CITY OF ELK GROVE CITY COUNCIL STAFF REPORT

Transcription

1 CITY OF ELK GROVE CITY COUNCIL STAFF REPORT AGENDA ITEM NO AGENDA TITLE: Consider adopting a resolution that subjects the City of Elk Grove to the California Uniform Public Construction Cost Accounting Act (UPCCAA) and approves the Elk Grove Uniform Public Construction Cost Accounting Policy and Procedures; and consider introduction of an ordinance making amendments to the Elk Grove Municipal Code for the purpose of adopting the California Uniform Public Construction Cost Accounting Act (UPCCAA) MEETING DATE: February 24, 2016 PREPARED BY: DEPARTMENT HEAD: Rick Carter, Capital Program Manager Bob Murdoch, Public Works Director / City Engineer RECOMMENDED ACTION: Staff recommends the City Council consider the following actions: 1. Adopt a resolution that subjects the City of Elk Grove to the California Uniform Public Construction Cost Accounting Act (UPCCAA); and approves Elk Grove Uniform Public Construction Cost Accounting Policies and Procedures 2. Introduce and waive the full reading, by substitution of title only, an ordinance amending the Elk Grove Municipal Code for the purpose of adopting the California Uniform Public Construction Cost Accounting Act (UPCCAA). 1

2 Elk Grove City Council February 24, 2016 Page 2 of 4 BACKGROUND INFORMATION: When constructing public projects, the City must follow the State Public Contract Code. Section of that code requires that any public project in excess of $5,000 must be publicly bid and awarded to the lowest responsible bidder. The cost of the engineering and administrative staff time required to develop the biddable plans, specifications and estimates (PS&E) documents and to perform the advertising and award of a publicly bid project can often exceed $10,000. The table below shows the PS&E preparation cost for several current or recent projects. The figures exclude the added cost of City staff for review of PS&E documents or the costs to publish, advertise and award the contracts. The adoption of UPCCAA would not eliminate all of the PS&E document costs, but it can greatly reduce them by permitting more simplified documents. These costs render smaller projects to be fiscally inefficient. Bidding these smaller projects also results in other unquantifiable costs, such as time delays in preparing projects for bid. Plans, Specifications, and Project Description Estimate Preparation Cost Bus Stop Accessibility Improvements $ 45,000 Speed Control Phase 6 Project $ 30,000 Franklin Creek Pedestrian Bridge Lighting $ 27,000 Special Waste Collection Center Minor Improvements $ 25,000 Citywide Curb Ramps $ 25,000 Big Horn/Laguna Bus Stop and Sidewalk Infill $ 25,000 Library Minor Improvements * $ 22,000 Bicycle Routes Signing and Striping $ 15,000 Electric Vehicle Charging Stations at City Hall * $ 13,000 Police Facility Fiber Optic Improvements $ 10,000 PD Service Center Safety Upgrades $ 8,687 City Hall ADA Improvements * $ 8,100 Carpet Replacement $ 6,475 Restroom Upgrades for Water Efficiency $ 6,000 City Hall Entrance Door Replacement * $ 5,000 * Recently completed projects The California Uniform Public Construction Cost Accounting Act (UPCCAA) was created in 1983 as an alternative bidding procedure designed to reduce costs, expedite the awards process, reduce inefficiencies, and 2

3 Elk Grove City Council February 10, 2016 Page 3 of 4 simplify administration of smaller public projects. UPCCAA is contained at Public Contracts Code Section through UPCCAA provides for the following alternative bidding procedures when an agency performs public project work by contract. a) Public projects of $45,000 or less may be performed by negotiated contract or by purchase order; b) Public projects of $175,000 or less may be let to contract by the informal bidding procedures set forth in the Act; c) Public projects of more than $175,000 must be let to contract by traditional formal bidding procedures. Contracts procured through informal procedures would be awarded by the City Manager, while contracts requiring formal bidding procedures would be awarded by the City Council. Consistent with the reporting requirements set forth in the City s Purchasing Ordinance, any projects of $5,000 or greater will be regularly reported to the City Council. UPCCAA also allows a public agency to perform project work with its own workforce in an amount up to $45,000, if the public agency follows the accounting procedures set forth in the act. These accounting procedures basically require an agency to track labor, equipment, material and overhead costs to a specific project. Of the approximately 482 incorporated cities in California, 214 have adopted the UPCCAA guidelines; 40 of the 58 counties in the state have also adopted UPCCAA. In total, about 928 public agencies have adopted UPCCAA. To provide ongoing guidance to meet the requirements of UPCCAA, staff has condensed the UPCCAA manual into a set of Policies and Procedures to be followed by Elk Grove staff. Staff is recommending that these policies and procedures be adopted by resolution of the City Council. Once adopted, the policies and procedures will be subject to future modification as necessary by the City Manager. The Contracting limits in UPCCAA are modified from time to time by the California Uniform Construction Cost Accounting Commission. The proposed ordinance provides that when these limits are modified under state law, these new limits to take effect. 3

