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  Consent-General Government   # 16.       
Financial Services  
Meeting Date: 12/07/2021  
Brief Title:    Annual Procurement Report
From: Tom Haynes, Interim Chief Financial Officer, Department of Financial Services
Staff Contact: Ryan Pistochini, Manager of Procurement, Department of Financial Services, x8218

Receive the annual procurement report and approve revisions to the County's Policy on Procurement. (No general fund impact) (Haynes/Pistochini)
Recommended Action
  1. Receive the annual procurement report; and
  2. Approve revisions to the County's Policy on Procurement
Strategic Plan Goal(s)
In Support of All Goals
Reason for Recommended Action/Background
Annual Procurement Activity in Fiscal Year 2020-21
As required by the Procurement Policy adopted by the Board in December 2018, the County Purchasing Agent submits this annual report on procurement during the fiscal year ended June 30, 2021. The current procurement system is not yet capable to efficiently deliver the types of information specifically stipulated in the policy at this time (due to not having yet implemented the Contracts Management module), however the following summary statistics are offered:

The County issued 1,388 purchase orders totaling $21.5 million in FY 2020-21. The County entered into 296 contracts last fiscal year, with a total value of $145.8 million.  Some of these contracts are multi-year contracts, and the value does not represent the total authorized spent within FY 2020-21.  The total number of active contracts continuing into FY 2020-21 is 558 contracts for a total maximum compensation of $432.6 million.

The County continues to operate a purchase card program to streamline the process to purchase low cost items.  The Purchase Card policy directs the Chief Financial Officer to file an annual report including the purchase card limits for each department head, elected official or equivalent; the total number of cards in use by department; the volume of transactions both in number and amount; and other information relative to the effectiveness of the purchase card program. Such report is submitted herein as Attachment B - Purchase Card Summary.  

Page 1 of the Summary shows the number of cardholders in the County and associated transactions by department during last fiscal year.  The number of cardholders declined from 190 to 162.  The total amount of spending made by purchase card declined year-over-year from $1.36 million to $1.00 million.  Page 2 of the Summary summarizes the top 25 merchant categories the County spent money during last fiscal year. Each vendor that a Cal-Card user purchases from is assigned merchant category code by the vendor’s payment processor. The County spent money in 133 categories last fiscal year. The largest 25 reported categories represent approximately 73% of the total spend.

The County's Division of Internal Audits issued an audit report in February 2021 reviewing the purchase card program during the period of July 2019 through June 2020.  The report identified a few areas of improvement, generally related to the need for documentation.  The Procurement Division incorporated those recommendations into a series of mandatory cardholder training sessions.

Procurement Policy Revisions
The Board is requested to approve four notable changes to the County's Policy on Procurement.  Three of these changes improve the County's efforts to comply with the Federal Uniform Guidance regulations concerning procurement and contracting activity. 
  • The first change adds language detailing that County employees who violate the Procurement Policy's Conflict of Interest section are subject to disciplinary action. Including this section is a procurement best practice and required by the Uniform Guidance.
  • The second change adopts and clarifies existing public works project bonding practices.  The Federal Uniform Guidance requires the County to have a bond policy in place for use in federally-funded construction projects. 
  • The third change codifies the existing Board policy requiring general contractors to be a member of a joint apprenticeship committee on public works construction projects of $1,000,000 or more.  The policy was originally adopted in January 2015. 
  • The fourth change adds language implementing Federal Uniform Guidance requirements concerning subrecipient contracts.  Federal regulations have specific requirements that must be followed when issuing a subaward contract to County partners.  
A strikethrough version of the revised Procurement Policy is presented in Attachment A. 

Future Activity
The Procurement Division continues to research the new procurement requirements imposed by Senate Bill 1383 of 2016.  These new requirements require the County to procure a quantity of recovered organic waste products on an annual basis and also imposes more restrictive paper procurement standards on the County.  The Procurement Division is working with other County departments to recommend a strategy to ensure compliance with the new requirements.  Aso in the coming year, the Procurement Division is working to implement the Infor upgrade to provide enhanced functionality and reports.
Collaborations (including Board advisory groups and external partner agencies)
County Counsel has reviewed the proposed revisions to the Procurement Policy. The proposed language regarding the Joint Apprenticeship Committee requirement was reviewed and approved by the Board's Committee on Capital Investments at the committee's November 18, 2021 meeting.

Fiscal Impact
No Fiscal Impact
Fiscal Impact (Expenditure)
Total cost of recommended action:    $   0
Amount budgeted for expenditure:    $   0
Additional expenditure authority needed:    $   0
On-going commitment (annual cost):    $  
Source of Funds for this Expenditure
Explanation (Expenditure and/or Revenue)
Further explanation as needed:
There is no fiscal impact associated with approving the proposed procurement policy changes.
Att. A. Policy on Procurement_Redline
Att. B. 2020-21 Cal Card Report

Form Review
Inbox Reviewed By Date
County Counsel Kimberly Hood 11/30/2021 09:21 PM
Joanne Van Hoosear Joanne Van Hoosear 11/30/2021 10:29 PM
Form Started By: Ryan Pistochini Started On: 11/03/2021 09:30 AM
Final Approval Date: 12/01/2021


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