THE CORPORATION OF THE NATION MUNICIPALITY POLICY
Policy Number: POL-FIN-05-2025
Version Number: V#2
Policy Title: Procurement of Goods and Services Policy
Effective Date: June 23, 2025
Approval Authority: Council
Resolution / By-law Number: 86-2025
Scheduled Review Date: June 1, 2027
Policy Contact: Nadia Lockhart-Knebel, Treasurer
Initiating Department: Finance
Abstract: This policy provides a framework for departments for the procurement of goods and services.
1. POLICY STATEMENT
This policy shall ensure that all purchasing activities are conducted in a manner that is open, fair, and transparent, and that they achieve the best value for the Corporation. This policy is designed to maximize efficiencies and foster innovation within the procurement process, while adhering to all applicable laws and trade agreements. The Corporation is committed to ethical procurement practices that support local economic development, environmental sustainability, and social responsibility.
2. SCOPE
This policy applies to all Departments and all staff who make purchases.
3. LEGISLATIVE AUTHORITY
Section 270(1) of the Municipal Act, 2001 as amended provides that a municipality shall adopt and maintain policies with respect to its procurement of goods and services. Section 227 of the Act requires officers and employees to implement Council's decisions and establish administrative practices and procedures to carry out Council's decisions.
4. DEFINITIONS
For the purposes of this policy:
Award" is when the contract has been signed by both the vendor and The Nation.
"Bid(s)" means a proposal from a prospective supplier in response to a Request for Quotation, Tender or other proposal for the purchase of goods or services issued by the Municipality which is subject to acceptance or rejection.
"Bidder" means any proponent, respondent, or other person or entity who has obtained official Procurement documents for the purpose of submitting or who has submitted a Bid in response to a Bid request.
"Bid Deposit" means a financial guarantee to ensure that the successful bidder will enter into an agreement with the Nation Municipality.
"Bid Request" means all documents which solicit a response with respect to supplies or services including, but not limited to, a Request for Information, Request for Proposal, Request for Qualifications, Request for Quotations or a Request for Tender.
"Construction" means construction, reconstruction, demolition, repair or renovation of a building, structure or other civil engineering or architectural work and includes site preparation, excavation, drilling, seismic investigation, supply of products and materials and supply of equipment and machinery to the construction, installation and repair of fixtures of a building, structure or other civil engineering or architectural work, but does not include professional services related to the construction contract unless included in the procurement.
"Cooperative Purchases" means the process by which multiple municipalities or public agencies aggregate their purchases to form a large group with similar buying needs thus allowing them to secure better prices and services due to the increased volume of purchase. This allows better value in procurement activities while adhering to the applicable trade agreements and regulations.
"Contract" means a formal written or spoken sales agreement. In the context of this policy, an email confirming purchase shall serve as a form of contract. A contract is not required for all purchases but could be entered into or obtained for a purchase, as required by for the type of purchase.
"Corporation" means the Corporation of The Nation Municipality unless stated otherwise.
"Council" means the Council of the Corporation of The Nation Municipality.
"Department Head" means the person responsible for the management and operational control of a Department within the Municipality.
"Designated Employee" means an employee designated by a Department Head and approved by the Chief Administrative Officer to exercise any or all of the responsibilities with respect to this policy.
"Emergency Purchase" means a situation where, in the opinion of the Chief Administrative Officer or the Department Head, the immediate purchase of goods and services is essential. Such a situation shall include a need to prevent an imminent or actual danger to the life, health or safety of a municipal employee or of the public, to prevent delays in service delivery, to prevent or remedy damages to municipal properties or to restore an essential service and may include, but is not limited to, an emergency declared under the Emergency Management Act
"Finance Department" means the finance department of the Municipality.
"Formal Bid Request" means all documents which solicit a formal written response in a sealed envelope with respect to supplies or services, including but not limited to, a Request for Information, Request for Proposal, Request for Qualification or a Request for Tender.
"Invoice" means a document showing the details and the cost of goods purchased and/or services received from a supplier.
