Housekeeping

o Restrooms

o Sign in

Participant Introductions

o What agency are you from

o What do you hope to get out of the training today?

Why all the new focus on procurement?

What other changes can we expect?

o Procurement reviews

• Explain the procurement process and methods

• Help you learn to apply the procurement process and methods to your food service operations

• Provide materials and references for your future procurement plan

Professional Standard Learning Codes=2000 Operations: 2400 Purchasing/Procurement

Series

• How to better understand the

procurement process &

requirements

• How to write a specification

• How to buy products available

locally/regionally

Can you share some of your

challenges?

The act of obtaining of goods or services

in exchange for money or value

Emphasis on free and open competition to maximize

costs savings

Free and open competition means that everyone has

the same opportunity to compete for business

What are some examples of UNFAIR procurement

practices?

• If the “playing field” is level, vendor

participation is encouraged

• The cost of products and services will be

lower in price

• Better quality products and services

result

• State agency

• SFAs (sponsors)

• Distributors

• Manufacturers

• Food Service Management Companies

(FSMCs)/Vended Contracts

• Cooperatives

• Why are they important?

• Required by regulations

• Helps to determine procurement methods

to be used

• Includes a written code of conduct to

prohibit conflict of interest

• SP 09-2015

• Confidentiality agreement sample

Procurement procedures

Forecasting

Selecting the proper procurement method

Developing a solicitation

Advertising the solicitation

Evaluating proposals/offers

Awarding the Contract

Managing the Contract

Small Purchase Threshold

1. Informal 2. Formal

Micro-Purchases

<$3,500

Small Purchases

$0-$150,000 Sealed Bids (IFBs)

& Competitive

Proposals (RFPs)* Requires public

advertising

Requires price

quotes from at

least 3 bidders

Distribute

equitably

among

suppliers

(Federal Threshold = $150,000)< >

• Micro Purchases ($0-$3,500 aggregate)

Typical three step process

Draft specification

Identify vendor sources

Distribute Equitably amongst

suppliers

• Small Purchase Threshold ($0-$150,000 aggregate)

Typical five step process

Draft specification

Identify vendor sources

Obtain three bids (“3 Bids & a

Buy!”)

Evaluate the bids

Select vendor

• $150,000 or more aggregate (annually)

• Multi step process

Detail oriented and planning must be done in advance

• Two methods

• Competitive Sealed Bids (Invitation for Bid – IFB)• Results in a fixed costs, awarded based on lowest price

• Competitive Proposal (Request for Proposal – RFP)• Multiple factors evaluated

• Price is one criteria, must be largest component

• State of Nevada has templates in place for FSMC and vended meals

Most restrictive rule applies

PRICE determines method!

Micro-purchasing ($3,500 or less)

Small Purchase Threshold ($150,00 or

less)

Over $150,000 annually

Competitive Sealed Bidding

Competitive Negotiation

Noncompetitive Negotiation

An SFA must plan and evaluate:

–Food service operations

–Food service needs

• Evaluate the current and future food service operation to determine needs

– Self-Op/Central Kitchen/FSMC

– Storage capacity

– Operation: scratch vs reheat

– Resources- financial, staff, other

– Food safety practices

– Prior year menus

– Inventory

Definition: a solicitation is a document used by the SFA to acquire goods, products, and/or services. It must incorporate a clear and accurate description of the technical requirements for the material, product and/or service to be procured.

1. Decision is made regarding what goods and services are needed and the appropriate method to acquire them

2. Solicitation must be developed which contains specifications & all necessary contract elements

Who has done a solicitation?

• The description and scope needs to be in line with

what is being procured (i.e., procuring milk, frozen

foods, POS, bakery items, etc.)

• Must be clearly stated so that bidders will

understand and can be responsive to the need

• Identify all of the requirements that offerors must

fulfill, so that changes do not need to be made to the

contract after award has been made

• Contract Type

• Introduction/Scope

• General Descriptions of Goods and Services

• Specifications such as the Standard of Identity

• Timelines and Procedures

• Technical Requirements

• Evaluation Criteria

• Model Contract if applicable

General Information

Information about the District/RCCI

Contract Type

General Description of Goods & Services

Procedural Issues

Technical Requirements

Evaluation Criteria

Invitation for Bid:

o Single factor evaluated (Price)

o Bakery prices for the year for delivery to all sites;

o Warewasher with high temp capabilities w/ 5 year

warranty

o Dishwasher chemicals for 4 kitchens/year;

Supplies and disposables for all sites (year)

Request for Proposals

o Multiple factors evaluated

o POS system for all sites with wireless capabilities, training

& technical assistance

o FSMC

o Pest control

IFB or RFP?

