CC 02-21-2024 Item No. 10 CMC_Supplemental ReportCC 2-21-2024
Item No. 10
Amendments to the
Cupertino Municipal Code
Chapter 3.22 (Purchase of
Supplies, Materials,
Equipment, and Services)
Supplemental Report
1
CITY COUNCIL STAFF REPORT
SUPPLEMENTAL 1
Meeting: February 21, 2024
Agenda Item #10
Subject
Amendments to the Cupertino Municipal Code Chapter 3.22 (Purchase of Supplies, Materials,
Equipment and Services) and Chapter 3.23 (Public Works Contract and Bidding Procedures) of
Title 3 (Revenue and Finance)
Recommended Action
Conduct the first reading of Ordinance No. 24-XXX: “An Ordinance of the City Council of the City
of Cupertino Amending Chapters 3.22 and 3.23 of the Municipal Code regarding the purchase of
goods and services, and contract and bidding procedures for public work contracts.”
Background:
Staff is providing additional information.
1. The internal audit reports identified in the report can be located on the City website
through the links below or at Internal Audit | City of Cupertino, CA.
The Enterprise Risk Assessment Report was presented to Council on July 20, 2021:
https://www.cupertino.org/home/showpublisheddocument/30061/637708434324670000
The Procurement Operational Review was presented to Council on April 19, 2022:
https://www.cupertino.org/home/showpublisheddocument/30917/637859736846930000
The Fiscal Policy Inventory and Gap Analysis was presented to Council on July 19,
2022:
https://www.cupertino.org/home/showpublisheddocument/31117/637889960212230000
2
2. For clarification on the difference between Council Policy and administrative policy,
Council has the authority to issue Policy’s that guide matters of governance while the
City Manager has authority to adopt and implement administrative policies in
accordance with CMC 2.28.040 to address standardization, guidance and department
responsibilities. This aligns with Moss Adams’ recommended policy framework.
Staff’s responses to questions received from councilmembers are shown in italics.
Q1: Please see the attached Cumming/Concord Contract as an example for which I want to
understand if the city is following the current and proposed purchasing ordinances and best
practices. Here are my questions regarding the Cumming/Concord contract:
(Councilmember Moore)
1. The City Council guidance regarding City Hall was to look at no longer doing a $27M
renovation, but to look at rebuilding an 80,000 SF new city hall and to consider adding
a 500 seat auditorium. When you look at the Project Understanding of the attached
contract, you will see that it veers off into many areas not requested by the Council
and not specified in the Work Program authorized by City Council here:
https://www.cupertino.org/home/showpublisheddocument/33391/6382303944100000
00 The Council referred to BMR ELI housing at Mary Avenue or the Simian Property
which the County has negotiated a swap for, and this contract ignores what Council
requested and inserted other properties and intentions the Council never asked for.
a. This contract Scope is inconsistent with Council direction and did not come to
Council for discussion and agreement
b. The contract includes having a private use of public land, also not agreed by
Council. The contract states they will “Analyze the properties with a specific
focus on the market potential for creating private development opportunities
that will assist in paying for a new City Hall, other facilities and other identified
civic uses.”
2. The contract has multiple other services which would foreseeably increase the costs
above $200,000 and appears to have ‘baked in’ design build construction. Is this
understanding somewhat correct and is this best practice?
Staff Response:
#1 - The question is not germane to the agenda item. Discussion on this item occurred at Council
Meeting 10/17/23, Item 7.
#2 – The cumulative total contract is not to exceed $431,766, including $359,805 in Basic Services
and $71,961 in Additional Services. Contract amendments that would exceed this cumulative total
contract would be presented before City Council for approval.
Q2: Regarding the City Hall Torre Annex project. One is the signed “Draft” which was signed
by the City and the Cumming Representative (see last page of document) October 3, 2022. The
“Draft” contract then came to City Council on October 18, 2022 for approval as item 2:
https://cupertino.legistar.com/View.ashx?M=A&ID=916887&GUID=B4AA5575-4885-41F7-
B77D-BC7A13A8201D The contract then has a new final page in agreement 22-149 with no
3
date of signature by the Cumming rep, and a new signature date of 10/22/2022 by the City.
My questions are: (Councilmember Moore)
1. Did the City appear to have already entered into a contract prior to Council approval
as it appears?
2. Is there an explanation for the signing dates?
3. Is this following our purchasing ordinance?
4. When a project has a construction component, should that be broken out of the
professional services contract because it is under public works contract law? This
contract seems to (like the City Hall/Sport Center/Senior Center/BBF Golf Course
contract above) have the construction combined into it, and already a determination
of design-build not design bid build.
I would like to understand that nuance better and whether there are better practices
regarding the choice of design-build and design bid build and if that is a City Council
discretion or not.