"Invoice Approval" means the procedure required by the Finance Department of the Municipality to ensure the required approvals are applied to an invoice.
"Original Invoice" means a document clearly identifying the supplier, is addressed to the Municipality, shows the sales tax charged on goods and services (HST) along with the tax number. Faxed and emailed invoices are accepted.
"Partner" means a corporation or a community agency with which an agreement is currently in place for the exchange or delivery of good and/or services.
"Piggybacking" means using the procurement contacts of another municipality, public agency, or cooperative group. This allows the municipality to "piggyback" on the contract terms, which have already been competitively solicited, to obtain goods or services without going through its own separate bidding process.
"Pooled Assets" means assets that are grouped together based on similar characteristics such as nature, types of product or service, and other traits. This grouping is done to obtain better purchasing power often in terms of volume discounts. Individually, these assets may have a low monetary value, but when aggregated, they can represent a significant total value.
"Quotation" means a response to a Request for Quotation for prices for specific goods and/or services from selected suppliers, submitted in writing as specified in the Request.
"Record of Tender Opening" means a document that records the bids at a public opening of bids.
"Request for Information (RFI)" means a process where information is requested from suppliers regarding the feasibility and availability of specific goods and/or services in the marketplace and to determine if there are enough suppliers to justify a Request for Proposal. The responses to an RFI can be used to pre-qualify suppliers for an upcoming Request for Proposal.
"Request for Proposal (RFP)" means a formal request for details on the supply of goods or the provision of services which cannot be fully defined or specified at the time of request.
"Request for Qualification" means a document used for evaluating suppliers based on issues such as capacity, adequacy of personnel, past record, experience, etc. The responses to an RFQ can be used to pre-qualify suppliers for an upcoming Request for Proposal.
"Request for Quotation (RFQ)" means a document describing the supplies and services required and requiring written response by either mail, email or facsimile.
"Request for Tender (RPT)" means a formal, publicly advertised request for sealed bids for the supply of goods and/or services.
"Scope of work" is the work that has been described in a bid solicitation that must be done to deliver the good and/or services with the specified features and functions within the time, quality and price specified.
"Sealed Bid" means a bid submitted in a sealed envelope.
"Services" means requirements that are not goods or supplies.
"Single Source" means only one supplier is recommended for providing a particular product or service for operational reasons, even if there is more than one source on the market. This indicates a non-competitive purchase.
"Sole Source" means that there is only one known source of a particular product. This product could be copyrighted or trademarked or is simply not available for general purchase.
"Successful Bidder" means the bidder selected by the Municipality to provide goods and/or services based on this procurement process.
"Supplier" means any person or company supplying goods and/or services to the Municipality.
"Supplies" means goods, items, merchandise, material and equipment.
"Two-envelope Bid" means the process of submitting the bid in two envelopes with technical and qualitative information in the first envelope and the bid price in the second.
Schedules A, B, C, D, E, and F attached hereto form part of this policy.
5. ADMINISTRATION
This policy is administered by the Finance department.
6. POLICY
6.1. PROCUREMENT PRINCIPLES
The procurement activities of The Nation shall be guided by the following principles:
a) Transparency: All procurement processes shall be transparent and open to competition, ensuring equal opportunities for all qualified supplier
b) Fairness: Procurement decisions shall be made impartially and without bias, based on predetermined evaluation criteria.
c) Value for Money: The primary objective of procurement shall be to obtain the best value for money, considering quality, cost, and other relevant factors.
d) Accountability: Procurement activities shall be conducted in a manner that ensures accountability to taxpayers and stakeholders.
