HomeMy WebLinkAbout12/09/2008 07 City/County Purchasing Merge MOU for Interim Operating Arrangement [Memo of Understanding] BUSINESS OF THE CITY COUNCIL
0 YAKIMA, WASHINGTON
AGENDA STATEMENT
Item No. 7
For Meeting Of December 9, 2008
ITEM TITLE: Consideration of a resolution authorizing the execution of a Memo of
Understanding (MOU) between the City of Yakima and Yakima County for the purpose of .
establishing an interim operating arrangement while an implementation plan is developed to
potentially merge the City and County Purchasing functions.
SUBMITTED BY: Dave Zabell, Assistant City Manager
CONTACT PERSON/TELEPHONE: Dave Zabell, Assistant City Manager
Sue Ownby, Purchasing Manager /576 -6695 )=)
SUMMARY EXPLANATION:
The City of Yakima and Yakima County have spent the past year evaluating their respective .
purchasing operations and exploring the possibility of merging operations with a goal of
reducing costs and increasing efficiencies.
The first phase of this effort included a feasibility analysis conducted by the Nation Institute of
Government Purchasing (NIGP). During the course of the study, professionals from the NIGP
® worked with City and County staff in evaluating current operations, identifying areas for
improvement, and examining the merger alternative. The feasibility analysis included
numerous recommendations for improvement, but more importantly identified the concept of a
merged purchasing operation as a viable alternative. Subsequent to the completion of the
NIGP analysis, City and County staff have been working collaboratively to evaluate the
alternatives and have concluded that a merged operation holds promise for the greatest ,
collective gains in efficiency and cost savings. (continued on next page)
Resolution Ordinance Other (Specify)
Contract Mail to (name and address):
Phone:
Funding Source General Fund Reve from C $56,400. General Fund Expenditures $72,248
APPROVED FOR SUBMITTAL: - - -, ' City Manager
STAFF RECOMMENDATION: Approve MOU.
BOARD /COMMISSION RECOMMENDATION: The Intergovernmental Committee
recommends proceeding approval of the work elements outlined in the MOU.
• COUNCIL ACTION:
The City /County Intergovernmental Committee has been actively engaged throughout this
process and has played an instrumental role in maintaining progress and in providing
invaluable feedback. Working through the IGC process, City and County staff have
addressed many of the challenges inherent with the proposed merger. The fruits of these
efforts are the attached Memorandum of Understanding (MOU) and the framework to
complete a successful merger evaluation and implementation plan. The County has
preliminarily agreed to reimburse the City for a portion of the expenditures related to the
strategic planning and implementation phase of the project per the attached Budget Wrap -up
memo dated November 24, 2008.
The MOU, represents the next major phase of this effort resulting in the development of a
Strategic Plan that will map out in detail the steps necessary to implement a successful
merger.
While not contemplated, the process allows maximum flexibility for either agency at any time
to unilaterally determine it to be in their best interest to move forward alone. Should the City
and County ultimately determine a merger is in their best individual and collective interests, a
subsequent Inter -local Agreement will be required to establish the relationship. If the City and
County purchasing functions are ultimately merged, it would be the first ' City /County
Purchasing merger in over three decades in the nation and would serve as a model for
collaboration among local governments. .
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• RESOLUTION NO. R- 2008 -
A RESOLUTION authorizing and directing the City Manager of the City of Yakima to execute
a Memorandum of Understanding (MOU) between the City of Yakima and
Yakima County for the purpose of negotiating and establishing an interim
operating arrangement for joint City and County purchasing while a
comprehensive implementation plan is developed that would effectuate the
proposed merger of the City and County Purchasing functions; and also
authorizing the City Manager to execute additional Interlocal Agreements,
contracts and related documents necessary to accomplish the merger.
