Loading...
HomeMy WebLinkAboutOrdinance No. 3306-2022Sponsored by: Council Member Baisden A. KENAI CITY OF KENAI ORDINANCE NO. 3306-2022 AN ORDINANCE AMENDING KENAI MUNICIPAL CODE 7.15.020 PURCHASES REQUIRING COUNCIL APPROVAL, TO PROVIDE INCREASED FLEXIBILITY FOR THE ADMINISTRATION TO CONDUCT CITY BUSINESS WHILE MAINTAINING SUFFICIENT SAFEGUARDS TO PROTECT THE PUBLIC INTEREST. WHEREAS, KMC 7.15.020 establishes thresholds for and the types of purchases which require approval of the City Council prior to them being made; and, WHEREAS, the limits of KMC 7.15.020 were last amended by Ordinance 2121-2005 which was adopted on September 21, 2005; and, WHEREAS, the $15,000 limit imposed by KMC 7.15.020 is overly restrictive and limits the Administration's ability to react to situations that arise during each budget year, especially with four or more weeks between some City Council Meetings; and, WHEREAS, KMC 7.15.020 provides no ability for the Administration to issue change orders to contracts or purchase orders, causing delays in projects or requests for Council approval/ratification after the fact; and, WHEREAS, seeking approval again for the purchase of items for which funds were approved with the adoption of the annual budget is redundant and causes delays in the purchase of needed equipment, supplies and services; and, WHEREAS, review of other municipal codes shows that most only require further action by councils/assemblies when the purchase amount exceeds the amount at which formal solicitation for the purchase was required; and, WHEREAS, KMC 7.15.040 requires formal solicitation for any purchase of $35,000 or more; and, WHEREAS, increasing the amount in KMC 7.15.020 to $35,000, the same amount for which formal solicitation is required by KMC 7.15.040, will reduce delays and after -the -fact approvals by Council; and, WHEREAS, inclusion of provisions to accommodate change orders to contracts will increase the efficiency of operations when unforeseen circumstances are encountered; and, WHEREAS, the annual budget process, the purchasing policies promulgated in KMC 7.15 and the proposed amended limits will ensure sufficient controls to protect the public interest remain; and, WHEREAS, providing a procurement system with sufficient controls without overly burdensome requirements is needed for the efficient administration of the City and is in its best interest. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, AS FOLLOWS: Section 1. Amendment of Section of Kenai Municipal Code: That Kenai Municipal Code, Section 7.15.020 is hereby amended as follows: New Text Underlined; [DELETED TEXT BRACKETED] Ordinance No. 3306-2022 Page 2 of 2 7.15.020 Purchases requiring Council approval. (a) Every contract for, or purchase of, thirty-five [FIFTEEN] thousand dollars $35,000.00 [($15,000.00)] or more of supplies, materials, equipment, professional or contractual services shall require the prior approval of the Council. The only exceptions will be: (1) Utility bills (i.e., electricity, gas, fuel, and telephone); (2) City's routine investment purchasing; (3) Monthly payments for payroll deductions (i.e., income tax, F.I.C.A., retirement, and fringe benefits), including both employer's and employee's share; (4) Authorized debt; or (5) Monthly contracted janitorial service. (b) All such exceptions will be paid when they fall due and payments will be ratified by Council at the next regular Council meeting. (c) Purchase order amendments. (i) Thirty-five thousand dollars $35,000.00: or Section 2. Severability: That if any part or provision of this ordinance or application thereof to any person or circumstances is adjudged invalid by any court of competent jurisdiction, such judgment shall be confined in its operation to the part, provision, or application directly involved in all controversy in which this judgment shall have been rendered, and shall not affect or impair the validity of the remainder of this title or application thereof to other persons or circumstances. The City Council hereby declares that it would have enacted the remainder of this ordinance even without such part, provision, or application. Section 3. Effective Date: That pursuant to KMC 1.15.070(f), this ordinance shall take effect 30 days after enactment. ENACTED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, THIS 21ST DAY OF SEPTEMBER, 2022. ATTEST: Michell S r, MC, City Clerk Brian Gabriel Sr., Mayor Introduced: Enacted: Effective: New Text Underlined; [DELETED TEXT BRACKETED] September 7, 2022 September 21, 2022 October 21, 2022 r-, KENAI ,enai 1210 Fidal. Ave, Kenai, AK 99611-7794 1 907.283.7535 1 www.kenai.city MEMORANDUM TO: Mayor Gabriel and Council Members FROM: Council Member James Baisden DATE: August 31, 2022 SUBJECT: Ordinance 3306-2022 Amending Kenai Municipal Code (KMC) 7.15.020, Purchases Requiring Council Approval. The purpose of this memo is to request your support for adoption of Ordinance 3306-2022 which will amend KMC 7.15.020. KMC 7.15.020 establishes thresholds for the types of purchases which require approval of the City Council prior to them being made. The $15,000 or greater threshold requiring Council approval prior to the purchase has not increased since 2005 when it increased from $2,500 to $15,000. The $15,000 threshold is too restrictive, which delays the Administration in its efforts to provide services to the Citizens of Kenai. Limits are important to ensuring the public's interest is protected but should not be so restrictive as to limit the ability to effectively provide City services. In addition, KMC 7.15.020 is silent on change orders to contracts or purchase orders requiring additional council approval prior to issuance when the existing or amended contract amount exceeds the established threshold. In preparing this Ordinance the limits of other governments were examined for comparative purposes. Municipal codes varied from least restrictive being the Kenai Peninsula Borough on which there is no limit on the Mayor's authority to contract or purchase to the City of Homer where no approval is needed for items specifically identified in the annual budget or $10,000. The proposed change is modeled after the City of Wasilla's code which requires formal solicitation for purchases in excess of $30,000, and allows contract or purchase order amendments up to 10% with no additional council action. Proposed changes to KMC 7.15.020 will 1. Increase the threshold for purchases needing prior approval of Council to the same amount at which formal solicitation is required for purchase, $35,000. 2. Add provisions for contract amendments which allow the Administration to increase PO's and contracts previously approved by Council by 15% without the need for additional Council action. These proposed changes will maintain adequate controls and safeguards to protect the public while enhancing the Administration's ability to provide services to the citizens of Kenai. Your support is respectfully requested.