HomeMy WebLinkAboutOrdinance No. 3453-2025Sponsored by: Vice Mayor Knackstedt
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KENAI
CITY OF KENAI
ORDINANCE NO. 3463-2026
AN ORDINANCE AMENDING KENAI MUNICIPAL CODE CHAPTER 7.15 - PURCHASES AND SALES,
SECTIONS 7.15.060 - PROCUREMENT OF PROFESSIONAL SERVICES AND 7.15.070 -
INNOVATIVE PROCUREMENTS AND OTHER EXCEPTIONS, TO ALLOW INSURANCE COVERAGES
TO BE PROCURED BY DIRECT NEGOTIATION AND AUTHORIZE OTHER PROCUREMENT
EXCEPTIONS SUBJECT TO CITY COUNCIL APPROVAL BY RESOLUTION.
WHEREAS, Kenai Municipal Code Chapter 7.15 — Purchases and Sales, determines the City's process
for procuring goods and services as well as sales of surplus items; and,
WHEREAS, Ordinance 2852-2015 repealed and reenacted the Chapter to expand public solicitation
requirements, redefine professional services and define management services; and,
WHEREAS, due to limited competition and the complexity of comparing insurance coverages, an
exception to permit direct negotiation with providers is likely to produce the greatest benefit to the City;
and,
WHEREAS, permitting a Council -approved exception for direct negotiation or limited solicitation when in
the best interest of the City, not prohibited by the funding source, and supported by sufficient evidence
of a fair and reasonable price will allow the City to take advantage of unique opportunities and allow for
the City to obtain necessary goods and services when standard solicitation methods may not work, and,
WHEREAS, requiring City Council approval by resolution ensures transparency, public notice, and an
opportunity for public input; and,
WHEREAS, these amendments support the City's ability to efficiently procure necessary insurance
coverages and other goods and services while maintaining oversight and fiscal responsibility and are in
the best interests of the City.
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
7.15.060 — Procurement of Professional Services is hereby amended as follows:
7.15.060 Procurement of Professional Services.
(a) Professional services for a total contract amount, including all reasonably foreseeable change
orders and modifications, less than ten thousand dollars ($10,000.00) may be procured in any
reasonable manner.
(b) Professional services for a total contract amount, including all reasonably foreseeable change
orders and modifications, of between ten thousand dollars ($10,000.00) and thirty-five thousand
dollars ($35,000.00) require the solicitation of three (3) or more quotes with written documentation
on an applicable purchasing form. If three (3) quotes cannot reasonably be obtained, a written
justification must be documented on an applicable purchasing form.
(c) Professional services procured in an amount in excess of thirty-five thousand dollars ($35,000.00)
must be solicited by issuing a request for proposals. The request for proposals shall state, or
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Ordinance No. 3453-2025
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incorporate by reference, all specifications and contractual terms and conditions to which a
proposal must respond, and shall state the factors to be considered in evaluating proposals and
the relative importance of those factors. Public notice of a request for proposals shall be published
a minimum of two (2) times at least two (2) weeks prior to the date proposals are due in a
newspaper of general circulation within the City and may be advertised in other appropriate
forums. A request for proposals may be modified or interpreted only in written addenda.
(d) The City may negotiate with one (1) or more qualified and responsible proponents whose
proposals are determined to be reasonably responsive to the request for proposals. Negotiations
shall be used to clarify and assure full understanding of the requirements of the request for
proposals. Proponents may be permitted to revise their proposals after submission and prior to
award to obtain best and final offers. Proponents deemed eligible for negotiations shall be treated
equally regarding any opportunity to discuss and revise proposals. Specific fee schedules shall
be kept confidential until after the notice of intent to award is distributed.
(e) Awards shall be made by written notice to the qualified and responsible proponent whose final
proposal is determined to be most advantageous to the City. No criteria other than those set forth
in the request for proposals may be used in proposal evaluation. If the City Manager determines
that it is in the best interest of the City to do so, the City may reject any and all proposals.
