Just the Facts, Ma`am - Michigan School Business Officials

4/20/2015
Just the Facts, Ma’am
RFPs: From Posting to Awarding
Sandra Elka, MST, CFO
Supervisor of Budget & Purchasing
Huron Valley Schools
[email protected]
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Where to Start
State
of Michigan statues:
M.C.L.
380.1267
M.C.L.
380.1274
Construction,
Supplies,
addition, repair, or renovation
materials, and equipment
www.legislature.mi.gov
Check
regularly for updated statues
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Where to Start continued
Board
Policy(s)
M.C.L.
380.1274 section 1
Requires
written policies for procurement
of supplies, materials, and equipment
No statue requires policies for procuring
services
District
Bidding
preferences
services
Quote limit
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Legal Requirements
Item
Bid
Required
Advertise in
newspaper
Post to
State site
Public
Opening
Construction
Yes, if over
bid limit
Yes, once
Yes, for 14
days
Yes
Supplies, etc
sec. 1274
Yes, if over
bid limit
No
No
No
Services
No
No
No
No
sec. 1267
Caveats:
*Bid limit changes yearly at beginning of State fiscal year
*Sec. 1274 - Exceptions for cooperative bulk purchasing program operated by
Michigan Department of Technology, Management and Budget (e.g. REMC program)
*Unless your Board policy requires bidding, advertising and public opening
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Don’t panic yet…
Bid
limits
Updated
yearly in September for the next
State fiscal year (October to September)
Currently
Memo
at $23,126
(for sec. 1267 & sec 1274)
on MDE State site
http://www.michigan.gov/mde/0,1607,7-140-
37818_36344---,00.html
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Still Don’t Panic…
Exceptions
MDTMB’s
to bidding…or let others do the work
cooperative programs:
REMC www.remc.org
State
contracts: MiDEAL www.michigan.gov/localgov
Local,
State and National cooperative bids
Other
school districts & ISDs
compacts: e.g. WSCA-NASPO
Cooperative programs: e.g. NJPA
State
Just
be sure that the cooperatives have been
competitively bid, not negotiated bids
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Now You Can Panic…Maybe
Board
Policy(s)
Compare
Must
If
requirements to State law
follow most restrictive requirements
Board policy requires bidding any
transaction over $5,000, then you have to bid
any transaction over $5,000, even if State or
Federal requirements are higher
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One More Wrinkle
Federal
Must
funds
follow federal guidelines
Districts
can not award contracts paid with federal
funds to vendors excluded from receiving federal
contracts
System
for Award Management www.sam.gov
Must
follow most restrictive requirements –
Board, State or Federal
Bid
limit, advertising, etc.
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To Bid or Not to Bid
Bid when you are not sure of the cost
Saves you having to bid if quotes are over limit
Bid
if you want transparency for bidders
Services
Easier
– professional, consulting, etc.
to deal with requests from companies if
they know there will be a bid out on a regular basis
Vendors also feel they will get an equal
opportunity to show their value
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Bid Options: Breaking Up Isn’t
Hard to Do
Some
times breaking up a complicated
project saves you time and money
When
there are many options, each with a
different set of criteria
When there is potential for savings by
eliminating markups
If time or budget does not allow for the full
project to be done at one time
DO NOT break up projects to avoid bidding
(red flag for auditors)
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Pieces of a Puzzle
Boiler

Bid out boiler only first




replacement & installation
Allowed District to determine best price/option
combination from different manufacturers
Saved on mark up of installer
Don’t forget to pay sales tax (include in bid)
Bid out installation second



