EXECUTIVE MANAGEMENT AND AUDIT COMMITTEE

EXECUTIVE MANAGEMENT AND AUDIT COMMITTEE

MARCH 21, 2002

SUBJECT: THE Metro PROCUREMENT POLICIES AND PROCEDURES MANUAL

ACTION: APPROVE REVISIONS TO THE Metro PROCUREMENT POLICIES AND PROCEDURES MANUAL

RECOMMENDATION

Approve revisions to the Metro Procurement Policies and Procedures Manual (PPPM) as summarized in Attachment A to comply with changes in California law and 49 CFR Part 26. The red-lined version of the PPPM is also included as Attachment B.

ISSUE

The Board of Directors established that changes to the PPPM be presented to the Executive Management and Audit Committee and the Board in a clear and concise request for approval. The current series of changes represents the fifth requested Board action on the PPPM since 1997. These changes will help ensure that Procurement staff comply with all requirements of California law in discharging their responsibilities.

POLICY IMPLICATIONS

All policy changes resulting from this action have been delineated in the attached matrix (Attachment A). The matrix summarizes the reason for the proposed change.

OPTIONS (ALTERNATIVES CONSIDERED)

The Board has the option to disapprove all or any of these proposed revisions to the PPPM. However, the proposed revisions are made with the intent of updating current procedures to comply with revisions to California law.

There is no appreciable financial impact relating to the implementation of these changes. In addition, if the Metro does incur additional costs, there is the possibility that the Metro may be able to recover certain costs from the California State Mandates Claim Fund.

The Board approved the Procurement Policies and Procedures Manual in July 1997. Since that time, there have been four occasions where staff has requested and received Board approval for changes to the PPPM. More specifically, in July 1999, the Board approved a revision to the CEO contracting authority. In March 2000, the Board approved four additional changes to the PPPM. Six changes occurred in the February 2001 Board action. In September 2001, the Board approved a significant enhancement of the PPPM. These recommendations, if approved, would be the fifth Board action on revisions to the PPPM in five years.

The approved revisions will be reflected in the updated PPPM within 30 days from Board approval.

In view of rapid advances in industry processes, staff anticipates a sustained procedural review and update effort in order to keep the manual current. As requested by the Metro Board, we will continue submitting future changes in the PPPM for Board approval.

Prepared by: Rudy LeFlore, Director, Procurement Compliance and Business Planning