Procurement Modernization Procurement Modernization Town Hall Meeting August 15, 2016
Laws, Rules and Policies , Laws, rules, and policies govern the procurement functions for the S procurement functions for the S tate of tate of Colorado: Proc rement Code & R les Procurement Code & Rules S tate Purchasing & Contracts Office Policies S S tate Controller S C ll S tatute & Policies & P li i Fiscal Rules Personnel Rules Procurement Code of Ethics
Procurement Code • Governs how most executive branch agencies buy goods, services, information technology and d i i f ti t h l d construction • Administered by Department of Personnel & • Administered by Department of Personnel & Administration
Purpose of t he Procurement Code p f 1. S implify, clarify, and modernize the law; 2. Provide for increased public confidence in public procurement; 3. Ensure the fair and equitable treatment of all who 3 E th f i d it bl t t t f ll h deal with procurement; 4 4. Provide increased economy in state procurement Provide increased economy in state procurement activities; 5. Foster effective broad-based competition; and p ; 6. Provide safeguards for a procurement system of quality and integrity.
Ot her S t at ut ory Requirement s y q In addition to the Procurement Code, waivers or approvals are required for the following: approvals are required for the following: Office furniture Technology goods and services Printing document management mail related Printing, document management , mail-related services, microfilm, graphic arts, copying, copiers, fleet, personal services contracts, independent contractors, and training
Preferences/ S f et Asides • Low Tie Bids L Ti Bid • S tate purchases of recycled paper and recycled products • Environmentally Preferable Products • S ervice-disabled veteran owned small businesses • Persons with S evere Disabilities • Reciprocal bidder preference
Organizat ional S g t ruct ure Department of Personnel & Administration S tate Purchasing & Contracts Office Agency Agency Agency Agency Purchasing Purchasing Purchasing Purchasing Purchasing Purchasing Purchasing Purchasing Office Office Office Office
Why does Government Buy what y y it Does? To fulfill the mission of its agency! Why doesn’ t everyone get a state contract? Why do we require competition?
Met hods of S f ource S elect ion Discretionary Discretionary S S tate Price Agreements tate Price Agreements Documented Quotes Documented Quotes Invitation for Bids Invitation for Bids Request for Proposals q p Competitive Negotiation p g Emergency S ole S ource
Discret ionary • No competitive bidding required • Must ensure price is fair and reasonable p • Encouraged to use Minority and Women-Owned Businesses
S t at e Price Agreement s g • Competitive solicitations that result in statewide contracts t t • Administered by S tate Purchasing & Contracts Office • Users include state and local government, higher education, and qualified non-profit organizations • Multiple vendors can be awarded Multiple vendors can be awarded • Based on need and opportunity to leverage state’ s buying power buying power • Mandatory vs. Permissive
Document ed Quot es (DQ) Q ( Q) • S • S implest solicitation implest solicitation • Typically has a quick turnaround • Informal process • Price is primary consideration • Flexibility to negotiate at S y g tate’ s discretion
Invit at ion for Bids (IFB) f ( ) • Primarily used for goods • Primarily used for goods • Works well when specific need can be defined • Formal process – bids must be sealed • Bidders must be responsive (meet the requirements) • Low (responsive) bidder is awarded • No flexibility to negotiate
Request for Proposals (RFP) q f p ( ) • Used primarily for services Used primarily for services • Works well when the details are unknown (results) • Formal process – proposals must be sealed • Requires an evaluation committee Requires an evaluation committee • Price is one of many factors • Flexibility to clarify
Discret ionary & Bidding Thresholds y g Goods Services Method < $10,000 < $25,000 Discretionary (no bidding required) ( biddi i d) > $10,000 and > $25,000 and Documented Quote < $150 000 < $150,000 < $150 000 < $150,000 > $150,000 > $150,000 Invitation for Bids or Request for Proposals Request for Proposals Overview of Colorado Procurement
