Purchasing
Ordinance Update
Finance Committee (03/26/2025)
FINANCE DEPARTMENT
Travis Hickey, Chief Financial Officer
Margarita Cornejo, Deputy Finance Director
Amir Zaki, Finance Manager
PURCHASING ORDINANCE UPDATE
BACKGROUND & OVERVIEW
(Chapter 3.12 & 3.30 Menifee Municipal Code)
• Since incorporation in 2008, the City’s Purchasing Ordinance & thresholds adopted by the County have remained unchanged.
• The ordinance establish procurement procedures for the purchase of goods, supplies, and services.
• The purpose of the ordinance is to maximize the value of City’s purchases & promotes accountability and transparency while ensure compliance with State & Federal regulations.
• Since incorporation, 3 major departments were established by the City causing a significant increase in purchasing activity (Community Services, IT, and PD) -1-
PURCHASING ORDINANCE UPDATE
BACKGROUND & OVERVIEW CONTINUED
(Chapter 3.12 & 3.30 Menifee Municipal Code)
• City’s operations have significantly increased from 2008 to the present, with adopted budget in FY2009/10 of $21.8 million compared to the FY2023/24 adopted Budget of $97 million.
• The region has experienced overall cost increases reflected in annual CPI adjustments from 2008 to 2024 of 47.83% in aggregate, during last 5 years the CPI averaged 5.23%.
• In fiscal year FY2023/24, the City issued approx. 982 POs & executed 590 purchasing related contracts, 55% of the issued POs (545 POs) are representing
1.7% of the total encumbered amounts (less than $10K).
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• The proposed updates will be aligned with the City’s
strategic priorities and goals through the “Thriving
Economy” strategic goal.
• Increasing efficiency & cost-effectiveness by reducing the administrative expense necessary to obtain goods &
services.
• Purchasing function is centralized & housed in the Finance Department with a team of 4 dedicated members.
• Invoice payment is subject to a thorough review of at least 2 members in Finance including a dedicated Senior
Accountant, in addition to Department’s oversight &
approval of the expense.
Thriving
Economy
PURCHASING ORDINANCE UPDATE
PURPOSE
5 YEAR
STRATEGIC
PLAN
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The proposed ordinance was reviewed in detail with City Attorney’s office to ensure compliance with Federal & State rules and regulations. Input gathered from all stakeholders including Executive Team & Departments Heads to address all potential areas of concern. A comprehensive analysis and benchmarking with other neighboring municipalities within the region was completed, comparison considered size of population, adopted operating budgets, and similar purchasing volume.
Several municipalities either updated their thresholds or in the process of doing so with similar thresholds.
PURCHASING ORDINANCE UPDATE
APPROACH
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Unified Existing Ordinance (3.12 & 3.30) into one section. Addressed Council’s priorities to support local & veterans owned businesses. Proposed higher purchasing authority thresholds and designated by resolution to allow more flexibility in future updates.
Requirements for competitive quotes raised from $5K to $10K to match current federal levels for micro purchases.
Standardizing City Manager’s authority to $100K for all purchase categories.
Updated Public Works bidding thresholds to match Public Contract Code.
SUMMARY OF PROPOSED UPDATES/REVISIONS
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Added clarifications on exempt categories (legal advertising, utilities, regulatory fees, land acquisitions, etc.).
Introduced new procurement methods permitted by California law to accommodate future projects (design-build, public/private partnerships). Clarified approvals for MOU, MOA, & Property Leases . Added clarification for disposal of surplus property. Added sections for definitions & ethical standards.
Updated language to maintain consistency & clarity throughout the ordinance.
SUMMARY OF PROPOSED UPDATES/REVISIONS
CONTINUED
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RECOMMENDED ACTION
Review and provide comment on the draft
Purchasing Ordinance Update and recommend
submittal to the City Council for approval at a
future City Council meeting
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Thank You!
Questions?