(f) Legal services may be procured by direct negotiation with an attorney or law firm qualified to
undertake the type of legal assistance required subject to Council approval for services of fifteen
thousand dollars ($15,000.00) or greater. Negotiations or contracts for the services of legal
counsel shall be pursued by the City Attorney, or in the case of a conflict of interest, the City
Council or City Manager.
igZ Group insurance coverage for employees. including life. medical. dental. and vision, as well as
other insurance such as general liability, workers compensation. Property. marine and airport
liability may be procured by direct negotiation subiect to Council approval by resolution.
Section 2. Amendment of Section 7.15.070 of Kenai Municipal Code: That Kenai Municipal Code,
Section 7.15.070 — Innovative Procurements and Other Exceptions, is hereby amended as follows:
7.15.070 Innovative Procurements and Other Exceptions
(a) A contract may be awarded for supplies, services, professional services, or construction using an
innovative procurement process, with or without competitive sealed bidding or competitive sealed
proposals. A contract may be awarded under this section only when the City Manager or designee
determines in writing to the City Council that it is advantageous to the City to use an innovative
competitive procurement process in the procurement of new or unique requirements of the City,
new technologies, or to achieve the best value. This process is appropriate when it may be in the
best interest of the City to consider an award to other than the lowest priced offer or other than
the highest technically rated offer.
(1) To utilize an innovative procurement procedure the requesting department shall submit:
(A) A detailed procurement plan to the City Manager for review and approval before public
notice is issued as required under KMC 7.15.040. The plan shall, at a minimum, address
the method of solicitation, scope, method of award, protest procedures, and proposed
contract provisions; and
(B) An explanation of how use of this procedure will achieve the best value, or why it is
advantageous to the City. To the maximum extent allowed by law, costs and benefits
associated with the location of the bidder, may be considered in determining the best
value for the City.
(2) When using the process authorized in this section, all of the following apply:
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(A) The City Manager must first approve the use of the proposed innovative procurement
plan.
(B) All evaluation factors and significant sub -factors that will affect the contract award and
their relative importance shall be clearly stated in the solicitation.
(C) The solicitation shall state whether all evaluation factors other than cost or price, when
combined, are significantly more important than, approximately equal to, or significantly
less important than cost or price.
(D) In developing evaluation factors, generally, where the requirement is clearly definable
and the risk of unsuccessful contract performance is minimal, cost or price may play a
dominant role in source selection. The less definitive the requirement, the more
development work required, or the greater the performance risk, the more technical or
past performance considerations may play a dominant role in source selection.
(b) The following may be purchased without giving an opportunity for competitive bidding:
(1) Supplies, materials, equipment, or contractual services which can be furnished only by a
single dealer or which has a uniform price wherever bought.
(2) Supplies, materials, equipment, or contractual services purchased from another unit of
government at a price deemed below that obtainable from private dealers, including war
surplus.
(3) Contractual services purchased from a public utility corporation at a price or rate determined
by State or government authority.
(4) Supplies, materials, equipment or contractual services purchasable under the contract of
another governmental agency in which contract the City is authorized to participate.
(5) The City may award a contract for supplies, contractual services, or professional services
without competition, formal advertising or other formal procedure where the City Manager
determines in writing that an emergency threatening the public health, safety or welfare
requires that the contract be awarded without delay. The City Manager shall make a report
on such contract to the Council no later than the next regular meeting following award of the
contract.
(A) For purposes of this subsection, an "emergency" is defined as the occurrence or imminent
threat of widespread or severe damage, injury, loss of life or property, or shortage of food,
water, or fuel resulting from:
(i) An incident such as storm, high water, wind -driven water, tidal wave, tsunami,
earthquake, volcanic eruption, landslide, mudslide, avalanche, snowstorm,
prolonged extreme cold, drought, fire, flood, epidemic, explosion or riot;
(ii) The release of oil or a hazardous substance if the release requires prompt action to
avert environmental danger or mitigate environmental damage;
(iii) Equipment failure if the failure is not a predictably frequent or recurring event or
preventable by adequate equipment maintenance or operation;
(iv) Enemy or terrorist attack or a credible threat of imminent enemy or terrorist attack
in or against the State that the Adjutant General of the Department of Military and
Veterans Affairs or a designee of the Adjutant General, in consultation with the
Commissioner of Public Safety or a designee of the Commissioner of Public Safety,
certifies to the Governor has a high probability of occurring in the near future; the
certification must meet the standards of AS 26.20.040(c); in this subsection, "attack"
has the meaning given under AS 26.20.200; or
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(v) An outbreak of disease or a credible threat of an imminent outbreak of disease that
the Commissioner of Health and Social Services or a designee of the Commissioner
of Health and Social Services certifies to the Governor has a high probability of
occurring in the near future; the certification must be based on specific information
received from local, state, federal, or international agency, or another source that
the Commissioner or the designee determines is reliable.
