Council adopts first-reading ordinance limiting number of active city contracts per vendor to diversify procurement

The Huntington Park City Council on Aug. 18 approved on first reading an ordinance intended to limit the concentration of city contracts with single vendors and increase procurement transparency.

The proposed ordinance would generally limit the number of active contracts any single vendor may hold with the city to three at a time, require vendors to disclose potential conflicts of interest and complete specified ethics training, and authorize the city manager or designee to monitor compliance and impose penalties for violations, including disqualification from future procurements.

During council discussion a member asked whether the numeric cap of three was vetted by legal; the city attorney confirmed the council may set its own policy on the number of contracts it chooses to award a particular entity. Council members noted the measure is intended to reduce outsized reliance on single vendors, increase opportunities for other providers and protect the city in case a vendor fails or becomes insolvent. One council member asked whether the ordinance could also include a dollar-value cap on total contracting with a single vendor; staff responded that including a dollar threshold would complicate procurement for some capital projects and that capital projects often require larger single awards.

City staff said the ordinance includes an exceptions clause so the council may authorize exceptions when appropriate. The ordinance cleared first reading and will return for a subsequent reading as required by the city’s adoption procedures.