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7279-04 ORDINANCE NO. 7279-04 AN ORDINANCE OF THE CITY OF CLEARWATER, FLORIDA, RELATING TO PURCHASES OVER $50,000.00, AMENDING CHAPTER 2, ADMINISTRATION, DIVISION 3, SUBDIVISION II, PURCHASE OF COMMODITIES, SERVICES, AND PUBLIC WORKS CONTRACTS, SECTION 2.561 (6), PERFORMANCE AND PAYMENT BONDS, CODE OF ORDINANCES; PROVIDING FOR SECURITY IN LIEU OF PERFORMANCE AND PAYMENT BONDS AND ALLOWING FOR PERFORMANCE AND PAYMENT BONDS IN AN AMOUNT LESSER THAN THE FULL CONTRACT PRICE WHERE POTENTIAL EXPOSURE OF THE CITY IS DETERMINED TO BE AN AMOUNT LESSER THAN THE FULL CONTRACT AMOUNT; PROVIDING AN EFFECTIVE DATE. WHEREAS, the Code of Ordinances currently permits discretion in requiring a performance and payment bond before entering into a contract, but dictates that where a performance and payment bond is required, it must be for an amount at least equal to the contract price or higher, where necessary to protect interests if the city; and WHEREAS, the Code of Ordinances does not expressly allow for forms of security in lieu of a performance or payment bond; and WHEREAS, Florida Statutes 9 255.05 (7) permits alternative forms of security as specified therein and allows for the value of such other security to be determined by the appropriate city or political subdivision, as long as the purposes of the section and the same conditions applicable to a bond as dictated by Section 255, F.S., are achieved; and WHEREAS, such discretion expands the pool of contractors qualifying as responsive/responsible bidders, creates competition and results in reduced costs flowing to the City, it has been determined to be in the best interest of the City of Clearwater to allow for same; NOW THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF CLEARWATER, FLORIDA: Section 1. Chapter 2, Administration, Division 3, Subdivision II, Purchase of Commodities, Services, and Public Works Contracts, Code of Ordinances is amended to read as follows: Sec. 2.561. Purchases over $50,000.00. Except as otherwise provided in this division, the purchase of commodities or services of an estimated value over $50,000 shall be by purchase order and/or other written contract with the vendor submitting the lowest responsible bid whose bid has been solicited, received and approved, pursuant to the following procedures: Ordinance No. 7279-04 , * * * * (6) Performance and payment bonds. A performance bond and a payment bond, or a "contract bond" combining the elements of a performance and a payment bond, issued by a surety company licensed to do business in Florida, may be required before entering into a contract, in an amount at least equal to the contract price or such higher amount as may be found reasonably necessary to protect the best interests of the city except, in limited circumstances. such as incremental services contracts or blanket purchase orders. where it has been determined by the department director that the potential liability resultinq from the performance or payment under the contract is an amount less than the full contract price. The department director shall obtain the approval of the city manaqer to require a bond for less than the full contract price before proceedinq with the bid process. If such bond is required, the form and amount of the bond shall be described in the notice inviting bids. Bonds required hereunder shall be subiect to all other provisions of this section and the Code. (7) Security in lieu of Performance and Payment Bonds. In lieu of the bond required by this section. a contractor may file with the city, an alternative form of security in the form of cash. a money order. a certified check, a cashier's check. an irrevocable letter of credit. or a security of a type listed in part II. chapter 625 of the Florida Statutes. Any such alternative form of security shall be for the same purpose and be subiect to the same conditions as those applicable to the bond required hereunder. The determination of the value of the alternative form of security shall be made by the appropriate representative of the city as described above. Section 2. This ordinance shall take effect immediately upon adoption. PASSED ON FIRST READING June 17. 2004 July is, 2004 PASSED ON SECOND AND FINAL READING AND ADOPTED ~~-- Brian J. A6f1gst ~ Mayor-Commissioner Approved as to form: ./1:) ~ Lj/t/ / Attest: Laura. Lipowski Assistant City Attorney ................."..."'...." - ia E. ~~aeau- lerk -,.~- ~ ~ ,- - - ...... ....,. ',- - ~-"- ../, -- :-/' - ~ - ...... ~ 2 - -. Ord.ioan~e.N-Q.7279-04 "