6.2. PROCUREMENT PROCESS
a) Planning: Prior to initiating any procurement activity, departments shall conduct thorough planning to identify needs, assess requirements, and develop specifications. When considering procurement options, departments may explore the use of procurement groups such as Canoe to leverage collective purchasing power, streamline processes, and achieve cost savings.
b) Solicitation: When procurement needs arise, departments may utilize Canoe or other procurement groups to facilitate the solicitation process. This may include issuing requests for proposals (RFPs), requests for quotations (RFQs), or requests for information (RFIs) through Canoe's platform. Departments shall ensure that solicitation documents clearly specify the use of Canoe or other procurement groups, including any specific procedures or requirements associated with such procurement.
c) Evaluation: All submissions received through Canoe or other procurement channels shall be evaluated based on predetermined evaluation criteria, which may include price, quality, delivery time, and other relevant factors. Departments shall ensure that evaluations are conducted in accordance with established procedures and that all suppliers are treated fairly and equitably.
d) Award: The award of contracts shall be made to the supplier(s) offering the best value for money, as determined through the evaluation process. Contracts may be awarded directly through Canoe or through other procurement mechanisms, as deemed appropriate. Departments shall ensure that contract awards are made in compliance with applicable laws, regulations, and organizational policies.
e) Contract Management: Upon award, contracts shall be managed in accordance with established contract management procedures, ensuring compliance with terms and conditions, monitoring performance, and addressing any issues that may arise. Departments shall collaborate with Canoe or other procurement groups as necessary to effectively manage contracts and ensure the delivery of goods or services in accordance with contractual requirements.
6.3. APPLICATION
a) The policies and procedures outlined in this policy, including all purposes, goals and objectives of Section 1 shall be followed for the purchase of goods and/or services by The Corporation or any of its officers, servants, or employees.
b) The methods of purchasing set of in section 6 shall not apply to the purchase of goods and services outlined in Schedule F. This provision provides authority for the purchase of goods and services outlined in Schedule F if the funding is available in the budget.
c) Any contracts necessary to complete the purchase of good and/or services outlined in Schedule F shall be signed by the CAO or the appropriate signing authority as set out in The Corporation's delegation of authority by-law.
d) Purchases may be made only when:
i. The contract (if applicable) has been prepared in a form satisfactory to the department head and/or CAO;
ii. Any financial securities and insurance required under the contract are satisfactory to the Treasurer; and
iii. Funding is available in the budget for the purchase.
6.4. PURCHASING AND AUTHORIZATION RESPONSIBILITES
6.4.1. COUNCIL
a) Council has ultimate authority for all expenditures. This authority is delegated by approval of budgets or by a specific resolution. The Finance Department is not authorized to pay for items that have not been authorized through budget or resolution.
b) Despite any other provisions in this Policy, the following contracts are subject to Council approval:
i. Any contract requiring approval from the Ontario Municipal Board;
ii. Any contract requiring approval from the Local Planning Appeal Tribunal;
iii. Any contract prescribed by Statute to be awarded by Council;
iv. Where the cost or revenue amount proposed for acceptance is higher than the Council approved department estimates and the necessary adjustments cannot be made;
v. Where a contract is a result of a public private partnership ("P3) opportunity.
c) No provision in this Policy precludes a Department Head from submitting a recommendation to award to Council where in the opinion of the Department Head and the CAO it is in the best interest of the Municipality to do so.
6.4.2. CAO
a) Has the authority to instruct department heads not to award contracts and to submit recommendations to Council for approval and may provide additional restrictions concerning procurement where such action is considered necessary and in the best interest of The Nation.
b) Contracts are subject to the CAO's approval, when a major irregularity precludes the award of a tender to the Supplier submitting the lowest responsive Bid.
6.4.3. DEPARTMENT HEADS
a) Department Heads are responsible for procurement activities within their department and are accountable for achieving the objectives of this procurement policy.
b) Department Heads have the authority to award contracts in the circumstances specified in this policy provided that the delegated power is exercised with the limits prescribed in this policy and that all requirements of this policy are met.
c) Department Heads shall ensure and provide evidence, if needed, to the CAO that the contract pricing represents fair market value.
d) Department Heads are responsible for approval of accounts within their approved budget for their department and for any amendment thereto as approved by Council resolution.
e) Resolutions approving budget amendments or special appropriations shall contain a description of the purpose of the expenditure, cost estimates or expenditure limitation and the fund within which an appropriation has been provided. All reports by Department Heads recommending such resolutions shall be submitted to the CAO.
f) A Department Head may delegate his authority to a supervisor or designate provided the designate follows the requirements of this Policy. The Finance Department shall be informed of all such appointments.
