SURVIVING YOUR PROCUREMENT CODE’S REQUIREMENTS Voight Shealy State of South Carolina Materials Management Officer Chief Procurement Officer for Supplies and Services

WHY YOU SHOULD CARE

LEGISLATION 1979, American Bar Association produced its Model Procurement Code for State and Local Governments 1981, State of South Carolina adopted its Consolidated Procurement Code 24 other states have adopted some form of the ABA’s Model Code Source: NASPO’s 2012 Survey of State Government Procurement Practices

PROCUREMENT RULES – ALL OF YOU HAVE THEM All states have adopted procurement codes Ours requires political subdivisions to adopt model ordinances If you expend federal funds, you must follow your procurement policy or the Federal Acquisition Regulations It’s the buyers v. the sellers ladies and gentlemen

YOUR CODE’S PRIMARY PURPOSE? What do you think?

ANY CODE’S PRIMARY PURPOSE? To protect the citizens of our states from you and me.

EVERY PROCUREMENT CODE WRITTEN WAS REMEDIAL It was caused by someone else's transgressions

SURVIVAL TIP # 1 Know Your Authority

STATE PROCUREMENT ORGANIZATIONS Every state has a central purchasing office In SC, it’s the Budget and Control Board Procurement Services Division 3 Chief Procurement Officers Information Technology Management Officer – Mike Spicer State Engineer – John White Materials Management Officer – Voight Shealy

STATE PROCUREMENT ORGANIZATIONS Vary from state to state Some are more centralized Some are more decentralized Most are center lead

CENTRAL PROCUREMENT’S ROLE To process procurements of the highest complexity as well as statewide term contracts and multi-state cooperative purchases to save money on common items and services used by most agencies. Large, complex agency buys. State term contracts 1) to aggregate various agencies’ needs into very large buys for discounted pricing 2) So 100 agencies don’t have to

AGENCY PROCUREMENT ORGANIZATION Determined by Each Agency Know your personal authority

AGENCIES’ PRIMARY ROLE To manage procurements for: Routine needs Agency expertise

AGENCY AUTHORITY Varies state to state from $2,000 to unlimited In SC, Every State Agency’s authority - $50,000 Higher Limits May Be Requested All you have to do is hire a competent procurement staff and follow the Code

SURVIVAL TIP # 2 Learn how to write unambiguous specifications that accurately describe the products you need or the services you require.

SPECIFICATIONS - Products Describe what you need What should it do? How fast? Heavy or light duty? How big? How tall? How long? Do you care? Don’t spec it if you don’t need it Spec Quality Necessary Low Bid Does Not Mean Cheap!

Specifications - Products For products, most common specifications are "Brand Name or Equal" specs Name an acceptable make and model or two to describe the quality needed List Salient Features Desired What distinguishes this model from all others? Allow bidders to offer the models listed or other “equal” products

SPECIFICATIONS - Services Describe what services you need What must the contractor do? Be Specific! Spec qualifications required i.e., Do you want a licensed contractor? How fast should the response time be? How many staff should be devoted to your job? Past experience requirements? Always require references – Check Them

Specifications It is vital that your Scope of Work is clear in defining what you expect your contractor to do. It is vital that you are clear in stating what must be covered in each bidder’s price Be precise

Specifications Should Be Open and Competitive. But: Every specification imposes a requirement. Therefore, it may limit competition. If necessary, that is fine. But, it cannot be unduly restrictive. It's OK to Seek Info From Vendors Before You Solicit

LET’S BUY SOMETHING!

SPECIFICATIONS It’s all about building successful contracts

SURVIVAL TIP # 3 Know your Code’s authorized source selection methods

UNIVERSAL SOURCE SELECTION METHODS Small Purchases Competitive Sealed Bidding Competitive Sealed Proposals Emergency Sole Source

SOURCE SELECTION METHODS ALL PROCUREMENTS MUST BE MADE BY ONE OF THE METHODS LISTED ABOVE.

SMALL PURCHASES – INFORMAL PROCEDURES In SC, <$50,000 Competition Required <$2,500.00 - None $2,500.01 - $10,000.00 - Call for 3 Written Quotations $10,000.01 - $49,999.99 - Advertisement in South Carolina Business Opportunities

SMALL PURCHASES DO DON’T Be Consistent With Specifications Call the Required Number of Vendors Document Calls - Write them down DON’T Tell Competitors What Other Vendors Bid Split Orders

COMPETITIVE SEALED BIDS Formal process for $50,000 or more Written solicitations request written bids Award - Lowest Responsive & Responsible Bidder

COMPETITIVE SEALED BIDS DO Allow Bidders Adequate Time to Develop Bids Make Sure Low Bidder is Responsive and Responsible Don’t Base your specifications on a single vendor’s product Make your specifications overly restrictive

COMPETITIVE SEALED PROPOSALS Evaluation - Team Scores of Proposals Judged Against Weighted Factors i.e., past experience with similar projects, innovation in solving our problem, team qualifications, financial stability Award - Highest Ranked Offeror, not necessarily lowest cost State your problem - Buy solutions!

EMERGENCY Allowed only in emergency situations - Threats to Public Health, Welfare, Critical Economy or Safety Written Determinations Often Required Authorized Approval Required

EMERGENCY Plan Your Requirements DO Plan Your Requirements Explain the Emergency - What happened? Compete as Practical DON’T Shoot Yourself in the Foot! “This annual event” – REALLY?!

SOLE SOURCE Unique Item or Service and Available From Only One Source It’s not the source we like the most Written Determination Often Required Authorized Approval Required

SOLE SOURCE DO Search for Competitors Document Efforts to Find Competition - How do you know it’s a sole source? DON’T Play a Bad Hand - if in doubt, compete it

SURVIVAL TIP # 4 Protect Yourself People are watching As a public manager, it is your duty to ensure that you and your employees comply.

LEGAL AND CONTRACTUAL REMEDIES Every state (except Massachusetts) has a protest process In SC, Protests - $50,000 or more Solicitations - Any Prospective Bidder or Offeror Awards - Any Actual Bidder or Offeror Contract Controversies - State or Vendor May File

STATE AUDITING State Auditors Legislative Auditors Other Auditors In SC, Audit and Certification - Performs compliance audits of procurement activity

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