Chapter 41.36
PURCHASING CARD PROGRAM
Sections:
41.36.030 Limitations on use of purchasing card.
41.36.060 Prohibited use of purchasing cards.
41.36.080 Requests, disputes and forgery/fraud.
41.36.090 Internet purchasing card procurement.
41.36.010 Introduction.
The City of Grand Junction purchasing card program is designed to improve the efficiency in processing small dollar purchases from any vendor that accepts the purchasing card. This program shall allow the cardholder to purchase approved commodities and services directly from the City’s vendors. Each purchasing card is issued to a named individual. Under special conditions, upon written request, a Department card may be issued in areas that do not require the employee to have a card on a daily basis. Contact the Purchasing office for details. The City of Grand Junction is clearly identified on the card as the “corporate” buyer of goods and services. Purchases are exempt from sales tax.
The Purchasing Division and Accounting Division shall monitor the performance of the program. All questions or concerns shall be directed to:
|
Procurement Related: |
Program Administrator |
244-1513 |
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Accounting Related: |
Finance Supervisor |
244-1522 |
(Res. 04-12 (§ 9.1), 1-16-12)
41.36.020 Who does what?
The following is a summation of the responsibilities of the individuals and agencies involved in the purchasing card program.
(a) Department Director/Division Managers shall:
(1) Request purchasing cards for designated employees;
(2) Set cardholder spending limits within established guidelines;
(3) Designate representatives responsible for authorizing charges;
(4) Collect cards from cardholders that end employment;
(5) Evaluate the need to transfer cards when employees transfer;
(6) Notify the Purchasing Card Administrator of cards that must be terminated; and
(7) Comply with all purchasing and purchasing card policies and procedures.
(b) Cardholder shall:
(1) Hold and secure purchasing card;
(2) Ensure availability of funds and proper account codes;
(3) Order/receive materials and services;
(4) Make sure there is no sales tax or back-orders;
(5) Collect and save detailed sales receipts;
(6) Handle disputed items;
(7) Provide detailed receipts to the Department/Division Liaison;
(8) Comply with all purchasing and purchasing card policies and procedures; and
(9) Cancel lost or stolen cards by notifying the Purchasing Card Administrator and your Department/Division Manager.
(c) Department Liaison (designated by Department Director) shall:
(1) Timely collect all bi-weekly information for the department or division(s) to be processed for account debiting;
(2) Review bi-weekly statement of each assigned cardholder to ensure inclusion of necessary receipts;
(3) Confirm that appropriate supervisor authorizes all charges if cardholder is nonexempt employee;
(4) Make sure there is no sales tax or back-orders;
(5) Ensure availability of funds in proper account codes;
(6) Verify appropriateness of account codes;
(7) Process all cardholder statements in a timely manner;
(8) Forward statement(s) and supporting receipts to Accounts Payable Division;
(9) Process journal entries as required; and
(10) Comply with all purchasing and purchasing card policies and procedures.
(d) Accounting Division shall:
(1) Monitor charges for proper account codes and fund availability;
(2) Receive statements every two weeks from Department/Division Liaison;
(3) Notify Departmental Liaisons when reports are not entered or received in a timely manner;
(4) File and store statements, receipts, etc.;
(5) Administer 1099 reporting;
(6) Monitor missing documentation and notify the Purchasing Card Administrator or the Department Liaison; and
(7) Notify the Purchasing Card Administrator of any violations or discrepancies.
(e) Purchasing Card Administrator and Purchasing Division shall:
(1) Coordinate program policy issues;
(2) Create and maintain cardholder hierarchy for control and reporting purposes;
(3) Create dollar transaction limits for cardholders and oversee any necessary and required modifications;
(4) Process properly authorized card requests and card strategy changes;
(5) Assign merchant codes to particular card strategies and change when in the City’s best interest;
(6) Block merchant/commodity codes when appropriate;
(7) Initiate training program for all cardholders;
(8) Coordinate issuance and cancellation of cards;
(9) Target new cardholders and expanded use of cards;
(10) Maintain policy and cardholder guides/manuals;
(11) Maintain purchasing card software database;
(12) Evaluate purchasing card feedback from suppliers and from departments;
(13) Coordinate and maintain internal controls;
(14) Assist in resolving billing disputes, if required;
(15) Monitor/audit use of cards and selection of vendors;
(16) Participate in ongoing program reviews;
(17) Conduct annual inventory of purchasing cards; and
(18) Provide cardholders all relative information regarding card-use policy and procedures.
(Res. 04-12 (§ 9.2), 1-16-12)
41.36.030 Limitations on use of purchasing card.
(a) Cardholder Use Only. Only the employee whose name is embossed on the card may use the card. No other individual is authorized to use the card.
(b) City Purchases Only. The card is to be used for City authorized purchases only. The purchasing card cannot be used for any personal use and any such use shall require immediate reimbursement and may result in disciplinary action.
(c) Infractions. All infractions against the policy stated in this manual are tracked. The information is reviewed by the Program Administrator every two weeks. If it is found that an employee has multiple infractions or seems to be abusing the purchasing card guidelines, the information will be elevated and reviewed by the Purchasing Manager, the Department Director and the City Manager. Disciplinary action may include a decrease in spending limit, loss of purchasing card privileges or dismissal.
(Res. 04-12 (§ 9.3), 1-16-12)
41.36.040 Dollar limitations.
(a) The Department Director approving the assignment of a purchasing card shall set single purchase limits and monthly limits. The maximum single purchase limit is $4,999. Maximum allowable monthly limit is $20,000. Requests for spending limit changes must be initiated by the Department Director or Division Manager and approved by the Purchasing Card Administrator.