Staff Response: The draft contract and the executed agreement retain the same vendor signature
date of October 3, 2022. The contract was executed on October 20, 2022, two days after the Council
Meeting. The Service Order No 1, for Master Agreement 2020-031, issued on September 12, 2023
was for a different contract that was executed on August 29, 2023. As standard practice, a service
order cannot be executed without an available and valid agreement in place.
This contract is for design professional services that extend through the construction phase, where
the consultant is providing design support. The contract does not include construction activities,
just construction support.
A design-build project contract is typically a large-scale project that will require Council approval.
A design-build contract will have provisions for both professional and construction work necessary
in that type of project. A design, bid and build procurement is the typical approach the City takes
to awarding construction contracts. This procurement approach will include a professional
consultant contract to develop plans and specifications, which are then used to bid and be built by
the low bid contractor through a construction contract.
Attachments Provided with Original Staff Report:
A. Attachment A from published agenda
B. Attachment B from published agenda
C. Attachment C from published agenda
D. Attachment D from published agenda
Attachments Provided with Supplemental Staff Report:
E. Supplemental 1 Attachment D - Purchasing Policy Matrix
Purchasing Matrix
Purchase Amount Procurement Result Competitive Bid/Quote Requirements Delegated Purchasing Authority
(Department authority to make purchasing decision)
Contract Award Authority Delegated Contract
Signature Authority
up to $5,000
P-Card*
Request for Check
Purchase Order
(* Up to P-Card limit)
No bidding requirements Management Analyst/ Supervisor/ Manager Supervisor/ Manager
$5,000 to $10,000 Informal competitive process: Verbal quote or online pricing
(3 vendors outreached)
Management Analyst/ Supervisor/ Manager Supervisor/ Manager
$10,000 to $60,000 Informal competitive process: Written quote or online
pricing (3 vendors outreached)
Supervisor/ Manager Department Head
Above $60,000 to $200,000 RFQ or informal RFP Department Head Department Head
Above $200,000 IFB or RFP Department Head City Council City Manager
Purchase Amount Procurement Result Competitive Bid/Quote/Proposal Requirements Delegated Purchasing Authority
(Department authority to make purchasing decision)
Contract Award Authority Delegated Contract
Signature Authority
up to $5,000 No bidding requirements Management Analyst/ Supervisor/ Manager Supervisor/ Manager
$5,000 to $10,000 Informal competitive process: verbal quote, informal RFP, or
online pricing (3 vendors outreached)
Management Analyst/ Supervisor/ Manager Supervisor/ Manager
$10,000 to $60,000 Informal competitive process: written quote, informal RFP,
or online pricing (3 vendors outreached)
Supervisor/Manager Department Head
Above $60,000 to $200,000 RFQ or RFP Department Head Department Head
Above $200,000 RFP Department Head City Council City Manager
Purchase Amount Procurement Result Competitive Bid Requirements Delegated Purchasing Authority
(Department authority to make purchasing decision)
Contract Award Authority Delegated Contract
Signature Authority
up to $60,000 No bidding requirements CIP Manager City Manager Public Works Director
Above $60,000 to $200,000 Informal competitive process utilizing CUPCCAA list or
Standard PW Project Manual
Department Head City Manager Public Works Director
Above $200,000 Standard PW Project Manual Department Head City Council City Manager
Purchase Amount Procurement Result Competitive Bid Requirements Delegated Purchasing Authority
(Department authority to make purchasing decision)
Contract Award Authority Delegated Contract
Signature Authority
up to $60,000 No bidding requirements PW Assistant Director / CIP Manager City Manager Public Works Director
Above $60,000 to $200,000 Informal competitive process utilizing CUPCCAA list or
Standard PW Project Manual
Department Head City Manager Public Works Director
Above $200,000 Standard PW Project Manual Department Head City Council City Manager
Term Definition:
RFQ = Request for Quote; RFP = Request for Proposal; Invitation for Bid = IFB;
GOODS AND SERVICES
PROFESSIONAL, CONSULTANT or UNIQUE SERVICES
CONSTRUCTION CONTRACTS
CUPCCAA is utilized for public works projects as allowable
and defined in the PCC
Purchase order with
appropriate contract
Purchase Order with
agreement, when
necessary
Purchase Order with
appropriate Services
Agreement
Construction contracts are for public works projects as
defined in the PCC
Operating or maintenance supplies and materials, tools,
furniture, equipment
Operating or maintenance services for buildings or
hardware/software
Note: Online licenses, subscriptions and renewals likely
utilize vendor's terms
Professional, consultant or other unique services are
defined as those provided by a person or firm engaged in a
profession based on a generally recognized special
knowledge or skill.
Purchase order with
construction contract
CUPCCAA (Only for use by PW)
City Manager
City Manager
Rev: January 2024