6.4.4. TREASURER
a) Is responsible for establishing, through consultation with the CAO, standards for bid solicitations, purchase orders, contracts, and other documents.
b) Ensure open, fair, and impartial purchasing processes for goods and/or services.
c) Ensure compliance with this policy and advise the CAO when there has been non- compliance.
6.5. EXEMPTIONS
6.5.1. This policy does not apply to the procurement of good or services for municipal drains.
6.6. REQUIREMENT FOR APPROVED FUNDS
a) The exercise of authority to award a contract is subject to the identification and availability of sufficient funds in appropriate accounts within the budget.
b) Where goods and/or services are routinely purchased or leased on a multi-year basis, the exercise of authority to award a contract is subject to the following:
i. The identification and availability of sufficient funds in the appropriate accounts for the current year within the budget;
ii. Where the goods and/or services will continue to be required in subsequent years, in the opinion of the Treasurer the required funding can be reasonably expected to be made available; and
iii. The contract includes a provision that the supply of goods and/or services in subsequent years is subject to the approval by Council of the budget estimates to meet the proposed expenditures.
iv. Advertising is not required for services that may be provided only by any of the following licensed professionals: engineers, land surveyors, architects, laboratory professionals, accountants, lawyers, and paralegals.
6.7. PURCHASING MECHANISMS
The estimated expenditure value of the goods and/or services requirement will determine the purchasing mechanism to be used as per Schedule "A" "Methods of Procurement".
6.7.1. PETTY CASH
a) The purpose is to provide the possibility for each department to purchase goods less than $149.99 by way of a petty cash fund.
b) The Treasurer shall have the authority to establish the petty cash funds in such amount as deemed required by a Department.
c) All purchases made from petty cash shall be approved and coded by the Department Head and submitted to the Finance Department.
6.7.2. CREDIT CARDS
a)The purpose is to provide Departments with a simplified system for the purchase and payment of goods and/or services not exceeding $10,000.00.
b) All purchases made with the credit card shall be approved and coded by the Department Head and submitted to the Finance Department.
c) The Treasurer shall have the authority to establish the maximum spending limit on the credit card in amounts as deemed required by the Department.
6.7.3. SUPPLIER CARDS / ACCOUNTS
a) The purpose is to provide Departments with a simplified system for the purchase and payment of goods and/or services generally not exceeding $150,000.00.
b) All purchases made with the supplier card or charged to a supplier account shall be approved and coded by the Department Head and submitted to the Finance Department.
c) The Treasurer shall have the authority to request maximum spending limits on the supplier cards or accounts in amounts as deemed required by the Department.
6.7.4. CONTRACT
a) A Department Head or Designate shall be authorized to make purchases of goods and services for estimated expenditures exceeding $10,000.00 but not exceeding $150,000.00 from a supplier through the use of a contract, whether formal or informal.
b) All purchases agreed to by way of a contract shall be approved and coded by the Department Head and submitted to the Finance Department.
6.7.5. REQUEST FOR QUOTATION (RFQ)
a) A Department Head or Designate shall be authorized to make purchases of goods and services for estimated expenditures exceeding $25,000.00 but not exceeding $150,000.00 from a supplier subject to first obtaining three (3) written quotes whenever possible or a Request for Tender. RFQ documents and specifications (as applicable) may be issued by the Department by mail, email and/or facsimile.
b) When the selected quote or tender exceeds the approved budget by 10%, the Department Head shall submit a report to the CAO and Council for direction and/or approval in accordance with this Policy.
