Proposed Purchasing Policy Changes Summary
Goal: Update the purchasing policy to enhance efficiency while maintaining appropriate purchasing controls to ensure the best value for the City of Lawrence.
Statement of Issue: The Purchasing Procedures were last updated in 2011. However, it has been a number of years since the purchasing limits outlined in the policy have been revised. The current policy requires extensive process for purchases of relatively small value. For example, every purchase over $1000 requires City Manager level approval and every purchase over $15,000 requires a system of internal approvals, but also requires City Commission approval. It should be recognized that any process has an opportunity cost and such cost should be balanced with appropriate purchasing controls in line with the expense of the item.
Summary of Changes:
o Maintains larger policy statements in the policy document, while detailed procedures will remain in a purchasing procedures document.
o When Requisition or Purchase Order is required:
§ Current $1000
§ Change to $5000
o When Quotes are required
§ Current policy sets general threshold at purchases over $1000, except for contractor or construction type services less than $2,500
§ Change to $5000 as general threshold and $10,000 for contractor/construction type services
o When Formal Bidding and/or Request for Proposals/Qualifications is required
§ Current over $15,000 unless special circumstances
§ Increase to $50,000
o When Department Head Authorization is required
§ Current is not specified
§ Recommend setting this at $5000-$25,000
o When City Manager approval is required
§ Current $1000
§ Change to $25,000
o When City Commission approval is required
§ Current over $15,000
§ Change to $100,000
o Payment of Claims
§ Clarify to provide the City Manager with authority to make purchases, within budgeted authority, as needed to operate the City. Claim register acknowledges these payments and is approved by the City Commission.
o Local preference:
§ Current threshold for application of local preference is $15,000
§ Change to $50,000 (same as competitive bidding threshold)
o Change Orders/Changes to Scope:
§ Current threshold for cumulative changes requiring City Commission approval is $15,000
§ Change to $50,000 (same as competitive bidding threshold)
o Disposal of City property:
§ Current procedure document unclear about approvals for this
§ Recommend requiring City Manager approval for disposal with City Commission approval required at property valued $100,000 or more