WHEREAS, the City and the County have jointly been engaged in evaluating the
potential merger of their respective purchasing functions; and
WHEREAS, the City and County have determined there are significant economic,
operational and strategic advantages to such a merger; and
WHEREAS, the City and County desire to further evaluate the proposed merger of their
purchasing functions and to establish an interim operating arrangement to allow the time
necessary to prepare a strategy to facilitate the merger; and
WHEREAS, the City and the County agree to engage in the next steps necessary to
facilitate this process; and
WHEREAS, the parties will commit to continue working together in a cooperative
manner for the purpose of assembling a cross - functional team to develop a strategic plan; and
Ill WHEREAS, the Intergovernmental Committee has reviewed the terms and conditions of
the MOU and supports further planning of the proposed purchasing department merger; and
WHEREAS, the City Council deems it to be in the best interest of the City of Yakima to
enter into a Memorandum of. Understanding to further investigate and develop the vision of
merging the City and County Purchasing Departments, Now, Therefore
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA:
The City Manager of the City of Yakima is hereby authorized and directed to execute the
attached and incorporated Memorandum of Understanding between the City of Yakima and
Yakima County to facilitate establishing an interim operating agreement for joint City and
County purchasing while opportunities for a complete departmental merger are investigated and
while the actions necessary to accomplish the merger are completed; in order to address the
numerous steps necessary to complete the review and fulfillment of the proposed merger
objectives for the City and County Purchasing Departments the City Manager is hereby further
authorized to execute all additional Interlocal and contract agreements within his budgeted
authority to approve as shall become necessary to accomplish the merger of the City and
County Purchasing operations.
ADOPTED BY THE CITY COUNCIL this day of December, 2008.
David Edler, Mayor
ATTEST:
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City Clerk
• MEMORANDUM OF UNDERSTANDING
This Memorandum of Understanding ( "MOU ") dated December 9, 2008 is by and
between,
City of Yakima
129 North Second St.
Yakima, WA 98901
hereinafter referred to as "City"
and,
Yakima County
128 North Second St.
Yakima, WA 98901
hereinafter referred to as "County"
RECITALS:
WHEREAS, the City and the County have jointly been engaged in evaluating the
potential merger of their respective purchasing functions; and
• WHEREAS, the City and County have determined there are significant economic,
operational and strategic advantages to such a merger; and
WHEREAS, the City and County desire to further explore the merger of their
respective purchasing functions and establish an interim operating arrangement while an
implementation plan is developed; and
WHEREAS, the City and the County agree to engage in the next steps necessary
to facilitate this processes,
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants contained herein, the parties hereto agree as follows:
PURPOSE OF THE AGREEMENT:
The parties intend that this Agreement shall memorialize their desire to
cooperatively form a cross - functional team for the purpose of consolidating and
merging the City and County Purchasing Divisions, under the authority and in
conformance with RCW 39.34, the Interlocal Cooperation Act. This
Memorandum of Understanding (hereinafter referred to as "MOU ") will provide
for the relationship necessary to initiate the next stage of the merge, which is -
Strategic Planning.
•
THE PARTIES AGREE AS FOLLOWS:
1. RESPONSIBILITIES — The responsibilities are defined as follows:
• A cross - functional team, hereinafter referred to as "Team" shall be formed
which will consist of City and County representatives from the following
departments with responsibilities as listed but not limited to:
➢ Purchasing
o City of Yakima Purchasing Manager shall serve as Project
Manager
➢ Management
o Oversight and input
➢ Information Technology
o Schedule demonstrations with e- procurement firms to find
a "best of breed" and determine if City and County
purchasing interface is feasible
o Implement and support systems
➢ Finance
o Address integration issues between e- procurement and
financial systems
o Establish financial protocols for joint purchasing office
o Develop methodology for allocating operational costs
o
➢ Human Resources
o Assist in defining staff requirements
o Develop recruitment plan for new city positions in
accordance with Civil Service Rules
➢ Legal
o Establish framework for drafting consistent policies and
regulations
o Establish framework for developing uniform
o Draft Interlocal Agreement
➢ Other key departments as necessary
• The team shall be responsible for meeting a minimum of once per week
for one and one -half hours to engage in strategic planning to form a vision
of how the new merged function shall operate, while keeping the
following parameters in mind:
➢ The City shall be the lead agency of the merged function and
provide all necessary management, personnel, benefits,
equipment and facilities to perform procurement services for
both entities.
