1. Part 1: Overview of Procurement
2CFR
Welcome to the Oregon Department of Education Child Nutrition Program’s (ODE CNP) training on procurement.
This training is Part 1 of the procurement training and provides an overview of procurement and the procurement process for all United States Department of Agriculture (USDA) Child Nutrition Programs.

2. Procurement Part 1 Overview Importance of Procurement
What you need to know
Introduction to methods of procurement
Competition
Need for a Procurement Plan
The objectives of Procurement Part 1 is to provide an overview of Federal Procurement Requirements. As a result of listening to this training, the Sponsor will:
Understand why procurement is important,
Identify what you need to know to conduct procurement,
Identify the procurement methods
Understand full and open competition, and
Recognize the need for a procurement plan.
Procurement is an important part of operating the USDA Child Nutrition Programs, because Federal dollars are used to purchase goods, products or services. The procurement requirements are Federal requirements that ensure compliance with USDA Child Nutrition Programs. Therefore Sponsors need to understand and comply with local, state, and Federal procurement guidelines.
This procurement training is a more in depth training of the USDA procurement requirements.

3. Definitions Procurement – purchase of goods, products, services
Simplified Acquisition Threshold – dollar amount for small or informal purchases
Goods or Products – items used in operation of CNP
Services – performance of tasks
To get started, we will review some definitions of terms that will be used in the training on Federal Procurement requirements.
Generally, when we use the term (click) “procurement,” it refers to the purchasing of goods, products, or services. It is a multi-step process for organizations to obtain goods, products or services at the best possible price. Proper planning before procuring goods, products, or services is worthwhile and has a critical role in obtaining the high-quality goods, products or services needed. In other words you are looking to get the best product from the best vendor at the best price.
(click) The Simplified Acquisition Threshold was previously known as the “Small Purchase Threshold”. The Simplified Acquisition Threshold is the dollar amount below which a purchase or services may be made using informal (or small purchase) procurement methods. The Federal simplified acquisition threshold is $150,000. The Sponsoring Organization may establish a simplified acquisition threshold that is different than the Federal threshold. If the Sponsoring Organization’s simplified acquisition threshold is lower than the Federal Threshold, then the Sponsor must use the lower threshold as their informal or small purchase threshold. If the Sponsoring Organization’s simplified acquisition threshold is higher than the Federal Threshold, then the Sponsor must use the Federal Threshold as their informal or small purchase threshold.
(click) “Goods” are products and items used in the daily operation of the Child Nutrition Programs. Some examples maybe food, napkins, milk, cookware.
(click) “Services” is the performance of tasks associated with Child Nutrition programs(CNP). Some examples maybe custodial, vended meals, maintenance.

4. Definitions Continued
Specification – description of product/service that a purchaser seeks and a description of what a vendor/bidder must offer
Purchase – to buy a good, product or services
Transaction – an occurrence in which two or more entities exchange goods, services or money
Transparency – details surrounding the procurement are open and clear
(click) Specification – is a description of the goods, products or services a user seeks to procure and a description of what a bidder must offer to be considered for an award
(click) Purchase – to buy a good, product or service
(click) Transaction - A transaction is an occurrence in which two or more entities exchange goods, products, services, or money between or among them under an agreement formed for their mutual benefit.
(click) Transparency – for the purposes of procurement, transparency means that the details surrounding a purchase or transaction are open and clear. The person conducting the procurement provides clear and open information to ensure that prospective vendors have all the information they need to submit bid and pricing information.

5. Definitions Continued
Responsible – accountable or capable to meet the terms of the contract for the goods, services or products being procured
Responsive – prepared in full compliance with the requirements
(click) Responsible – for the purposes of procurement responsible means accountable or capable to meet the terms of the contract for the goods, products or services being procured.
(click) Responsive – for the purposes of procurement, responsive generally refers to a proposal submitted for bid. A proposal is considered “responsive” if the proposal has been prepared in full compliance with the requirements

6. Why is Procurement Important?
USDA Requirement
Good Money Management
Why is procurement important?
USDA requires that all purchases made by Child Nutrition Programs, whether funded entirely or in part with Child Nutrition funds, are conducted in accordance with all Federal Procurement requirements.
There is no minimum dollar amount with Federal funds purchasing. The purchase of goods, products or services for $100 involves the same practice as purchasing goods, products or services for $50,000.
Procurement helps sponsors know that the money they have spent on a product or service was purchased with full and open competition and integrity.

