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] 1 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 2 1 4/20/2015 3 4 2 4/20/2015 5 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 6 3 4/20/2015 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 7 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 8 4 4/20/2015 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 9 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 10 5 4/20/2015 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. 11 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 12 6 4/20/2015 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) 13 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 14 7 4/20/2015 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) 15 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) 16 8 4/20/2015 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 17 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 18 9 4/20/2015 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 19 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 20 10 4/20/2015 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 21 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 22 11 4/20/2015 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 23 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 24 12 4/20/2015 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 25 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 26 13 4/20/2015 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 27 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 28 14 4/20/2015 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 29 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! 30 15 4/20/2015 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 31 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 32 16 4/20/2015 Your turn – Questions? 33 17
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