6.7.6. REQUEST FOR TENDER (RFT)
a) The overall objective is to obtain the goods and/or services at the best price from an appropriately qualified supplier. The RFT documents and specifications (as applicable) shall include the requirements as per Schedule B "Request for Tender".
b) A Department Head or Designate shall not purchase goods or services exceeding $150,000.00 without requesting and obtaining sealed tenders unless specifically authorized by Council resolution to do otherwise. A least three (3) tenders shall be obtained whenever possible.
c) When several departments come together to make purchases of the same type, the value of a minimum of $150,000.00 will be calculated by department rather than for the total group purchase.
d) When the selected tender exceeds the approved budget by 10%, the Department Head shall submit a report to the CAO and Council for direction and/or approval in accordance with this Policy.
e) When the RFT process is completed but the purchase is postponed, the tender results may be used for a twelve (12) month period providing the pricing remains available. When the purchase is made within the twelve months and the amounts are budgeted, the RFT process will continue as if no interruption had taken place. When the purchase is made within the twelve months, but the amount exceeds the budget, the Department Head shall submit a report to the CAO and Council for approval. If the purchase is made after the twelve-month period, the Request for Tender process must be repeated.
6.7.7. REQUEST FOR PROPOSAL (RFP)
a) The overall objective is to obtain the required goods and/or services at the best price from an appropriately qualified vendor. The RFP documents shall include the main requirements as per Schedule C "Request for Proposal".
b) A Department Head shall not purchase goods and/or services exceeding $150,000.00 without requesting and obtaining sealed proposals for goods and/or services unless specifically authorized by Council resolution to do otherwise. Whenever possible, at least three (3) proposals must be obtained.
c) A Department Head may use an RFP instead of a RFQ or a RFT when goods or services cannot be precisely stipulated, or when alternative methods are being sought to meet certain requirements of the Municipality.
d) A Department Head may choose not to open the proposals publicly when a RFP is used.
e) Proposals may be evaluated with a scoring system where the price is one of the evaluation criteria. In this case, the proposal achieving the highest score based on the set criteria will be awarded the contract, even if it is not the lowest bidder.
f) A two-envelope proposal process may be used for RFP. Each proposal is submitted in two envelopes with technical and qualitative information shown in the first envelope and the proposal price in the second. The bidder's second envelope is opened only if the first envelope demonstrates that the bidder is qualified. There will be no public opening when a two-envelope process is used.
g) When the selected proposal exceeds the approved budget by 10%, the Department Head shall submit a report to the CAO and Council for direction and/or approval in accordance with this Policy.
6.8. NON-COMPETITIVE PROCESS
a) A non-competitive process shall only be used if one (1) or more of the following conditions apply and a process of negotiation is undertaken to obtain the best value in the circumstances for the Corporation.
i. For any acquisition under $10,000;
ii. When the proposed acquisition is a Sole Source acquisition due to:
a. a statutory or market-based monopoly;
b. rarity of supply in the market;
c. the existence of exclusive rights such as patent, copyright, or licence; or d. the complete items, Services, or systems being unique to one (1) Supplier and no alternatives or substitutes existing within Canada.
b) When the proposed acquisition is a Single Source acquisition and one (1) or more of the following reasons for selecting a particular Supplier apply:
i. the need for compatibility with goods/Services previously acquired and there are no reasonable alternatives, substitutes, or accommodations;
ii. the need to avoid violating warranties and guarantees where Services/support is required;
iii. the extension of an existing Contract would prove more cost-effective or beneficial;
iv. due to market conditions, required goods/Services are in short supply;
v. the required goods/Services are to be supplied by a particular Bidder having special knowledge, skill, expertise, or experience, which cannot be provided by any other person; or
vi. the nature of the requirement is such that it would not be in the public interest to solicit competitive Bids, as in the case of security or confidential matters.
c) An attempt to purchase the required goods/Services has been made in good faith, using a competitive Bid process, and has failed to identify a Successful Bidder.
d) The required goods/Services are to be supplied because of an emergency as covered under section 6.14.
e) Where it is deemed to be in the best interests of the Corporation to negotiate with the Bidder as covered under section 6.15.
f) A Sole and Single Source listing will be maintained by each head of department for their department. This list will be submitted to the Finance department annually and can be presented to Council upon request.
