Becoming a Procurement Pro Barbie Faust – Child Nutrition Program

Overview  Scope of Federal Regulations  Procurement Methods  Primary Procurement Standards  Frequently Asked Questions Nonprofit Food Service Account Funds Geographic Preference Material Changes Price Adjustments  Questions & Discussion

Scope of Federal Regulations  Regulations apply to all procurements conducted with funds in the food service account regardless of source  Must follow a combination of: Federal State; and local requirements  If there are any conflicts, the more restrictive standard apply

Procurement Methods  Small purchases  Sealed bids  Competitive proposals/requests for proposals (RFPs)  Noncompetitive proposals – rarely used

Federal Procurement Standards  Code of conduct  Competition requirements  Cost and price analysis  Contractor performance issues  Record maintenance

Code of Conduct  Maintain a written code of conduct  Exclude employees, agents, consultants, etc. from contract matters if they have a conflict of interest  Prohibit gratuities and gifts

Competition Requirements  All procurements must ensure “full and open” competition  No in-State or local preferences  No organizational conflicts of interest  Exclude anyone who drafts contract documents  Clear descriptions of item or service  No provisions that unduly restrict competition – e.g., limiting to certain brand or vendor  Pre-qualified bidder lists must afford opportunity to qualify during solicitation period

Cost and Price Analysis  A cost or price evaluation must be conducted for every procurement  Must always make an independent estimate prior to receiving bids  Depth of analysis depends on the procurement method used

Contractor Performance  Ensure that contract awards go to responsible contractors Integrity; Past performance; and Financial/technical resources  Police contract performance to ensure compliance with terms and specifications

Record Maintenance  Must maintain records that detail the procurement history  Examples: Justification for procurement method Selection criteria Basis for award determination/rejection Any modifications

Other Procurement Issues  Buy American requirement: Statutory -- Section 12(n) of the NSLA Implementing regulations at 7 C.F.R (d) Applies to all local food purchases for school meal programs Requires the purchase of domestic agricultural commodities and domestic food products

Nonprofit Food Service Account Funds  All funds deposited into the account are considered revenues Federal reimbursements Student payments State or local-provided funds

Nonprofit Food Service Account Funds, cont.  Revenues may only be used for the operation or improvement of school food service (7 CFR (a))  Revenues and expenditures from the account are subject to Federal procurement requirements

Geographic Preference  Federal regulations allows any SFA participating in the Federal CNPs has the option to apply a geographic preference when procuring unprocessed, locally grown or raised agricultural products. States may not prohibit use of the geographic preference procurement option.

Price Adjustments  Example: Fuel surcharges  Permitted only when initial solicitation and contract allowed for it  Tie to an appropriate index so increases are not arbitrary

Welcome to Procurement Jeopardy!

Small Purchases for 100  “Small” purchases don’t need to follow procurement regulations. True or False

FALSE  The small purchase threshold merely simplifies the process – it is not an exemption from competition requirements and other regulations.

Competition for 200  I can order fresh fruits and vegetables from any vendor I want because State procurement law allows perishable items to be purchased without competition.

FALSE  Schools must follow a combination of local, state and federal requirements. When there is a conflict the more restrictive requirement applies. Federal regulations require “full and open” competition for all procurements so that overrides the state law.

Geographic Preference for 300  I can never use an in state or local geographic preference even if it is required by State law.

TRUE  In state and local geographic preferences are prohibited. Again, when there is a conflict the more restrictive procurement requirement applies. Federal regulations explicitly prohibit the use of these preferences.

Sole Source for 400  It’s OK to enter into a sole-source contract when I want a particular product or the vendor certifies that they are the only one that offers a particular product.

FALSE  Sole source contracts – also called noncompetitive proposals – can only occur when other procurement methods are infeasible and there are extenuating circumstances.  Wanting a particular product or having a vendor certify that no one else has it does not meet these requirements.

Specifications for 500  It’s OK to use specifications developed by another school in my procurement.

TRUE but...  Make sure the specifications outline what you want. If they are very detailed, such as for software or hardware, it may contain provisions that you don’t want or need.  It’s good practice to check to make sure the other school actually drafted the specifications themselves. Just because they issued it doesn’t mean they drafted it.

Final Jeopardy Question  If I have a question, the first thing I should do is call Barbie Faust at the State Office.

FALSE  Your procurement office and/or school district attorney should be the first people you call.

Questions & Discussion

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