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Date: |
October 27, 2026 |
22 |
Title
Strengthening County Contracting to Maximize Taxpayer Savings, Improve Value, and Expand Local Business Opportunities (Districts: All)
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Overview
County of San Diego (County) purchasing decisions should make the most of taxpayer dollars and give small and local businesses a meaningful opportunity to compete. The County uses cooperative contracts to purchase a wide range of goods and services, including information technology equipment, facilities supplies, medical products, and professional services, at pre-negotiated prices through joint purchasing organizations. These agreements offer speed and efficiency by eliminating the need for a full competitive solicitation for every purchase, but they require periodic review to confirm they continue to deliver competitive pricing, meet the specific resource and service needs of the County, and remain aligned with the County's commitment to small and local business participation.
The Ad Hoc Subcommittee on Fiscal Transparency and Accountability (FTAS), established by the San Diego County Board of Supervisors (Board) on November 18, 2025 (21) and the Department of Purchasing and Contracting (DPC) agreed that a systematic review of the County's cooperative contracts and processes should be conducted to identify opportunities for improvement. DPC completed this Phase 1 analysis, developed a draft Standard Operating Procedure (SOP) for ongoing cooperative contract due diligence, and identified an approach that maximizes competitive value while expanding small and local business opportunities.
Today's action requests the Board to direct staff to receive an update from the FTAS and finalize the cooperative contract due diligence Standard Operating Procedures, which establishes clear criteria for evaluating pricing competitiveness, scope alignment, contract terms, small and local business participation, and the feasibility of a County-led alternative, and implement the SOP subject to the approval of the Director of DPC. This approach will help County purchasing decisions better serve taxpayers and our local economy.
Body
Recommendation by Chair Pro Tem Paloma Aguirre and Supervisor Joel Anderson:
1) Receive an update from the Ad Hoc Subcommittee on Fiscal Transparency and Accountability.
2) Direct the Chief Administrative Officer to finalize the Standard Operating Procedures (SOP) for cooperative contract due diligence, which establishes clear criteria for evaluating pricing competitiveness, scope alignment, contract terms, small and local business participation, and the feasibility of a County-led alternative, and implement the SOP subject to the approval of the Director of the Department of Purchasing and Contracting.
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Equity Impact Statement
The actions requested today advance equity by adopting an approach for cooperative contracting that includes conducting supplemental procurements set aside for small and local businesses who are historically underrepresented entrepreneurs in the San Diego business community. These groups have often faced structural barriers to accessing County of San Diego (County) contracting opportunities; a simplified procurement method set aside exclusively for small and local businesses lowers those barriers by reducing administrative complexity and targeting outreach to businesses already operating in San Diego.
To maximize the reach of these opportunities, the Department of Purchasing and Contracting will conduct targeted outreach to ensure awareness of and access to upcoming procurement opportunities in the maintenance, repair, and operations and medical equipment categories. Outreach will include hosting procurement industry days connecting eligible local businesses with County contracting representatives and BuyNet vendor registration labs designed to help small businesses register in the County's online procurement portal. Additionally, efforts will be extended to include vendors in unincorporated areas throughout the County, ensuring equitable access to procurement opportunities. The proposed actions advance the County's commitment to removing systemic barriers and building an inclusive, diverse supplier base.
Sustainability Impact Statement
These actions will strengthen economic, social, and community wellbeing by keeping procurement dollars within the region and supporting small and local businesses. This approach supports Sustainability Goal No. 2 by ensuring fair and transparent access to County contracting opportunities. Establishing a clear framework for when to use cooperative contracts versus local solicitations helps grow a strong pipeline of capable small and local suppliers, improves supply-chain resilience, and reduces long-term dependence on national cooperative contracts in key commodity areas.
Fiscal Impact
There is no fiscal impact associated with the first recommendation to receive an update. Funds for the actions requested in Recommendation 2 are included in the Fiscal Year 2026-27 Operational Plan based on existing staff time in the Department of Purchasing and Contracting funded by charges to procuring departments. There will be no change in net General Fund cost and no additional staff years.
Business Impact Statement
The proposed actions will create new opportunities for San Diego’s small and local businesses by expanding access to County contracting in areas traditionally dominated by national cooperative agreements. By directing certain procurements to be competitively sourced from local suppliers, the County opens the door for more businesses to participate, grow, and strengthen their capacity. Targeted outreach through BuyNet vendor labs and procurement industry days will help connect local entrepreneurs with these opportunities and support their long-term success. Together, these efforts reinforce a vibrant local marketplace and ensure that more County spending circulates within the regional economy, benefiting businesses and communities alike.
Advisory Board Statement
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Background
The County of San Diego (County) relies on cooperative contracts to procure a broad range of goods and services, including information technology and telecommunications equipment, facilities maintenance supplies, medical products, and professional services. Cooperative contracts are established through joint powers authorities (JPAs) and cooperative purchasing organizations such as OMNIA Partners, Sourcewell, and National Purchasing Partners, which negotiate pricing with vendors on behalf of multiple government agencies. By leveraging the collective purchasing power of member agencies, these contracts offer speed, efficiency, and access to pre-vetted vendors without requiring the County to conduct a full competitive solicitation for every purchase. The County's cooperative contract portfolio includes 167 contracts, most of which have an annual spend below $1 million.
A New Mandate for Fiscal Accountability and Local Business Access
On November 18, 2025 (21), the San Diego County Board of Supervisors (Board) established the Ad Hoc Subcommittee on Fiscal Transparency and Accountability (FTAS). The FTAS was created for the purpose of reviewing County contracts and agreements to identify actions that can be taken to reduce costs and enhance revenue received by the County. Among the FTAS' early priorities was an examination of the County's contract portfolio to assess whether those contracts were delivering best value for County taxpayers and creating opportunities for San Diego-area businesses.
