HomeMy WebLinkAboutItem 5d. Delegation of Fleet Purchasing Authority for Tier 4 and 5 Fleet and Transit Purchases made through Cooperative Purchasing Agreements Item 5d
Department: Public Works
Cost Center: 5008
For Agenda of: 9/20/2022
Placement: Consent
Estimated Time: N/A
FROM: Matt Horn, Public Works Director
Prepared By: Greg Cruce, Deputy Director – Maintenance Operations
SUBJECT: APPROVE A RESOLUTION TO DELEGATE FLEET PURCHASING
AUTHORITY TO THE PUBLIC WORKS DIRECTOR AND FINANCE
PURCHASING DIVISION FOR TIER 4 AND 5 FLEET AND TRANSIT
PURCHASES MADE THROUGH COOPERATIVE PURCHASING
AGREEMENTS AND WITHIN THE COUNCIL APPROVED BUDGET
RECOMMENDATION
Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis
Obispo, California, to delegate Fleet Purchasing Authority to the Public Works Director
and Finance Purchasing Division for Tier 4 and 5 Fleet and Transit purchases made
through Cooperative Purchasing Agreements and within the council approved budget.”
POLICY CONTEXT
Section 204 of the City’s Financial Management Manual allows for the use of cooperative
purchasing agreements if the cooperative agreements were competitively bid. This
section also allows for local dealers within the City limits to submit a quote to provide the
same brand, model, and configuration of any item in a cooperative purchase agreement
at or below the cooperative agreement vendor’s cost with the same terms and conditions.
If a competitive quote is received from a local dealer, the procurement can occur using
the local dealer without initiating a separate competitive bidding process.
Section 405-I of the City’s Financial Management Manual states that fleet assets should
generally be acquired new through State of California Multiple Award Schedule (CMAS)
contracts. Section 405-I also suggests that specialized units not generally available
through CMAS should generally be acquired new through “piggyback” purchases, where
other local agencies have conducted competitive procurements and made those
contracts available to other jurisdictions. Whenever possible, use of a dealer within the
City limits is preferred if they can provide the same brand, model and configuration of
item(s) identified in cooperative purchase agreement(s) at or below the cooperative
purchasing net cost within the same terms and conditions.
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Item 5d
The City’s Purchasing Policy designates general goods purchase thresholds into a five -
tier system. Tier 4 requires the approval of the City Manager for single or cumulative
purchases between the amount of $75,000 and $199,999; while Tier 5 requires the
approval of the City Council for single or cumulative purchases exceeding the threshold
of $200,000.
DISCUSSION
Background
The Fleet Services and Transit programs within the Public Works Department are
responsible for the maintenance, repair, procurement, and disposal of City fleet and
transit assets. The City prepares a two-year Financial Plan and appropriates a one‐year
budget. The Capital Improvement Plan is a five-year plan for projects and fleet
replacements. Funding is specifically allocated for each identified fleet asset, and all
replacements are recommended based on meeting replacement criteria in the Fleet
Replacement Policy.
Currently, when a fleet asset is approved for replacement, staff follow the Fleet
Replacement Policy to identify a suitable replacement asset that meets the requirements
of the program utilizing the asset with the overarching goal of obtaining Carbon Neutral
City Operations by 2030. The City’s purchasing policy allows and encourages the use of
cooperative purchasing agreements and historically, the City has utilized the Sourcewell
Cooperative Purchasing contract, in addition to the Ford Fleet Program.
Sourcewell Cooperative Purchasing Agreement
The Sourcewell Cooperative Purchasing Agreement is often used by the Public Works
Department when purchasing vehicles and equipment. This no-cost agreement combines
the buying power of more than 50,000 government, education, and non-profit
organizations to save time and money. The cooperative purchasing program manages
the solicitation requirements and offers members easy access to an established network
of awarded contracts.
Ford Fleet Program
The City also participates in the Ford Government Fleet Program and has been issued a
Ford Fleet Identification Number for use when making vehicle purchases. This
membership provides many of the same benefits as the Sourcewell Cooperative
Purchasing Agreement, in that it provides the City with government fleet pricing, while
utilizing the local Ford dealership for the purchase.
When staff identifies an approved replacement, they will seek pricing from the appropriate
vendor. The vendor supplied quote (good for 30-days) is evaluated for accuracy of asset
specifications and contract compliance. Staff will then submit a purchase requisition with
the necessary documentation. When the assets’ independent cost or the cumulative cost
of purchases within a fiscal year is elevated to Tier 4 or 5 as outlined in the City’s
Purchasing Policy, the purchase requestion must be accompanied by City Manager or
City Council approval.
