Report Prepared by: Venus Rodriguez, Finance Officer
Title
SUBJECT: Approval of a Resolution Declaring the Infeasibility of Using Public Bidding to Purchase Certain Vehicles and Authorizing Limited Direct Purchases
REPORT IN BRIEF
Considers approving a Resolution declaring the infeasibility of using Public Bidding to Purchase certain vehicles and authorizing limited direct purchases
RECOMMENDATION
City Council - Adopt a motion approving Resolution 2025-46, a Resolution of the City Council of the City of Merced, California, Declaring the Infeasibility of using Public Bidding to Purchase certain Vehicles and Authorizing Limited Direct Purchases.
Body
ALTERNATIVES
1. Approve, as recommended; or
2. Approve, subject to other than recommended (identify specific findings and/or conditions amended to be addressed in the motion; or
3. Deny; or
4. Continue to a future meeting (date and time to be specified in the motion).
AUTHORITY
City of Merced Charter Section 3.04.210 - Exemptions from Competitive Bidding:
Except as otherwise provided in this chapter, competitive bidding requirements for purchases in excess of twenty-five thousand dollars ($25,000.00), the "bidding threshold”, may be waived with the approval of the city council.
DISCUSSION
Current market conditions, including supply chain disruptions and long lead times, continue to make it impractical for the City to bid and award contracts for the purchase of vehicles that meet the City’s immediate needs. When we have been successful getting vendors to respond to our bid processes, we have seen lead times increase from nine months up to 18-24 months or when we are ready to purchase, they can no longer honor the bid. The inability to obtain vehicles necessary in a timely manner is impacting the ability to provide essential services. City staff has determined that some vehicles may be obtained timely and at a reasonable price directly from a dealership manufacturer. California law provides that where competitive proposals work in incongruity and are unavailing as affecting the final result or where they do not produce any advantage or where the competitive bidding processes would be impractical and would not serve the purpose of competitive bidding then public entities need not comply with competitive bidding. Section 3.04.21 of the City of Merced’s Municipal Code vests in the City Council the authority to waive the competitive bidding requirements in instances where the City Council deems it appropriate.
On February 21, 2023, and February 20, 2024, the City Council approved similar resolutions which expired June 30, 2023 and December 31, 2024, respectively. Under the first resolution we were able to purchase 7 vehicles with local vendors totaling $309,804.61. This was an average of $44,000 per vehicle. Under the second resolution a total of 14 vehicles totaling $634,850.34 were purchased. Each vehicle ranged between $30,216.44-$59,487.24. Since this continues to be a challenge, we are requesting the approval of a third resolution. The proposed resolution allows the Fleet Division to forego competitive bidding to purchase vehicles directly from a dealership or manufacturer. The resolution has some controls built in that include each vehicle purchase cannot exceed $100,000 and staff can only use this method for purchases not to exceed $900,000. The resolution would expire on June 30, 2026.
IMPACT ON RESOURCES
No additional appropriation is needed. Funding for vehicles to be purchased are included in the FY 2025-26 budget.
ATTACHMENTS
1. Resolution 2025-46