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Type:
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Procurement Contract/Change Order
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Status:
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Passed
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On agenda:
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5/12/2021
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Final action:
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5/12/2021
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Title:
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Contract: Purchasing Card Management Services (U.S. Bank)
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TO: Board of Trustees
THROUGH: Carolyn Gonot, Executive Director
FROM: Todd Mills, Director of Supply Chain
PRESENTER(S): Todd Mills, Director of Supply Chain
TITLE:
title
Contract: Purchasing Card Management Services (U.S. Bank)
end
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AGENDA ITEM TYPE: |
Procurement Contract/Change Order |
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RECOMMENDATION: |
Approve the U.S. Bank Commercial Account application contract, and Amendment No. 1 Rebate Amendment, and authorize the Executive Director to execute the contract, amendment, and associated disbursements with U.S. Bank for Purchasing Card Management Services for a base period of five years, plus five 1-year option years. |
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BACKGROUND: |
The Utah Transit Authority has been using bank credit cards for small purchases through Wells Fargo Bank since 2003. Purchasing Cards (P-Cards) allow for easy, immediate payment to vendors and are a critical part of the Procurement Strategy at UTA. P-cards are issued to employees once a request has been approved by their manager and the employee has taken the required training. Staff in UTA’s Purchasing Department administer the program in compliance with UTA Policy 1.2.3. - Purchase Card (“P-Card”). Because the Agency does not carry a revolving balance there are no transactional costs or fees charged to the Agency by the administering financial institution. The bank/institution receives revenue from the program by charging the merchant a percentage of the transaction amount. |
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DISCUSSION: |
The Agency recently performed a competitive RFP and evaluated proposals based on technical criteria, experience, training/support, implementation, and basis point rebate/fee structure. Four proposals were received, reviewed by a selection committee, and U.S. Bank was selected as the vendor for this contract. Due to the complexity involved in changing Financial Institutions a request was submitted to, and approved by, the Chief Procurement officer to enter into a long-term contract of 5 base years, plus 5 1-year options. This new contract with U.S. Bank will offer the Agency advancements in P-Card Management Services technology through the use of a mobile app. These include: • take pictures of, and submit receipts • add item descriptions at the time of purchase • enter UTA accounting detail including cost center information • review and submit monthly reconciliations • management review and approval In addition to these technology gains this new contract will increase UTA’s “revenue share rebate” from 0.5% to 1.825%. Last year’s rebate from the current P-Card vendor, Wells Fargo, at 0.5% was $45,786 on total expenditures of approximately $9 million. The rollout of this new P-Card program will require each card holder to submit a new P-card request form with their manager’s approval and a requested transaction limit. Procurement will review all P-Card requests subject to Policy 1.2.3. The anticipated go-live date of the new cards is June 7, 2021. |
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CONTRACT SUMMARY: |
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Contractor Name: |
U.S. Bank |
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Contract Number: |
20-03356CG |
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Base Contract Effective Dates: |
6/1/2021 - 5/31/2026 |
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Extended Contract Dates: |
6/1/2026 - 5/31/2031 |
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Existing Contract Value: |
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Amendment Amount: |
Amendment No. 1 (Rebate Amendment) also included which provides for a 1.825% rebate to UTA - expected to be approx. $160,000 per year based on expenditures of $9M |
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New/Total Amount Contract Value: |
$0 cost to UTA; expected rebates of approx. $160,000 per year. |
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Procurement Method: |
RFP |
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Funding Sources: |
Operational budgets |
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ALTERNATIVES: |
Perform all purchases using the JDE requisition and procurement process. This would require increased staff, create delays, and potentially increase cost to the Agency. |
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FISCAL IMPACT: |
N/A |
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ATTACHMENTS: |
Contract and amendment 1 |
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