1. Food Purchasing for Child Care National Food Service Management Institute The University of Mississippi www.nfsmi.org 800-321-3054

2. Lesson 4: Following the Rules

3. Lesson Objectives Explain where to find the laws, regulations, polices, and procedures Describe a practical application for Federal purchasing principles

4. Laws, Regulations, Policies, and Procedures “Laws” −U.S. Congress −State Legislatures “Regulations” −Federal Agencies −State Agencies “Policies” and “Procedures” −Local Agencies −Board of Directors

5. Where to Find the Regulations Code of Federal Regulations 7 CFR part 3019 – private, non-profit independent centers 7 CFR part 3016 – public independent centers 7 CFR 226.22 – institutions.

6. National Disqualified List A list of individuals who have been terminated and disqualified from participating in the CACFP.

7. Federal Principles Includes Federal regulations, policies, and guidance Designed to promote fair and ethical purchasing transactions Purchase foods at the highest quality price for the best price

8. Federal Principles: Written Standard of Conduct The child care program shall maintain a Written Standard of Conduct for its employees working with the award and administration of purchasing contracts.

9. Written Standard of Conduct (WSC) Describes the expected ethical behaviors during the food purchasing process Must address −Less-than-arm’s length arrangements −Acceptance of gifts and gratuities −Consequence of failing to comply

10. WSC and Child Care Providers Federal Requirement −Non profit, public, and for-profit child care centers Good Practice −Family child care providers

11. Federal Principles: Written Purchasing Procedures The child care program should have written purchasing procedures.

12. Written Purchasing Procedures Outlines steps for completing food purchases Promotes −good decisions −time efficiency −cost-efficient purchases

13. Written Purchasing Procedures Action Steps Specific, with actionable steps Based on the need of the program

14. Federal Principles: Free and Open Competition Purchasing transactions should be conducted in a manner to provide free and open competition.

15. Free and Open Competition All food vendors have the same opportunity to compete and earn your business…

16. Free and Open Competition (cont.) Free from −Conflict of interest −Noncompetitive practices −Unrealistic requirements −Unnecessary experience and bonding requirements −Other arbitrary actions

17. CACFP Institutions and Facilities Institutions – public, private, nonprofit sponsoring organizations, & eligible child and adult care centers Facilities - day care (family child care) homes, affiliated centers, or unaffiliated centers with an agreement with a sponsoring organization

18. Federal Principles: Small Business, Minority-Owned, and Women Child care programs shall ensure that small businesses, minority-owned firms, and women-owned businesses have an opportunity to compete for their business.

19. Small, Minority, and Women-Owned Businesses Meet special or unique needs −Bread store −Produce dealer −Local meat market butcher Offer harder to find items

20. Federal Principles: Purchasing Methods Purchases shall be made by one of the following methods: informal or formal.

21. Informal Purchase Method Informal procurement methods & small purchase method −Simple and informal Minimum of three quotes Small purchase threshold $150,000

22. Informal Procurement Process Typical five steps −Draft specification −Identify vendor sources −Obtain three bids −Evaluate the bids −Select vendor

23. Formal Purchase Methods Detail oriented Two methods −Competitive Sealed Bids (Invitation for Bid – IFB) −Competitive Proposal (Request for Proposal – RFP) Exceed small purchase threshold

24. Formal Procurement Process Typical four steps −Draft specification −Announce IFB or RFP −Evaluate quote −Select vendor

25. Geographic Preference Rule Promotes the purchase of locally grown and locally raised products −Provide extra points for local products −Allow higher cost for local products

26. Federal Principles: Debarred or Suspended A child care program should not knowingly do business with a company that is debarred or suspended.

27. Debarred or Suspended Debarred – a company is prohibited from doing business with child nutrition programs. Suspended – a company is temporarily prohibited from doing businesses with child nutrition programs.

28. Identifying Debarred or Suspended Companies Excluded Parties Listing System −www.epls.gov Require a written statement from vendors

29. Federal Principles: Purchasing Records Purchasing records should be kept for the appropriate time.

30. Food Purchasing Records Answer Why the purchase was necessary? Which method of purchase was selected and why? What vendor was selected and why? What was the basis for the price paid?

31. Required Documentation Procurement documents Purchase orders Delivery receipts Invoices Canceled checks Itemized cash receipts

32. Maintain Documentation for a minimum of three years plus the current fiscal year…

33. Lesson Recap Introduction to federal purchasing requirements Contact your State Agency for local and state requirements

34. Questions?

35. National Food Service Management Institute Mission: To provide information and services that promote the continuous improvement of child nutrition programs. Vision: To be the leader in providing education, research, and resources to promote excellence in child nutrition programs.