g) All non-competitive purchases over $100,000 for Goods and Services and over $250,000 for construction must be recorded in the electronic tendering system as an awarded Contract. To meet the reporting requirements from the Trade Agreements in place, regarding the use of limited tendering for purchases at/or above the threshold, the following information shall be entered into the electronic tendering system:
i. the name of Supplier;
ii. the value of the Procurement;
iii. the kind of goods and services procured; and
iv. the circumstances and conditions under which the limited tendering exception is claimed.
h) In order to ensure proper use of non-competitive purchasing, a post-purchase review will be conducted
6.9. STANDING OFFERS
a) The purpose of a Standing Offer is to facilitate the purchase of Goods and Services to be supplied on an ongoing basis at a predetermined amount over a defined period.
b) The Department Head may establish Standing Offers using the applicable bid mechanism based upon the estimated annual expenditure. Standing Offers may also be coordinated and issued by the Finance Department for all municipal departments as applicable.
c) Standing Offer terms shall not exceed 48 months period from the date of the Standing Offer approval, with the potential extension of an additional 24 months.
d) Employees shall submit a Declaration of Interest letter when submitting a Bid for a Standing Offer.
6.10. COOPERATIVE PURCHASING
a) The Corporation may participate in cooperative purchasing where it is in the best interest of the Corporation to do so, and the policies of the cooperative purchase venture are consistent with the Corporation's Procurement Policy and in compliance with the Canada Free Trade Agreement (CFTA).
b) The Corporation may participate in cooperative purchasing ventures with other government agencies, public authorities, or cooperative purchasing groups, including but not limited to the Ontario Government Vendor of Record Program, Local Authority Services (LAS), or the Canoe Procurement Group.
c) Where other government agencies have included a piggyback clause in their bid request, and with the contractor(s) approval, the Corporation may piggyback on other government agencies contracts, where it is in the best interest of the Corporation to do so. The Corporation may also allow other government agencies to piggyback contracts established by the Corporation with the approval of the Corporation's selected Contractor(s).
6.11. DISCRETIONARY POWER
a) Bidders shall acknowledge that the Municipality shall have the right to reject any or all bids for any reason, or to accept any bid which the Municipality in its sole unfettered discretion deems most profitable. The lowest bid, or any bid, will not necessarily be accepted and the Municipality shall have the unfettered right to:
i. Accept a non-compliant bid;
ii. Accept a bid which is not the lowest bid;
iii. Reject a bid that is the lowest bid even if it the only bid received;
iv. Request clarification or further information regarding any item in a bid;
v. Consider any alternate goods, services, terms or conditions that may be offered, whether such offer is contained in the bid or not;
vi. Breakdown a RFP/RFT or any agreement negotiated in connection with same, into multiple parts and accept proposals (or portions thereof) from more than one bidder;
vii. Enter into negotiations, at any time before or after a proposal submission deadline, with anyone, in relation to the subject matter hereof;
viii. If applicable, reject any bidder's recommendation of any subcontractor or any other third party associated with a bid and jointly, along with such bidder, determine alternate acceptable third parties;
ix. Extend or otherwise vary the proposal submission deadline, or any other timeline set out with the RFT/RFP;
x. Revise or modify the RFT/RFP;
xi. Withdraw or cancel the RFT/RFP in whole or in part, whether having received any response thereto or not;
xii. Waive any of the stated requirements set out in a RFT/RFP or request non- compliant proponents to rectify any non-compliance within such time as the Municipality may require.
b) During the evaluation of the bids, the municipality reserves the right to consider:
i. Information provided in the bid document itself;
ii. Information provided in response to credit and industry reference enquiries set out in the bid;
iii. Information received in response to enquiries made by the municipality or third parties, apart from those disclosed in the bid in relation to the reputation, reliability, experience and capabilities of the bidder;
iv. The manner in which the bidder provides services to others;
v. The experience and qualifications of the bidder's senior management and project management;
vi. The bidder's compliance with the municipality's requirements and specifications; and innovative approaches proposed by the bidder in the bid.
c) The bidder acknowledg"