4 Elk Grove City Council February 24, 2016 Page 4 of 4 It is important to note that the City s participation in UPCCAA and the proposed Policies and Procedures do not affect the City s obligation to complete projects at the lowest possible cost, nor does it relieve the City from its obligations to require the payment of prevailing wages for any public project of $1,000 or more. Although the Act allows negotiated contracts for projects under $45,000, the proposed Policies and Procedures require 3 bids and award to the lowest responsible bidder. FISCAL IMPACT: Aside from staff time to implement this new program, there is no cost to adopt UPCCAA. However, once adopted, the use of the alternative bidding procedures has the opportunity to reduce project costs. There are 11 current projects identified as candidates for expedited bidding. Adopting UPCCAA is estimated to result in about $100,000 in project savings for these projects. ATTACHMENTS: 1. Resolution adopting UPCCAA a. Exhibit A: City of Elk Grove UPCCAA Policies and Procedures 2. Ordinance 3. FAQs regarding UPCCAA 4

5 ATTACHMENT 1 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ELK GROVE ELECTING TO BECOME SUBJECT TO THE CALIFORNIA UNIFORM PUBLIC CONSTRUCTION COST ACCOUNTING PROCEDURES WHEREAS, Public Contract Code Section et seq., the Uniform Public Construction Cost Accounting Act, establishes a uniform cost accounting standard; and WHEREAS, prior to the passage of Assembly Bill No. 1666, Chapter 1054, Statutes of 1983, which added Chapter 2, commencing with Section 22000, to Part 3 of Division 2 of the Public Contract Code, existing law did not provide a uniform cost accounting standard for construction work performed or contracted by local public agencies; and WHEREAS, the California Uniform Construction Cost Accounting Commission (Commission) established under the Act has developed uniform public construction cost accounting procedures for implementation by local public agencies in the performance of or in the contracting for construction of public projects; and WHEREAS, the Act allows for alternative procurement methods for projects up to $175,000; and WHEREAS, the alternative procurement methods provide flexibility and opportunities for significant cost savings to the City. NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Elk Grove, hereby elects under Public Contract Code Section to become subject to the uniform public construction cost accounting procedures set forth in the Act and to the Commission's policies and procedures manual and cost accounting review procedures, as they may each from time to time be amended, and directs that the City Clerk notify the State Controller forthwith of this election. BE IT FURTHER RESOLVED that the City Council of the City of Elk Grove, hereby adopts the policies and procedures set forth in Exhibit A of this Resolution and authorizes the City Manager to make modifications to Exhibit A consistent with the Uniform Public Construction Cost Acccounting Act, and as necessary to meet the needs of the City. PASSED AND ADOPTED by the City Council of the City of Elk Grove this 9 th day of December GARY DAVIS, MAYOR of the CITY OF ELK GROVE ATTEST: APPROVED AS TO FORM: JASON LINDGREN, CITY CLERK JONATHAN P. HOBBS, CITY ATTORNEY 5

6 Date: Revised: EXHIBIT A City of Elk Grove Policies and Procedures for Implementing the California Uniform Public Construction Cost Accounting Act No. PW-005 Department: Public Works Division: Capital Improvement Program This Administrative Policy is declarative of existing City policy, is issued under the authority vested in the City Manager, and shall remain in place unless and until rescinded or superseded. PURPOSE Authority: City Manager Laura S. Gill, City Manager The purpose of this Policy is to streamline and provide efficiencies in the procurement of public projects by implementing the California Uniform Public Construction Cost Accounting Act (UPCCAA or Act ). This Policy defines the procedures to be followed in order to comply the Act which is defined in PCC SCOPE All public projects defined by Public Contract Code section All maintenance projects defined by Public Contract Code section where the City elects to use the procedures of the Act. ASSIGNMENT OF RESPONSIBILITY All Department Managers that initiate a public improvement project must insure delivery of the improvement complies with this policy. SECTION TITLE 1. Project Cost Estimate and Cost Thresholds An Engineer s Estimate must be developed to obtain a reasonable cost estimate. If the estimate is within 5% of a project cost threshold as listed below, go to the next higher level of compliance. UPCCAA will periodically update the project thresholds. If UPCCAA has different thresholds than those specified below, the UPCCAA thresholds shall be used. 6

