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Procurement

Finance & Governance updates procurement ordinance

Chief Financial Officer Betsy George (photo courtesy City of Oxnard)

Chief Financial Officer Betsy George (photo courtesy City of Oxnard)

Oxnard– The Finance & Governance Committee, Tuesday, April 12, updated its existing procurement ordinance to leverage its centralized purchasing and electronic cross-functional approval process.

Assistant Chief Financial Officer Mark Sewell presented the item to the committee and said the approval amends the approval authority within the ordinance to align with municipal best practices and new, modern system functionality.

The city is preparing to launch its Core Financial phase with Tyler-Munis.

The city adopted its procurement ordinance on June 19, 2018, and it defined the roles of all the city’s procurement processes.

“As a result of the city’s multi-year investment in a new ERP system, the changes amend the purchasing agent’s approval authority for annual dollar amendment per vendor from $100,000 to zero, amends city department manager authority for an annual dollar limit per vendor from zero to $50,000, and amends the city department director approval authority from $5,000 to $100,000 per vendor,” he said.

The changes are recommended for approval authority for all contracts, purchase orders, change orders, and task orders, other than for real property, which remains the same.

“The recommendation to transfer the $100,000 approval authority from the purchasing agent within the finance department to the department directors aligns with the budgetary responsibility department directors have for meeting the goals and objectives as set by them and the city council,” he said. “There are no other changes in the approval limits for the city manager, for public work projects, or the city council recommended as part of this change.”

He noted that all procurements will still be required to be reviewed and approved by the purchasing agent, ensuring compliance with all relevant policies.

“These changes are recommended because it’s an opportunity to update the ordinance to leverage the new system functionality of the ERP system that’s being implemented,” Sewell said. “The new ERP system has centralized purchasing, which enables reporting and review of all transactions by vendors, irrespective of which department is using them. It has electronic approval processes, and they are reviewed and approved by other departments, such as risk management, city attorney, information technology (IT), and finance.”

He said the system tracks and logs all actions by the users and is fully auditable.

“Electronic document storage is standard and required as part of all document procurements, whereby the city can add all bidding documents, justification, insurance documents, and any other items pertinent to that procurement along through the approval processes and after completion of the transaction for audit purposes,” he said. “Each procurement item is subject to an automated budget check, meaning that no purchase activity can occur that exceeds the council-approved budget.”

He said there is an advanced and consolidated city-wide vendor reporting and transaction reporting to improve the performance and monitoring against policies.

“The transfer of the approval from the use of city funds to the operating departments aligns with the responsibility for the service delivery to the community,” he said. “This change will increase operational efficiency as part of the move toward the new modern ERP system with automated budget checking and electronic approval routine.”

Chief Financial Officer Betsy George told the committee that the primary purpose of the action was to separate the execution of the purchase order from the approval of the purchase order.

“In the past, for our processes, we had the purchasing manager both approving the purchase, you know, an approved budgeted item from the City Council’s budget, and then the purchasing manager was also executing the purchasing order,” she said. “What this is going to do is shift the budget approval authority to the manager that has responsibility for their area, and then, the purchasing manager is still executing all of the purchasing orders.”

For the complete story, visit tricountysentry.com.

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