7. Procurement – What You Need to Know
Understand goods, products, services needed
Potential suppliers of goods, products, services
The best price
Which method of procurement to use
Document the steps involved
In order to conduct a proper procurement:
Sponsor’s need to thoroughly understand and communicate the need for goods, products or services to potential vendors or suppliers. This involves identifying enough detail so that the you purchases exactly what is needed from the vendor. Another term for the details is “specifications”. Specifications provide a detailed enough description so that when goods, products or services are compared and purchased, the Sponsor is comparing and purchasing exactly what they need. Part 8 of this training addresses developing specifications.
Additionally, Sponsors need to know the potential suppliers of the goods, products or services.
Sponsors need to determine the best price for the goods, products, or services. This includes the total cost of the procured item or items and the frequency of purchase. Knowledge of the total cost of the item or items informs the Sponsor regarding which method of procurement must be used. Additionally, the frequency of purchasing the item or items also determines the procurement method.
Sponsors should know the method of procurement to use based on the cost of the items. Parts 5, 6 and 7 of this training describe the five procurement methods and the steps involved in conducting the procurement.
Document the entire process. The types of documentation needed depends on the procurement method used. Parts 5, 6 and 7 includes information on documentation requirements for each procurement method.

8. QUICK REVIEW The definition of procurement is
Selling goods, products or services at the best possible price
Purchasing of goods, products or services at the best possible price
Notifying sellers that you are interested in buying goods, products or services.
All of the above
Let’s do a quick review. Choose the answer that best fits the question.

9. ANSWER TO QUICK REVIEW The definition of procurement is:
Purchasing of goods, products or services at the best possible price
The correct answer is B (click). Did you choose correctly?
Procurement refers to the purchasing of goods, products, or services. It is a multi-step process for organizations to obtain  goods, products or services at the best possible price.

10. 2 CRF 200 – Regulations for Federal Awards
Procurement
Government-wide Procurement regulations for all programs using federal funds are found in 2 CFR 200 – Regulations for Federal Awards. (click)Sections through provide the regulations specific to procurement.

11. Program Specific Procurement Regulations
NSLP SBP
7 CFR
SBP
7 CFR220.16
SMP
7 CFR215.14a
SFSP
7 CFR225.17
CACFP
7 CFR226.22
USDA Foods
7 CFR 250 – Subpart D: Donated Foods in FSMC
There are also program specific procurement regulations for each Child Nutrition Program.
(click)Procurement specific regulations for National School Lunch (NSLP) and School Breakfast (SBP) programs are located in 7 CFR and 7 CFR
(click)The Special Milk Program (SMP) procurement requirements are located in 7 CFR a
(click)7 CFR includes procurement regulations for the Summer Food Service Program (SFSP)
(click)7 CFR provides the procurement regulations for the Child and Adult Care Food Program (CACFP) and
(click)7 CFR 250 –Subpart D provides requirements for Donated Foods in Food Service Management Company or (FSMC) contracts.
Sponsors are required to know the general government-wide procurement regulations as well as program specific procurement regulations for each of the Child Nutrition Program they operate.

12. Program Specific Procurement Standards
Buy American
Cost- Reimbursable Contract provisions
Geographic Preference
Minority Business Enterprises
NSLP and SBP
7CFR Parts
210.21(d) and (d)
7CFR Parts (f), (e), and
7CFR Part (g) and (f) -
SMP
7CFR Part a(d)
7CFR Part a(e)
SFSP
7CFR Part (e)
7CFR Part (d)
CACFP
7CFR Part (n)
7CFR Part (f)
USDA Foods
7CFR Part
7 CFR Part (b)
Some procurement requirements are program specific. In other words, not all procurement provisions apply to all Child Nutrition Programs. For example, the Buy American Provision applies only to National School Lunch Program, School Breakfast Program and USDA Foods. Geographic Preference applies to all programs except USDA foods. Minority Business Enterprises apply only to the Summer Food Service Program and the Child and Adult Care Food Program. The table on this slide show some selected procurement provisions and the programs to which they apply.

