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July 8, 1993
HONORABLE CITY COUNCIL
Palo Alto, California
Meabe~8 of the Council:
Baokclropp4
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In response to two separate requests in september and October 1992,
Purchasing statf submitted information to the Grand Jury of Santa
Clara county regarding procurement policies and practices.
The information provided concerned the fol1o~ing areas:
1. Bow we assure tha~ departments follow procurement policies
and what reports are qenerated in that process;
2. How staff deals with potential problems regarding conflict of
interest and 901e source issues;
3. How we ensure compliance with Disadvantaged Business Enter
prises (DBE) , Americans with Disabilities Act (ADAJ, and other
established social programs.
The aaterials furnished were. reviewed by the Grand JUry, which
indicated by a ri'inal Report-(Attachl!lent A) issiled in June of 1993
that,
-The Grand Jury review indicates that the cities in Santa
Clara County qenerally have and are followinq adequate
written procurement policies and procedu~es.·
Attach: Attaclment A,
92-93 Grand 3ury Final Report
CMR:J86:9J
,
ATIACHMENT A
1992-93 Santa Clara County Grand Juri
MAL REPORT
1. REVIEW OF CmES' PROCEDURES FOR AWARDiNG
CONTRACTS FOR GOODS AND SERVICES
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o
REVIEW OF CInES' PROCEDURES FOR
AWARDING CONTRACTS )OOR GOODS AND SERVICES
INTRODUCTION
The Grand JUlY reviewed the procedures used by cities in the County for
awarding contracts for' goods and ~ervices to determine whetner such goods and
services are obtained tn accordance V'.itP1 sound pojicies.
NARRATIVE
A letter was sent to each of the fifteen chics in the coun~y requesting
Copie!5 o~ their most fi3Cent fi.nandal reports, auditor comment le\!~rs. and
procurement policy and procedure manuals. The Grand Jury re~'"iewed the policies
and procedures of each chy, and' determined if such policies had been the subject
of any auditor comment.
The Grand Jury found that each city has written pu,cnasing policies and
procedures in various J'!vels of detail, describing the rules governing purchases at
different kWels of expenditure and the approva r processes reQ uired. None of the
au<frtor comment lettet'$ had any observations relating to the pmchasing activity
of the cities.
A set of questions was ttlen compiJed which asked each city administration
to describe the manner in wt1ich it had obtained assurance that the prescr~ed
poricies and procedures were actuaRy being followed. The -answers reeeived
corresponded to the questions asked and described the review procedures
followed by the various levels of city mar-.gement and the city councils. The
responses indicated an awareness; of thi! importance of monitoring the
procurement process.
Based on th[s evaluation, three representative cities were selected as
samples. This selection was based on size~ content of material and responses,
and whether the purchasing function was centralized or decentTattzed.
From these three cities the Grand Jury requested a nSt of t"ose contracts
of $20.000 and above awarded during fiscal year 1991-92. Representative
sampJe contracts were selected. and the cities were 6sked to make them allanable,
The sample contracts were reviewed. and appropriate city officials wefe
Questioned relating to the material involved. Review ot these contracts and the
supporting o.ocumenu confirmed that the relevant pOricies had been comptled w~h
and that the required procedures had been followed. In cases where competitive
-.
bidding was reQlJired. bid and evaluation steps appeared to be in order.
SUMMARY
This Grand Jury review indicates that the ctties in Santa crara County
generafly have and are foMowing adequate written procurement policies and
procedures.
PASSED AND ADOPTED by the Grand Jury of Santa
Clara County this twentieth day ay, 1993.
1/('-, ~~-0
Helen Mineta
Secretary