(b) A purchase may be made of multiple items, but the invoice cannot exceed $4,999 or the cardholder’s limit if it is less. Payment for purchases must not be split to stay within the single purchase limit.
(Res. 04-12 (§ 9.4), 1-16-12)
41.36.050 Other conditions.
(a) All items purchased over-the-counter must be immediately available. No back ordering is allowed.
(b) All items purchased during one telephone or fax transaction must be delivered in a single delivery. If an item is not immediately available no back ordering is allowed.
(c) All items purchased by telephone, on the Internet or fax must be delivered by the vendor within 28 days (two billing cycles). An order shall not be placed without this assurance.
(Res. 04-12 (§ 9.5), 1-16-12)
41.36.060 Prohibited use of purchasing cards.
The following types of items may not be purchased with a City purchasing card, no matter the dollar amount:
(a) Any item exceeding $4,999 in value not approved in advance by the Purchasing Supervisor;
(b) Cash advances, cash refunds;
(c) City Stores inventory items;
(d) Items on a blanket purchase order;
(e) Personal items;
(f) Local (Grand Junction) vehicle repairs;
(g) Local (Grand Junction) gasoline and oil purchases for city-owned vehicles. The City has a separate card for fuel purchases; and
(h) Any merchandise, product or service normally considered to be inappropriate use of City funds.
(Res. 04-12 (§ 9.6), 1-16-12)
41.36.070 Violations.
(a) Making purchases which exceed the cardholder’s specific dollar limit. It is the responsibility of the ordering department to ensure all “extra” charges such as freight handling, set up, etc., are considered before a purchasing card transaction is made.
(b) Purchases from vendors that create conflicts of interest (e.g., companies owned by the City employee or relatives or where the employee has or will gain or benefit directly or indirectly from the purchase).
(Res. 04-12 (§ 9.7), 1-16-12)
41.36.080 Requests, disputes and forgery/fraud.
(a) To initiate issuance of a new purchasing card or to change information on an existing account a written request by the Department Liaison and/or his/her immediate supervisor is required. The request shall state the employee’s name (as it should appear on the card), last four digits of the employee’s Social Security number, accounting defaults, Liaison number and requested spending limits. The request shall be sent to the Purchasing Card Administrator. An e-mail request is sufficient.
(b) To dispute a charge, the Department Liaison can click the dispute button while reconciling the cardholder’s statement and/or the cardholder can complete the purchasing card dispute form and return the form to the issuing bank within 60 days from the posting date statement. The form can be found on the intranet under Forms – Purchasing.
(c) To report a lost or missing card, or to report a forgery or unauthorized use of a card, the cardholder must complete the affidavit of commercial card fraud and return the form using the directions stated on the form. The form can be found on the intranet under Forms – Purchasing.
(Res. 04-12 (§ 9.8), 1-16-12)
41.36.090 Internet purchasing card procurement.
(a) Making purchases on the Internet by use of the purchasing card requires special precaution by the using department. Individuals must be aware that the chance of fraudulent card purchases could occur as a result of the City card number being obtained by unscrupulous individuals and used to make purchases. In order to discourage any fraudulent activity, the using department is encouraged to make the actual purchase by using the e-company’s toll free number and placing the order verbally. If purchases are made directly on the Internet, they should only be made on a secured Internet site. A small gold colored lock symbol will appear on the lower right corner of the screen if it is a secure site. However, secure web sites do not normally guarantee the security of their site, although they attempt to provide a safety net for the consumer.
(b) The using department representative must be careful to monitor the electronic purchasing process. All responsibility is borne by the individual making the purchase to ensure the process is monitored and recorded. Users are responsible to maintain a log of Internet purchases to ensure that the City is not billed for goods that have not been received. The log may be a manual log or a computer log. Entries are to be contemporaneous to give up-to-date information of the activities relative to the purchase.
(c) At the time the order is placed the individual employee making the electronic purchase is required to download a receipt or record of the order placed for future reference. Some e-companies provide you a confirmation of the order electronically and some do not. This process ensures a record of the transaction. The downloaded order documentation must be detailed with an itemized list of all items purchased and shall be submitted with the purchasing card statement for the items that have been charged for that period. Caution should be made to ensure the items that have been ordered are received, prior to authorizing the payment. If the items are not received as ordered, it is the sole responsibility of the individual ordering the merchandise to contact the vendor and rectify the situation. Erroneous billings will be charged to the appropriate budget if the protested activity is not rectified.
(d) Additional caution must be made with regard to shipping and handling charges. Often the minimum charges for shipping and handling can exceed the savings or value the employee thinks they are obtaining on behalf of the City of Grand Junction. It is not uncommon for the shipping and handling to be a large percentage of the total expenditure, canceling out any savings that would have been realized. The most common carriers used by e-commerce companies are UPS and Federal Express, although heavier shipments may be made by freight carriers. Normally the rates are established based on the dollar value of the order placed and no documentation of the actual UPS/Federal Express/freight bill is provided to the purchaser.
(e) Although the City supports this type of purchasing activity, City employees are encouraged to purchase from local trusted vendors if the goods desired are available. The element of risk is reduced considerably and the assurance of quality is enhanced, because employees can examine the goods prior to purchase.
(f) All e-commerce purchasing is subject to promulgated City purchasing policy and procedures.
(Res. 04-12 (§ 9.9), 1-16-12)