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FINAL REPORT
City of Glendale
PROCUREMENT PROCESS COMPLIANCE AND PERFORMANCE
ASSESSMENT
December 13, 2023
Moss Adams LLP
999 Third Avenue, Suite 2800
Seattle, WA 98104
(206) 302-6500
filMOSSADAMS
Table of Contents
I. Executive Summary 1
A. Objectives 1
B. Conclusions 1
C. Commendations 2
II. Detailed Report 4
A. Introduction 4
B. Background 4
C. Scope and Methodology 4
Ill. Findings and Recommendations 6
IV. Process Improvement Recommendations 16
Appendix: Definitions of Assesment Finding Rankings 17
Procurement Process Compliance and Performance Assessment Report
FOR INTERNAL USE OF CITY OF GLENDALE ONLY
I. EXECUTIVE SUMMARY
Moss Adams LLP (Moss Adams)was contracted by the City of Glendale (the City)to perform a
compliance and performance assessment related to the City's procurement processes. This
assessment was designed to assess the efficiency and effectiveness of the City's procurement
processes in enabling timely procurements while ensuring consistent compliance with regulatory
requirements. Moss Adams analyzed a sample of formal and informal City procurements from July
2021 to March 2023, interviewed a selection of individuals involved in procurement across City
departments, and surveyed a group of the City's external vendors related to their overall satisfaction
with the City's procurement process. Additionally, Moss Adams reviewed relevant documents from
the City, including policies and procedures, performance measures, and training documentation.
This engagement was performed in accordance with Standards for Consulting Services established
by the American Institute of Certified Public Accountants. Accordingly, we provide no opinion,
attestation, or other form of assurance with respect to our work or the information upon which our
work is based. This report was developed based on information gained from our interviews and
analyses of sample documentation. The procedures we performed do not constitute an examination
in accordance with generally accepted auditing standards or attestation standards.
A. OBJECTIVES
Our objectives for this engagement were to assess the extent to which the City completes
procurement processes in:
An efficient and timely manner, as well as to identify barriers in processes and systems that limit
the efficiency
A consistent manner that is compliant with relevant regulations, as well as to identify barriers in
processes and systems that limit this consistency
B. CONCLUSIONS
The procedures and testing performed identified four areas that warrant improvement. These are
highlighted in the table that follows.
FINDINGS AND RECOMMENDATIONS
Medium Risk
Usability of MUNIS Procurement Vendor Self Service System
VSS usability issues were reported by several interviewees and
Finding corroborated by the City's IT team. Usability issues can hinder the ability of
potential vendors to bid on City solicitations.
1
The City should consider whether technology changes or upgrades within
Recommendation the VSS would better align technology with procurement strategy and
needs.
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FINDINGS AND RECOMMENDATIONS
Procurement Process Timeliness in Relation to Published Expectations
The timeframes within which procurements generally take place are not
Finding accurately reflected on the City's public-facing website which can create
unrealistic expectations for City vendors and City personnel.
2
As a part of performance measurement and management efforts,the City
Recommendation should establish and communicate key performance indicators for
timeliness based on standards that are realistic and within the Procurement
Division's control.
MRTRIP
Sole Source Purchase Requestion
A sole source justification may have been used inappropriately as a
Finding workaround to procure equipment from a vendor before an expired, linked
contract was renewed.
3 The Procurement Division should have regular communication and training
to City department staff involved in purchasing. Training should include
Recommendation information on the required elements of a Sole Source Request Form and
appropriate uses of the sole source purchase method.The Procurement
Division should ensure sufficient review of Sole Source Request Forms.
Low Risk
City-Wide Procurement Policy
The procurement code, policy, and manual are missing some key best
practice elements and/or appropriate references to other sources of
Finding guidance for the omitted elements.A lack of complete, comprehensive
policies and procedures can lead to inconsistencies in procurement
4 practices and can increase the risk of non-compliance with applicable rules
and regulations.
The City should update the existing procurement policies and procedures
Recommendation to include references to key policy elements that are housed in primary
source documents outside of the procurement policy.