Report out results by food group

Name of Product

Description of Product

Case Pack and Weight

Minimum & Maximum Size pieces

Main ingredient(s), other product

ingredients, prohibited ingredients

Nutritional Standards/Quality Indicators

Unit on which award is made

Meal Pattern Requirements

Run & Code numbers

Mock Product label example

What are you including in your specifications?

• Product Name

• Variety

• Grade

• Size

• Quantity

• Quality

• Cleanliness

• Packaging

• Delivery

• Food Safety

• Farm Practices and

Characteristics

• Other requirements

based on product or

service

Part 2 will include details on specifications

• (1) Placing unreasonable requirements on firms in order for them to qualify to do business;

• (2) Requiring unnecessary experience and excessive bonding;

• (3) Noncompetitive pricing practices between firms or between affiliated companies;

• (4) Noncompetitive contracts to consultants that are on retainer contracts;

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• (5) Organizational conflicts of interest;

• (6) 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

• (7) Any arbitrary action in the procurement process.

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The content of the solicitation announcement should

be sufficient enough in scope to allow bidders/offerors

to identify:

• The general nature of the goods or services to be

procured;

• The method of procurement that will be used (formal

or informal);

• How they can obtain the solicitation or more

information

• Procurement officer?

• Due date for responses to the solicitation

• Due date for questions, walk through, etc if applicable

When determining due dates, keep in mind:

• Complexity of the solicitation requirements;

• Time needed for pre-bid/award meetings, site visits, etc; and

• Federal Due dates:• FSMC for all program except SFSP—at least 21 days in

advance of due date*

• FSMC for SFSP—at least 14 days in advance of bid opening*

• In absence of applicable State or local laws, other solicitations should be publicly announced at least 21 days before the response is due, unless an emergency or good cause exists for expediting the acquisition.

• *NOTE: USDA recommends using a time period of 4-6 weeks.

To allow for Free and Open Competition, use the

following ways to advertise your solicitation:

• State, regional, or nation-wide newspapers

• District list of vendors

• Trade periodicals

• Designated internet sites

• Direct mailings (informal only)

• Other print media that serves the business

community and general public

• Responsive

• Vendor’s products or services meets the SFA’s

specifications.

• Responsible

• Vendor can and will successfully fulfill the terms

and conditions of the proposed procurement.

Determine if a contractor is responsible by

investigating the contractor’s:

• Integrity;

• Compliance with public policy;

• Record of past performance; and

• Financial and technical resources

If it is determined that the contract is NOT responsible:

• Carefully document decision

• Contractor becomes ineligible for award.

• Contract Duration

• Identification of the Contract’s parties

• Herein reference to “District”, ”Contractor”

• Scope of Work

• Product Specifications

• Type of Contract

• Renewal Options

• Modification and Change Procedures

• Default and Breach provisions, remedies, penalties

• Termination rights

• Required Compliance certifications and sanctions

• Recordkeeping requirements

• Laws and Regulations that govern the contract

• In cost reimbursable contracts, ensure that all costs

are net of all discounts, rebates and credits

• Clear methodology for tracking costs (i.e. monthly

billing payable within 10 days)

• Any Sanitation and Licensing requirements

• Professional Certification requirements or minimum

levels of experience or education (for example FSMC

employees)

Fixed price contracts: Evaluation is for lowest responsive and

responsible along no other dimension than

price

Cost reimbursable:

Evaluation – document review

of best technical response

according to evaluation criteria

including price

• Evaluation process in place by committee; should be

set up prior to releasing solicitation

• All documents are subject to review

• Board agenda items (public comment opportunity or

consent agenda item) with staff recommendation

• Legally ensures commitment of district and vendor

• Provides record of the deal-public record

• State Agency may require a review and/or approval

of materials before the award and execution of

contracts

For example FSMC contracts & contract renewals

• This ensures that contractors perform in

accordance with the terms, conditions,

and specifications of their contracts, and

allows for adequate and timely follow-up

of all purchases.Procurement procedures

Forecasting

Selecting the proper procurement method

Developing a solicitation

Advertising the solicitation

Evaluating proposals/offers

Awarding the Contract

Monitoring the Contract

The SFA must monitor contractor performance

to make sure it:

• Receives the quantity and quality of the

goods and services requested;

• Receives the goods and services on time;

and

• Is charged correct prices and within budget

• FSMC monitoring form now in place

Menus and ServiceYes Needs

Improvement

N/A

1. Has the FSMC followed the 21-day cycle menu as described in contract, for the first

21 days of the contract? (Monitored during the first year of contract only)

1. If changes were made to menus following the first 21 days of the contract, did the

SFA approve them?

