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City auditor: procurement timeliness lags; council accepts audit and directs improvements
Summary
San Jose’s city auditor presented a procurement audit finding long delays in competitive procurements and recommended eight improvements; the council accepted the report and staff pledged to implement recommendations in the coming fiscal year.
The City Auditor presented a procurement audit Sept. 9 that found San Jose’s purchasing processes for goods and services (excluding public works projects) are frequently slower than business needs and recommended changes to risk strategy, milestone tracking and consolidated staff guidance.
Auditor Joe Royce and lead auditor Lisonbee Pauley told the City Council that three‑quarters of requests for proposals (RFPs) processed between 2019 and 2024 took longer than purchasing’s 6‑ to 9‑month expectation; nearly half of the RFPs took more than a year. The audit recommended five areas for reassessment — including competitive thresholds, insurance waivers tied to contract risk, expedited approvals for small‑dollar software subscriptions, delegated authority for low‑risk contracts, and streamlined standard terms and conditions — and called for documented procedures for pilot procurements and an escalation process for stalled negotiations.
The audit also recommended that purchasing adopt a workflow tracking system and performance measures for strategic procurements and consolidate procurement guidance and templates (staff reported procurement resources are currently spread across more than 100 links and documents). The report included eight formal recommendations.
Director of Finance Maria Oberg thanked the audit team and told the council the finance department is committed to implementing the recommendations in the coming fiscal year. Councilmembers pressed auditors and staff about innovation options such as AI for scope development and whether the changes could produce measurable cycle‑time reductions; auditors said some reforms would shorten timelines but RFPs will remain variable in complexity.
Councilmember Kamei moved and the council accepted the audit report unanimously. Councilmembers asked staff to return with implementation milestones and to explore whether changes could be prioritized to reduce cycle times for commonly used procurement types.
