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Home My WebLink About6.a. Review of City of Rosemount Purchasing PolicyCITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION PORT AUTHORITY COMMISSION MEETING DATE: SEPTEMBER 1, 1992 AGENDA ITEM: AGENDA SECTION: REVIEW OF ROSEMOUNT PURCHASING POLICY OLD BUSINESS PREPARED BY: AGENDA NO. JOHN MILLER, ECONOMIC DEVELOPMENT COORDINATOR 6. A ATTACHMENTS: AP OVE ROSEMOUNT PURCHASING POLICY IV !W At the August 18 Port Authority meeting, Commissioner Sinnwell asked to review the Rosemount Purchasing Policy. A copy is attached. ACTION: None. Informational item only. PORT AUTHORITY ACTION: CITY OF ROSEMOUNT POLICY TITLE• POLICY NUMBER: PROPOSED BY: DATE APPROVED BY COUNCIL: PURCHASING POLICY F-1 ADMINISTRATION JANUARY 3, 1989 Item 8 c. PURPOSE: The purpose of this policy will be to establish specific guidelines for the budgeting, approval process and expending of funds by employees of the City of Rosemount. I. The disbursement of public funds requires diligent scrutiny and careful regulation. The controls over these publLc funds are of two kinds. First, the statutory law, which clearly --spells out detailed procedures for handling these funds. Second, controls which the law doesn't require but which should be part of a sound management program. This policy will reference those laws covering municipal disbursements and establish guidelines for local fiscal management. In establishing and carrying out local policy on purchasing and contracting, city officials should be careful to adhere to all state laws and to avoid any actions which, although legal, may carry the appearance of official misconduct. Following state law and a sound local purchasing policy can help local officials obtain maximum benefit from each dollar of public funds. I. A. The City of Rosemount is classified under Minnesota state statute Chapter 412, as a statutory "A" type city of the 4th Class. This means, for all purposes, the laws governing what the city may do, or not do, came from the state of Minnesota. "4th Class" refers to the population level of less than 10,000 people. The law also states that, "three steps are involved in making a payment for city purchase. They are: the claim or bill must go to the clerk for filing, the council must audit it, and the proper city official must sign and issue the check or order." It is very clear that the City council is ultimately responsible for approving all expenditures. "Auditing" can take several forms. In some cases this may require, by state law, such procedures as sealed bids, advertising, requests for proposals and public hearings. Below certain levels of expenditures such requirements may not be set and internal checks and balances are considered sufficient to insure that public funds are safeguarded. "Auditing" may mean actual, individual approval of each item purchased or some administrative approach to approving certain items by setting guidelines by cast level and type of item to be purchased or acquired. This policy will assume that all state statues are followed, as referenced, and that the policy will set out guidelines to city staff to follow in order to process purchase requests, at all expenditure levels, through the city's process to city council approval. II. APPROVAL SCHEDULE/GUIDELINES It is the intent of the City of Rosemount to use what ever reasonable means necessary to make expenditures for good and services to the most benefit to its citizens. State statutes require formal bidding processes, beyond certain levels of expenditure below the levels. City staff is encouraged to gain competitive pricing through informal quotes and price comparisons between potential suppliers. In the "Level of Approval" Chart Schedule, where formal bidding is not specified, this guideline is assumed. City staff is also made aware of cooperative purchasing methods available through joint city agreements and county programs such as Hennepin County has in place. Staff is encouraged to utilize such methods where possible. II. A. General Item Purchases — The following schedule reflects levels of expenditures and levels, within the city organization, of approval which must be given for the purchase/contract. II. B. Contracted services for the supplying of materials, equipment and the rental of them is set out in Minnesota State Law Chapter 471. Contracts for services provided to cities for which assessments will be determined.and levied for collection in connection with are governed under Minnesota State Law Chapter 429. These statutes specifically govern requirements for cities in determining the legal process to follow in entering into these contracts for all city purchases. These laws supersede any local definition of need in this area of purchasing approval. II. C. Expenditures for normal repairs on equipment, which have been budgeted, will be processed by department heads at levels of $1000 and less without city administrator prior approval. Expenditures for this type of repair at a level r of $1001 — $5000 will be made by department head after consulting with city administrator if budgeted. Emergency repairs, for amounts less than $5000, will be made at the discretion of the department with consultation with the administrator if he/she is available. If not the department would proceed with the emergency repair. "Emergency" may be defined as a repair needed to insure the continued operation of the city service, without which the health, safety and welfare of the general citizenry may be "threatened." III. This policy will go into effect the day following its adoption by city council. LEVEL OF APPROVAL ' Amount/Item Needing Expenditure (see II. C) Dept. Head City Administrator Formal Bidding City Council Approval Consent Individual Item Agenda I)Expenditure YIN YIN Review (see II.B) YIN YIN $0 - $250 Yes of Expenditure Rep. Bills Listing Yes 2)Expenditure $251 - $1000 Yes Yes Bills Listing Yes - 3)Expenditure $1001 - $5000 Yes Yes Bills Listing Yes - 4)Expenditure $5001 - $10,000 Yes Yes - Yes 5)Expenditure $10,001 - $15,000 Yes Yes Yes O Expenditure $15,001 and up Yes Yes - Yes 7)Any CIP Item Budgeted Yes Yes Yes 8)Conferences Seminars Yes Yes Use above Advise for Schools & Fact Requirements Regularly Budgeted Yes for Special Finding Trips Staff Functions i.e. Nat'l Conf. Wart Time Employee Yes Yes 10)Full Time Employee Yes Yes - - Yes ll)Salary/Benefit Adjustment 12)Consultant(regular 13)Consultant (Special Projects) Yes Administrator Yes Yes - - To Implement Yes Yes - Yes Bills Listing Yes Yes RFPs - Yes 14)Contracted Services RFP's or for City Programs & Yes Yes Negotiated Yes Projects Contract