Procurement Review Summary SY (CYCLE 2)

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1 Texas Department of Agriculture Procurement Review Summary SY (CYCLE 2) Please All Procurement Questions, Comments, And Approval Request To

2 Procurement Regulations 7 CFR Parts 3016 and 3019 OMB Circulars (A- 21, A-50, A-87, A-89, A-102, A- 110, A-122 and A-133) Super-Circular 2 CFR Administrator's Reference Manual (ARM) Section 17 Procurement

3 The foundation of sound procurement practices Free and Open Competition Fairness and Integrity Transparency Responsive and Responsible

4 What Did We See In The First Cycle Of Procurement Reviews There Were Many Findings And Observations (No Fiscal Action) No Written Procurement Procedures The Business Office and Financial Staff Are Better Suited For Document Submission And The Contact Person For The Procurement Review No Procurement Documentation Is Being Retained By The CE The Codes of Conduct In Reference To Purchasing Are Out Of Compliance Or Do Not Exist

5 General Procurement Requirements 1) Does the SFA have written codes of conduct that include prohibiting real, or apparent conflicts of interest for employees engaged in selection, award, and administration of contracts? 2) If yes, does the code of conduct: a) Prohibit officers, employees and agents from soliciting or accepting gratuities, favors or anything of monetary value from contractors or parties of subcontracts? b) Provide for disciplinary actions for violations by officers, employees, or agents?

6 General Procurement Requirements 3) Does the SFA have documented Procurement Procedures? 4) Does the SFA/LEA perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications? 5) Does the SFA/LEA take steps to assure that small, minority and women's businesses enterprises and labor surplus firms are used when possible

7 Informal Procurement Micro-Purchases ARM 17:39-17:43 Aggregate dollar amount does not exceed $3500 Must distribute equitably among qualified suppliers Price must be reasonable and buy American provisions apply 7

8 Micro-Purchase Requirements Was each transaction with this vendor below $3,500? Were purchase prices reasonable? Did the SFA spread purchases equitably among all qualified sources?

9 Informal Procurement Small Purchases ARM 17:43-17:45 Develop specifications Buy American Price quotes from at least 3 vendors Award contract Manage purchase and documents 9

10 Small Purchase Requirements Was this procurement in compliance with the requirements for the appropriate threshold? Were price or rate quotations obtained from three qualified sources? Were clear and accurate descriptions of the technical requirements provided for the product, or service being procured? Did the solicitation include a requirement that goods must be produced and processed in the United States ("Buy American")?

11 Small Purchase Requirements Did the SFA restrict competition by: Placing unreasonable requirements on firms to qualify for business? Requiring unnecessary experience or excessive bonding? Specifying a brand name product, not allowing an equal product to be offered?

12 Small Purchase Requirements Did the SFA maintain records sufficient to detail the significant history of the procurement? Was the correct vendor selected based on the products/services requested and the vendor responses provided? Does a review of three invoices/receipts show that the SFA purchased the products they solicited from the vendor?

13 Invitation for Bids (IFB) Develop Solicitation Specifications Quantities Evaluation Process Terms Manage Contract Publicly Publish Invitation For Bids IFB Selection/Evaluation/Award No Negotiation 13 Formal Procurement

14 Request for Proposals Develop Solicitation Specifications Quantities Evaluation Terms Selection Process Negotiations Evaluate & Award Publicly Publish Request For Proposal RFP Contract Administration Performance Management Process 14 Formal Procurement

15 Formal Purchase Requirements Did the IFB or RFP include the following clauses, as applicable: Termination for cause and for convenience clause included with the manner by which it will be effected and the basis for settlement?(contracts in excess of $10,000) Equal Employment Opportunity(contracts in excess of $10,000) Contract Work Hours/Safety Standards Act(contracts in excess of $2,500) Davis Bacon Act(construction contracts) Rights to Inventions Made Under a Contract or Agreement (if applicable) Debarment and Suspension (all contracts) Byrd Anti-Lobbying Amendment (For contracts worth $100,000 or more)

16 Formal Purchase Requirements Did the Invitation for Bid or Request for Proposal include all requirements regarding "Buy American," including: The need for documentation that requests consideration on the use of domestic alternative foods before approving an exception? A requirement to document the use of a non-domestic food exception when competition reveals the cost of domestic food is significantly higher than non-domestic food? A requirement to document the use of a non-domestic alternative food due to the domestic food not produced or manufactured in sufficient and reasonable available quantities of a satisfactory quality? Were bids/offers evaluated and awarded as published in the solicitation?

