Article 3. Purchases of California Public Utilities Code >> Division 6. >> Chapter 6. >> Article 3.

(a) Except as specified in Section 12751.5, the purchase of all supplies and materials, when the expenditure required exceeds twenty-five thousand dollars ($25,000), or in a district that has a population of 250,000 or more, when the expenditure required exceeds fifty thousand dollars ($50,000), shall be by contract let to the lowest responsible bidder. Notice requesting bids shall be published pursuant to Section 6061 of the Government Code at least 10 days before bids are received. The district may reject any and all bids and readvertise in its discretion. The board may authorize the general manager to determine, in the discretion of the general manager, whether to reject all bids and whether, after the bids have been rejected, to readvertise.
  (b) The dollar limit identified in subdivision (a) shall annually be adjusted upward or downward to reflect the percentage change in the Implicit Price Deflator for State and Local Government Purchases of Goods and Services for the United States, as published by the U.S. Department of Commerce. The annual adjustments shall be rounded to the nearest one thousand dollars ($1,000).

Notwithstanding Section 12751, the board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may authorize the general manager to determine the lowest responsible bidder and to award a contract to that bidder.

Notwithstanding Section 12751, the board of a district which has owned and operated water distribution or sewage disposal systems for at least eight years and has a population of 250,000 or more may authorize the general manager to act for the board in determining the lowest responsible bidder and awarding a contract to that bidder where the expenditure required by the bid price is less than one hundred thousand dollars ($100,000). When acting pursuant to this section, the general manager shall, in each instance, promptly notify the board of the action taken.

(a) The purpose of this section is to provide affected districts with an alternative acquisition process that will result in reduced costs to ratepayers. Notwithstanding Section 12751, when the expenditure for the purchase of supplies and materials exceeds fifty thousand dollars ($50,000) and the district determines that ratepayers reasonably can expect a net benefit in the cost of district services, the district may provide for the purchase of the supplies and materials by contract let in accordance with best value at the lowest cost acquisition policies adopted by the board pursuant to this section.
  (b) The best value at the lowest cost acquisition policies adopted pursuant to subdivision (a) shall include the following:
  (1) Price and service level proposals that reduce the district's overall operating costs.
  (2) Supplies and materials standards that support the district's strategic supplies and materials acquisition and management program direction.
  (3) A procedure for protest and resolution.
  (c) For purposes of this section, "best value at the lowest cost acquisition" means a competitive procurement process whereby the award of a contract for supplies and materials may take into consideration any of the following factors:
  (1) The total cost to the district of its use or consumption of supplies and materials.
  (2) The operational cost or benefit incurred by the district as a result of the contract award.
  (3) The value to the district of vendor-added services.
  (4) The quality, effectiveness, and innovation of supplies, materials, and services.
  (5) The reliability of delivery or installation schedules.
  (6) The terms and conditions of product warranties and vendor guarantees.
  (7) The financial stability of the vendor.
  (8) The vendor's quality assurance program.
  (9) The vendor's experience with the provision of supplies, materials, and services.
  (10) The consistency of the vendor's proposed supplies, materials, and services with the district's overall supplies and materials procurement program.
  (11) The economic benefits to the general community related to job creation or retention.
  (d) If a district that did not purchase supplies and materials by contract let pursuant to this section before January 1, 2006, elects to purchase supplies and materials by contract, let in accordance with best value acquisition policies adopted by the board pursuant to this section, the district shall submit a report to the Legislative Analyst on or before January 1, 2011. The district shall include in the report a summary of the costs and benefits of best value acquisition compared to traditional low bid procurement practices. The report shall also include statistics showing the number of contracts awarded to small businesses, minority-owned businesses, and new businesses and the number of years each contract awardee had been in business. The report shall also include an analysis of the effects of best value procurement practices on these businesses, the nature of any disputes arising from the use of best value procurement practices, and the status of those disputes. On or before April 1, 2011, the Legislative Analyst shall report to the Legislature on the use of "best value at lowest cost acquisition" procurement practices used by municipal utility districts, and recommend whether to modify this section and extend the authority of additional districts to elect to purchase supplies and materials by contract let in accordance with best value acquisition policies, beyond January 1, 2012.
  (e) The district shall ensure that all businesses have a fair and equitable opportunity to compete for, and participate in, district contracts and shall also ensure that discrimination in the award and performance of contracts does not occur on the basis of marital status, ancestry, medical condition, any characteristic listed or defined in Section 11135 of the Government Code, or retaliation for having filed a discrimination complaint in the performance of district contractual obligations.
  (f) A district that did not purchase supplies and materials by contract let pursuant to this section before January 1, 2006, shall not purchase supplies and materials by contract let pursuant to this section after January 1, 2012.

If after the bids have been rejected, the board determines and declares by a four-fifths vote of all the members of a five-ward district, or by a five-sevenths vote of all the members of a seven-ward district, that in its opinion the materials and supplies may be purchased at a lower price in the open market, the board may proceed, or may authorize the general manager to proceed, to purchase the supplies and materials in the open market without further observance of the provisions requiring contracts, bids, or notice.

In case of any great emergency, the board may, by resolution passed by a four-fifths vote of all the members of a five-ward district, or by a five-sevenths vote of all the members of a seven-ward district, declare and determine that such emergency exists, and thereupon proceed to expend sums or enter into contracts involving the expenditure of any sums needed in such emergency without observance of the provisions requiring contracts, bids, or notice.