C. COMMENDATIONS
Although the focus of this compliance assessment was to identify areas of noncompliance with City
procurement policies and regulation and find opportunities for improvement, it is important to note the
areas that are operating well. The City should be commended for the following accomplishments:
Collaboration: We observed collaboration across City departments. For example, Information
Technology(IT) supported the Procurement Division in obtaining reporting data and
troubleshooting Vendor Self Service (VSS) system issues, and the Procurement Division
supported other departments in understanding and completing the procurement process, like
having discussions with departments rather than just rejecting paperwork. Interviewees noted that
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0
they have found the Procurement Division staff to be knowledgeable, collaborative, and
responsive.
Continuous improvement mindset: The Procurement Division implemented a project tracking
system through Smartsheet in Fiscal Year(FY) 2022 that has increased the ability to track
procurements through the entire procurement process as well as to track and report on
performance measures. In addition, during FY 2023, the City's Legal Department implemented an
electronic green sheet system for legal approval to improve timeliness of approvals.
Dedication and commitment to serving the City: Procurement is an inherently complex and
high-risk area and City staff appeared dedicated to carrying out their work safely and effectively
for the City.
We would like to thank City staff and management for their time and efforts in assisting with this
project.
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II. DETAILED REPORT
A. INTRODUCTION
Moss Adams was contracted by the City to perform a compliance assessment over the City's
procurement process. We assessed the extent to which the City completes procurement processes in
an efficient and timely manner as well as how consistent their procurement process is in a manner
that is also compliant with relevant regulations. This compliance assessment was performed as part
of the FY 2022 Annual Audit Plan developed by the City's Independent Internal Audit Program (IIAP).
Our compliance assessment was performed between March 2023 and October 2023. Please refer to
the appendix for definitions of assessment finding rankings.
B. BACKGROUND
The City's Budget and Finance Department provides financial management services across City
departments. The Budget and Finance Department is organized into five different divisions including
the Procurement Division. The Procurement Division enables City departments to acquire materials
and services needed City-wide. The Procurement Division is responsible for ensuring the City gets
the best value for its money, by negotiating favorable contracts, and reviewing whether vendors meet
quality and performance standards. Additionally, the Procurement Division is responsible for
promoting transparency and accountability by helping maintain an open and competitive bidding
environment and ensuring that the City is complying with applicable laws and regulations.
Our objectives for this engagement were to assess the extent to which the City completes
procurement processes in:
An efficient and timely manner, as well as to identify barriers in processes and systems that limit
efficiency
A consistent manner that is compliant with relevant regulations, as well as to identify barriers in
processes and systems that limit this consistency
C. SCOPE AND METHODOLOGY
To obtain an understanding of specific processes and controls, and overall City procurement
processes, we conducted interviews with personnel from the Procurement Division as well as the
Engineering Department(specifically to discuss Title 34 procurement processes that are outside of
the Procurement Division). In addition, we reviewed the City's policies and procedures provided
during the assessment to evaluate whether they aligned with both federal and state procurement
requirements and best practices. We performed the following detailed testing and analysis
procedures:
Procurement Regulatory and Peer Analysis: We compared the Glendale City Code Chapter 2
Article V Division 2 (the City's Procurement Code)to 2 CFR Part 200 as well as the Arizona
Revised Statue Title 41 and 34. We reviewed the City's Procurement Code to evaluate whether it
conflicted with those regulations set by a higher authority. Additionally, we compiled comparative
Arizona valley cities collective data regarding procurement and compared to the City's
Procurement Code.
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Procurement Timeliness: We obtained a listing of all procurements that had taken place in the
City from January 1, 2022, to June 30, 2023. We then quantified the number of days that it took to
complete the following tasks in the procurement process for each procurement:
Publish request to clerk/bid published
Bid due date to bid evaluation start date
Bid evaluation date to notice of intent issue date
Notice of intent date to Council approval date (if applicable)
VSS Portal Analysis: We interviewed City stakeholders (personnel from the Procurement
Division, Engineering Department, IT, and City leadership) regarding the VSS portal that is used
during the bid process. Additionally, we sent a survey to a sample of five vendors currently using
the City's VSS portal to understand their experience with it and identify areas of challenges and
inefficiencies.
