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SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan. 1, 2010
THE CORPORATION OF THE TOWNSHIP OF PELEE
PROCUREMENT OF GOODS POLICY
SECTION: Procurements of Goods and Services
SUBJECT: Procurement of Goods Policy
DATE: January 1st, 2010 Amended March 10, 2016
POLICY: It is the policy of the Township of Pelee to establish procedures
for the procurement of Goods and Services.
PURPOSE; To provide a Corporate wide policy for the procedures and controls in the
acquisition of Goods and Services, that applies to all departments, boards and
committees.
SCOPE: Corporate wide policy.
PRINCIPLES:
a. To ensure fairness among bidders.
b. To ensure all goods and services are purchased on a competitive basis at lowest
cost consistent with the quality required and availability.
c. To provide a level of service that meets the time frame requirements for each
department.
d. To ensure openness, accountability and transparency while protecting the financial
best interest of the Township of Pelee.
e. To monitor all purchases within current control resources and to maximize savings
to the taxpayers.
f. Policy will be applicable to all departments of the Corporation of the Township of
Pelee and where their operational and reporting structure permits, boards and
service responsible to the Corporation.
1. OBJECTIVES:
To provide policy and procedure for methods of acquisition:
a. Request for proposals
b. Request for tenders exceeding $25,000.00
c. Request for quotations not exceeding $25,000.00
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
2
d. Request for quotations not exceeding $10,000.00 (Department Manager)
e. Written price quotations
f. Purchases not exceeding $1,000.00
g. Purchases not exceeding $500.00
h. Petty Cash purchases
i. Vendor Selection
j. Bulk purchasing
k. Purchase Orders
l. Blanket Purchase Orders
m. Approved vendors
n. Single Source Items
o. Emergency Purchases
p. Purchase Control
RESPONSIBILITIES:
2. CAO/CLERK/TRESURER
The CAO/Clerk/Treasurer has the overall responsibility for administering and
maintaining the purchasing policy. Municipal council will have the responsibility by
bylaw to establish, review, amend, and enact the purchasing policy.
3. DEPARTMENT ADMINISTRATION
Finance and Administration will be responsible for implementing and maintaining
the proper accounting controls.
All other Department Managers shall, where authorization has been delegated to
purchase, be responsible for ensuring that the principles and objectives of this
policy are adhered to and be responsible for procurement activity and decisions
within their Department.
4. BOARD AND COMMITTEE ADMINISTRATION
Boards and Committees must follow the same procurement and purchasing
requirements as the rest of the departments within the municipality, including all
tender, quote and purchase order requirements, namely Section 6.1.5. All
procurement and purchasing initiated by any board and committee is still subject to
pre-approval by the CAO or Treasurer through the purchase order process.
4.1 Board and Committee Authorization
Boards and Committees must appoint two authorized representatives responsible
for the purchasing process, these members have the sole ability to file purchase
orders, correspond with vendors and initiate any quote or tender process as
supported by the CAO or Treasurer.
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
3
5. POLICY AND PROCEDURES:
The following policies and procedures shall apply to the procurement of all goods
and services for the corporation.
6.1 METHOD OF PROCUREMENT:
6.1.1 Request for proposals
A request for proposal shall be used where one or more of the criteria for issuing a
request for tender cannot be met such as:
a. Owing to the nature of the requirement, suppliers are invited to propose a solution
to a problem, requirement or objective and the selection of the supplier is based
on the effectiveness of the proposed solution rather than on price alone; or
b. It is expected that negotiations with one or more bidders may be required with
respect to any aspect of the requirement.
c. Where the contract price is anticipated to be $100,000.00 or greater and the
request for proposal method of procurement is utilized
6.1.2. Request for Tender exceeding $25,000.00 (Council's approval)
All formal tenders as described below will be subject to a tender policy as established
by Municipal Bylaw and practice.
A request for tender shall be used for purchases exceeding $25,000.00
Tender documents are to be prepared, advertised, analyzed and evaluated by the
originating department and a recommendation prepared for Council consideration.
If a consultant is engaged to issue a tender on behalf of the corporation, the
CAO/Clerk/Treasurer and the appropriate department manager will ensure that the
documentation and recommendation is prepared for Council consideration.
Initial opening of the documents for the above noted preparation and evaluation will
be conducted by the Department Manager, CAO/Clerk/Treasurer and the appropriate
Committee Chair or designate. All tendering review will be open to the parties
submitting the tender.
