City of Oak Creek

Common Council Report

Meeting Date: 07/19/05

Item No.:        

Recommendation: 

That the Common Council approve a modification to Section 3.2 of the City’s Purchasing Policy, increasing the minimum amount requiring City Administrator approval to $2,500.

Background:

The City’s Purchasing Policy has been in effect since 1990.   An update of the policy is in the draft process, but is not ready for consideration.   One of the changes included in the draft is to increase the minimum amount requiring City Administrator approval.  Currently, Sec. 3.2 of the policy requires purchases from $500 to $2,500 to be approved by the City Administrator prior to placing an order with a vendor. (A copy of the current section is attached.)  This section also requires the use of quotations for any purchase in the range. This often creates a substantial delay of routine and regular purchases while waiting for approval, and increases the amount of time the Administrator must spend on reviewing and signing routine items.  Since Department Managers work within specific budget amounts, it is reasonable to set a higher minimum amount.  The recommended change will authorize Department Managers to issue purchase orders or requisitions up to the amount of $2,500.  The following language would replace the current language in the policy:

Section 3.2    Purchases Under $2,500

Department Managers are authorized to issue requisitions for any purchase in the amount of $2,500 or less.  The Department Manager need not secure the approval of the City Administrator in order to make purchases in this price range.  It is the responsibility of each Department Manager to insure control over this segment of the purchasing process.  Each Department Manager may designate certain employees with proper current written notice provided to the Accounting office to make purchases and to provide internal controls to insure that all purchases are for legitimate public purposes.  Department Managers may authorize open purchase accounts in cases where the department makes routine or frequent purchases under $2,500.

While there are other changes being considered in the policy update, it seems advisable to wait to consider additional changes until the City hires a City Administrator, since that person may have his/her own policy elements to recommend.   This change, however, will streamline the purchasing process until that time.

Fiscal Impact:

None. 

Prepared by and Fiscal review by:

Beverly A. Buretta, CMC

City Clerk/Comptroller