17 1. Public Emergency 3.TDA authorizes use of a non-competitive purchase Noncompetitive Purchases ARM The product or service is only available from single (sole) source 4.Inadequate Competition

18 Overview Procurement Review (Startup) CE s Scheduled For SY 17/18 Procurement Review(PR) Will Receive A General Notification ESC s Will Be Copied On PR Correspondence To CE s. Letter To Individual CE s Requesting The Completed Procurement Tool(PT), Written Procurement Procedures, Code Of Conduct and General Ledger This Must Be Provided By Due Date

19 CE s Response Submission Of Written Procurement Procedures & Code Of Conduct CE Must Submit The Code Of Conduct And Written Procurement Procedures To The Reviewer By The Due Date. CE Should Consult with The ESC and Be Familiar With ARM ,

20 The CE s Response Submission Of Procurement Tool CE s Must Submit The Procurement Tool With The SFA Procurement Table Tab Completed In Sections 2-6 The CE Will Provide The Total Amount Of The Purchases From Each Vendor For Last SY 16/17 According To The Method Of Procurement This Year The CE Must Submit A General Ledger of Expenses Paid With SNP Funds In SY 16/17 Along With The Procurement Tool

21 CE s Response Procurement Tool Completion (Examples In Red) 1. Procurement Authority (List staff at the LEA/SFA level responsible for procurement) John Doe, Business Manager, (512) , M-F Micro Purchases (Purchases from vendors valued at $3,500 or below on single invoice/receipt) Wal-Mart, Food and Paper Goods, $7855, 8 Separate Purchases in 16/17. In Sections 2-6 If A CE is Buying From A Vendor Selected By a Co-op The CE Will List the Full Name Of The Co-op For That Purchase.

22 CE s Response Procurement Tool Completion 3. Small Purchase/Informal Contracts (Purchases from vendors valued at $50,000 [Texas] or below, or most restrictive threshold) Texas Chemical Company, Cleaning Supplies, Total was $15,278 in 16/17, Four Separate Purchases in 16/17, Received Three Quotes, Did Not Purchase Through A CO-OP. 4. Formal Contracts: Sealed Bids/Competitive Proposals (vendor contracts valued above $50,000 [Texas], or at or above the State's/LEA's small purchase threshold) American Food Distributor, Food Product, $895,000, Invitation For Bids, Fixed Price Contract, One Year Contract, Received Four Responses, Not Purchased Through A CO-OP, No Amendments To Contract.

23 CE s Response Procurement Tool Completion 5. Food Service Management Company(FSMC) Contracts. CE s will complete this section if they had a contract with a FMSC in SY 16/17. If not this will be N/A. Clean Kitchen Company, Operation of Food Service, 1.6 Million Contract, RFP, Fixed Price, 14/15 Was The Contract Year With Three One Year Renewals, Received Three Reponses, There has been One Amendment, No CO-OP. 6. Processing Contracts for USDA Foods. There has been instruction changes this year. CE s will complete this section if they utilized USDA food entitlements through a processor. If not this will be N/A. Chicken Forever Company, Chicken Nuggets and Patties, $2900, RFP, One Year Contract, There Were Four Responses, The Processing Was Procured Through ESC Region 33 CO-OP. No Amendments.

24 Overview Procurement Review (Continued) 2nd Letter To Individual CE s Requesting Procurement Documents From Sampled Vendors Depending Upon The Accuracy And Completeness Of The Documents Provided There Could Be A request for more documents Clarification or an explanation of a document or circumstance

25 CE s Response Submission Of Procurement Documents From Samples CE s Must Submit The Documents Requested For The Sampled Vendors. Solicitation (What The CE Used To Solicit Quotes or Bids From Vendors) Responses (What The CE Received Back From The Vendor In Response To The Solicitation) Evaluation (What Criteria/Processes The CE Used To Determine Which Vendor To Award) Contract ( The Agreement The CE Has With The Vendor About The Price, Service, and Details Of The Purchases) (Any Other Documentation Requested By The Reviewer)

26 Overview Procurement Review (Ending) Findings, No Findings, or Observations Determination Is Made The CE Will Be ed The Appropriate Letter Based On Determination It Is Very Important That CE s Use ARM Section 17 When Purchasing With SNP Funds

27 Make Ready For PR The CE s Child Nutrition Department Should Be Working With The Business Office In Preparation For This Year s Procurement Review. CE s Should Be Making Ready By Reviewing All Purchases And Identify Any Issues. Managing The Purchasing (What Processes Are In Place To Check Vendor Invoices To Make Sure The Purchase Price Matches The Cooperatives or SFA s Contracted Price Or Quote

28 Acknowledgment Statement You understand and acknowledge that: The training you have completed does not cover the entire scope of the program; and that You are responsible for knowing and understanding all handbooks, manuals, alerts, notices and guidance, as well as any other forms of communication that provide further guidance, clarification or instruction on operating the program. Texas Department of Agriculture 28

29 The Texas Department of Agriculture s Food and Nutrition Division is funded by the U.S. Department of Agriculture, Food and Nutrition Service. The U.S. Department of Agriculture prohibits discrimination against its customers, employees, and applicants for employment on the bases of race, color, national origin, age, disability, sex, gender identity, religion, reprisal, and where applicable, political beliefs, marital status, familial or parental status, sexual orientation, or all or part of an individual s income is derived from any public assistance program, or protected genetic information in employment or in any program or activity conducted or funded by the Department. (Not all prohibited bases will apply to all programs and/or employment activities.) If you wish to file a Civil Rights program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, found online at or at any USDA office, or call (866) to request the form. You may also write a letter containing all of the information requested in the form. Send your completed complaint form or letter to us by mail at U.S. Department of Agriculture, Director, Office of Adjudication, 1400 Independence Avenue, S.W., Washington, D.C , by fax (202) or at Individuals who are deaf, hard of hearing or have speech disabilities may contact USDA through the Federal Relay Service at (800) ; or (800) (Spanish). USDA is an equal opportunity provider and employer. 29

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