Presenter
Presented by Mr. Deasy
Negative Recommendation
Title
Resolution authorizing and directing the Mayor and the Director of the Department of Finance to initiate the process to enter into a Cooperation Agreement between the City of Pittsburgh and Allegheny County, for the purpose of centralizing purchasing functions of both government entities, to cut costs for goods and services and improve overall efficiencies, resulting in a cost savings to the taxpayers of the City of Pittsburgh and County of Allegheny.
Body
WHEREAS, the combined leverage of joint City and County purchasing of goods and services can directly benefit the taxpayers by reducing expenses, streamlining the efforts of the purchasing departments, improving visibility into contract award and savings, aligning both strategy and contracts, and lastly, improving supplier relationships.
WHEREAS, the City and County have long purchased similar goods and services within the same supply base without having the opportunity to work cohesively to drive efficiencies and cost reductions and which centralization of these functions can benefit the City and County from 7% to 15% in cost reductions, equaling $3.5 million to $7.5 million annually for the City; and
WHEREAS, the Commonwealth of Pennsylvania has instituted a similar cost out program under Governor Ed Rendell which to date has saved $180 million for goods and services that were in the past sourced amongst many state agencies and not directly through the Pennsylvania Department of General Services (DGS); and
WHEREAS, in October 2006, Governor Rendell further stated that "by consolidating our purchases, we have been able to realize millions of dollars in savings and direct more of our resources to programs that benefit our citizens"; and
WHEREAS, cities like Washington DC as recently as December 2006 have reduced costs over $30 million for commodities as routine as electricity through aggregation programs with the District of Columbia transportation authority, public universities, sports and exhibition authorities along with other private sector members to benefit the taxpayers of the District; and
WHEREAS, many of the City and County goods and services such as printing services, advertising services, mailing services, transportation equipment, fuel, electricity, natural gas, and many others are offered as contracts by both city and county offices separately with no alignment of expenses to gain better taxpayer value; and
WHEREAS, the City of Pittsburgh is committed to cost reductions in order to provide further resources and programs to benefit our citizens.
Be it resolved by the Council of the City of Pittsburgh as follows:
Section 1. The Council of the City of Pittsburgh authorizes and directs that the Mayor and the Director of the Department of Finance to initiate the process to enter into a Cooperation Agreement between the City of Pittsburgh and Allegheny County, for the purpose of centralizing all purchasing functions of both government entities, to cut costs for goods and services and improve overall efficiencies, resulting in a cost savings to the taxpayers of the City of Pittsburgh and County of Allegheny. The Cooperation Agreement shall be approved by the City Solicitor as to form and substance.
Section 2. The Council further authorizes and directs that the Mayor and Director Finance to explore a 120 300 day post resolution adoption plan to investigate the full merger of the City and County organizations with the following activities post resolution adoption:
30 days - A Purchasing Shared Services Task Force shall be appointed and shall hold the first planning meeting to begin implementation planning for the resolution.
60 150 days - the Task Force shall publish and issue the shared services plan to City Council for review of the steps to merge the organizations. This should include the merger of processing requisitions under $10,000 and purchase orders, processing or managing construction procurement, processing or managing professional services procurements, and processing invoices.
90 270 days - City Council shall review, comment and respond with support for the Task Force plan. This should include public input through a public hearing process.
120 300 days - The Task Force implementation plan shall be executed with joint City/County purchasing activities.