At a special meeting on Tuesday, the Loveland City Council approved a temporary change to the city’s procurement rules to help fight the impact of inflation, supply chain delays, and labor shortages.
By a unanimous vote, the Council passed an emergency ordinance that will allow city officials to make purchases of up to $300,000 without going through a formal bid process.
“The combination of inflation and also supply chain issues are putting a crunch on a lot of our operations,” Loveland Chief Financial Officer Brian Waldes told the council during his presentation. “It won’t totally solve the problem, but will help our managers be able to acquire materials more quickly.”
Waldes cited urgent shortages facing the city’s water and power utilities. Among the most “critical materials” being impacted include transformers, cable, and PVC pipe.
“That’s where we’re seeing the most acute issues, and also where you could have the most impactful issues,” he said.
As an example, an order of pipe that cost $33,000 in January 2021 increased by five times to $150,000 in May 2022, according to a supporting PowerPoint presentation.
The ordinance, which will sunset in 12 months, adds a subsection to the city’s municipal code that raises the minimum purchase amount subject to competitive bidding from $30,000 to $300,000. However, city purchasers will still be required to get at least three quotes.
With passage of the emergency option, the new rules go into effect immediately. Waldes isn’t anticipating a rush of large purchases in the coming weeks, but said he is relieved that the city now has the flexibility to address needs as they arise.
“I don’t think it’s going to get a ton of use,” he said. “But if it did, it would probably be for something really urgent, so that’s why we’re doing this.”
