The URL can be used to link to this page

Home My WebLink About2.c. Purchasing PolicyCITY OF ROSEMOUNT *" EXECUTIVE SUMMARY FOR ACTION COMMITTEE OF THE WHOLE MEETING DATE: March 14, 2001 AGENDA ITEM: Purchasing Policy AGENDA SECTION: PREPARED BY: Jeff May, Finance Director AGENDA 2 C ATTACHMENTS: Current Purchasing Policy, Delegating APPROVED BY: Authority Resolution, Minnesota Statute 471.345- Subdivisions 1 Through 5 For your discussion this evening is the City's Purchasing Policy. This policy was put into place in 1994 and amended last in 1996. Staff would like to discuss amending this policy to reflect current, updated Minnesota statutes. Dollar figures have been adjusted by amendments to the statute as well as some of the wording used for clarification that was used when the policy was first adopted in 1994. Staff would like to amend our policy to reflect whatever the State statute says so that we do not have to formally amend our policy each time the State makes changes to its statute. Amending the policy to reflect current State statute gives staff the ability to better manage the City's purchases without having to spend the time, money and energy to do sealed bids with formal specifications on purchases /contracts under $50,000. Time and effort still go into the process in direct negotiations and soliciting quotations but gives staff more flexibility in how they deal with the purchasing process. Staff that are involved with this level of purchases are professionals that have a fair amount of expertise in dealing with these situations and should be trusted to act accordingly with the City's best interests in mind. With your approval, I will work on amending this policy to reflect the State statute and to word it that we will follow that statute from this point forward whenever it may change. RECOMMENDED ACTION: Discussion only. COUNCIL ACTION: CITY OF ROSEMOUNT POLICY TITLE: POLICY NUMBER: PROPOSED BY: DATE APPROVED BY COUNCIL: PURCHASING POLICY F -1 FINANCE June 21, 1994 (Amended November 5, 1996) PURPOSE The purpose of this policy is to establish specific guidelines for the purchase of goods and services by employees of the City of Rosemount. The use of public funds requires diligent scrutiny and careful regulation. The controls necessary are in two areas. First, the statutory law, which clearly details procedures for the purchase of goods and services by City employees. Second, the controls not required by statute, but that are important to a good system of internal control and a sound management program. This policy will outline the laws governing contracts and bids and describe the basis for a good internal control system. Following the law and the City's purchase system should help City officials obtain maximum benefit from each dollar of public funds. CONTRACTING - BID LAWS A City entering into an agreement for the sale or purchase of supplies, materials, equipment or the rental thereof, or the construction, alteration, repair or maintenance of real or personal property must abide by the statutes relating to contracting and bidding. Minnesota Statute 471.345 was established to provide dollar limits for all cities upon contracts which shall or may be entered into on the basis of competitive bids, quotations or purchase or sale in the open market. This statute puts the following basic requirements on cities (based on the estimated contract amount): 1. For contracts over $25,000 - sealed bids, solicited by public notice and subject to the particular requirements of the City. The sealed bids should be solicited by public notice and be kept on file. 2. For contracts from $10,000 to $25,000 - sealed bids or direct negotiation, with two quotations whenever possible. If sealed bids are used they should be solicited by public notice and be kept-on file. If quotations are used, the quotes should be kept on file. CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 1996 - 94 A RESOLUTION DELEGATING AUTHORITY FOR PAYING CLAIMS WHEREAS, the City Council of the City of Rosemount recognizes the need to delegate a City official with the authority to pay claims without prior City Council approval; and WHEREAS, the City Council recognizes the need to establish internal accounting and administrative control procedures to ensure the proper disbursement of public funds which are established in the City's Purchasing Policy F -1; NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Rosemount hereby delegates the authority for paying claims prior to City Council approval to the City Administrator or the City Clerk of the City of Rosemount as set out in the City's Purchasing Policy F -1. ADOPTED this 5th day of November, 1996. Cathy Bushctf Mayor Motion by: Edwards Seconded by: A n d e r s o n Voted in Favor: Anderson, Wippermann, Busho, Carroll, Edwards Voted Against: None. Minnesota Statutes 2000, 471.345 Pagel of 5 _4innesota Statutes 2000, Table of Chapters Table of contents for Chapter 471 471.345 Uniform Municipal Contracting Law. Subdivision 1. Municipality defined. For * purposes of this section, • "municipality" means a county, town, city, school district or other municipal corporation or political subdivision of the state authorized by law to enter into contracts. Subd. 2. Contract defined. A "contract" means an agreement entered into by a municipality for the sale or purchase of supplies, materials, equipment or the rental thereof, or the construction, alteration, repair or maintenance of real or personal Subd. 3. Contracts over $35,000 for municipalities of less than 2,500 population; $50,000 for all others. If the amount of the contract is estimated to exceed $35,000 for municipalities of less than 2,500 population, or $50,000 for all others, sealed bids shall be solicited by public notice in the manner and subject to the requirements of the law governing contracts by the particular municipality or class thereof provided that with regard to repairs and maintenance of ditches, bids shall not be required if the estimated amount of the contract does not exceed the amount specified in section 103E.705 subdivisions 5, 6, and 7. Subd. 4. Contracts from $10,000 to $35,000 for municipalities of less than 2,500 population; $50,000 for all others. If the amount of the contract is estimated to exceed $10,000 but not to exceed $35,000 for municipalities of less than 2,500 population, or $50,000 for all others, the contract may be made either upon sealed bids or by direct negotiation, by obtaining two or more quotations for the purchase or sale when possible, and without advertising for bids or otherwise complying with the requirements of competitive bidding. All quotations obtained shall be kept on file for a period of at least one year after receipt thereof. Subd. 5. Contracts less than $10,000. If the amount of the contract is estimated to be $10,000 or less, the contract may be made either upon quotation or in the open market, in the discretion of the governing body. If the contract is made upon quotation it shall be based, so far as practicable, on at least two quotations which shall be kep_ on file for a period of at least one year after their receipt. Subd. 5a. County or town rental contracts. If the amount of a county or town contract for the rental of equipment is estimated to be $60,000 or less, the contract may, in the discretion of the county or town board, be made by direct negotiation by obtaining two or more quotations for the rental when possible and without advertising for bids or otherwise complying with the requirements of competitive bidding. All quotations shall be kept on file for a period of at least one year after their receipt. Subd. 6. Applicability of other laws. The purpose http://www.revisor.leg.state.nin.us/stats/471/345.htrnl 3/8/01