7 UPCCAA Policy a. Project Cost Threshold $5,000 and Below. Projects below $5,000 can be performed by City staff (Force Account) or any other contracting procedure consistent with the City s purchasing ordinance. (EGMC 3.42). b. Project Cost Threshold above $5,000 but below the limits set forth in Public Contract Code section 22032(b), as amended from time to time ($45,000 at the time of adoption) These projects are subject to prevailing wage. These projects must be contracted through the Capital Improvement Program Manager using a contract or by purchase order (PCC 22032(a)) as follows: Special Note: Though the Act allows these projects to be performed by City Forces (Force Account), the accounting and tracking requirements of the Act must be followed which requires project specific cost accounting for all Labor, Equipment and Materials. Therefore, the use of Force Account shall not be used without prior written approval of the Department Head with the specific recognition that the accounting tracking provisions of the Act must be followed 1. Solicit 3 quotes 2. City Manager makes award to lowest responsible bidder 3. Require the Contractor to report labor, equipment, and materials expenses separately c. Project Cost Threshold above the limits specified in 1b, but below the limits set forth in Public Contract Code section 22032(b), as amended from time to time ($175,000 at the time of adoption). These are the Informal Bidding requirements. A. Maintain a List of Registered Contractors 1. The Capital Program Manager must maintain a list of registered contractors in accordance with the guidelines provided in UPCCAA. B. Notice of Informal Bidding 1. A notice of a request for informal bids shall be developed containing information about the project and the time and place for the submission of bids. (PCC 22034(d)). This notice must be mailed to either one or both of the following options at the discretion of the Capital Program Manager: a. All City of Elk Grove registered contractors for the type of work being bid b. All appropriate construction trade journals 2 7

8 UPCCAA Policy d. Public Cost Threshold above the limits set forth in Public Contract Code Section (C), as amended from time to time ($175,000 at the time of adoption) shall, except as otherwise provided for in the Act, be let to contract by formal bidding procedures. 2. Award of Bid for Public Projects Eligible for Informal Bidding. A. Bids shall be awarded by the City Manager to the lowest responsible and responsive bidder. If two bids are received in the same bid amount, the City Manager has the discretion to award the project to either bidder. B. If no bids are received the project may be abandoned, rebid or performed by City Staff (force account) C. Rejecting bids. The City Manager has the authority to reject all bids and make any the final determination ruling on all bid protests. D. If all bids received are in excess of the limits set forth in Public Contract Code section 22032(b), as amended from time to time ($175,000 at the time of adoption)), the City Council may by adoption of a resolution by a four-fifths vote of the City Council, award the contract, at $187,500 or less, to the lowest responsible bidder, if the City Council determines the engineer s estimate for the project, prepared by the City, was reasonable. (PCC 22034(f)). These monetary limits are subject to change if and when the monetary limits change under state law. E. All Contracts authorized by the City Manager over $5,000 will be regularly reported to the City Council. 3 8

9 ATTACHMENT 2 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ELK GROVE AMENDING ELK GROVE MUNICIPAL CODE CHAPTER 3.42 TO ADOPT THE PROVISIONS OF THE CALIFORNIA UNIFORM PUBLIC CONSTRUCTION COST ACCOUNTING ACT (UPCCAA) WHEREAS, State Law generally requires that public works contracts in excess of $5,000 must be publicly advertised and awarded to the lowest responsible and responsive bidder; and WHEREAS, preparing public works projects for formal bidding as required by State law can add substantial costs to a project; and WHEREAS, State Law allows public agencies to adopt alternative bidding procedures under the California Uniform Public Construction Cost Accounting Act (UPCCAA) which allows informal bidding procedures to be used for Public Works Projects up to $175,000; and WHEREAS, by adopting UPCCAA, the City of Elk Grove must conform to various accounting requirements prescribed in the Act that are targeted at tracking costs of public work projects by in-house staff, and the City will realize efficiencies and costs savings gained by adopting UPCCAA. NOW, THEREFORE, the City Council of the City of Elk Grove does ordain as follows: Section 1: Purpose and Authority The purpose of this Ordinance is to amend Elk Grove Municipal Code Chapter 3.42, Contracts and Purchasing; and enact Elk Grove Municipal Chapter 3.50, Public Works Projects (Uniform Public Construction Cost Accounting Act), for the purpose California Uniform Public Construction Cost Accounting Act. Section 2: Amendments to Elk Grove Municipal Code 1. Section 3.42 of the Elk Grove Municipal Code is amended as follows: i) Repeal Section (D) D. Contracts for public projects (public works) concerning prequalification of bidders, providing that nothing herein shall be interpreted to supersede any provision of State law concerning the bidding or awarding of contracts for public projects under the California Public Contract Code. [Ord (Exh. A), eff ; Ord , eff ; Ord , eff ] ii) Repeal Article VII of Chapter 3.42 in its entirety [to be recodified in Chapter 3.50, as set forth below] 9