Where are S olicit at ions Post ed? ColoradoVS S (Vendor S elf S ervice) https:/ / codpa-vss.hostams.com/ webapp/ PRDVS S 1X1/ AltS elfS ervice CDOT S uS S (S upplier S elf S ervice) Portal https:/ / www.codot.gov/ business/ procurement-and-contract- services/ cdot-supplier-information services/ cdot supplier information Rocky Mountain E-Purchasing S ystem http:/ / www.rockymountainbidsystem.com/ p y y BidExpress (BidX) https:/ / www.bidx.com/ co/ main For more information, see the S tate Purchasing & Contracts Office website https:/ / www.colorado.gov/ osc/ solicitations p g
S ole S ource Must meet both of these conditions: • Only 1 product or service meets our needs AND • Only 1 source can provide that product or service
Except ions p • No state funds are expended • Revenue-producing • Legislative or j udicial branch • Interagency/ Intergovernmental • Public printing (Article 109) • Resale • Grant-specified • Law-specified • A&E, land surveyors, or industrial hygienists y yg
Commit ment Document s Commitment documents are state purchase orders or state contracts purchase orders or state contracts. • Purchase orders are required for purchase of goods or services greater than $5,000. • S tate Contracts are required for purchase of services greater than $100 000 $100,000.
Terms and Condit ions • The S tate’ s terms and conditions are provided in conditions are provided in S tate purchase orders and contracts. • Terms from vendors that are problematic for the S tate include indemnification include indemnification, limitations of liability, and choice of law. • Vendor Agreements are not ideal.
Communicat ion Wit h Vendors Why limit communication? • Maintain the integrity of the procurement process M i t i th i t it f th t • Ensure fair and equitable treatment of all vendors • Avoid perception of giving an advantage Avoid perception of giving an advantage
Communicat ion Wit h Vendors Conflicts of Interest • The potential for a conflict can arise in the procurement process • Agencies may require conflict of A i i fli t f interest disclosures from bidders
Communicat ion Wit h Vendors Requests for Information (RFI) • May be issued to gain information from vendors in a transparent, from vendors in a transparent, inclusive way. • Posted publicly. • Not a solicitation, a vendor is not N t li it ti d i t chosen
Quest ions? Q Cindy Lombardi S tate Purchasing & Contracts Office https:/ / www colorado gov/ pacific/ osc/ spo https:/ / www.colorado.gov/ pacific/ osc/ spo
Procurement Modernization Procurement Modernization Town Hall Meeting August 15, 2016
how long!? how long!? g It’ s been It’ b
It ’ s been how long!? g
It ’ s been how long!? g
It ’ s been how long!? g
It ’ s been how long!? g
Procurement Code Adopt ed p • Colorado Procurement Code established in 1982 • Based on 1979 American Bar Association (ABA) model procurement code • No comprehensive review/ update in more than 34 years
What’ s the Wh t’ th problem? problem? p
What ’ s t he problem? p
What ’ s t he problem? p
What ’ s t he problem? p
What ’ s t he solut ion? • DPA led internal review of Procurement Code and Rules • Procurement professionals from many S tate agencies examined each section and identified i i d h ti d id tifi d problems and opportunities • Identified areas for potential changes • Identified areas for potential changes • Need stakeholder input to make recommendations to the General Assembly recommendations to the General Assembly
we start? we start? Where do d Wh
Where do we st art ?
Where do we st art ?
Where do we st art ?
Where do we st art ?
Where do we st art ?
Purpose of t he Code p f The Code exists to help keep the public trust, p p p , promote fair competition, make efficient use of taxpayer dollars, and allow the S tate to effectively do the people’ s business.
House Bill 1451 Directed DPA to solicit input from: p • Vendors • Business organizations • Nonprofit organizations • Labor organizations L b i ti • Taxpayer advocacy organizations • Legal professionals • S • S tate employees tate employees S ubmit recommendations to General Assembly
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