13. General Procurement Standards 2 CFR 200.318
Sealed
Bids 4
Competitive
Proposals 2
Small Purchase 5
Sole
Source 1
Micro Purchase
General Standards
Document Policies
Necessary
Full and Open Competition
Conflict of Interest
Documentation
Cost & Price Analysis
Vendor Selection
In the 2 CFR there are five general standards for procurement: (click)
The Sponsoring organization must have written procurement policies and procedures. These policies and procedures must address the four standards listed on this slide and any applicable state and local laws.
The costs incurred must be necessary and cost- effective
All procurement transactions must provide full and open competition
The Sponsoring organization must maintain a written standard governing conflicts of interest
The Sponsoring organization must maintain documentation addressing cost and price analysis, and vendor selection as applicable for the selected method of procurement.
These standards apply to all methods of procurement –
(click)Micro-purchases
(click)Small purchases or Informal Procurement
Large Purchases or Formal Procurement which includes:
(click)Sealed bids
(click)Competitive Proposals
(click)Sole Source

14. Methods of Procurement 2CFR 200.320
Sealed
Bids 2
Small Purchase 4
Competitive
Proposals 1
Micro Purchase 5
Sole
Source
There are five available methods of procurement for each purchase or transaction. These methods of procurement are:
Micro-purchases:
Small purchases:
Large Purchases are greater than $150,000 or the Sponsoring Organization’s simplified acquisition threshold. There are several methods of conducting formal purchases:
Sealed bids:
Competitive proposals:
Sole source:
Each of the five procurement methods are discussed in greater detail in Parts 5, 6 and 7 of this training

15. Federal Procurement Roadmap
All CNP Sponsors
Is the purchase or contract worth more than $150,000
Purchase/contract less than $150,000
Purchase/contract greater than $150,000
The ODE CNP Federal Procurement Roadmap on this slide outlines the decision making process to use in deciding which procurement method to use in Child Nutrition Programs. The important number to remember is the $150,000 Federal Threshold. The $150,000 Federal Threshold is also called the Simplified Acquisition Threshold. The threshold is the level of spending to determine if an informal or formal procurement process is required.
If an agency has a lower simplified acquisition threshold then the Federal threshold of $150,000, then the Sponsor should use their agency’s spending limit when procuring goods and services. If the Sponsor’s agency simplified acquisition threshold is greater than the Federal threshold of $150,000, then the agency should use the Federal threshold as the spending limit.
ODE CNP’s Federal Procurement Roadmap is a useful tool to help Sponsors determine which method of procurement to use. The link to the Federal Procurement Roadmap is located on the resource slide at the end of this presentation.
For goods and services costing less than $150,000 Sponsors will use the informal process. The informal procurement process includes Micro-purchasing and small purchases. Micro-purchasing is covered in part 5 of this training. Informal purchasing is covered in part 6.
For goods and services costing more than $150,000 Sponsors will use the formal procurement process. The formal procurement process is covered in part 7 of the training.
Use Informal Process
Use Formal Process
Micro
Small
Competitive
Proposals
Sealed Bid

16. Procurement Plan 2 CFR 200.318(a)
What is a procurement policy?
A procurement policy is a written statement that assures all purchases made with CNP Federal funds are handled fairly and in a manner that encourages full and open competition.
The first step in implementing procurement procedures is to develop, write and implement a written procurement policy and plan.
A procurement plan assures that all purchases made with CNP Federal funds are handled fairly and in a manner that encourages full and open competition.
Part of the procurement plan includes a policy statement. For instance, a written policy statement may be: “Sponsor’s Name” will follow Federal and state regulations for purchases made with Federal funds.

17. Procurement Plan Continued 2 CFR 200.318(a)
What is a procurement plan?
What will be done, who will do it, and how it will be done.
Code of Conduct
Conflict of Interest
A procurement plan identifies what will be done, who will do it, and how it will be done.
The plan includes a step by step process for purchasing goods, products or services. Additionally the procurement plan must include a written code of standards of conduct and a policy on conflict of interest which includes procedures when a conflict of interest is identified.
ODE CNP has a template Procurement Plan located on the ODE CNP webpage for procurement resources. Sponsors may use this template in creating their procurement policy and procedures.