10 Prequalification of bidders. A. Purpose. This section is enacted pursuant to Section of the California Public Contract Code, which authorizes the City to establish a system for prequalification of prospective bidders on public works construction and maintenance projects. In addition, pursuant to the City s general police powers under California Constitution Article 11, Section 7, the City desires to apply this process to the award of public works maintenance contracts in order to ensure that bidders are qualified to perform City public works maintenance. B. Prequalification of Bidders. 1. The City hereby establishes a system for prequalification of prospective bidders for public works construction and maintenance projects. The City may use the prequalification system identified in this section for any public works project. 2. The City Engineer is authorized to adopt and apply a uniform system of rating bidders for each project based on: a) the requirements of Section of the California Public Contract Code, and b) the model guidelines and standardized questionnaire created by the State of California Department of Industrial Relations, as modified at the City Engineer s discretion to address the needs of the particular project, or projects, to which they are to be applied. 3.a. Prequalification of prospective bidders shall be conducted for public works projects that involve the construction, retrofitting, remodeling, renovation or expansion of public buildings, water or wastewater treatment facilities, water works; maintenance of roadways, drainage facilities, roadway landscaping, or parks; or require significant specialized experience or expertise, unless the City Engineer determines that it is in the best interests of the City to forego prequalification of prospective bidders on a particular project. In making his or her determination whether it is in the best interests of the City to forego prequalification of prospective bidders on a particular project, the City Engineer s decision shall be supported by one (1) or more of the following reasons: i. Prequalification of prospective bidders is likely to unreasonably adversely affect the cost of the project; ii. The complexity, scale or cost of the project does not warrant use of this prequalification process; iii. There is an urgent need, based upon concerns for the health and safety of the public, to pursue the project on an expedited basis; iv. The particular project is of such a specialized nature that there is a very limited pool of qualified potential bidders, and for this reason the purposes of 10

11 the prequalification process may be accomplished by use of a bid questionnaire; or v. The project will not be competitively bid. b. Notwithstanding subsection (B)(3)(a) of this section, the City Engineer is authorized to require prequalification of prospective bidders on any public works project or to engage in a program of prequalification of prospective bidders, on public works projects on a recurring basis as provided in Section of the California Public Contract Code. 4. If prequalification of prospective bidders is required for a particular project, the City Engineer shall determine which bidders are qualified to bid that project based upon the uniform system of rating bidders. If the City Engineer determines any bidder is not qualified to bid a project, the City Engineer shall provide to the bidder written notice that includes the basis for the determination and an identification of any supporting evidence therefor, and an opportunity for the bidder to appeal the determination pursuant to subsection (C) of this section. A copy of all prequalification determinations shall be filed with the City Clerk at least ten (10) days prior to the scheduled bid opening. C. Appeals. 1. Any person aggrieved by a determination made by the City Engineer pursuant to subsection (B)(4) of this section may appeal the determination only by complying with the requirements set forth in this subsection. Such an aggrieved person shall be referred to herein as appellant. Without a timely appeal, the appellant waives any and all rights to challenge the decision of the City Engineer, whether by administrative process, judicial process or any other legal process or proceeding. 2. The appellant shall submit a written notice of appeal to the City Clerk, along with a complete written description of all factual and legal bases for the appeal and accompanied by a fee in the amount established by resolution of the City Council, no later than ten (10) days after the City has mailed written notice of the determination made by the City Engineer. Should the appellant prevail in its appeal, the deposit shall be returned to the appellant and the City shall bear the costs of the appeal. If the appellant does not prevail, the deposit shall be used to pay all costs associated with the appeal. If the deposit is insufficient to pay the entirety of the costs of the appeal, the appellant shall pay the remaining costs within thirty (30) days after the decision. Any failure by the appellant to timely pay any outstanding appeal costs, as required herein, shall be considered by the City in future prequalification proceedings. 3. If the appellant gives the required notice of appeal, provides the necessary deposit, and requests a hearing, the hearing shall be conducted so that it is 11

12 concluded no later than five (5) business days prior to the last date for the receipt of bids on the project or twenty (20) days following the City s receipt of the notice of appeal, whichever is sooner. The hearing shall be an informal process conducted by an arbitrator, who shall be an attorney experienced in public works and construction matters. The arbitrator may be selected by the mutual consent of the appellant and the City. If an agreement cannot be reached regarding the selection of the arbitrator, the appellant and the City shall each exchange a list of three (3) arbitrators they would be willing to accept. In turn, beginning with the appellant, each party shall strike one (1) name from the other party s list until only one (1) name remains and that remaining person shall be the arbitrator. If the arbitrator selected is unavailable, the parties shall repeat the process until they succeed in selecting an available arbitrator. 4. At the hearing, the appellant and the City shall each be provided an opportunity to be represented by legal counsel and to present or rebut any evidence bearing upon the issues presented in the appeal. Each party shall bear his, her, its, or their own attorneys fees, regardless of the outcome of the appeal. 5. The arbitrator shall consider relevant evidence presented during the hearing and provide a written decision on the appeal to the City, with a copy to the City Clerk, and the appellant within one (1) business day after the close of the hearing. The time identified in this section for providing the arbitrator s decision may be extended only by consent of the City and the appellant and such an extension shall not affect or require a delay in a scheduled time for opening of bids for any public works project. Failure by the arbitrator to render a timely decision shall be deemed a denial of the appeal. 6. The arbitrator s decision shall be final. [Ord (Exh. A), eff ; Ord , eff ; Ord , eff ; Ord , eff ] iii) Amend Section (C) in its entirety with the following: C. Public Works Contracts. Contracts for public projects (public works) governed by the California Public Contracts Code, except that the provisions of Article VII of this chapter concerning prequalification of bidders shall continue to apply; and C. Contracts for Public Works Projects shall be governed by Elk Grove Municipal Code chapter Chapter 3.50 of the Elk Grove Municipal Code is added as follows: Chapter 3.50 Public Works Projects (Uniform Public Construction Cost Accounting Act) 12

