HomeMy WebLinkAbout1998-03-23 City Council (20)TO:
FROM:
City
City of Palo Alto
Manager’s Report
HONORABLE CITY COUNCIL
CITY MANAGER DEPARTMENT: ADMINISTRATIVE
SERVICES
DATE:
SUBJECT:
MARCH 23, 1998 CMR:176:98
SUPPLIES CONTRACTS AWARDED BY THE CITY MANAGER
UNDER PALO ALTO MUNICIPAL CODE SECTION 2.30.060(a),
OCTOBER THROUGH DECEMBER 1997 AND BLANKET ORDERS
SUPPLY CONTRACTS AWARDED BETWEEN JULY 1, 1996 AND
DECEMBER 31, 1997
This is an informational report and no Council action is required.
BACKGROUND
The Palo Alto Municipal Code (PAMC) section 2.30.060, subsection (a) authorizes the City
Manager to award contracts for the purchase of supplies regardless of the dollar amount. In
late December 1997, the PAMC was amended to change the Council reporting requirements
for supply contracts awarded by the City Manager. Effective January 1998, quarterly reports
are required for contracts over $65,000 instead of for contracts over $25,000. This report
covers the time frame prior to the amendment of the PAMC and provides information
regarding supply contracts awarded by the City Manager in excess of $25,000. The attached
report lists all supply purchases over $25,000 awarded from October through December 1997
and blanket order supply contracts over $25,000 from July 1996 through December 1997,
respectively.
DISCUSSION
As part of the Purchasing redesign efforts, the Purchasing Task Force implemented a number
of improvements to the blanket order process. During this effort, staff became aware that
including the purchase of standard commercial services (e.g., dry cleaning services,
newspaper advertising services, etc.) as part of the definition of supplies was questionable.
Although the procurement industry abides by this practice, under the PAMC, such an
interpretation may not be defensible. In the future, accordingly, blanket orders in excess of
$65,000 for standard commercial services will be subject to prior approval by Council and
will not be included as part of this quarterly report to Council.
CMR:176:98 Page 1 of 2
In addition, with the. redesign of the blanket order process, funds for blanket order contracts
are no longer committed (encumbered) in the City’s financial system. This eliminates the
need to establish blanket orders on a fiscal year basis and allows Purchasing to spread the
processing of approximately 800 blankets throughout the year. As a result, the Purchasing
Division has more time to to spend on each order to ensure the City is purchasing high
quality goods and services at the lowest possible price. Since blanket orders are no longer
encumbered, these purchases will now be reported to Council when expenditures exceed
$65,000, versus when the contract is established. A report was created in late 1997 to
provide the blanket order expenditure information needed for monitoring blanket order
activity and for reporting to Council.
ATTACHMENT
Supplies Contracts Awarded October through December 1997and Supplies Purchases on
.Blanket Orders Between July 1, 1996 and December 31, 1997
PREPARED BY: Debbie Park, Account Specialist, Lead
APPROVED BY:
Meliss\a Cavallo
Acting Director -
Administrative Services
CITY MANAGER APPROVAL:
CC: n/a
Er~ily Harrison
Assistant City Manager
CMR:176:98 Page 2 of 2
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