18. QUICK REVIEW True or False:
All procurement regulations apply to all programs.
The procurement method used is determined by whether the purchase exceeds the simplified acquisition threshold.
Let’s do a quick review:
True or False: All procurement regulations apply to all programs.
True or False: The procurement method used is determined by whether the purchase exceeds the simplified acquisition threshold.

19. ANSWERS TO QUICK REVIEW
True or False: All regulations apply to all programs. FALSE The procurement method used is determined by whether the purchase exceeds the simplified acquisition threshold. TRUE
What answer did you choose?
The statement #1 “All regulations apply to all programs” is (click) false. There are several regulations that are program specific. For example the Buy American regulation applies only to NSLP, SBP and USDA Foods.
The statement #2 “The procurement method used is determined by whether the purchase exceeds the simplified acquisition threshold” is (click) true. The Simplified Acquisition Threshold is the dollar amount below which a purchase or services may be made using small purchase (or informal) procurement  methods. The Federal simplified acquisition  threshold is $150,000. The Sponsoring Organization may have a simplified acquisition threshold that is different than the Federal threshold. If the Sponsoring Organization’s simplified acquisition threshold is lower than the Federal Threshold, then the Sponsor must use the lower threshold as their small purchase threshold.  If the Sponsoring Organization’s simplified acquisition threshold is higher than the Federal Threshold, then the Sponsor must use the Federal Threshold to determine whether CNP procurement is done using the small or informal purchase method or the large or formal purchase method.  

20. Other Aspects of Procurement
The next slides will review the Principles of a Good Procurement and Full and Open Competition.

21. Principles of Good Procurement
Full and Open Competition
Fairness and Integrity
Responsible Vendor; Responsive Bid
Transparency
An important principle is that a good procurement is a competitive procurement.
All procurement transactions must be conducted in a manner that provides full and open competition. Full and open competition means that all suppliers are playing on a level playing field and thereby have the same opportunity to compete for Federal funds.
Fairness and integrity in all aspects of the procurement process are critical to achieving full and open competition. The procurement process cannot be both effective and self-serving. No matter how strongly the Sponsor may prefer a particular product or supplier, other comparable products and suppliers must be given every reasonable consideration.
To be considered responsible, a vendor/contractor must be capable of performing successfully under the terms and conditions required. Qualified respondents must be both responsible and responsive. This meals that qualified respondents must have the capability of performing successfully under the terms and conditions required and are able and willing to provide the goods, products or services being sought.
Another important aspect of procurement is transparency. Transparency in the procurement process allows vendors the widest possible access to information regarding the goods, products or services being purchased.

22. Full and Open Competition 2 CFR 200.319(a)
Goal all Federal Procurement requirements
Same opportunities to compete
Higher quality goods, products or services at the lowest possible price.
Specifications do not restrict or eliminate competition.
2 CFR (a) describes the requirement that all procurement transactions must be conducted in a manner providing full and open competition consistent with the standards of the section.
(click) Full and open competition is the goal of all Federal Procurement requirements.
(click) Full and open competition provides the same opportunity to all suppliers to compete on a level playing field.
(click) Federal and State procurement requirements leads to higher quality goods, products or services as the lowest possible price.
In order to ensure full and open competition and eliminate unfair competitive advantage, any contractors that participate in the development or drafting of specifications, requirements, statements of work, or invitations for bids or requests for proposals must be excluded from competing for the procurements.
(click) Additionally, specifications must never unduly restrict or eliminate competition.

23. Elements that Restrict Competition
Unreasonable requirements
Unnecessary experience or bonding
Noncompetitive pricing practices
Noncompetitive contracts
Organizational Conflicts of Interest
Specifying “brand name”
Any arbitrary action
Some situations that are considered to be restrictive of competition include but are not limited to:
Placing unreasonable requirements on firms in order for them to qualify to do business;
Requiring unnecessary experience and excessive bonding;
Noncompetitive pricing practices between firms or between affiliated companies;
Noncompetitive contracts to consultants that are on retainer contracts;
Organizational conflicts of interest;
Specifying only a “brand name” product instead of allowing “an equal” product to be offered and describing the performance or other relevant requirements of the procurement; and
Any arbitrary action in the procurement process.