Tailored bid documents to the boiler awarded in first bid
Saved time of bidders – only installers of that one boiler
bid
Saved time of District personnel - only needed to evaluate
one type of installation
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Bid Options: Getting Back
Together Can Be So Sweet
Combining
Put
projects
together several projects to save you
time and money during the year
Look
at combining several quotes into a bid
Saves
time during the year (one Purchase Order)
money – get set pricing for a time period
You probably already do some: classroom supplies
Saves
DO
NOT break up projects to avoid bidding
(yes, I am repeating this)
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Digging into the Detail
Look
at where you are spending above the
bid limit for a fiscal year
Good place to look are emergency
services during the year
Look
at total spent in a year for an estimate
spend for the bid
Even though you may not know when you will
have an emergency, you know that you will
have them (i.e. roof leaks)
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Emergency? Not now
Bidding
out emergency septic service
rates for the fiscal year rather than as
needed
Allowed
the District to get a set price and
vendor for the year and saved time with
quoting during year
Gave vendor security of the work for a year
Can set up a “back up” vendor if necessary
but make sure everyone knows process
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Steps to the Bid Process
Once
you have decided to bid:
Determine
your timeline
Create your RFP
Post your RFP and advertisement
Receive, open & analyze bids
Post tally sheet
Obtain Board approval
Inform bidders of bid results
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Timelines
Best
to work backwards
Determine
when the construction must be
started or the items must be received
Determine lead time for delivery(s)
Determine Board approval date
Determine analysis time for responses
Determine how long bid needs to be posted
Determine how much time you need to create
RFP and technical specifications
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Creating Your RFP
Or Options, Options, Options
Basic
elements:
District
Information
Technical Specifications
Don’t
be so specific that it eliminates competition,
be sure to set “standard” & include essential
information
District still determines if alternate is equivalent
Bid
Form
Ask
for voluntary alternates
Required
Familial
affidavits
Disclosure M.C.L. 380.1267
Iran Linked Business P.A. 517 of 2012
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So you want options?
Voluntary
Set
Alternates
up your bid document so bidders can
offer solutions not just a process or product
Paving
bid – bidder offered an alternate that no
one else did (knowing that we would consider it)
and saved the District $25,000
Some Districts ask for alternates before the due
date to evaluate and offer it to all bidders
Remind
bidders to label alternates so you
don’t waste time evaluating apples and
oranges
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Speeding Up The Process
Templates
Poach
from other districts and let them do
the same – but don’t blindly copy
Request info you or your Board wants to
know from bidders, e.g. do they do
background checks or are they a local
taxpayer
Remember:
the RFP, Bidder’s Response
and the PO are the basis of your
contract with the bidder
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Advertising
Required
for Construction Projects (State
requirement) and Food Service (Federal requirement)
Check
Board policy for designated newspaper(s) of
the District for notices
Must
do it once - plan ahead, post before pre-bid
meeting if you can
When
ad is not required, determine if
advertising will pull in more bidders
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Advertisement
The ad must specify:
Date and time bids are due
Date, time and place where bids will be opened and
read aloud
District will not accept late bids
Each bid shall include a familial affidavit, won’t
accept a bid without it
Note that this statue has not been updated for the
new Iran Linked Business affidavit
Other
Bid
items to include:
bond/certified check of 5% of bid
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Posting: Getting Your Information Out
Must
Post Construction Ad OR RFP on
State’s Web Site
Must
be posted for at least 2 weeks (that
means 14 calendar days)
If you post bids on your website, then post ad
to direct bidders to your site
Buy4Michigan.com – district/ISD must
register to post items
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Bid Opening
Time
stamp all bids & keep them secure
Do not accept a bid, even 1 minute late
Always have two employees in the room
when physically opening the bids
Have all people that are present at the
bid opening sign in
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Bid Opening continued
Confirm
all required documents are
included before reading the dollar
amounts
Never
write on the original bid
document – ask for additional copies
to be included with the bid
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Choosing the “Best” Vendor
(The Short, Short Version)
 Always
use a committee to review bid responses, even
if an informal committee
 Determine
if you are going to start with the lowest
apparent bidder or rate bidders on a matrix
 Confirm
that the bidder(s) has included all aspects of
the project in their bid and/or confirmed items
specified will be provided
 Call
references they gave and any others you can find
 Research
the bidder’s company if you are not familiar
with them
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Awarding the Bid
Review
Board policy for when formal approval
is necessary
Sec.
1274 requires Board approval over the bid limit
Under the bid limit, may be able to issue PO after
due diligence
Once
Board approves award to bidder, if they
back out, you must re-bid
After
Board approves, but before work begins,
get all insurances and bonds
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Help!? Don’t Be Afraid To Ask
K-12
and ISD colleagues
MSBO List Serv
District Attorney
Note
that this is NOT an nuclear option
If you are unsure during any part of the
bid process, ask!
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Purchasing Resources





Michigan Public Purchasing Officers Association
www.mppoa.org
National Institute of Governmental Purchasing
www.nigp.org
Institute for Supply Management
www.napm-md.org
Michigan School Business Officials
www.msbo.org
National Association of State Procurement Officials
www.naspo.org
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Cooperative Web Sites
Oakland Schools
www.cooperativecontracts.com
Cooperative programs
WSCA-NASPO www.aboutwsca.org
MHEC www.mhec.org
NIGP www.nigp.org
NJPA www.njpacoop.org
PEPPM www.peppm.org/state/Michigan.htm
TCPN www.tcpn.org
U.S. Communities www.uscommunities.org
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Your turn – Questions?
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