6.1.3. Request for Quotation not exceeding $25,000.00
Where the estimated value of an acquisition is between $10,000.00 and $25,000.00 a
formal request for quotations (R.F.Q.) will be required. The formal request will
follow a similar procedure as noted in 1.a.b.c.
Request for quotations will require a minimum of three sources as determined by the
department manager.
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
4
Quotations will be analyzed, evaluated and reviewed by the originating department,
reviewed by the appropriate standing committee, with a recommendation to be
forwarded to Council for approval.
The CAO/Clerk/Treasurer may waive where the requirement of the originating
department is such that time does not permit the use of a formal R.F.Q. This
requirement if in his discretion it is in the best financial interest of the corporation.
Support documentation will be required to support any discretionary exercise within
the R.F. Q. provisions.
6.1.4. Request for Quotations (Department Managers) not exceeding $10,000.00
Where the price of an acquisition is between $1,000.00 and $10,000.00 three written
quotations will be required. Any deviation from the number of quotations required
will be subject to documented rationale and approval from the CAO/Clerk/Treasurer.
Where time requirements and cost effectiveness require a faster response, written
price quotations may be waived by the Department Manager if prices can be
confirmed by telephone and properly documented.
All copies of the written quotation will be received by the Administration department
for documentation except where authorized by the CAO/Clerk/Treasurer.
The appropriate Committee Chairperson or in their absence other committee member
designate will also be notified of any potential purchase.
6.1.5. Purchases not exceeding $1,000.00
Where the price of an acquisition is between $500.00 and $1,000.00 properly
documented or noted telephone quotations will be required from three different
sources. Any deviation from the number of quotations required will be subject to
documented rationale and approval from the CAO/Clerk/Treasurer.
Subsequent to processing all written quotations will be received by the
Administration department for documentation except where authorized by the
CAO/Clerk/Treasurer.
6.1.6 Purchases not exceeding $500.00
Where the value of the acquisition is less than $500.00 competitive quotations need
not be recorded, however for Boards and Committees, these expenses should be
outlined in their annual budget, prior to initiating any purchases.
6.1.7Petty Cash Purchases not exceeding $200.00
Cash purchases (petty cash) may be used by approved departments in accordance
with established procedures and where the value is less than $200.00.
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
5
They are not to be grouped to achieve larger purchases, and petty cash is not available
to for use by Boards and Committees.
6.2 Vendor Selection
Notwithstanding section 5 and adhering to principle 2.2 the Township of Pelee
reserves the right to deviate from the established policy if in the opinion of the
Township of Pelee it is in the best financial interests of the municipality.
The municipality is therefore under no obligation to accept the lowest cost or any of
the amounts as submitted and can request further submissions conforming to the
provisions of section 5.
6.3 Bulk Purchasing
In the event of the municipality utilizing bulk purchasing the Township of Pelee
reserves the right to deviate from the local purchasing policies of section 5 providing it
is consistent with principle 2.2.
6.4 Exemptions
The purchase of goods and services listed in Schedule "A" to this bylaw may be made
provided that sufficient funds are available and identified in Council's approved
budget. The purchase of goods and services in Schedule "A" may be made without
following the procedures set out.
6.5 Irregularities
The process for administering irregularities contained in bids shall be set out in
Schedule "B"
7.0 Procedures for procurement
7.1 Purchase Orders
The following procedures shall be observed for all the procurement of all materials
and services.
i)
Purchase order forms will be used exclusively by all departments, local
boards, and committees, for the purchase of supplies and services,
equipment, replacement articles, repairs, etc.
The purchase order form (Schedule C) has the following four parts for use:
Copy 1 (white) to be forwarded to the supplier
Copy 2 (yellow) to be forwarded to the main office accounting dept.
Copy 3 (pink) to be retained by the originating department
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
6
ii)
Purchase orders will be issued by the staff of each department and should
include actual prices or close estimates.
All purchase orders should be totalled and coded to correct general ledger
accounts and include the correct vendor number.
iii)
The department manager/authorized board or committee member of his/her
designate shall sign purchase orders.
iv)
Originator's copy will be removed and retained. The accounting copy will
be forwarded immediately to the municipal office. The supplier's copy will
be mailed or delivered to the supplier by the originating office. The
originating office for inclusion with the approved invoice will retain
receiving copies.
v)
Purchase orders are to indicate correct delivery designation of the supplies
or equipment.
vi)
Materials received will be verified by checking off the items against the
Receiver's copy #3. If the shipment is incomplete, this copy will be signed
and returned to the Municipal Office with the invoice. Indicate "All
material received" on the copy. The municipal office will attach the invoice
and receiving slip to their Copy #2 process the invoice for payment.
