the municipal secretary desktop reference manual - Southwestern ...

H. MUNICIPAL PURCHASING
Effective and efficient management and/or an environment of declining or no growth
revenue sources appear to dictate that municipal officials would seek a way to make their
municipal operations and processes more cost-effective. If this assumption is correct, then local
government officials should evaluate the processes used to obtain goods and services, which
represent the second largest items in their municipal budgets. It is most likely that their
evaluation would indicate that this function requires improvement and change.
Two broad policy considerations are available to those officials who want a purchasing
system designed to obtain goods and services at the least possible or most economical cost to the
local government.
One is external in nature and involves the municipality's participation in some form of
cooperative or intergovernmental purchasing. The other consideration is internal in nature. It
involves the centralization of purchasing authority in an individual and the adoption, by the
governing body, of rules and regulations controlling the centralized purchasing operation. These
considerations or options are not mutually exclusive. They are both critical to improving the
cost-effectiveness of the purchasing operation.
A centralized purchasing function encompasses the following steps or processes:
! developing standards and specifications
! soliciting bids
! obtaining price inquiries
! preparing requisitions and purchase orders
! encumbering accounts
! inspecting or testing goods
! making payment for goods
! providing exceptions in emergencies
Regulations involving these several steps should be adopted in an ordinance.
The preparation and use of a purchasing manual is an effective way to provide details or
added guides to this process. To facilitate involvement in cooperative or intergovernmental
operations, the purchasing ordinances should authorize the jurisdiction=s participation in one or
more types of cooperative plans.
The ordinances, manual and intergovernmental purchasing materials which are a part of
these comments are available through the Southwestern Pennsylvania Commission.
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