HomeMy WebLinkAboutMINUTES - 10102006 - C.80 i
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Vi): BOARD OF SUPERVISORS '� -_ Uontra
FROM: FINANCE COMMITTEE Costa
Mary N. Piepho, Chair, ,
John Gioia County
DATE: October 10, 2006
C . � O
SUBJECT: Purchase Orders Practices and Procedures
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SPECIFIC REQUESTtSr OR RECOty MENDATIONES_ 3 BACKGROUND AND JUSTIFICATION
RECOMMENDATION:
ACCEPT report from the Finance Committee on current practices and procedures for purchase
orders: DIRECT the Purchasing Agent to make semi-annual reports to the Board of Supervisors
detailing all blanket purchase order activity by department by expenditure: and STIPULATE that I
purchase orders (either 'standard' or 'blanket') for individual items over S25.000 must receive County I
Administrator approval and those over $100,000 must be approved by the Board of Supervisors. i
FISCAL IMPACT:
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No specific fiscal impact although it is anticipated that some savings will be generated through self-
regulation in anticipation of a higher level of review. i
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BACKGROUND:
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The Finarce Committee met on August 1. 2005 and directed staff to study the practices and I
procedures for purchase orders and make recommendations to enhance oversight of the process.
Staff returned to the Finance Committee on July 6 with the following report.
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Currently. Contra Costa has no requirement for purchase orders to receive either Board of Supervisor
or County Administration approval. All contracts, on the other hand. require County Administrator
approval and those with a payment limit exceeding S25,000 require approval by the Board of
Supervisors.
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Purchase Order j
Contra Costa County's current procurement process requires that departments prepare requisitions I
for purchase orders and submit them to Purchasing for processing. Each requisition is reviewed by
Purchasing for pricing, outreach compliance and quality of service prior to issuing the purchase order.
All purchase orders. regardless of cost. are approved by the County Purchasing Officer. i
CONTINUED ON ATTACHMENT: X YES SIGNATURE:
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RECOMMENDATION OF COUNTY ADis:NES-RATCR RECC V.ENDAT.CN CP-90ARD COMMITTEE
APPROVE OTHER
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&GNATURE;S;
APPROVED AS RECOt.it;iENDED i
A:,T;ON OF BOARD ON x��� �Q ��/J� OT R
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VOTE CF SLPERVISCRS i HEREBY CERTIPY THAT THIS IS A TRUE AND CORRECT I
COPY OF AN ACT!CN TAKEN AND ENTERED ON MINU-ES OF
THE BOARD OF SUPERVISORS ON THE DATE SHOWN
JNA"JIF:ACUS tABSEN- /j,6rY10-- i
AYES NOES:
ABSENT: ABSTAIN
Cc^tact: Lisa Dr.sco 1 335-5023
Cc Cc,:c,yAdr-..,i:stra;;c. ATTESTED
Ge era!Seryo-ces JOF- CULLEN.CLERK OF THE BOARD OFSUPERViSORS
A!!Cola+;:DeFartrrerts
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BY DEPUTY/Gy . DEPUTY I
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Beard, rder - Purchase Orders Practices and Procedures
October 10. 2006 /U to aG
Page i wo (2) I
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A blanket purchase order is a contractual agreement. issued on an annual or multi-year basis, which
provides for procurement of goods, services. maintenance services, and/or rentals on an as-needed I
basis with a stipulated maximum amount for a fixed period of time. Used when there will be on-going
activity with a vendor, a blanket purchase order allows departments to order goods and services as I
needed throughout the fiscal year without having to request a new purchase order in each instance.
The County spends approximately S40 million per year through the blanket purchase order process.
The most significant of these orders are those for pharmaceuticals totaling over $10.2 million per ,
year.
Review/Approval i
Currently purchase orders do not require review and approval by the County Administrator's Office or
the Board of Supervisors. In reviewing the process, staff considered requiring some higher level of
approval for purchase orders of a determined amount with the goal of enhancing overall oversight of
these actions. After reviewing the list of purchases, it appears that sufficient oversight is already
occurring in that these purchases are for routine items required for regular operation of departmental i
functions and, as such. are already approved as part of the budget process. Additionally, all
purchasing contracts over S10,000 will now be part of the internet-based automated County outreach
program/E-Outreach as approved by the Board of Supervisors on February 6, 2006. ,
Staff is recommending that the Purchasing Division make semi-annual reports to the Board of j
Supervisors, for informational purposes, detailing all blanket purchase order activity by department by
expenditure. Additionally, staff recommends that purchase orders (either 'standard' or 'blanket) for
individual items over S25,000 receive County Administrator review and those over $100,000 be j
approved by the Board of Supervisors.
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Organizational Assessment
In addition to this review of the purchase order procedure. General Services is in the process of an i
Organizational Assessment as it relates to Purchasing. The Organizational Assessment has three
primary objectives:
1. Provide a comprehensive analysis of Purchasing, including methods of service delivery, cost
structure, and relationships with departments and vendors:
2. Provide an assessment of the type of procurement services that are needed to support
departments, including strengths to build upon and areas to improve; and I
3. Provide a reference for the Board of Supervisors. County Administrator's Office, and
departments to understand the service capabilities and potential of Purchasing, including its I
mission and operational objectives.
These objectives will guide the assessment of the Purchasing & Materials Management Division,
which will include:
■ complete review and evaluation of purchasing and procurement policies, practices, j
Administrative Bulletins. Purchasing Guide, and the County's Purchasing Ordinance;
■ identification of service delivery issues;
■ analysis of workload indicators and identification of performance measures;
■ review fiscal and budgetary practices/issues;
■ evaluate opportunities for improved automation (technology assessment):
■ evaluate communications (internal/external); and
■ identify "best practices" and develop business plan for implementing policy and practice
improvements.
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