Split Purchase Testing: We requested a list of all purchase order(PO)transactions from
FY 2022-2023. We deleted all transactions over$50,000 and performed an analysis of the total
amount of POs made on the same day to the same vendor. We also assessed whether multiple
POs were made within a short timeframe that exceeded the $49,999.99 informal threshold and
were formally procured with a contract. We filtered POs with no contract numbers to also isolate
those that were not formally procured.
Procurement Process: To assess the City's compliance with policy and procedure, we assessed
a random sample 49 procurements that the City had processed from July 1, 2021, through March
31, 2023. We tested requirements relating to each of the specific types of procurements
(emergency, sole source, special, informal, and formal)as well as the overall Request for
Proposal (RFP)/Request for Quote (RFQ) process.
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III. FINDINGS AND RECOMMENDATIONS
Usability of MUNIS Procurement Vendor Self Service System - Medium
Risk
1. Finding VSS usability issues were reported by several interviewees and
corroborated by the City's IT team. Usability issues can hinder the ability of
potential vendors to bid on City solicitations.
Recommendations The City should consider whether technology changes or upgrades within
the VSS would better align technology with procurement strategy and
needs.
Condition: The City employs VSS, a component of the City's current Munis Enterprise Resource
Planning (ERP) system, as a bid submission portal. VSS usability issues were reported by several
interviewees and corroborated by the City's IT team. Issues reported by interviewee type included:
City Procurement Engineering
Issue(s) Reported Leadership Department Department IT Department
Difficulty with attachments x x x x
Cannot use evaluation tool
within system x
Multiple bids, same vendor x x
Vendor was unable to
submit through portal and x x
submitted by email
System crashed for vendor x
Vendor could not login x
Vendor unsure whether bid
was received x x
System is not user friendly x x
System lacks desired
reporting ability, have to x x
rely on IT Dept
System is a challenge x x x
System may be inadequate
for City's needs x x
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Criteria: Procurement technology should aid the procurement process and support the overall
strategy of the organization, per The Institute for General Procurement(NIGP). Well-implemented
procurement technology can reduce procurement time and costs, increase collaboration with
vendors, increase competition, and increase transparency in public procurement. In addition,
technology can improve audit capabilities by improving data collection and information flow.
Further, procurement departments and stakeholders should employ best practices that promote
transparency and accountability and maximize competition. A vendor bid portal that is easy to access
and navigate can help to maximize competition and help to mitigate or avoid potential protests.
The City's Balanced Scorecard includes the goal to "improve processes and technology."The City's
Finance Administrative Policy 1 — Procurement Policy and Procedures (FAP1) specifies that each
proposal/bid received shall be time stamped and retained in the online bid system or in a secure
place until the closing date and time for receipt of proposals/bids. A vendor portal must enable this
requirement.
Cause: The VSS portal may be designed in a way that is not user friendly and/or not meeting the
needs of the City.
Effect: There is a risk that vendors who are unable to navigate the VSS portal may be dissuaded
from doing business with the City, which can lead to minimized competition. In addition, a lack of
easily retrievable bid time stamps and audit trails can increase risk related to bid protests and
decrease the efficiency with which solicitations can be completed.
Recommendation:
The City should consider whether technology changes or upgrades would better align technology with
procurement strategy and needs. The City should also assess current technology being used
including the VSS portal and whether the reporting is accessible and well designed for City needs.
The City's Balanced Scorecard includes the goal to"improve processes and technology."As part of
that goal, if and when the City is exploring an ERP system upgrade, the City should evaluate the ERP
procurement module for usability, user interface, reporting self-service, easily accessible audit trails,
and ability to handle large attachments to align with the Balanced Scorecard.
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MANAGEMENT RESPONSE
Management Concur
Agreement
Owner Levi D. Gibson, Budget and Finance Director
Target Completion June 30, 2026
Date
The City currently has a Technology Governance Committee made up of
department directors (Finance, HR, IT, etc.) and the Assistant City
Managers and is used to identify items within our technology
Action Plan infrastructure environment that need to be upgraded or changed. The
Budget and Finance Director will work with this committee to identify if an
ERP upgrade is needed or if a standalone procurement system should be
implemented to better support the city and city departments.
Procurement Process Timeliness in Relation to Published Expectations —
Low Risk
Finding The timeframes within which procurements generally take place are not
1111 accurately reflected on the City's public-facing website which can create
unrealistic expectations for City vendors and City personnel.