Mapping the Cooperative Contract Portfolio
On April 13, 2026, the Department of Purchasing and Contracting (DPC) presented the FTAS with a comprehensive overview of the County's cooperative contract portfolio and a strategic framework for the review effort. The presentation established that while the County's 167 cooperative contracts covered a wide range of goods and services, there were 16 contracts at or above $1 million in annual spend, representing the greatest concentration of cooperative spending, were the most important starting point. DPC proposed a tiered review approach beginning with these highest-value contracts, where even modest improvements in pricing competitiveness or local business participation would carry the greatest impact.
Defining a Strategic Path for Cooperative Contracting
On May 13, 2026, County staff presented the FTAS with a memorandum outlining strategies to improve the value and transparency of cooperative contracting, recommending that cooperative contracts be used when they offer strong pricing and efficiency, and that County-led solicitations be pursued when better pricing outcomes are possible or when unmet procurement needs can be met. Staff proposed reviewing the 16 highest-value cooperative contracts, each exceeding $1 million annually, across five major procurement categories to determine whether continued use or a new solicitation would deliver greater benefit. The five procurement categories included information technology and telecommunications; facilities, furniture and workplace solutions; maintenance, repair, and operations (MRO); medical, pharmaceutical, and laboratory supplies; and professional and marketing services.
Results of the Comparative Analysis
DPC conducted the Phase 1 analysis, applying a standardized Cooperative Contract Due Diligence evaluation framework developed specifically for this review. The framework assessed each contract across four dimensions: pricing competitiveness relative to other JPAs, state-leveraged contracts, and the open market; scope alignment with current County operational needs; contract terms and flexibility; and small and local business participation rates and expansion potential. As a result of the analysis, 14 of the 16 reviewed contracts were found to offer competitive pricing and acceptable terms, supporting their continued use under the cooperative framework. Additionally, the review identified two categories where the County has an opportunity to expand small local business participation: MRO products and medical and laboratory supplies. In both cases, a County-led solicitation using the simplified procurement method, set aside for small and local businesses, would likely yield more competitive pricing, greater flexibility in specifications, and meaningful expansion of the local vendor base.
Throughout Phase 1, DPC also developed a draft Cooperative Contract Due Diligence Standard Operating Procedure (SOP), a replicable evaluation framework designed to apply to all cooperative contracts with annual spend at or above $500,000. The draft SOP establishes clear criteria for evaluating pricing competitiveness, scope alignment, contract terms, small and local business participation, and the feasibility of a County-led alternative. This tool will serve as the operational foundation for ongoing cooperative contract review and management once finalized.
The Phase 1 analysis results speak directly to the recommended actions. Fourteen contracts demonstrated competitive value and should continue under the cooperative framework. For the remaining two contracts, the comparative review found pricing gaps and limited access for local vendors, making a County-led solicitation using the simplified procurement method the stronger path forward. The SOP developed during Phase 1 gives the County the institutional framework to make this determination consistently for every cooperative contract going forward.
Standard Operating Procedure Evaluation Criteria:
The Cooperative Contract Due Diligence framework establishes a consistent and documented process for evaluating cooperative contracts and supporting procurement decisions. The framework applies a structured, multi-factor review that evaluates each contract across key criteria, including whether the original procurement was done competitively, marketplace competitiveness, total value, operational fit, risk considerations, and alignment with County policies and priorities. Together, these criteria provide a comprehensive basis for assessing whether a cooperative contract continues to represent the best overall procurement solution. To support the analysis, staff validate the originating procurement and County authority to use the contract, compare available marketplace alternatives, evaluate total value beyond price alone, and assess operational considerations such as implementation requirements, supplier performance, service delivery impacts, and potential risks. The review also considers applicable Board policies and County priorities, including opportunities to expand Small Local Business participation. By applying the same methodology across contracts, the framework provides a consistent basis for determining whether a cooperative contract remains the best option or whether an alternative procurement approach should be considered.
Anticipated Outcomes
The implementation of today’s actions is expected to deliver meaningful savings for taxpayers by helping the County clearly identify when cooperative contracts provide strong value and when a County-led solicitation can secure even better value. By using a consistent, easy-to-understand review process, departments will be better equipped to choose procurement pathways that truly fit their operational needs. This approach will also encourage more opportunities for local and small businesses, especially in areas where the County can shape its own solicitations. The SOP strengthens transparency and accountability by providing a clear, commonsense method for explaining contracting decisions to the public. Together, these improvements will enhance taxpayer value, support local economic growth, and modernize the County’s overall approach to procurement.
Today's action requests the Board to direct staff to receive an update from the FTAS, finalize the cooperative contract due diligence Standard Operating Procedures, which establishes clear criteria for evaluating pricing competitiveness, scope alignment, contract terms, small and local business participation, and the feasibility of a County-led alternative, and implement the SOP subject to the approval of the Director of DPC.
Linkage To The County Of San Diego Strategic Plan
The proposed actions support the Sustainability (Economy) initiative within the County of San Diego’s (County) 2026-2031 Strategic Plan commitments to fiscal responsibility, government transparency, and equitable access to County opportunities. Expanding small and local business participation through intentional procurement design supports the County's core goal of achieving equitable outcomes, while finalizing cooperative contract due diligence procedures advances accountability in fiscal operations. These actions collectively contribute to a local economy where San Diego-area businesses, particularly those owned by historically underrepresented entrepreneurs, have a meaningful opportunity to participate in and benefit from County contracting.
Respectfully submitted,
Paloma Aguirre Joel Anderson
Supervisor, First District Supervisor, Second District
Attachment(s)
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