Commentary: The proposed charter and no-bid contracts
There’s been a lot of talk (and some shenanigans) about the “no-bid” provisions in the proposed Costa Mesa charter.
The council insists there’s no such thing as “no-bid” contracts or purchases. Here’s the truth:
State law. California’s Public Contract Code was enacted to “eliminate favoritism, fraud and corruption in the awarding of public contracts.” (Public Contract Code Section 100)
•Allows public works contracts of $45,000 or less to be issued without competitive bidding. (Section 22032(a))
•Requires informal bids for public works contracts between $45,000 and $175,000. (Section 22032(b))
•Requires formal bids for public works contracts exceeding $175,000. (Section 22032(c))
•Prohibits splitting a project into smaller parts to avoid exceeding the limits established for competitive bidding. (Section 22033)
Costa Mesa Municipal Code. Requires all public works projects (except for maintenance) to be awarded in accordance with Public Contract Code (Section 22032).
•Prohibits splitting a project into smaller parts to avoid exceeding the limits established for competitive bidding.
•Allows purchases of less than $5,000 to be made without competitive bidding. (CMMC Section 2-165)
•Requires informal bids for purchases between $5,000 and $50,000. (CMMC Section 2-167)
•Requires formal bids for purchases exceeding $50,000. (CMMC Section 2-166)
Note: The provisions of the Municipal Code may be changed at any time, by a majority vote of the City Council, as long as the change complies with other applicable laws or regulations (state law now, or city charter if adopted).
Proposed charter. The proposed charter says, “the city is exempt from the provisions of all California statutes regulating public contracting and purchasing” for projects and purchases that are considered “municipal affairs” and are funded only by city revenue sources (no state or federal funding). (Section 401(b))
•The proposed charter requires the council to “set a value at which Municipal Public Works Contracts shall be exempt from formal public bidding” and requires the council to adopt procedures to ensure “the best value and quality of work is being obtained.” (Section 401(c))
What it means. If adopted, the proposed charter would allow three council members to remove current competitive bidding requirements for purchases and contracts and replace them with an unspecified limit to be determined by three council members. It could be $6,000, or it could be $6 million, the charter doesn’t say.
The Municipal Code sections that regulate purchases and public works contracts may be amended or deleted by a vote of three council members, and any new limits may be adopted by ordinance (requires notice, two public hearings and a 30-day “referendum” period before the ordinance is effective) or by resolution (no notice, effective immediately, not subject to referendum).
In summary, if the charter is adopted, three council members will have unlimited authority to allow for “no-bid” contracts. Removing, or greatly increasing, the caps on contracts that do not require competitive bidding open the door to favoritism, fraud and corruption.
Remember, it’s not what the council tells you the charter says, but what it actually says (or doesn’t say, or leaves open for council decision).
PERRY VALANTINE is a retired city employee and a resident of Costa Mesa.