1. Menu standards have been maintained as to type and quality of meal service. All

menus have been developed using the agreed upon food based menu planning

system(s) for each age/grade group.

a. The FSMC is serving only reimbursable meals that comply with the latest USDA

dietary guidelines as established by USDA in Federal regulations for the National

School Lunch Program, the School Breakfast Program, and all other USDA

contracted meal programs.

a. The SFA has retained control of the quality, extent and general nature of its food

service.

Food Service Management Company (FSMC) Monitoring FormReview Date:

Name of District and Site Monitored:

Ultimately, it is the SFA’s responsibility to

follow each of these Procurement

Process steps. The SFA is NOT to be

guided by vendors’ opinions or requests.

• Buy American NSLP 2016-26 & RCCI 2016-20 (2/5/16)

Guidance Memo

• Must purchase domestically produced items (to the

maximum extent practical)

• UNLESS it’s not produced domestically

• What’s not produced domestically?

• Two situations which may warrant a waiver to permit

purchases of foreign food products are:

• the product is not produced or manufactured in the

U.S.in sufficient and reasonable available quantities

of a satisfactory quality; or

• competitive bids reveal the costs of a U.S. product

are significantly higher than the foreign product.

What does local mean?

What types of products are local?

What’s Geographic preference?

Informal or Formal procurement?

• Within a

radius

• Within a

county

• Within a

state

• Within a

region

A district’s definition of

local may change

depending on the:

• Season

• Product

• Special events

Examples of “Local”

Definitions• Page County Public Schools, in Virginia, defines local

using three tiers:

» Within the county

» Within the region (within 90 miles of Luray, VA)

» Within the state

• Oakland Unified School District, in California, defines

local within a 250-mile radius of the city of Oakland.

• Hinton Public Schools, in Oklahoma, defines local as

within Oklahoma.

Prohibited in Federal

procurements except where

applicable Federal Laws expressly

permit their use

National School Lunch Act: apply

a geographic preference when

procuring unprocessed locally

grown or locally raised agricultural

products.

7 CFR Part 210.21(g)

49

SFAs may contact local sources for purchasing products under informal purchase procedures (but do not include “local” as a specification)o 3 bids and a buy

Small purchases may include geographic preference for unprocessed agricultural productso must state in the solicitation and include evaluation criteria

and scoring

Use product descriptions, requirements, and specifications to target local products

Product requirements, specifications, criteria

a) Specify product varieties unique to the region

b) Freshness (delivery within 24-48 hours of harvest)

c) Harvest techniques

d) Storage crops

e) Crop diversity

f) Origin labeling

g) Able to provide classroom or cafeteria

visits

Photo by: Christine Tran

http://www.fns.usda.gov/farmtoschool/farm-school

Webinars, slides, handouts

Streamlines guidance for federal awards to ease

administrative burden

Supersedes and streamlines requirements

contained in OMB circulars by consolidating the

requirements of these eight documents into one.

Eliminates duplicate and conflicting guidance

between circulars

National School Lunch Program:

• 7 CFR PART 210.16 - Food Service Management Companies

• 7 CFR Part 210.21 – Procurement Standards

School Milk Program:

• 7 CFR PART 215.14a - Procurement Standards

School Breakfast Program:

• 7 CFR PART 220.16

Summer Food Service Program:

• 7 CFR PART 225.17

Child and Adult Care Food Program:

• 7 CFR Part 226.21 Food Service Management

Companies

• 7 CFR PART 226.22 Procurement Standards

Procurement Chart of Informal versus Formal Methods

(CHART)

Informal Procurement Log and Evaluation Matrix

(Pink Sheet)

Sample Conflict of Interest and Confidentiality Statement

(White Copy) for Evaluator to sign

Institute of Child Nutrition Procurement Reference Manual

Procurement Plan and Procedures

Below the Small Purchase Threshold

(most restrictive)

Above the Small Purchase Threshold

(most restrictive)

Develop solicitation documents(includes: specifications,

estimated quantities, terms, conditions & provisions)

Develop solicitation documents(IFB,RFP)(specifications, estimated

quantities, terms/conditions/provisions)

Informal procedures

($3,500 - $150,000)

Formal procedures (above $150,000)

Publicly publish solicitationAdvertise, obtain &

document quotes

Evaluate & Award

Code

of S

tand

ards

of C

ondu

ct

Contract Administration/Performance Management Process

Evaluate & AwardFixed price or cost-reimbursable

contract

Micro-purchase threshold (< $3,500)

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