.

Section 3. Contract Pricing:

The cost plus a percentage of cost and percentage of construction cost method shall not be used. The Denali Borough shall perform some form of cost or price analysis in connection with every procurement action including contract modifications. Costs or prices based on estimated costs for contracts under grant shall be allowed only to the extent that costs incurred or cost included in negotiated prices are consistent with Federal cost principles.

Section 4. Contract Provisions:

The Denali Borough shall include the following contract provisions in all procurement contracts and subcontracts:

A. Contracts other than small purchases shall contain provisions or conditions which allow for administrative, contractual, or legal remedies in instances where contractors violate contract terms, and provide for such sanctions and penalties as may be appropriate.

B. All contracts in excess of $10,000.00 shall contain suitable provisions for termination by the Denali Borough including the manner by which it will be effected and the basis for settlement. In addition, subcontracts shall describe conditions under which the contract may be terminated for circumstances beyond the control of the contractor.

C. All contracts awarded in excess of $10,000.00 by the Denali Borough and their contractors or subcontractors shall contain a provision requiring compliance with Executive Order 11246, entitled "Equal Employment Opportunity," as amended by Executive Order 11375, and as supplemented in Department of Labor regulations (41CFR, Part 60).

D. All contracts and subcontracts for construction or repair shall include a provision for compliance with the Copeland "Anti-Kickback" act (18ESC 874) as supplemented in Department of Labor Regulations (29 CRF, Part 3). This Act provides that each contractor or subcontractor shall be prohibited from inducing, by any means, any person employed in the construction, completion, or repair of public work, to give up any part of the compensation to which he/she is entitled. The Denali Borough shall report all suspected or reported violations to the grantor agency.

E. When required by the Federal grant program legislation, all construction in excess of $2,000.00 awarded by the Denali Borough and subcontracts shall include a provision for compliance with the Davis-Bacon Act (40 USC 276a to a-7) as supplemented by Department of Labor regulations (29 CFR, Part 5). Under this Act, contractors shall be required to pay wages to laborers and mechanics at a rate not less than the minimum wage specified in a wage determination made by the Secretary of Labor. In addition, contractors shall be required to pay wages not less than once a week. The Denali Borough shall place a copy of the current prevailing wage determination by the Department of Labor in each solicitation and the award of a contract shall be conditioned upon the acceptance of the wage determination. The Denali Borough shall report all suspected or reported violations to the grantor agency.

F. Where applicable, all contracts and subcontracts awarded by the Denali Borough for construction work which are in excess of $2,000.00 or involve the employment of mechanics or laborers which are in excess of $2,500.00 shall include a provision for compliance with Sections 103 and 107 of the Contract Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR, Part 5). Under Section 103 of the Act, each contractor shall be required to compute the wages of every mechanic and laborer on the basis of a standard workday of eight (8) hours and a standard workweek of (40) hours. Work in excess of the standard workday or workweek is permissible provided that the worker is compensated at a rate not less than 1 1/2 times the basic rate of pay for all hours worked in excess of eight (8) hours in any calendar day or forty (40) hours in the workweek. Section 107 of the Act is applicable to construction work and provides that no laborer or mechanic shall be required to work in surrounding or under working conditions which are unsanitary, hazardous, or dangerous to his/her health and safety as determined under construction, safety and health standards promulgated by the Secretary of Labor. These requirements do not apply to the purchase of supplies or materials or articles ordinarily available on the open market, or contracts for transportation or transmission of intelligence.

G. The contract shall include notice of grantor agency requirements and regulations pertaining to reporting and patent rights under any contract involving research, developmental, experimental, or demonstration work with respect to any discovery or invention which arises or is developed in the course or under such contract, and of grantor agency requirements and regulations pertaining to copyrights and rights in data.

H. All negotiated contracts (except those awarded by small purchase procedures) awarded by the Denali Borough shall include a provision to the effect that the Denali Borough, the Federal Grantor Agency, the Comptroller of the United States, or any of their duly authorized representatives, shall have access to any books, documents, papers, and records of the contractors which are directly pertinent to that specific contract, for the purpose of making audit, examination, excerpts, and transcriptions. The Denali Borough shall require contractors to maintain all required records for three years after the Denali Borough makes final payments and all other pending matters are closed.

I. Contracts, subcontracts, and subgrants of amounts in excess of twenty five thousand dollars ($25,000.00) shall contain a provision which requires compliance with all applicable standards, orders, or requirements issued under Section 306 of the Clean Air Act (42 USC 1857 (h)), Section 508 of the Clean Water Act (33 USC 1368), Executive Order 11738, and Environmental Protection Agency Regulations (40 CFR, Part 15), which prohibit the use under non-exempt Federal contracts, grants, or loans of facilities included on the EPA Listing of Violating Facilities. The provision shall require reporting of violations to the grantor agency, and the USEPA Assistant Administrator for Enforcement (EN-329).

J. Contracts shall recognize mandatory standards and policies relating to energy efficiency which are contained in the State Energy Conservation Plan issued in compliance with the Energy Policy and Conservation Act (P.L. 94-163).

Grantor agencies are permitted to require changes, remedies, changed conditions, access and record retention and suspension of work clauses approved by the Office of Federal Procurement Policy.

Section 5. Effective Date. This ordinance becomes effective upon adoption.

DATE INTRODUCED: January 10, 1993

FIRST READING: January 10, 1993

PUBLIC HEARING: March 14, 1993

PASSED and APPROVED by the DENALI BOROUGH ASSEMBLY this 14th day of March, 1993.

SIGNATURE ON FILE

Mayor

ATTEST: SIGNATURE ON FILE

Borough Clerk