Purchasing Policy — full text

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Purchasing Policy & AdministraƟve Procedures Page 1 of 6 Purchasing Policy Date adopted by Council: November 28, 2023 1. POLICY STATEMENT The Town of Lunenburg is dedicated to transparent, eﬃcient, and fair purchasing that delivers value to our taxpayers and supports our local community. 2. PURPOSE The purpose of this policy is to ensure that all purchases of goods, services, and construcƟon by the Town of Lunenburg are conducted in a manner that is transparent, compeƟƟve, and eﬃcient while ensuring value for taxpayers' money. 3. SCOPE The Town of Lunenburg will: - Comply with all applicable regional, naƟonal and internaƟonal agreements and acts. - Avoid dishonesty, corrupƟon and favouriƟsm in the procurement of Goods, Services and ConstrucƟon 4. APPLICABILITY This policy applies to all Town of Lunenburg employees involved in purchasing. 5. DEFINITIONS For this policy and administraƟve procedures, the following deﬁniƟons are provided: "Emergency" refers to an unforeseen situaƟon or event that requires immediate acƟon to prevent harm to individuals, signiﬁcant damage to property, substanƟal ﬁnancial loss, disrupƟon of essenƟal services, or any circumstance contrary to the public interest if not addressed promptly. This includes situaƟons where failure to act quickly could reasonably cause economic disrupƟon or other detrimental impacts to the Town of Lunenburg and its residents. "Purchase Order (PO)" is a formal document issued by a buyer to a seller, indicaƟng the type, quanƟty, and agreed prices for products or services. "RequisiƟon Form" details the items or services requested, the reason for the purchase, the requested delivery date, and any other perƟnent informaƟon. Once approved, it serves as the basis for generaƟng a Purchase Order to a supplier. Purchasing Policy & AdministraƟve Procedures Page 2 of 6 "Request for Proposals (RFP)" is a formal document issued to potenƟal suppliers, inviƟng them to submit proposals for a speciﬁc project or service. Unlike a Request for QuotaƟons, which focuses on price, an RFP typically emphasizes the soluƟon, approach, and methodology. "Request for QuotaƟons (RFQ)" is a formal document issued by a buyer to potenƟal suppliers, inviƟng them to submit a detailed price quote for speciﬁc goods or services. "Tender or call for tenders" is a formal, structured invitaƟon to suppliers to submit a bid to supply products or services. 6. TENDERING, QUOTES AND PURCHASING Purchases under $5,000: For purchases below $5,000 + HST, there's no need for a writen Request for QuotaƟons (RFQ) or tender calls. However, if the Purchasing Agent knows of mulƟple suppliers that might beneﬁt the Town, an RFQ can be requested. Purchases of $5,000 - under $10,000: For purchases over $5,000 +HST but under $10,000, a request for quotaƟon (RFQ) should be sent to all known suppliers within reasonable limits if the product or service can be described in a fashion that fair quotaƟons can be obtained. Purchases over $10,000: For purchases exceeding $10,000 + HST, a Tender or Request for Proposals (RFP) will be published on the Town's website or other relevant websites. AddiƟonally, if deemed beneﬁcial for the Town, the Tender or RFP can be directly sent to known suppliers. ExcepƟons: In cases where specialized products are available from only one supplier, a single- source quotaƟon may be pursued. However, the Town can adverƟse these purchases to ensure transparency. 7. AWARDING TENDERS AND QUOTATIONS Tenders or quotaƟons valued at $100,000 + HST or more require approval from Council. However, if Council has passed a resoluƟon granƟng authority to staﬀ, staﬀ can award such tenders or quotaƟons. The Purchasing Agent will approve tenders or quotaƟons under $100,000 + HST unless Council directs otherwise through a moƟon. 8. LOCAL PREFERENCE When prices are idenƟcal and factors like a vendor's past performance, delivery Ɵme, quanƟty, servicing, and quality of goods and services are comparable, suppliers will be chosen based on the following order of priority: - Suppliers located within the Town of Lunenburg. - Suppliers within the County of Lunenburg. - Suppliers within Nova ScoƟa. Purchasing Policy & AdministraƟve Procedures Page 3 of 6 - Suppliers within the AtlanƟc Provinces. - Suppliers elsewhere in Canada. - Suppliers from other locaƟons. In evaluaƟng the purchase price of items, the costs and potenƟal delays associated with servicing the product will be factored in, ensuring the Town achieves the best overall value. 9. EMERGENCY PURCHASING In an emergency, the CAO, Finance Director or designate is authorized to make reasonable and informed procurement decisions of up to $50,000 +HST, which they determine to be necessary to protect and fulﬁll the obligaƟons of the Town or which involve a situaƟon where failure to act could reasonably cause economic disrupƟon or would cause other detrimental impacts to the Town of Lunenburg and its residents. These expenditures must be reported to Council. Emergency purchases greater than $50,000 + HST require Council's approval. 10. GENERAL No purchases of unbudgeted items are permited unless deemed emergency in nature. 