13 Purpose The purpose of this chapter is to adopt and implement the provisions of the California Uniform Public Construction Cost Accounting Act hereinafter referred to as the Act (Section 22000, et seq. of the Public Contract Code). The City Manager shall be authorized to implement administrative policies and procedures consistent with the Act and this chapter Informal Bid Procedures Article I. Informal Bidding Procedures Public projects, as defined by the Act, and in accordance with the monetary limits set forth in the Act, as now existing or hereafter amended, may be let to contract by informal procedures as set forth in the Act, this chapter, and any administrative policies and procedures promulgated by the City Contractors List A list of contractors shall be developed and maintained in accordance with the provisions of the Act and criteria promulgated from time to time by the California Uniform Construction Cost Accounting Commission Notice Inviting Informal Bids A. Where a public project is to be performed which is subject to the informal bidding provisions of the Act and this chapter, a notice inviting informal bids may be mailed to all contractors for the category of work to be bid, as shown on the list developed in accordance with Section and shall be mailed to all construction trade journals as specified by the California Uniform Construction Cost Accounting Commission in accordance with the Act. All mailing of notices to contractors pursuant to this section shall be completed not less than 10 calendar days before bids are due. Additional contractors and/or construction trade journals may be notified at the discretion of the City, provided however: 1. If there is no list of qualified contractors maintained by the City for the particular category of work to be performed, the notice inviting bids shall be sent only to the construction trade journals specified by the Commission. 2. If the product or service is such that it can be obtained only from a certain contractor or contractors, the notice inviting informal bids may be sent exclusively to such contractor or contractors. B. The notice inviting informal bids shall describe the project in general terms and how to obtain more detailed information about the project, and shall state the time and place for the submission of bids Award of Contracts A. The City Manager is authorized to award informal contracts pursuant to the 13

14 monetary limits set forth in the Act, as now existing or hereafter amended. If all bids received are in excess of the City Manger s monetary authority, the City Council may, by adoption of a resolution by a four-fifths vote, award the contract, subject to the monetary limits set forth in the Act for informal bidding, as now existing or hereafter amended, if the City Council determines the cost estimate of the public agency was reasonable. B. Contracts subject to formal bidding under the Act shall be awarded, if at all, by the City Council. Article II. Prequalification of Bidders The City hereby establishes a system for prequalification of prospective bidders for public works projects. The City may use the prequalification system identified in this section for any public works project The Public Works Director is authorized to adopt and apply a uniform system of rating bidders for each project based on: a) the requirements of Section of the California Public Contract Code, and b) the model guidelines and standardized questionnaire created by the State of California Department of Industrial Relations, as modified at the Public Works Director s discretion to address the needs of the particular project, or projects, to which they are to be applied Prequalification of prospective bidders shall be conducted for public works projects that involve the construction, retrofitting, remodeling, renovation or expansion of public buildings, water or wastewater treatment facilities, water works; maintenance of roadways, drainage facilities, roadway landscaping, or parks; or require significant specialized experience or expertise, unless the Public Works Director determines that it is in the best interests of the City to forego prequalification of prospective bidders on a particular project. In making his or her determination whether it is in the best interests of the City to forego prequalification of prospective bidders on a particular project, the Public Works Director s decision shall be supported by one (1) or more of the following reasons: A. Prequalification of prospective bidders is likely to unreasonably adversely affect the cost of the project; B. The complexity, scale or cost of the project does not warrant use of this prequalification process; C. There is an urgent need, based upon concerns for the health and safety of the public, to pursue the project on an expedited basis; D. The particular project is of such a specialized nature that there is a very limited pool of qualified potential bidders, and for this reason the purposes of the prequalification process may be accomplished by use of a bid questionnaire; or E. The project will not be competitively bid. 14

