City Council

Summary/Final Minutes – Work Session – August 15, 2013 Savannah City Government SUMMARY/FINAL MINUTES MAYOR AND ALDERMEN WORK SESSION August 15, 2013 – 4:00 pm PRESENT: Alderman Van R. Johnson, II Mayor Pro-Tem (arrived at 4:25 p.m.) Alderman Mary Osborne, Vice-Chairman of Council Aldermen John Hall, Mary Ellen Sprague, Carol Bell (arrived at 4:15 p.m.) and Estella Shabazz (arrived at 4:15 p.m.) City Manager Stephanie S. Cutter ABSENT: Mayor Edna B. Jackson, Presiding (in court) Alderman Tony Thomas, Chairman of Council Alderman Tom Bordeaux City Attorney W. Brooks Stillwell (in court) Alderman Osborne, Vice-Chairman of Council called the meeting to order. City Manager Stephanie Cutter introduced Taffanye Young, Bureau Chief and Carla Byrd, Savannah Entrepreneurial Center Administrator who presented a detailed PowerPoint Presentation on the M/WBE program. Ms. Young introduced the staff at the Entrepreneurial Center. Carl Biathrow, Business Instructor Jacoby Bell, MWBE Compliance Officer, MarRonde Lumpkin-Lotson, who participates in the program as a reference because the program was previously under her, Carla Byrd, Administrator, and Joy Kerkhoff, Purchasing Director. She also recognized Gayle Delaney and Abe Ghazi who were not present. Minority and Women Owned Business Enterprise (M/WBE) Program Overview Ms. Byrd began the presentation by reviewing the mission of the program. The following questions and concerns came up during and after the presentation: Alderman Osborne asked for clarification on one of the goal setting process steps which stated purchasing proceeds with evaluation and recommendation process. Ms. Young stated that is only one piece of the evaluation process, the entire packet still has to be reviewed and sent to the Purchasing Department. City Manager Cutter stated the departments have a very important piece in the evaluation process. Purchasing is there to ensure all procurement laws are being followed correctly. However the actual content of the bids rest on the user departments. Mayor Pro-Tem Johnson asked if the user departments are trained in evaluation they may be good subject matter experts but are they able to subjectively assess the process. City Manager Cutter responded consultants are sometimes used that may be a part of the project. Alderman Osborne asked if the user departments have someone they can refer to, to clarify information if necessary. City Manager Cutter replied yes, project managers are typically 1  Summary/Final Minutes – Work Session – August 15, 2013 assigned to the projects that have experience working with the various contractors that submitted bids. Presently, everyone is working as a team versus in the past, the team aspect wasn’t present and things went missing. Alderman Sprague asked if the firms are registered in the proper areas and how does the program ensure accuracy of the registry. Ms. Young replied there is a slide that will address the concern. In short, it’s a self-registry and that is now maintained in Lawson. The program is also in the process of determining how often businesses need to re-register. Ms. Kerkhoff stated when the emails went out to the vendor list half came back with failed delivery and the department is currently in the process of updating the list. Alderman Osborne asked for clarification of the lowest responsive bid and asked if the state can make the selection. Ms. Byrd stated if it is a certain type of project yes, the state can for example, a drainage improvement project. Ms. Kerkhoff stated projects over $100,000 fall into that category such as road improvements and vertical construction are other examples. City Manager Cutter stated lately it hasn’t been all or nothing. A point system is currently being utilized where points are given based upon the highest goal submitted. Ms. Byrd began describing the 3 methods used the first: all or nothing where both the MBE and the WBE goals must be separately met or exceeded; the second: bid scoring which is a weighted score method where no goal is set. Points are assigned to all respondents based on the highest proposed M/WBE goal received. Total possible points that can be assigned are identified in the RFP. Third: the 10-9-8 Method where the M/WBE goal is set in RFP. Points are assigned based on a “Point Schedule” that is included in the RFP. Alderman Osborne asked how the policy is being injected on 2% below participation and how is it assigned. Ms. Kerkhoff stated it is evaluated in the procurement office not the M/WBE office. The lowest bidder is determined if they are not local the next bidder that is local is looked at to see if they fall within the 2% range and is rewarded based on preference. Alderman Sprague asked for clarification of M/WBE, MBE and WBE goals. Ms. Young explained they are all combined and are taken into consideration as one goal number. Alderman Sprague then asked how you decide what is significant