TITLE
Recommendation to adopt resolution authorizing City Manager to execute a master agreement with US Bank National Association ND, of Fargo, ND, for a Commercial Credit Card Program, on the same terms and conditions afforded to the City of Los Angeles, pursuant to City Manager approval. (Citywide)
DISCUSSION
City Council approval is requested to authorize the City Manager to execute an agreement for providing purchasing card services to the City of Long Beach. On May 15, 2001, the City Council approved a contract with Bank One NA for purchasing card services. During the term of that contract, Bank One NA was purchased by JP Morgan Chase, which is the City's current provider for purchasing card services.
Participation in a purchasing card program provides a number of cost efficiencies and administrative benefits to the City, including:
Ø Reduces administrative costs to the City;
Ø Eliminates purchasing delays on small dollar transactions;
Ø Reduces the number of checks issued;
Ø Improves supplier relations;
Ø Improves transaction reporting while reducing the amount of paperwork; and,
Ø Accelerates rebates on paid transactions.
Purchasing card expenditures represent small dollar transactions and have proven to be a valuable tool reducing the amount of invoices and staff time in processing payments. The recommended program provides a number of internal control improvements and security that enhance accountability, improve best practices and increase program oversight. In addition to these benefits, the Purchasing Division will establish the following card controls and limits: 1) credit limits (dollar amount per cycle); 2) single amount limit (dollar amount per transaction); and, 3) Merchant Category Code (MCC) groups. It is the intent of the Purchasing Division to implement an effective purchasing card program which will encompass on-going training, approved Administrative Regulations, annual City Auditor review and reporting to maintain compliance.
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