15 Notwithstanding subsection of this section, the Public Works Director is authorized to require prequalification of prospective bidders on any public works project or to engage in a program of prequalification of prospective bidders, on public works projects on a recurring basis as provided in Section of the California Public Contract Code If prequalification of prospective bidders is required for a particular project, the Public Works Director shall determine which bidders are qualified to bid that project based upon the uniform system of rating bidders. If the Public Works Director determines any bidder is not qualified to bid a project, the Public Works Director shall provide to the bidder written notice that includes the basis for the determination and an identification of any supporting evidence therefor, and an opportunity for the bidder to appeal the determination pursuant to section A copy of all prequalification determinations shall be filed with the City Clerk at least ten (10) days prior to the scheduled bid opening Appeals A. Any applicant to be considered for prequalification for bidding, that is aggrieved by a determination made by the Public Works Director pursuant to subsection of this section may appeal the determination only by complying with the requirements set forth in this subsection. Such an aggrieved applicant shall be referred to herein as appellant. Without a timely appeal, the appellant waives any and all rights to challenge the decision of the Public Works Director, whether by administrative process, judicial process or any other legal process or proceeding. B. The appellant shall submit a written notice of appeal to the City Clerk, along with a complete written description of all factual and legal bases for the appeal and accompanied by a fee in the amount established by resolution of the City Council, no later than ten (10) days after the City has mailed written notice of the determination made by the Public Works Director. Should the appellant prevail in its appeal, the deposit shall be returned to the appellant and the City shall bear the costs of the appeal. If the appellant does not prevail, the deposit shall be used to pay all costs associated with the appeal. If the deposit is insufficient to pay the entirety of the costs of the appeal, the appellant shall pay the remaining costs within thirty (30) days after the decision. Any failure by the appellant to timely pay any outstanding appeal costs, as required herein, shall be considered by the City in future prequalification proceedings. C. If the appellant gives the required notice of appeal, provides the necessary deposit, and requests a hearing, the hearing shall be conducted so that it is concluded no later than five (5) business days prior to the last date for the receipt of bids on the project or twenty (20) days following the City s receipt of the notice of appeal, whichever is sooner. The hearing shall be an informal process conducted by an arbitrator, who shall be an attorney experienced in public works and construction matters. D. At the hearing, the appellant and the City shall each be provided an opportunity to be represented by legal counsel and to present or rebut any evidence bearing upon the issues presented in the appeal. Each party shall bear his, her, its, or their own attorneys fees, regardless of the outcome of the appeal. 15

16 E. The arbitrator shall consider relevant evidence presented during the hearing and provide a written decision on the appeal to the City, with a copy to the City Clerk, and the appellant within one (1) business day after the close of the hearing. The time identified in this section for providing the arbitrator s decision may be extended only by consent of the City and the appellant and such an extension shall not affect or require a delay in a scheduled time for opening of bids for any public works project. Failure by the arbitrator to render a timely decision shall be deemed a denial of the appeal. F. The arbitrator s decision shall be final. Section 3: No Mandatory Duty of Care. This ordinance is not intended to and shall not be construed or given effect in a manner that imposes upon the City or any officer or employee thereof a mandatory duty of care towards persons and property within or without the City, so as to provide a basis of civil liability for damages, except as otherwise imposed by law. Section 4: Severability. If any provision of this ordinance or the application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of the ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this ordinance are severable. This City Council hereby declares that it would have adopted this ordinance irrespective of the invalidity of any particular portion thereof and intends that the invalid portions should be severed and the balance of the ordinance be enforced. Section 5: Savings Clause The provisions of this ordinance shall not affect or impair an act done or right vested or approved or any proceeding, suit or prosecution had or commenced in any cause before such repeal shall take affect; but every such act done, or right vested or accrued, or proceeding, suit or prosecution shall remain in full force and affect to all intents and purposes as if such ordinance or part thereof so repealed had remained in force. No offense committed and no liability, penalty or forfeiture, either civilly or criminally incurred prior to the time when any such ordinance or part thereof shall be repealed or altered by said Code shall be discharged or affected by such repeal or alteration; but prosecutions and suits for such offenses, liabilities, penalties or forfeitures shall be instituted and proceeded with in all respects as if such prior ordinance or part thereof had not been repealed or altered. Section 6: Effective Date and Publication This Ordinance shall take effect thirty (30) days after its adoption. In lieu of publication of the full text of the ordinance within fifteen (15) days after its passage, a summary of the ordinance may be published at least five (5) days prior to and fifteen (15) days after adoption by the City Council and a certified copy shall be posted in the office of the City Clerk, pursuant to GC 36933(c)(1). INTRODUCED: ADOPTED: EFFECTIVE: 16

17 GARY DAVIS, MAYOR of the CITY OF ELK GROVE ATTEST: APPROVED AS TO FORM: JASON LINDGREN, CITY CLERK JONATHAN P. HOBBS, CITY ATTORNEY Signed: 17