24. Documentation Procurement Documents
Three years plus the current fiscal year
Accounting Documents
Invoices
Grocery receipts
Cancelled checks
Quotes or Bid documents
Sponsors must maintain procurement documentation on file for every purchase of goods and services made with Federal funds. Documents must be retained on file for three years plus the current fiscal year. Documentation includes information obtained when comparison shopping, obtaining quotes or requesting and receiving bids, contracts, and proposals.
Examples of documents to maintain are:
Invoices
Grocery receipts
Cancelled checks
Quotes or Bid documents depending on the type of procurement method used.
Justification for choosing a supplier.
During administrative reviews or audits ODE CNP staff will review these documents to verify the appropriate procedures were followed when using Federal funds.

25. QUICK REVIEW
True or False: An important principle of good procurement is that good procurement is competitive procurement
Let’s review again:
True or False: An important principle of good procurement is that good procurement is competitive procurement.

26. ANSWERS TO THE QUICK REVIEW
True or False: An important principle of good procurement is that good procurement is competitive procurement TRUE
The answer to the question: “an important principle is that a good procurement is a competitive procurement” is (click) true.
All procurement transactions must be conducted in a manner that provides full and open competition. Full and open competition means that all suppliers are playing on a level playing field and thereby have the same opportunity to compete for Federal funds.
Fairness and integrity in all aspects of the procurement process are critical to achieving full and open competition. The procurement process cannot be both effective and self-serving. No matter how strongly the Sponsor may prefer a particular product or supplier, other comparable products and suppliers must be given every reasonable consideration.

27. SUMMARY Definitions of frequently used words
Why Procurement is important
What Sponsors need to now about procurement
Five procurement methods
Presented the Roadmap to Federal Procurement
Reason a Procurement plan is needed
Full and open competition
Procurement Documentation
This overview of Federal Procurement requirements provide basic procurement information to help Sponsors as they implement Federal Procurement requirements. The information covered in this part included:
(click) a presentation of the definitions of frequently used words
(click) a discussion of why Procurement is important
(click) Information that Sponsors need to now about procurement
(click) an introduction to the Five procurement methods
(click) a presentation of the Roadmap to Federal Procurement
(click) a discussion of why a Procurement plan is needed
(click) a description of full and open competition
(click) the methods to maintain procurement Documentation

28. ODE CNP Contact Information
Oregon Department of Education Child Nutrition Programs 255 Capitol St. NE Salem, OR Phone: Website:
Here is ODE CNP contact information.

29. Questions
If you have any questions regarding this session please contact your assigned specialist.

30. Resources ODE CNP Procurement webpage
CACPF Policy and Procedure Manual Chapter 14
2 CFR 200
NSLP Procurement Regulations (7 CFR )
SBP Procurement Regulations (7 CFR )
Special Milk Program (7 CFR a
USDA Foods (7 CFR 250 – Subpart D)
CACFP (7 CFR )
SFSP (7 CFR225.17)
The resources listed on this slide may be found on the ODE CNP website.

31. In accordance with Federal civil rights law and U. S
In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, sex, disability, age, or reprisal or retaliation for prior civil rights activity in any program or activity conducted or funded by USDA. Persons with disabilities who require alternative means of communication for program information (e.g. Braille, large print, audiotape, American Sign Language, etc.), should contact the Agency (State or local) where they applied for benefits. Individuals who are deaf, hard of hearing or have speech disabilities may contact USDA through the Federal Relay Service at (800) Additionally, program information may be made available in languages other than English. To file a program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, (AD-3027) found online at: and at any USDA office, or write a letter addressed to USDA and provide in the letter all of the information requested in the form. To request a copy of the complaint form, call (866) Submit your completed form or letter to USDA by: (1) mail: U.S. Department of Agriculture Office of the Assistant Secretary for Civil Rights 1400 Independence Avenue, SW Washington, D.C ; (2) fax: (202) ; or (3) This institution is an equal opportunity provider.
Thank you for participating in ___the Procurement_Overview_____ Training for ODE Child Nutrition Programs. If you have any questions please contact your assigned Child Nutrition Specialist. We greatly appreciate the work that you do to fuel Oregon’s future.