7.2 Blanket Purchase Orders
Blanket Purchase Orders, to a limited number of local suppliers, may be
issued if such a purchase order is desirable. Any such purchase order issued
shall be limited as to the time and value per order.
Time: Not to exceed a period of 12 months.
Value: Not to exceed a specific amount of $1,000.00 per order.
i)
Department Managers approval must be obtained for items over
$100.00 on blanket purchase orders.
ii)
Invoices for materials and supplies purchased under blanket
purchase orders must be signed, coded to proper expense account or
a notation made on the invoice as to what the material was used for,
and delivered to the Department Manager.
7.3 Approved Vendors
Finance and Administration will in cooperation with the user departments compile a list
of approved vendors from which no quotes will be required. Such vendors are such that
they supply a specific contracted service, or product.
7.4 Single Source Items
When the Department Manager has selected a vendor as the single source of an item the
acquisition may be made by a regular purchase order. Items exceeding $10,000.00 will
require the approval of Council.
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
7
7.5 Emergency Purchases
Where and emergency exists requiring the immediate procurement of goods, services and
construction, the CAO/Clerk/Treasurer may authorize the purchase required by the most
expedient and economical means.
During working hours the CAO/Clerk/Treasurer or designate shall be contacted to
approve the applicable purchase.
After working hours the Department Manager may arrange to make the applicable
purchase and provide the relevant documentation and rationale in a timely manner to
Finance and Administration for review of the CAO/Clerk/Treasurer or designate
8.0 Purchase Control
The Finance and Administration Department will maintain a system of controls and
provide guidance and review of all purchasing policy activities. These controls shall
ensure that:
- The proper methods and procedures for procurement are used.
- The purchases are made from approved vendors where applicable.
- The procedures applicable to blanket purchase orders and emergency purchases
are being allowed to by all departments.
- All accounting copies (yellow) of the applicable purchase order are to be
forwarded to Finance and Administration.
- All deviations will be monitored and brought to the attention of the department
manager with a copy of the CAO/Clerk/Treasurer.
9.0 Addendum
Schedules "A". "B" and "C" attached hereto shall form part of the Bylaw.
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
8
SCHEDULE "A"
To Bylaw No. 2010-6
The purchasing methods described in this bylaw do not apply to the following goods and
services:
1. Training and Education
a) Registration and tuition fees for conferences, conventions, courses and seminars
b) Magazines, books and periodical unless the purchase of such magazines, books
and periodicals are subject to value-added services
c) Memberships
2. Refundable employee/councillor expenses
a) Advances
b) Meal allowances
c) Travel and entertainment
d) Miscellaneous-non travel
3. Employer's general expenses
a) Payroll deductions remittances
b) Medical
c) Licenses, (vehicles, etc)
d) Debenture payments, grants, tax remittances, petty cash
e) Damage claims
4. Professional Services
a) Legal fees and other professional services related to litigation or legal matters
b) Utilities
c) Advertising services required by the Township on or in but not limited to radio,
television, newspaper and magazines
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
9
SCHEDULE "B"
To Bylaw No. 2010-6
Irregularity Response
Late Bids Automatic rejection and not opened or
read publicly.
Unsealed Envelope
Automatic rejection
Insufficient financial security
Automatic rejection
(no bid security or agreement to
Bond
All required sections of bid
Automatic rejection, unless, in the
documents not completed
consensual opinion of the agent,
the Department Manager in charge and
the CAO/Clerk/Treasurer, the incomplete
nature is trivial or insignificant
Bids received on documents
Automatic rejection
other than those provided or
specified by the Township
Bids containing minor obvious
48 hours to correct and initial errors
clerical errors
Failure to execute agreement to
Bond(suretys consent) or bonding
Automatic rejection
company corporate seal or signature
missing from agreement to bond
Failure to execute bid bond by
Automatic rejection
Bidder and bonding company
a) Corporate seal of the Bidder
48 hours to correct
and bonding company missing
Documents-execution
48 hours to rectify situation
a) Corporate seal or signature missing;
signatory's authority to bind the
corporation or signature missing
Procurement of Goods and Services Policy 2010
SECTION: Procurement of Goods & Services
SUBJECT: Procurement of Goods Policy
DATE: Jan.2, 2010
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