18 ATTACHMENT 3 CALIFORNIA UNIFORM PUBLIC CONSTRUCTION COST ACCOUNTING ACT FREQUENTLY ASKED QUESTIONS (FAQs) 1. What is the Uniform Public Construction Cost Accounting Act? A program created in 1983 which allows local agencies to perform public project work up to $45,000 with its own work force if the agency elects to follow the cost accounting procedures set forth in the Cost Accounting Policies and Procedures Manual of the California Uniform Construction Cost Accounting Commission (Commission). The Uniform Public Construction Cost Accounting Act (Act) is enacted under Public Contracts Code Section through (hereafter abbreviated as PCC ). In addition, the Act provides for alternative bidding procedures when an agency performs public project work by contract. a) Public projects of $45,000 or less may be performed by negotiated contract or by purchase order (PCC 22032(a)). b) Public projects of $175,000 or less may be let to contract by the informal procedures set forth in the Act (PCC 22032(b)). c) Public projects of more than $175,000 shall be let to contract by formal bidding procedures (PCC 22032(c)). Every five years, the Commission shall consider whether there have been material changes in public construction costs and make recommendations to the State Controller regarding adjustments to the bidding procedure monetary limits (PCC 22020). Adjustments should be effective for the fiscal year that commences not less than 60 days following the State Controller s notification to all participating agencies. 2. What are the benefits of the program? a) Increased force account limit b) Informal bidding for projects between $45,001 and $175,000 which do not require advertising. c) Reduces the number of formal bids. d) Expedited contracting for small projects. Many participants laud the program because it gives them more leeway in the execution of public works projects; has speeded up the awards process; has improved timeliness of the project completion; has eliminated considerable red tape and cumbersome paperwork relative to advertising and filing of reports; and has simplified administration. Many agencies have encountered only minimal challenges with the accounting requirements and the overhead portion. Moreover, where required, the adjustment was relatively simple; most of the required procedures were already actually in place, so there was no noticeable change in the existing operations. The Standard Accounting Codes Structure will satisfy the reporting requirements when used properly. 1 18

19 Frequently Asked Questions (FAQ) Uniform Public Construction Cost Accounting Act 3. Is the Uniform Public Construction Cost Accounting Act mandatory for local agencies? No. The Act is a voluntary program. However, it is available to all local agencies, counties, and cities, both general law and charter. 4. How does a local agency become subject to the Act? The governing body must elect by resolution to become subject to the Act and file a copy of the resolution with the State Controller's Office (PCC 22030). Sample documents are available at: Once an agency has opted into the Act it will remain a part of the program until it opts out. There is no need for renewal/re-opting in. 5. May a local agency withdraw from the Act? An agency may withdraw by filing a resolution of the agency s election to withdraw with the State Controller's Office. 6. What is the California Uniform Construction Cost Accounting Commission? A state commission created under the Act (PCC 22010). It consists of fourteen (14) members: thirteen (13) members are appointed by the State Controller and one is a designated member of the Contractors State License Board. Seven members represent the public sector (counties, cities, school districts, and special districts). Six members represent the private sector (public works contractors and unions). The Commission members receive no salary, but are eligible for reimbursement of their direct expenses related to the Commission. The Commission is responsible for administration of the Act. The State Controller provides limited staff and other support to the Commission (PCC 22015(a)). 7. What are the Uniform Public Construction Cost Accounting Procedures? The cost accounting procedures were developed by the Commission. They are to be used to estimate costs for determining if a public project is required to be bid out and to capture and record actual costs when a public project is performed by the agency s own work force. The procedures follow normal accounting in the industry and in many cases are not much different from those already in place at the agency. Sample forms are available in the CUCCAC Cost Accounting Policies and Procedures Manual. School districts may use the Standard Accounting Code Structure to comply with the tracking requirements. 8. Are the cost accounting policies and procedures applicable for agencies whose work force only performs maintenance tasks as defined in the Act and whose public projects are all contracted out? The cost accounting policies and procedures are only applicable for agencies that perform public project work by force account. This does not exclude from the program agencies whose public projects are all contracted out. In fact, they might want to review the benefits available and elect to participate now in the event conditions change at some time in the future. Updated: September 9,

20 Frequently Asked Questions (FAQ) Uniform Public Construction Cost Accounting Act 9. The Public Contract Code section 22034(a) states the agency shall maintain a list of qualified contractors1. What is meant by the term qualified contractors? The term qualified contractors is intended to define contractors who request to be added to an agencies list for specified types of specialty work and are licensed and otherwise legally qualified to perform that work as licensed contractors. In addition, the Commission has determined that nothing in the Act prohibits a participating agency from, at their discretion, using an objective pre-qualification process in the formation and maintenance of their contractor s lists. This change will be added to the language on Section 3, page 7, of the Cost Accounting Policies and Procedures Manual. 10. Can a local agency disqualify or exclude certain contractors from the Qualified Contractors List required pursuant to PCC 22034(a)? Agencies may disqualify contractors from the Qualified Contractors List when a contractor fails to furnish information to meet the minimum criteria as established by the Commission pursuant to PCC 22034(a). 11. For agencies that do not maintain an informal bidders list, are they allowed to choose who will get notifications on information projects? The Act requires that an informal bid project is either advertised and/or notifications are sent to all contractors on the informal bidders list. We have noticed that a very large percentage of signatory local public agencies do not maintain or update an informal bidders list and are sending notices to only one or two contractors. There is no exemption to maintaining a list of bidders. PCC 22034(a). The public agency shall maintain a list of qualified contractors, identified according to categories of work. Minimum criteria for development and maintenance of the contractors list shall be determined by the commission. If an agency is not maintaining a list or notifying all contractors or trade papers, then they are not in compliance with the Act. The Public Contract Code states that participating agencies shall adopt an ordinance requiring that a list of all qualified contractors, identified according to categories of work be maintained. It does not require the list to be used however, and allows notifications to the required trade journals and exchanges be used as an alternate if desired. For agencies that elect to use the alternative authorized method of advertising, the purpose of the list is effectively negated. If an agency is using the contractor's list then they must send the notification to all contractors on the list for that category of work and the list must be maintained in accordance with the Manual. 12. What is the difference between qualifying contractors under UPCCAA and prequalification of contractors under PCC 20101? Qualification of contractors is a process that allows contractors to register with the agency for notification of public works opportunities. The prequalification process under PCC is a more complex process that requires a standardized questionnaire and evaluation of contractors using standard scoring criteria The term Qualified Contractors is pending legislative change. The proposed term is Registered Contractors. Updated: September 9,

