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TO: Mayor and City Council
FROM: Finance Department
Law Department
Public Works Department
DATE: July 30, 2021
SUBJECT:
Purchasing authority of department heads; revision of purchasing provisions in the City Code.
PURPOSE:
To increase the authority of the City's Department heads to purchase labor, equipment, goods, services and professional services from $25,000 to $50,000 and to make conforming changes to the City Code.
BACKGROUND:
Under Division 2-V-2 of the Chapter 2 of the City Code, the Council is required to approve all procurements in amounts of $25,000 or more, with very limited exceptions. This threshold has been in place without adjustment since at least 2013. As a result, every purchase requiring Council approval must proceed through the Council's formal three-week deliberative process, which begins after the purchasing division and using department have selected a vendor and the Law Department has had the opportunity to review proposed contract language.
Similarly, Division 2-V-2 contains obsolete language that does not accurately reflect the City's authority as a home rule unit, provide a coherent process for the consideration of bid protests, or provide direction as to source selection when competitive bidding is not employed.
DISCUSSION:
In consultation with the Chairperson of the Finance Committee, staff feels that this purchasing threshold could be responsibly be raised to $50,000 without compromising the City's obligation to spend public funds appropriately. One of the most basic principles of local government law is that public moneys cannot be spent until the public body has budgeted or made an appropriation for a particular purpose. While increasing the purchasing limit may superficially create the perception that the City Council is relinquishing its oversight role, no department will be able to incur a liabilities in excess of its budgetary authority. Further, the Council will continue to review bills for payment as part of...
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