Recommendations As a part of performance measurement and management efforts,the City
should establish and communicate key performance indicators for
timeliness based on standards that are realistic and within the
Procurement Division's control.
Condition: The average time from bid opening to City Council, per the solicitations data we reviewed,
was 69 days (approximately nine to ten weeks) in FY 2022 and 51 days (approximately seven to eight
weeks) in FY 2023. Many factors within the procurement process timeframe are outside the control of
the Procurement Division, however, the public-facing Procurement Policies on the City's website
states that"After the opening, the evaluation and approval process takes an additional four to six
weeks before an award is authorized by the City Council."The City's website states that the process
from issuance and advertising to opening of sealed offers generally takes three weeks.
Of the solicitations tested in our sample of 25 solicitations (from Smartsheet solicitations data)from
FY 2022:
Two unique solicitations exceeded the three-week stated duration (per the City's website)from
issuance and advertising to opening of sealed offers
One unique solicitation did not have a "to Council" date documented
Eleven unique solicitations exceeded the four-to-six-week stated timeframe from bid opening to
City Council
One solicitation had a stated publish request date of 2011
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Of the solicitations tested in our sample of 28 solicitations (from Smartsheet solicitations data)from
FY 2023:
Three solicitations did not list a bid evaluation start date
Three solicitations exceeded the three-week stated duration from issuance and advertising to
opening of sealed offers
One solicitations listed a notice of intent issuance date prior to the bid evaluation date
Six solicitations did not have a "to Council" date entered
Fifteen solicitations exceeded the four-to-six-week stated timeframe from bid opening to City
Council
Four solicitations had a notice of intent date prior to the bid evaluation date
One solicitations did not have a bid evaluation end date documented
Internally, the Procurement Division currently reports on the following annual performance metrics:
number of vendor protests upheld
number of RFPs and Invitation for Bid (IFB) issued
% of contract renewals completed on time
% of sole source and special procurements processed within 10 days
Criteria: Per the NIGP, appropriate performance metrics are critical to a performance measurement
system. Appropriate metrics need to be aligned with overarching organizational goals, meaningful,
and developed in collaboration with those responsible for the performance. Similarly, performance
measures must be specific, consistently applied, and within the control of the procurement function to
be meaningful.
The "Formal Purchase Procedures" as outlined in the public-facing Procurement Policies on the City's
website, state the following:
"The formal competitive process, from the issuance and advertising to the opening of the sealed
offers, generally takes three (3)weeks. After the opening, the evaluation and approval process takes
an additional four to six weeks before an award is authorized by the City Council."
Cause: The procurement timeframes advertised on the City's external-facing website, accessible by
both potential vendors and City employees, does not reflect an accurate estimate of how long the
procurement process generally takes. The performance results reported annually by the Procurement
Division to internal stakeholders in the Performance Report include only limited metrics regarding the
timeliness of the portions of the procurement process under the Procurement Division's control.
Further, the Smartsheet used to track procurements as they move through the process is a newer
tool that is still being refined and is currently for internal use only.
Effect: Without appropriate, achievable, measurable, clearly communicated timeliness standards and
performance measurement against standards, it will be difficult for the Procurement Division to
demonstrate its value to all stakeholders, both in terms of its accomplishments and its improvements.
Lack of appropriate, achievable, measurable, clearly communicated standards will also inhibit
continuous improvement efforts within the Procurement Division.
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Recommendations:
The City should consider updating the City's website to provide a more realistic estimate for
procurement timeframes and consider enhancing the Procurement Division's performance
measurement and management efforts.
As a part of its performance measurement and performance management framework, the City should
establish procurement-related key performance indicators (KPIs). Effective KPIs can be regularly
measured and reported. KPIs increase transparency, improve communications, and assist
management in identifying areas for improvement. One or more KPIs should measure baseline
procurement process timeliness. This metric can then be utilized to help inform departments on how
long they should expect the procurement process to take, as well as in the City's efforts to improve
process bottlenecks.
