Contract and Other Requirements
Contracts are required for service work performed by an independent contractor. An independent contractor is defined as an individual (rather than a company) who performs a service (rather than provides a tangible product) for the District. Independent contractors are in business for themselves and are responsible for their own tax reporting to the IRS. An independent contractor uses a social security number for tax identification purposes (rather than a Federal Tax ID number). SB1419 sets specific guidelines for appropriate use of independent contractors. Board approval is required for independent contracts in excess of the legal bid limit of $84,100.
Contracts are required when working with a vendor who provides services to the colleges or the District. These contracts must be submitted to the Executive Vice Chancellor's Office for review and approval prior to the services being rendered. Only the Chancellor and the Executive-Vice Chancellor are authorized to sign contracts for the District. A contract without one of these signatures is not a valid contract.
Board approval is required for contracted services in excess of the legal bid limit of $84,100. Once again, the exception to this amount is public contract code agreements, which require Board approval if they exceed $175,000.
Board approval is required, regardless of the dollar amount, for (1) District use of off-campus facilities which require a lease, or (2) use of District facilities by outside organizations requiring a lease.
A Certificate of Insurance from a contractor performing services is required if the services are performed at a District site. A minimum of $2,000,000 comprehensive general liability is required. Certain large construction projects may require additional insurance. For construction performed under CIP2, the District has a mandatory Owner Controlled Insurance Program (OCIP) for all contracts in excess of $30,000.
Public Works Project Requirements
The District has elected to become subject to the California Uniform Public Construction Cost Accounting Act. The Act provides for alternative bidding procedures when an agency performs public work by contract.
- $0-$45,000 - No Bid Requirements
CUPCCAA exempts this size of project from bidding requirements; the District will negotiate a contract or procure the job by purchase order.
- $45,001-$175,000 - Informal Bid
Bid award to the qualified contractor submitting the lowest quote through an informal bidding process. Bid, performance, and payment bonds continue to be required of all contractors doing work under CUPCCAA. Board action is not required with an informal bid. The District reserves the right to bid a project in this range formally.
- Over $175,000 - Formal Bid
Requires advertisements in a local paper with 14-day advance notice. Trade Journals are notified 30 days in advance. Requires Board approval.
- No Bids Received
If the District receives no bids through the informal or formal bidding procedures, the Act authorizes the District by Section 22038(c) to have the Project completed by negotiated contract, which complies with bidding procedures.
Board Approval Requirements
- Annual membership dues over $25,000.
- Lease agreements.
- Purchases of products or equipment over the legal bid limit of $84,100.
- Contracts or agreements for services, including Independent Contractors, in excess of the legal bid limit of $84,100, except those contracts governed by public contract codes.
- Public Works Projects over $175,000.