Agenda Item
Meeting Date: 4/2/2019 - 5:00 PM
Category: Adoption of Consent Agenda
Type: Action
Subject: Board Policy DJ District Purchasing - Procurement Thresholds
End Statements:
Enclosure: Attachment #1: Revised Board Policy District Purchasing DJ Redline
Attachment #2: Revised Board Policy District Purchasing DJ Final
File Attachment:
Purchasing Thresholds Clean 3.26.19.pdf
Summary : Strategic Sourcing & Contract Management has received comments from school principals that DCSD's Purchasing Card (P-card), Request for Proposal (RFP) and Required Quotes purchasing thresholds were out of date and not consistent with other school districts. In response, Strategic Sourcing reviewed past and current Board Purchasing Policy DJ and compared the policy to other school districts and public entities in Colorado. Please note: This request is in regards to the P-card, RFP and Required Quotes thresholds, not the Board purchasing consent threshold of $500,000. Typically, thresholds associated with P-card, RFP, and Required Quotes would not be a Board policy but rather a Superintendent policy. Given these thresholds are currently in Board policy, we are requesting updating Board policy.

The current Board Purchasing Policy (DJ) states the following:
- Small purchases of up to $1,000 shall not require a competitive process, but shall nevertheless be made in a commercially prudent manner.
- Purchases in which the estimated total cost of goods is greater than $5,000 and up to $24,999 shall require three quotes.
- Purchases in which the estimated total cost of goods is greater than $25,000 shall require a formal competitive process (RFQ or RFP).

Please note, these policies have not been updated since 2006. In 2006, total General Fund expenditures were $321M. In 2019, total General Fund expenditures are $600M.

Strategic Sourcing surveyed 11 Colorado school districts and 3 public entities to learn their current purchasing policies. The findings showed that:
- 8 out of 11 school districts and 3 out of 3 public entities have higher p-card limits than DCSD.
* Denver Public Schools, Cherry Creek, Boulder Valley and Adams 12 all have p-card limits of $5,000.
- The current three-quote requirement for purchases exceeding $5,000 is significantly below the average of the larger school districts.
* Jeffco Public Schools does not require quotes for purchases under $24,000.
* Denver Public Schools does not require quotes for purchases under $10,000.
- 9 out of 14 entities have RFP thresholds of $50,000 and above.
* Denver Public Schools requires RFPs for purchases over $250,000.
* Jeffco Public Schools requires RFPs for purchases over $100,000.
* Boulder Valley School District requires RFPs for purchases over $50,000.

Based on the research findings above, Strategic Sourcing & Contract Management recommends that the purchasing thresholds under review should be updated as follows:

Small Purchases
- Small purchases of $2,500 or less shall be made in commercially prudent manner but do not require a competitive process. These purchases may be made via p-card.
- Purchases of more the $2,500 and up to $4,999 shall be made using informal means of obtaining competitive pricing. These purchases can only be made via p-card with the prior approval from the Director of Strategic Sourcing and Contract Management.

Required Quotes
- Require that purchases over $5,000 and up to $49,999 must have 3 written quotes.

RFP's
- Any spend $50,000 and greater shall require a formal competitive process (RFQ or RFP).

These changes will allow the proper balance between the protection of taxpayer dollars and efficiency of operations while ensuring that DCSD has proper internal controls without unnecessarily tying the hands of our school leaders.
Funding:
Recommendation: That the Board of Education approve Board Policy DJ District Purchasing as revised under adoption of Consent Agenda.
Approvals:
Recommended By:
Signed By:
Scott S. Smith - Chief Financial Officer
Signed By:
Dr. Thomas Tucker - Superintendent
Vote Results:

Original Motion
Member Krista Holtzmann Moved, Member Vogel W seconded to approve the Original motion 'That the Board of Education approve Board Policy DJ District Purchasing as revised under adoption of Consent Agenda.'. Upon a Roll-Call Vote being taken, the vote was: Aye: 7 Nay: 0.
The motion Carried 7 - 0