TOWN OF LADYSMITH
POLICIES AND PROCEDURE MANUAL
PURCHASING POLICY
TOPIC:
APPROVED BY:
Council
DATE:
Page 1 of 3
Jan 2002
RESOLUTION #: 01-098
Amended from: - March 5, 2001 March 26/01 & Oct. 30, 2001 Jan 2002 housekeeping changes
(replaces April 6/98 version in its entirity)
PURCHASING POLICY
GENERAL
A purchasing policy needs to be responsive, cost effective and open to public scrutiny. The following
policy has been designed to achieve that result. These principles and statements are to be used as a
guideline in conjunction with each purchaser’s good judgement. Each Department Manager is
responsible for ensuring that the authorized purchasers in their department adhere to this policy.
1
PRINCIPLES & DEFINITIONS
.1
Professional Ethics
Employees shall not use their authority or office for personal gain and shall seek to
uphold and enhance the Town’s image by maintaining unimpeachable standards of
integrity in all their business relationships, including the following:
(a)
declaring to a supervisor any personal interest which might reasonably be
deemed to affect the impartiality of an employee;
(b)
ensuring that any information received in the course of duty remains
confidential and is not used for personal gain.
(c)
declaring all business gifts to the Town Administrator.
.2
Definitions of “Best Buy”
“Best Buy” will take into consideration the following factors:

compliance with requirements and specifications

price

quality of goods or services, including timeliness and quality of support and
follow-up

availability of the goods or services

financial stability and business reputation of supplier

local preference will be given where the price variation for equally suitable goods
or services is less than 5%. After local suppliers, preference will be given to B.C.,
Canada and finally, international suppliers

orders will not be split between tie bidders
.3
To comply with INTERNAL TRADE REGULATIONS for Purchases of goods and
services over $100,000 and Construction over $250,000 – the following apply:
local preference does not apply
weighted average criteria is applied.
tenders are to be advertised electronically or on BC Bid and must contain bid
proposal information.
5 - 1790 - D
Town of Ladysmith Purchasing Policy (Jan. 2002)
Page 2 of 3
.4
Quantity Buying
(a)
Whenever possible, departments will pool the tendering of similar needs
(b)
Whenever possible, departments will join with other local governments and
public organizations in group buying.
.5
Definition of Capital
Capital equipment or projects shall mean items or projects that:

have an aggregate cost exceeding $3,000

have a useful life of one year or greater

are not budgeted in the Operations section of the Financial Plan.
Should a dispute occur as to equipment or project classification, the Director of
Financial Services will make the final decision.
.6
Authorization in Financial Plan
(a)
All purchases must be included in the Financial Plan.
(b)
2
Department Managers are responsible for ensuring that sufficient funds are
available in duly authorized accounts before making a commitment for goods
and services
METHOD OF PURCHASING GOODS / SERVICES
Upon sourcing the required goods and/or services, the following instruments will be used to
acquire the item from the appropriate supplier:
.1
Petty Cash
Used where the direct acquisition of a good and/or service is required and of very small
value (generally less than $20).
.2
Town Purchase Order
A Town purchase order will be issued for all items except where petty cash or credit
card has been used.
.3
Blanket / Standing Purchase Orders
A blanket or standing purchase order may be used for the continuous supply of a good
or service, but must not be issued for a period extending beyond the fiscal year end
Approval of the Director of Financial Services is required before issuing a blanket or
standing purchase order
Continued…
Town of Ladysmith Purchasing Policy (January 2002)
3
Page 3 of 3.
PURCHASE PROCEDURE
.1
All Purchases
(a)
(b)
require a purchase order signed by department Director or designate; purchase
orders in excess of $10,000 must be co-signed by the Director of Financial
Services
purchase order must be completed with accurate information regarding
quantities, product specifications, pricing, coding.
All improperly completed purchase orders will be returned to the Department
Manager.
.2
Minimum Required Price Checking
$0 - $ 1,000
Best Value
$1,001 - $ 3,000
Three telephone quotations from suppliers, noted on
Finance copy of purchase order (yellow)
$3,001 - $10,000
Three written quotations from suppliers attached to the
Finance copy of purchase order (yellow)
$10,000+
Tender (advertised or invitation); opened in public forum (see:
Town of Ladysmith Tender Policy)
$25,000+
Council approval of tender.