Are municipalities required to adopt a procurement code?
Yes. According to Section 11-35-50 of the South Carolina Code of Laws, "all political subdivisions of the state shall adopt ordinances or procedures embodying sound principles of appropriately competitive procurement no later than July 1, 1983." The content of the procurement ordinance or policy is left to the discretion of the municipal council. The law does not require municipalities to adopt state procedures.
Are there any model ordinances or procedures available?
Yes. In 1983, a state task force developed a model ordinance for political subdivisions; however, this ordinance is most suitable for larger municipalities with a full-time purchasing staff. To assist smaller municipalities, the Association developed a simplified model purchasing ordinance. Municipalities should adapt the model ordinance to meet local needs and operating requirements.
What determines the method used to solicit and advertising for bids?
The local procurement code adopted by the council should specify the dollar threshold(s) that triggers implementation of bid procedures, what methods must be used in each procedure and whether advertising is required. The dollar values in the model ordinance are suggested amounts which can be altered to meet the specific needs of the municipality and its form of government.
Can municipalities establish preferences in its procurement code?
Yes. State law only requires that the adopted procurement code "embody sound principals of competitive procurement." Including preferences is a local policy decision. State and federal courts have upheld properly constructed and applied geographic and/or socioeconomic preferences.
Examples include awarding bids to minority-owned businesses or to local businesses if its bid is within a defined percentage, i.e. 5 percent, of the next lowest bid. The percentage of preference generally is specified in a schedule that varies with the value of the purchase and is often capped on purchases over a defined value. If considering preferences, consult your city attorney before adopting the policy.
The Municipal Clerks and Treasurers Institute will have a session on purchasing and procurement during its Spring session in March.