HomeMy WebLinkAboutCORRESPONDENCE - RFP - P1090 PURCHASING CARDS (6)1
Staff: Jim O’Neill
Mike Beckstead
SUBJECT
First reading of Ordinance No. , 2013 authorizing the extension of the Purchasing Card
Services Agreement with UMB Bank, n a, for an additional five (5) year period.
EXECUTIVE SUMMARY
In 2007, the City and Poudre School District did a cooperative request for proposal
process for Procurement Card (PCard) Services. The solicitation was for a five (5) year
period with an option to renew for an additional five (5) years with the approval of City
Council. This cooperative bid was also open for participation of other governmental
entities. Each entity contracts separately with the selected bank but shares in the value
of the combined spending and services offered by the bank. The bank selected was
UMB Bank n a (UMB). The contract was signed in March of 2008. Services provided
by UMB have been outstanding. Participation in this cooperative contract has grown
from the original 2 to over 70 governmental agencies in Colorado. The participants in
the cooperative combine their volume of purchases which results in a higher rebate to
each participant based on their individual volume of purchases. The City’s estimated
2013 rebate amount is over $130,000.
BACKGROUND/DISCUSSION
In 2007, the City and Poudre School District did a cooperative bid for Procurement Card
(PCard) Services. The solicitation was for a five (5) year period with an option to renew
for an additional five (5) years with the approval of City Council. This cooperative bid
was also open for participation of other governmental entities. Each entity contracts
separately with the selected bank but shares in the value of the combined spending and
services offered by the bank. The bank selected was UMB Bank n a (UMB). The
contract was signed in March of 2008. Services provided by UMB have been
outstanding. Participation in this cooperative contract has grown from the original 2 to
over 70 governmental agencies in Colorado. The participants in the cooperative
combine their volume of purchases which results in a higher rebate to each participant
based on their individual volume of purchases. The cooperatives total volume has
grown from $4 million to over $103 million.
Pcard programs are designed to make small purchases in the most efficient manner
possible. Controls are placed an each card by category and also by individual. For
example all City cards are blocked from receiving cash advances or for the purchase of
alcohol. Individual spending limits are controlled by the spending need of the individual.
Periodic audits of card holder receipts ensure compliance with program controls. The
program has been very successful. The City’s program has increased from 725 card
holders to the current 968. The City’s rebate amount has grown from $24,351 in 2008
to over $130,000 per year.
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Because of the administrative costs for both the vendor and the City in setting up the
system and issuing cards, the contract has been structured to allow for two five year
periods. The second five year period is contingent on City Council approval.
UMB has done an outstanding job for the last five years and staff is recommending
Council approve an extension of an additional five year period.
City of Fort Collins:
2008 volume $6 million and 725 card holders.
2012 volume $8.4 million and 968 card holders
Number of other governmental agencies participating in the cooperative and dollar
volume:
2008 – 2 - $7 million
2012 -76 - $103 million
FINANCIAL/ECOMOMIC IMPACTS
The City receives a rebate on purchases made on the Pcard.
2011 rebate paid in 2012 - $120,312
2012 rebate to be paid in 2013 – Est. $132,647
ENVIRONMENTAL IMPACTS
Pcard programs reduce the number of small invoices submitted for payment and the
need to generate checks for multiple vendors.
STAFF RECOMMENDATION
Approval
BOARD OR COMMISSION RECOMMENDATION (include minutes from meeting)
N/A
PUBLIC OUTREACH (open houses, stakeholder groups, public meetings)
N/A
ATTACHMENTS (numbered 1, 2, 3,…)
NONE