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Item 5d
Due to the rising cost of fleet and transit assets, the Tier 4 and 5 threshold is met and
exceeded much more often than in the past. This new paradigm requires staff to draft and
route many more reports for approval which adds a significant amount of time to the
approval process in a very fast paced and competitive market. Delegating the fl eet
purchasing authority to the Public Works Director and Finance’s Purchasing Division for
Tier 4 and 5 purchases made through a Cooperative Purchasing Agreement and within
the Council approved budget will streamline this process, save significant staff t ime, and
allow the City to compete fairly in a fast-evolving market. This authority will also assist the
City in reaching the 2030 carbon reduction goal by expediting the process, which is
expected to secure purchases in a timely manner by reducing the duration of time to issue
a purchase order.
Public Engagement
Public comment on the item can be provided to the City Council through written
correspondence prior to the meeting and through public testimony at the meeting.
CONCURRENCE
The Purchasing Division within the Finance Department concurs with the intent of this
report.
ENVIRONMENTAL REVIEW
The California Environmental Quality Act does not apply to the recommended actions in
this report, because the action does not constitute a “Project” under CEQA Guidelines
Sec. 15378.
FISCAL IMPACT
Budgeted: N/A Budget Year:
N/A
Funding Identified: N/A
Fiscal Analysis: N/A
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $ $ $ $
State
Federal
Fees
Other:
Total $ $ $ $
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Item 5d
The delegation of purchasing approval in itself does not have a fiscal impact. All
purchases contemplated under the approval delegation follow the annual budget
appropriation and the purchases included in the fleet replacement program as outlined in
the two-year Financial Plan, the appropriated budget, and the five-year Capital
Investment Plan program.
ALTERNATIVES
1. Do not approve the Resolution as written. Council could choose to not approve the
delegation of purchasing authority to the Director of Public Works and Finance’s
Purchasing Division for Tier 4 or 5 single purchases but allow this delegation for
cumulative purchases within the same fiscal year. Although there would be benefits
to this option, larger purchase timeline would be affected.
2. Do not approve the Resolution. Council could choose not to approve the Resolution
and require staff to seek City Manager or Council approval for single and cumulative
tier 4 and 5 purchases. This alternative is not recommended due to the impacts of
staff time as well as the additional time required to issue purchase orders.
ATTACHMENTS
A - Draft Resolution adopting delegation of purchasing authority to the Public Works
Director and Purchasing Division for fleet and transit purchases
Page 42 of 130
R ______
RESOLUTION NO. _____ (2022 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, TO DELEGATE FLEET PURCHASING
AUTHORITY TO THE PUBLIC WORKS DIRECTOR AND FINANCE
PURCHASING DIVISION FOR TIER 4 AND 5 FLEET AND TRANSIT
PURCHASES MADE THROUGH COOPERATIVE PURCHASING
AGREEMENTS AND WITHIN THE COUNCIL APPROVED BUDGET
WHEREAS, in accordance with the San Luis Obispo City Charter Section 802, the
City Manager shall send to the Council a careful estimate, in writing, of the amounts,
specifying in detail the objects thereof required for the business and proper conduct of
the various departments, offices, Boards and Commissions of the City, over which the
office has control, during the next ensuing year; and
WHEREAS, the prepared budgets that are approved by the City Council include a
five-year fleet and capital improvement project list that identifies specific funding for each
project or asset; and
WHEREAS, the City’s Financial Management Manual requires the use of
cooperative purchase agreements for fleet purchases; and
WHEREAS, Tier 4 and 5 single and cumulative purchases require the approve of
the City Manager or City Council; and
WHEREAS, current fleet and transit purchases often meet the Tier 4 and 5
thresholds; and
WHEREAS, streamlining the purchase process will save a significant amount of
staff time and allow for expedited purchase orders.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis
Obispo as follows:
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Resolution No. _____ (2022 Series) Page 2
R _____
SECTION 1. Council authorizes delegation of fleet purchasing authority to the
Public W orks Director and Finance Purchasing Division for Tier 4 and 5 fleet and transit
purchases made through cooperative purchasing agreements and within the Council
approved budget.
Upon motion of ___________, seconded by ____________, and on the following
roll call vote:
AYES:
NOES:
ASSET:
The foregoing resolution was adopted this _____ day of ____________________ 202 2.
___________________________
Mayor Erica A. Stewart
ATTEST:
_________________________
Teresa Purrington
City Clerk
APPROVED AS TO FORM:
_________________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the
City of San Luis Obispo, California, on ______________________.
___________________________
Teresa Purrington
City Clerk
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