The goal of a performance management program is to help the City meet the goals of its internal and
external strategic plan. Performance management adds value and allows for a continuous cycle of
improvement. As a part of performance measurement and management efforts, the City should
establish and communicate KPIs for timeliness based on standards that are realistic and within the
Procurement's Division control. The City should continue to refine and systematize the use of the
procurement tracking Smartsheet in order to collect and report on Procurement timeliness data for
MANAGEMENT RESPONSE
Management Concur
Agreement
Owner Connie Schneider, Procurement Administrator
Target Completion January 31, 2024
Date
rProcurement will review all timelines and KPI's to correct any
inconsistencies and provide realistic estimates for procurement
timeframes and consider enhancing the Procurement Division's
Action Plan performance measurement and management efforts. Furthermore, the
Smartsheet information will be refined and systematized for Procurement
Process Compliance and Performance Assessment procurement tracking
to collect and report on Procurement timeliness data for not only internal
but also external use.
Sole Source Request Form — Low Risk
Finding A sole source justification may have been used inappropriately as a
workaround to procure equipment from a vendor before an expired, linked
contract was renewed.
Recommendations The Procurement Division should have regular communication and training
to City department staff involved in purchasing.Training should include
information on the required elements of a Sole Source Request Form and
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appropriate uses of the sole source purchase method.The Procurement
Division should ensure sufficient review of Sole Source Request Forms.
Condition: On three POs (of the total 211 POs falling under the $50,000 formal procurement
threshold that was within the scope of our evaluation), we identified that sole source and special
purchase types may have been used with one specific vendor as a workaround to bridge the expired
linked contract. Although a letter from the equipment manufacturer was present, the Sole Source
Request Form did not include (1)an explanation of why the procurement was a sole source or(2)the
specific efforts made to determine the availability of any other source. Further, the written response to
the Mandatory Research Documentation Requirement within the Sole Source Request Form appears
identical on Sole Source Request Form for PO 22200668 and Special Purchase Request Form for
POs 22200667 and 22200742.
Criteria: FAP1 states: "Sole Source Procurement shall not be used unless there is a preponderance
of the evidence [...] that there is only one reasonable source for the product or service. The city
agency requesting Sole Source Procurement shall provide written justification [...] to support the Sold
Source Procurement."
FAP1 requires the following minimum written justification for sole source procurement:
An explanation of why the procurement is a sole source
The specific efforts made to determine the availability of any other source
An explanation of why the need is not satisfied by another type of material or service
In comparison, the required minimum written justification for the special procurement method includes
the following:
An explanation of why use of another procurement method is unlikely to result in a lower price, or
An explanation of why the use of another procurement method would cause unnecessary
expense, or
An explanation of why the use of another procurement method would cause a delay, or
Any other relevant justification of why a special procurement is advantageous
Promoting fidelity to City procurement procedures is a complex task that should be addressed
through multiple avenues.
Cause: Based on discussions with the Procurement Division, the department requesting the
purchasing was not aware that the sole source procurement method was not the appropriate method
for purchasing items in this circumstance. The department requesting the purchase lacked training on
the required elements of the Sole Source Request Form. The incomplete Sole Source Request Form
was not rejected during the Sole Source Request Form review process.
Effect: The sole source procurement and special procurement methods were used inconsistently and
interchangeably to procure unique goods from one specific vendor that were needed urgently to
prevent water system failure. A lack of sufficient training on, and oversight of non-competitive
procurement methods could result in inadequate levels of full and open competition among potential
City vendors.
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Recommendations:
The Procurement Division should have regular communication and training to City department staff
involved in purchasing. Training should include information on the required elements of a Sole
Source Request Form and appropriate uses of the sole source purchase method. Sole source vendor
purchases should be supported by a narrative within the Sole Source Request Form justifying the
purchase. Sole Source Request Forms should be sufficiently reviewed by the Procurement Division
for adherence to FAP1 and consistently recorded alongside contracts for accessibility and
justification.
Regular training and communication on City procurement procedures can promote adherence to the
City-Wide Procurement Policy and Code. Among other objectives, this training should help explain to
staff the organizational reasons for having a procurement policy and the organizational benefits to
following such a policy, including those policy elements designed to maximize competition. Policy is
often restrictive—by providing a vital framework for how public organizations are administered, policy
often places limitations on the actions of public employees. It is important for employees to
understand these limitations are not merely bureaucratic hurdles; they provide concrete benefits to
the City and its citizens.