in terms of bidding. Ms. Kerkhoff stated procedurally ten points have always been awarded for M/WBE, with other categories they change based on the categories. Alderman Bell asked for clarification on the local preference process and inquired if it referred to price. If one is considered local do you receive an advantage or opportunity for a low bid? Ms. Kerkhoff stated, yes and clarified an advantage is not received rather an opportunity to match the lowest bid. Alderman Bell stated for clarification, if her bid or RFP is within 2% of the lowest bid and she lives in Savannah, can she match the lowest bid and would she be chosen if qualified. Ms. Kerkhoff stated yes that was correct. Alderman Sprague asked if within the last five years stopped payment on an M/WBE requirements. Ms. Lotson replied it has been enforced however, it has never gotten to the point where the project needed to be interrupted because negotiations for mediation were successful. 2  Summary/Final Minutes – Work Session – August 15, 2013 Alderman Sprague asked for clarification on what negotiations for mediations referred to. Ms. Lotson responded it may be sourced in terms of the sub-contractor for example, if they are not compensated timely that mediation would work because compensation could be provided and the project would not have to be interrupted. Alderman Sprague then asked, is it taken into account if the same contractor comes back to work for the City (i.e. constant compliance issues). City Manager Cutter responded that is a part of performance that is taken into consideration before awarding future contracts. Alderman Bell asked is the scoring process new or has it been in effect all along. Ms. Kerkhoff stated the construction bid process has been done since 2007. Alderman Bell stated it concerns her that bids are getting pulled because the M/WBE goals were incorrect or there was a percentage problem, if the same formula is being used why is the problem arising? City Manager Cutter responded the problem in the past was venturing outside the normal practice and it had to be corrected. Alderman Shabazz referred back to Alderman Bell’s questions about compliance and asked specifically were the shortfalls from the Purchasing Department or the M/WBE program. City Manager Cutter stated it was a combination of both departments. Currently there is a more structured team approach with staff effectively communicating. Alderman Johnson stated they are supposed to work hand in hand and counter balance one another. Based on questions asked by Alderman Shabazz City Manager Cutter provided everyone with a spreadsheet which provided Direct Procurement Activity: Purchases in which payment is made from the City directly to the vendor and Indirect Procurement Activity: Purchases in which payment is made indirectly, by the Primary vendor to the M/WBE subcontractor or sub- consultant in reference to the following question: Based on the City’s M/WBE certification process, how many businesses are currently doing business with the City, what are the names of these businesses, what purchasing category does each business fall under, and what is the dollar amount paid to these business. Alderman Shabazz: What methods are currently used by the City’s Purchasing Department to receive buds? (For example: hard bid, CMR, etc.) City Manager Cutter: there are three primary methods used by the Purchasing Department: the Competitive Sealed Bid or an Invitation to Bid (ITB) is awarded to the responsible bidder with the lowest price that meets specifications for procurements over $25,000. This is the preferred method and includes well-defined specifications, quantities, and/or services. The Competitive Sealed Proposal or Request for Proposal (RFP) is awarded to the proposer that is judged as providing the best solution for over $25,000. This is used for technical or complex purchases, when the City needs to evaluate criteria other than price, and when looking for solutions or qualifications. Best Value Procurements are for construction projects over $50,000. These procurements require issuing a Request for Qualifications first, followed by a construction bid awarded to the lowest responsive and qualified bidder. Informal Quotes are received for items under $25,000. These quotes can be received electronically trough the Supplier Portal, in hard copy, by telephone, fax or email. Alderman Shabazz: based on these methods, what are the names of the M/WBE businesses for each type who are currently doing work for the City? Also, what is the dollar amount associated 3  Summary/Final Minutes – Work Session – August 15, 2013 with the work? City Manager Cutter: we can easily identify the total dollars spent with each M/WBE this year, as outlined in the spreadsheet. Staff would require additional time to provide details to each individual contract. Mayor Pro-Tem Johnson adjourned this meeting. Dyanne C. Reese, MMC, Clerk of Council 4