11. ROLES AND RESPONSIBILITIES Council - Approves the Town's operaƟng and capital budgets. - Approves tenders or quotaƟons valued at $100,000 + HST or more. - Reviews emergency procurement decisions. Chief AdministraƟve Oﬃcer (CAO) - Designates roles for staﬀ to administer this policy and administraƟve or operaƟonal procedures. - Designates a Purchasing Agent and alternates for the Town of Lunenburg. Clerk's AnnotaƟon for Oﬃcial Policy Book Policy: Purchasing Policy Date of NoƟce to Council: November 14, 2023 Date of AdopƟon: November 28, 2023 I cerƟfy that this Policy was adopted by Council as indicated above. __________________________ Municipal Clerk Date: November 29, 2023 Purchasing Policy & AdministraƟve Procedures Page 4 of 6 ADMINISTRATIVE PROCEDURES Purchasing Policy Date approved by CAO: November 28, 2023 1. STAFF ROLES AND RESPONSIBILITIES Director of Finance - Will ensure a complete set of Procurement Guidelines is maintained to guide municipal staﬀ in procuring Goods, Services and ConstrucƟon in compliance with the Public Procurement Act and related regulaƟons, this policy and procedures, and industry standards. Purchasing Agent: - May, with the CAO's and/or Finance Director's approval, suspend or revoke any employee's purchasing authority for violaƟng this policy and administraƟve procedures. Employees engaged in purchasing acƟviƟes - All employees engaged in purchasing acƟviƟes will ensure that their sole priority is the best interests of the Town of Lunenburg. - All employees who receive items purchased by the Town which are inconsistent in quanƟty or other ordering speciﬁcaƟons must immediately inform their manager so they may address the issue. 2. PURCHASING AUTHORITY The Purchasing Agent, the CAO or the Finance Director is authorized to purchase all items in the Town's Budget once approved by resoluƟon of Council in compliance with this policy. 3. PURCHASE ORDERS The Town of Lunenburg issues two types of Purchase Orders: Small Purchase Orders and Large Purchase Orders. A Large Purchase Order is required for any purchase exceeding $2,500 + HST. A Small Purchase Order is required for all purchases under $2,500 + HST. All purchases made by authorized personnel must be made using a Purchase Order. Purchase Orders should be issued before goods or services are received by the Town. Staﬀ must issue a conﬁrmatory Purchase Order if emergency purchases are made outside of regular Town Hall hours. Purchasing Policy & AdministraƟve Procedures Page 5 of 6 Spliƫng purchases of idenƟcal or similar items to bypass the necessary tendering or quotaƟon process is prohibited. 4. REQUISITION FORMS A completed RequisiƟon Form must be submited to the Purchasing Agent when a request to purchase supplies or services requires a Purchase Order over $2,500 + HST. 5. TENDERS AND REQUESTS FOR PROPOSALS (RFPs) 5.1 IniƟaƟng the Process When public tenders or RFPs are necessary or beneﬁcial for the Town, as judged by the Purchasing Agent, these steps will be followed: The relevant manager or designated person will supply the Purchasing Agent with adequate details to draŌ a Tender Form, RFP, and any associated adverƟsements. When external consultants or engineers are involved, they might draŌ the tender/RFP package and related adverƟsements adhering to their industry standards. If there's a speciﬁc Ɵmeline for delivery, it should be speciﬁed by the staﬀ member overseeing the purchase. The Purchasing Agent will publish the tender or RFP noƟce in appropriate media outlets, such as oﬃcial websites or local/provincial newspapers. Staﬀ might directly send the tender or RFP to recognized suppliers if it beneﬁts the Town. 5.2 Submission Guidelines Adequate Ɵme will be provided for potenƟal bidders to receive, ﬁll, and return the forms within the speciﬁed period. Bids or proposals arriving aŌer the deadline will only be considered if all parƟcipants have been granted a prior extension. Faxed submissions are acceptable. Upon receiving, faxed submissions will be Ɵmestamped, sealed, and delivered to the Purchasing Agent. In speciﬁc scenarios, a deposit may accompany the bid or proposal. Only submissions on the oﬃcial Town of Lunenburg forms are accepted. Extra pages can be added for comprehensive informaƟon. Purchasing Policy & AdministraƟve Procedures Page 6 of 6 5.3 Review Process Tenders and proposals will be unsealed aŌer the closing period. The opening will involve the Purchasing Agent and at least one other staﬀ member, who will sign and date each submission. AŌer opening, tenders and proposals are handed over to the respecƟve department for evaluaƟon and recommendaƟons. 5.4 ExcepƟons The Purchasing Agent, with the approval of the CAO or Finance Director, may deviate from the Tender and RFQ process if they believe an alternaƟve procedure is in the Town's best interest. For purchases over $10,000, excluding HST, any deviaƟons from this policy will be reported to the Town Council in the Budget variance report. 5.5 Decision making For Tenders, the lowest qualifying bid that oﬀers the Town the best value is usually chosen. But the Town can override any irregularity and has the discreƟon to accept or decline any bid. The lowest or any bid will not necessarily be accepted. For RFPs, the Town selects the proposal with the most overall value, reserving the right to waive inconsistencies and accept or decline any proposal. The lowest or any cost proposal will not necessarily be accepted. 6. APPROVAL FOR PAYMENT Goods or services authorized for purchase under this policy and administraƟve procedures and received in acceptable quality and quanƟty may be approved for payment by the relevant Manager, Finance Director, and/or CAO. 7. BUDGET OVERRUNS AND AUTHORIZATION If necessary for operaƟonal purposes, components of a Department's OperaƟng budget may be exceeded if the total Departmental OperaƟng budget is not exceeded. Should this occur, it will be noted in the following Budget variance report with supporƟng reasons. If a fee esƟmate is exceeded for goods or services, such as per unit pricing construcƟon contracts or hourly fees, that are not within an approved budget limit, the prior authorizaƟon of the Purchasing Agent and CAO or Finance Director must be obtained before proceeding and the over-expenditure reported in the following Budget variance report to Council.