Additionally, the Procurement Division should consider providing sufficient self-service resources and
checklists to address common issues and provide guidance for the completion of procurement
requests, including sole source procurement requests. Training and self-service materials are
particularly helpful when inconsistencies are due to a lack of knowledge on City policy, rather than an
unwillingness to follow procedures.
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MANAGEMENT RESPONSE
Management Concur
Agreement
Owner Procurement Administrator/ Legal
Target Completion June 30, 2024
Date
Procurement is in the process of improving the Sole Source and Special
Procurement forms to ensure that the Sole Source method of
procurement is used appropriately. In order to assist departments, the
Procurement Division will clarify those uses that may qualify as a sole
source. This will include a check list on the required elements of a Sole
Source Request Form and appropriate uses of the sole source method of
procurement as well as the special procurement. Additionally,
Action Plan Procurement will work with our partners in IT to convert the form to a
digital form to allow for easier tracking as well as workflows, and
approvals. Training is also being created that will further clarify the uses
of these forms and will be available online to all city employees.
Procurement will work with legal to ensure a contract is not created
without a Sole Source form and thoroughly review Requisitions to ensure
Sole Source Request Forms are in adherence to FAP1 and consistently
recorded alongside contracts for accessibility and justification.
City-Wide Procurement Policy— Low Risk
Finding The procurement code, policy,and manual are missing some key best
practice elements and/or appropriate references to other sources of
guidance for the omitted elements.A lack of complete,comprehensive
policies and procedures can lead to inconsistencies in procurement
practices and can increase the risk of non-compliance with applicable
rules and regulations.
Recommendations The City should update the existing procurement policies and procedures
to include references to key policy elements that are housed in primary
source documents outside of the procurement policy.
Condition: The City's procurement code, FAP1, and manual are missing some key elements (or
reference to these elements) based on NIGP standard including:
Basic Organizational Concepts:
Tenure, removal, and compensation of the Chief Procurement Officer(Materials Manager)
Appointment, qualifications, and training of personnel
Specifications:
Use of appropriate types of specifications (e.g., design, performance, brand name or equal,
etc.)
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Ethics and Code of Conduct:
Guidance on gratuities and kickbacks
Guidance on contingent fees
Guidance on misuse of confidential information
Process for disciplining agency employees who violate the procurement policies or code of
ethics
Personnel and Professional Development:
Technical and professional qualifications for management and professional staff
Orientation and training requirements for new employees, and those who will be involved in
the procurement process
Certification and educational requirements of professional staff
Special Programs:
Sustainable procurement program, if applicable
The City's procurement code, policy, and manual are missing these further best practice elements:
Receiving procedures and related documentation requirements
The threshold for when a suspension and debarment check must be performed, the responsibility
for performing this check, when in the procurement process the check must occur, documentation
required to support that the check was performed and how/where the documentation will be
maintained to support new vendor setup, and reverification process for confirming that vendors
used for longer than a specified period (e.g., one year)are reconfirmed and the results of the
review are documented.
Specific requirements for certain high-risk purchases (if applicable)
Specific restrictions and unallowable purchases (alcohol or other)
FAP1 shows inconsistency with regards to"days" references within the policy.
Definitions section includes a definition for"days" as: "Days"means business days (unless
otherwise specified).
Policy itself includes:
1 reference to "60 days"
1 reference to "20 calendar days"
4 references to "14 days"
1 reference to "14 business days"
1 reference to "10 days"
2 references to "7 days"
1 reference to "7 business days"
2 references to "7 calendar days"
3 references to "5 days"
2 references to "5 business days"
Criteria: In a high-risk area such as procurement, a comprehensive policy manual is essential to
establish clear guidelines for effective operation in compliance with applicable laws and regulations.
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Per the NIGP, procurement organizations should develop a comprehensive policy manual that clearly
defines authority, responsibility, and establishes guidelines for the organization and the procurement
professional to follow when carrying out their responsibilities.
Cause: An objective review of the procurement policy as a clear, standalone guide for those carrying
out procurements had not been appropriately completed.
Effect: If elements are missing from a procurement policy manual, limiting the policy's
comprehensiveness, personnel may not have a clear and consistent understanding of the required
rules and regulations relating to procurement. Lack of consistency in how procurement work is carried
out could likely, result in frustration within and outside the Procurement Division and in addition risk of
noncompliance with laws and regulations increases.