21 Frequently Asked Questions (FAQ) Uniform Public Construction Cost Accounting Act 13. Must a local agency: (1) Notify contractors pursuant to PCC 22034(b) if the contractor is believed not to have the skills, credentials, or experience to perform the work? (2) Consider bids submitted if the agency believes the contractor does not have the skills, credentials, or experience to perform the work? a) If a contractor is on the Qualified Contractors List (PCC 22034(b)), the contractor must be notified by the agency of public projects for which he is licensed to perform. b) All bids received from qualified contractors must be considered. 14. Does the Act allow flexibility in cases of great emergency and when repair or replacements are necessary to permit the continued conduct of the operations or services of a public agency? PCC provides that in cases of great emergency the governing body may, by majority vote, proceed without adopting plans and giving notice to bids to let contracts. In addition, this section provides that the governing body may delegate to the appropriate agency manager the power to declare an emergency and/or proceed with repairs or replacements without approval by the board. PCC provides contracting procedures without giving notice for bids to let contracts for these emergencies. 15. Do the alternative bidding procedures apply only to public projects as defined in PC 22002(c) or can they be used for the following types of items: a) Maintenance work to be performed by contract? b) Purchase of heavy equipment? c) Purchase of materials? Pursuant to PCC 22003, a participating agency may use the alternative bidding procedures on maintenance work as defined in PC 22002(d), items 1-5. PCC is permissive and agencies can continue to exclude maintenance from the alternative bidding procedures. However, if an agency misclassifies a project ($45,001 or more) as maintenance and therefore, does not uses the applicable bidding procedures, a review by the Commission may be conducted pursuant to PCC 22042(c). The purchase of equipment and supplies fall under PCC 20111; however, when purchased or used as part of a public works project, the costs associated with the purchase or use become part of the project cost and must be considered when applying the bid limits under the Act. 16. What will membership in the Act cost my agency? At the present, no required membership fees or dues are assessed. However, the Commission has never received direct state funding for a short period of its history. The State has indicated that the participating agencies, contractors, and unions that benefit from the Commission should be responsible for its funding. Therefore, in November 2004, the Commission asked member agencies, contractor s associations, and construction related unions for voluntary donations to support the Commission. There may be additional requests for voluntary support. Any mandatory fees or dues would require legislation and would be for a nominal amount. 17. What are the most common concerns? Updated: September 9,

22 Frequently Asked Questions (FAQ) Uniform Public Construction Cost Accounting Act There are three leading areas of expressed concern and mostly all are quickly alleviated when addressed properly. These are: a) Cost accounting policies and procedures; b) Informal bidding procedures; c) Accounting review procedures. The cost accounting requirements follow those common to the construction industry. The informal bidding up to $175,000 is seen by the agencies as an asset enhancing project completion. Maintenance of a Qualified Contractor Bid List is routine, since interested contractors make it a point to be included on the list. While a review could potentially hold up a project for 30 days pursuant to PCC 22043, formal complaints have been rare in the Commission s history. 18. Does an agency have to calculate an overhead rate in order to apply the accounting procedures? Cities with populations of less than 75,000 may use an overhead rate of 20% of all direct costs in lieu of the overhead rate calculation specified in Section VI of the Cost Accounting Policies and Procedures Manual. Cities with a population of more than 75,000, counties, special districts, and school districts may use an overhead rate of 30% of all direct costs, in lieu of a calculated rate. 19. When a local entity opts into the Act, does the Act supersede other contracting legal requirements such as statutory requirements for performance bonds, prevailing wages, and certificates of insurance, etc.? The Act only supersedes the bidding procedures used once a public agency has adopted a resolution and notified the Controller. All other contracting requirements are applicable whether or not a public entity opts into the Act. The specific mention of bidding procedures emphasizes the omission of other statutory requirements (such as bond payments, prevailing wages, addenda, change orders, etc.) and implies that their applicability is found in specific statutory provisions rather than the Act. Therefore, the Act does not supersede other contracting requirements for performance bonds, prevailing wages, and certificates of insurance, etc. 20. Can a signatory agency, claim to be to be exempt from requirements in the Public Contract Code (PCC) by claiming they only have to follow the language and procedures within the Act? No. The Commission has ruled in the past that where the Act is silent, the Public Contract Code applies. 22 Updated: September 9,