2. EXCHANGE OF INFORMATION — The two entities shall freely exchange
information between themselves as needed to facilitate the consolidation.
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0110 3. OFFICE SPACE = A private office space shall be set up and maintained at the
County Courthouse for the purpose of city purchasing employees meeting with
county employees and vendors.
4. THE CONTACT REPRESENTATIVES FOR EACH OF THE ENTITIES ARE:
City: County:
Sue Ownby, Purchasing Manager Craig Warner, Budget Director
129 No. 2 St. 128 No. 2 St.
Yakima, WA 98901 Yakima, WA 98901
5. PERIOD OF VALIDITY
• This Memorandum will remain in effect until it . is superseded by an
Interlocal Agreement to be executed between the two parties, or until it is
cancelled by either party, whichever comes first, but shall not, in any
event, continue beyond June 30, 2009.
6. No obligation, covenant, amendment or agreement relating to this MOU shall be
binding until signed by both parties.
7. AMENDMENT — This MOU may only be amended by a written modification
signed by both parties.
• 8. EXCLUSIONS — Yakima County Roads Department partment is excluded from
participating in this agreement per R.C.W. 36.32.240.
9. COMPLIANCE WITH LAW - Both parties to this MOU shall comply with all
applicable federal, state and local laws, rules and regulations in carrying out the
terms and conditions of this MOU.
10. Both parties agree that this MOU is the complete and exclusive statement of
understanding between the parties and supersedes all prior agreements, whether
oral or written, with respect to the subject matter hereof.
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CITY OF YAKIMA YAHIMA COUNTY
R.A. Zais, Jr., City Manager Ronald F. Gamache, Chairman
Date:
J. Rand Elliott, Commissioner
ATTEST:
City Clerk
City Contract No. Michael D. Leita, Commissioner
Resolution No. Constituting the Board of County
Commissioners For Yakima County, Washington
Date:
ATTEST:
Christina S. Steiner
Clerk of the Board
Approved as to Form:
'AtoutcL
_ Deputy Prosecuting Attorney
•
2009 BUDGET WRAP -LIP
,. OTHER SUPPLEMENTAL INFORMATION
DEPARTMENT: City Management DIVISION: Purchasing
POLICY ISSUE TITLE: Budget Adjustments
INTERDEPARTMENTAL MEMORANDUM
To: Yakima City Council — For Budget Wrap -up Packet
From: Dave Zabell, Assistant City Manager
Sue Ownby, Purchasing Manager
Date: November 24, 2008
Re: City /County Purchasing Merge — 2009 Budget Amendment
® In preparation for and to facilitate the potential merger of the City and County Purchasing
functions, the 2009 budget has been amended to reflect the following:
➢ General Fund Revenue has been increased $56,400 (annual total)
• The County has agreed to pay the City a monthly sum of $4,700 for the purpose of
covering costs related to the strategic planning and implementation phase of the merge. -
➢ General Fund Expenditures has been increased $72,248 .
• In addition to the revenue above being expended to hire one temporary staff and
provide special assignment pay for existing staff, the additional $13,000 will be used to
hire a third party consultant to assist with the strategic planning phase of the merge. It
should be noted that the total cost to hire the third party consultant is $32,000 however,
the county has agreed to pay 60% of the costs. $13,000 is the city's portion.
A copy of the Joint Administrative Purchasing Assessment that the National Institute of
Governmental Purchasing completed in August 2008 was provided to council as an informational
item on November 4, 2008 and recommends the merge. A Memo of Understanding outlining the
vision of the merge and facilitates the next step towards strategic planning will be presented to
Council for its approval on December 9, 2008.
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Budget Wrap -Up 61