Recommendations:
The City should review that procurement policies and procedures are complete and comprehensive.
The existing procurement policies and procedures should be updated to include references to key
policy elements that are housed in primary source documents outside of the procurement policy.
Additionally, the City should specifically compare each procurement policy and procedure to the NIGP
to evaluate where expansions are needed to cover additional areas.
MANAGEMENT RESPONSE
Management Concur
Agreement
Levi D. Gibson, Budget and Finance Director
Owner
Connie Schnieder, Procurement Administrator
Target Completion June 30, 2024
Date
The Procurement Division is in the process of updating the FAP1 to
include items identified through this audit process as well as overall
Action Plan changes based on procurement best practices. This will include reviews
of both the Sole Source and Special Procurement forms as identified in
Finding #3. Forms will be in adherence to FAP1 and consistently
recorded alongside contracts for accessibility and justification.
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IV. PROCESS IMPROVEMENT RECOMMENDATIONS
CATEGORY PROCESS IMPROVEMENT RECOMMENDATIONS
Small Purchase Based on analysis of peer data,the City's current thresholds for small
Threshold and Formal purchases and formal procurements are set at a lower point than the majority
Procurement Threshold of peer cities analyzed. The City should consider whether efficiencies could
be gained safely by raising the small purchase threshold (currently
$4,999.99)and the formal procurement threshold (currently$50,000).
2 Authority Over Title 34 FAP1 specifies that the Engineering Department will manage and prescribe
Procurements procedures for all Title 34 solicitations. It appears that FAP1 does not ascribe
an authority to Engineering that is delegated by the Procurement Division but
an authority that is coequal or shared.
NIGP best practices recommend a centralized procurement model, led by an
individual with clear authority over the purchasing process, such as a
Purchasing Director or Materials Manager. In such a model, purchasing at
the department level occurs through the authority delegated by the figure of
centralized authority, rather than an authority that is coequal or shared. This
allows the central authority to strategically plan and optimize purchasing
throughout all organizational departments, monitor departmental practices for
adherence to centralized policies, ensure sufficiency and consistency of
training across departments, and ensure existence and sufficiency of
departmental cross training and backups.
The City should consider refining the procurement structure by clarifying the
delegation of certain procurement activities to departments and that
appropriate level of centralized oversight and authority over delegated
procurement activities is happening regularly.
3 Consistency of For two of 49 procurement samples tested during the course of our
Document Retention performance assessment, the green sheet provided by the procuring
and Storage department did not provide evidence required approvals. For six of 49
samples, a certificate of insurance from the vendor could not be provided to
us by the procuring department.The City should consider whether
procurement policies and procedures include sufficient guidance related to
documentation requirements, methods of storing information, and if the
Procurement Division has appropriate authority and capacity to provide
training to department-level staff and to monitor and enforce compliance with
the City's procurement procedures and policies. The City should consider
whether increasing the centralization of procurement within the City would
serve to increase consistency of procurement processes and procurement
documentation.
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APPENDIX : DEFINITIONS OF ASSESMENT FINDING
RANKINGS
We utilized the City IIAP's risk rankings, presented below, and assigned rankings based on our
professional judgment. A qualitative assessment of high, medium, or low helps to prioritize
implementation of corrective action as shown in the following table.
Critical control deficiencies that expose the City to a high degree of combined
risks. Recommendations from high-risk findings should be implemented
HIGH immediately (preferably within three months)to address areas with the most
significant impact or highest likelihood of loss, misappropriation, or damage
related to the City assets.
Represents less than critical deficiencies that expose the City to a moderate
degree of combined risks. Recommendations arising from medium risk
MEDIUM findings should be implemented in a timely manner(preferably within six
months), to address moderate risks and strengthen or enhance efficiency in
internal controls on areas with moderate impact and likelihood of exposure.
Represents low risk or control deficiencies and the exposure is not likely to
expose the City and its assets to significant losses. However, they should be
LOW addressed to improve efficiency and effectiveness of operations.
Recommendations arising from low-risk findings should be implemented within
12 months.
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0 MOSSADAMS