The City Council may approve any purchase or award any contract by resolution when the
solicitation of bids or proposals has been limited or the procurement is by direct negotiation
if found to be in the best interest of the City,sufficient information is available to ensure a fair
and reasonable price. and the procurement exception complies with any applicable funding
source requirements.
Section 3. 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 4. 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 5T" DAY OF MARCH, 2025.
ATTEST:
e a r, M , City Clerk
� 41
Brian Gabriel Sr., Mayor
Introduced: February 19, 2025
Enacted: March 5, 2025
Effective: April 4, 2025
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City of Kenai 1 210 Fidalgo Ave, Kenai, AK 99611-7794 1907.283.7535 1 www.kenai.city
MEMORANDUM
TO: Mayor Gabriel and Council Members
FROM: Vice Mayor Henry Knackstedt
DATE: February 11, 2025
SUBJECT: Ordinance No. 3453-2026 - Amending Kenai Municipal Code Chapter
7.15 — Purchases and Sales, Sections 7.16.060 — Procurement of
Professional Services and 7.16.070 — Innovative Procurements and
Other Exceptions, to Allow Insurance Coverages to be Procured by
Direct Negotiation and Authorize Other Procurement Exceptions
Subject to City Council Approval by Resolution.
Ordinance No. 3453-2025 proposes amendments to Kenai Municipal Code Chapter 7.15 —
Purchases and Sales, to allow for direct negotiation in the procurement of insurance coverages
and to authorize additional procurement exceptions with Council approval by resolution.
The first proposed change to KMC 7.15.060 Procurement of Professional Services, improves
efficiency by streamlining the complex insurance procurement process. The market for insurance
is unique and the City contracts with a brokerage firm to assist in exploring the market and
retaining the best coverages for the City. Limited competition and lack of standard products makes
typical bidding or solicitation of proposals less effective and sometimes not feasible. Additionally,
the City's general purchasing procedures do not afford the City the flexibility to take advantage of
different incentives offered by the market that are often not disclosed on the front end of the
procurement process. Allowing direct negotiation will enable the City to secure the most
comprehensive coverage at the best value.
The second proposed change amends KMC 7.15.070-Innovative Procurement and Other
Exceptions, by allowing award of purchases when the solicitation of bids or proposals has been
limited or by direct negotiation if it is found to be in the best interest of the City, evidence of a fair
and reasonable price is presented and the purchase does not conflict with the funding sources.,
such as grants that require a low bid procurement process. This amendment also expands
procurement options for specialized goods and services, provided fair pricing is documented, to
ensure that procurement processes remain agile and responsive without compromising fiscal
oversight. Examples of when this exception could be used include the purchase of used
equipment with exceptional value and negotiations with the market after traditional bidding or
proposal solicitations have failed to yield any responses or viable options. This proposed change
is not intended to be commonly used and are in line with purchasing exceptions employed by
other local governments, including the Borough and Soldotna.
The ordinance includes safeguards to ensure that all exceptions are justified, preventing
unnecessary expenditures while allowing the City to take advantage of unique procurement
opportunities. The exceptions require the City Council to approve the purchase by resolution
ensuring continued transparency and public notice of the procurement decision while allowing
flexibility for unique or time -sensitive purchases.
These amendments will improve the City's ability to efficiently obtain necessary insurance
coverages and other goods and services while maintaining proper oversight and competitive
pricing measures. The added flexibility in procurement methods will ensure that the City can act
strategically and responsibly when standard solicitation processes are impractical.
Thank you for your consideration.
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