Purchasing Using Discretionary Authority

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• Purchasing Using Discretionary Authority

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Presenters
Karla Ravida John Corbett Dan Ryan Office
of the State Comptroller Bureau of State
Expenditures and Bureau of Contracts
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Agenda

• Resources
• Order of Procurement
• Purchasing Requirements
• Overcome Pitfalls

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The Purpose
The purpose of State procurement is to facilitate
each State agency's mission while protecting the
interests of the State and its taxpayers and
promoting fairness in contracting with the
business community.
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Procurement Goals

• Guard against favoritism, improvidence,
  extravagance, fraud and corruption
• Ensure that the results meet agency needs
• Protect the interests of the State and its
  taxpayers
• State agencies should make a responsible effort
  to administer a process which provides maximum
  opportunities for vendors to compete

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Resources

• NYS Finance Law 163
• NYS Finance Law 112
• NYSCRR
• NYS Executive Law Article 15-A
• NYS Education Law
• The Economic Development Law Article 4C
• OGS Procurement Guidelines
• OSC A and G Bulletins, DOB Budget Bulletins
• Agency Policies, Procedures and Guidelines

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Ask Yourself

• What are you looking to buy?
• Is your purchase a Commodity, Service, or
  Technology Related?
• What is the estimated cost?
• Is your estimated cost greater than or less than
  your Formal Competitive Bidding Limits?
• What process do you follow?

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Order of Procurement

• Preferred Source
• Commodities
• Services
• Centralized Commodity Contracts
• Procure on your own

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Preferred Source Commodities

• Department of Mental Health

Not subject to competitive procurement
requirements.
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Preferred Source Services

• Department of Mental Health

Not subject to competitive procurement
requirements.
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Centralized Commodity Contracts

• PCXXXX
• Buying Power
• Exceptions to the use of PSG contracts include
• OGS or Less - agencies may competitively
  procure items otherwise available on a
  centralized contract when the resultant price is
  less, in accordance with OGS or Less
  Guidelines.
• Consortia procurements - when justified by price,
  State agencies may purchase from consortia, in
  lieu of using a centralized contract, in
  accordance with Consortia Guidelines.

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Centralized Contracts for Services and Technology

• PSXXXX or PTXXXX
• The use of most centralized service and
  technology contracts is at the option of State
  agencies.
• The State Procurement Council may, however,
  mandate the use of certain service and technology
  contracts where warranted.
• Bulk discounts
• 20 Rule

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Did a Preferred Source or OGS Centralized
Commodity Contract meet your need?
If your answer is NO,procure on your own
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Requirements

• Reasonableness of Price / Reasonableness of
  Vendor
• Competition
• Ensure the procurement process produces the best
  possible product at a reasonable price
• Guard against favoritism, fraud and collusion

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Discretionary Buying Thresholds

• Purchases under the Discretionary Buying
  Threshold do not require a formal competitive
  procurement process.
• When procuring under the Discretionary Buying
  Threshold, the agency has the responsibility to
  obtain the commodities or services at a
  reasonable cost.

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Ask Yourself

• What is the estimated cost?
• Is your estimated cost greater than or less than
  your Formal Competitive Bidding Limits?
• What do you think your estimated Annual cost will
  be?
• One Year Rule

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Advertising Limits
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Discretionary Contract Reporter Ad
ALTERNATIVE LANGUAGE 1

• Agency X intends to purchase (insert project
  description, e.g., 1,000 widgets) pursuant to its
  discretionary authority under State Finance Law
  section 163(6), which authorizes purchases
  without a formal competitive process in certain
  circumstances, including purchases from New York
  State small businesses, from businesses certified
  pursuant to Article 15-A of the New York State
  Executive Law and, if applicable, from businesses
  selling commodities or technology that are
  recycled or remanufactured. Interested parties
  should contact (agency purchasing officer) to
  discuss this opportunity.

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Discretionary Contract Reporter Ad
ALTERNATIVE LANGUAGE 2

• Agency X intends to purchase (insert project
  description, e.g., 1,000 widgets), pursuant to
  its discretionary authority under State Finance
  Law section 163(6). Interested parties should
  contact (agency purchasing officer) to discuss
  this opportunity.

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Discretionary Contract Reporter Ad
ALTERNATIVE LANGUAGE 3

• Agency X intends to purchase 1,000 widgets
  pursuant to its discretionary purchasing
  authority under State Finance Law Section 163.
  This procurement opportunity is limited to NYS
  Small Businesses, businesses certified pursuant
  to Article 15-A of the NYS Executive Law and, if
  applicable, businesses selling recycled or
  remanufactured commodities or technology.

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• Do not specify a particular vendor

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Discretionary Purchases Exceeding OSC Contract
Approval Threshold

• Avoid Formalities
• Reasonableness of Price
• Reasonableness of Transaction
• Compliance with Rules, Regulations and Law

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Discretionary Thresholds

• Limit
• General Purchases
• M/WBE
• Small Business
• Recycled/Remanufactured
• Printing

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Discretionary Thresholds
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Procurement Record

• Purchase Order
• Vendor Invoice
• Vendors Quotation/Bid
• Selection of Vendor/Reasonableness of Price
• Contract Reporter Ad (if required)
• Exemption Letter Preferred Source or OGS or
  less
• Recycled/Remanufactured Certification (if
  required)
• Procurement Lobbying Documentation (if required)

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Avoid Pitfalls

• Get the most from your Purchases
• Be Specific
• Monitoring
• Do your homework
• OGS or less
• Talk to everyone dont reinvent the wheel

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Questions and Answers
QUESTIONS??

• New York State Procurement Council Guidelines
• http//www.ogs.state.ny.us/procurecounc/default.as
  p
• http//www.ogs.state.ny.us/procurecounc/pdfdoc/Dis
  cretionaryPurchasingGuidelines.pdf
• OSC Help Desk - 518.473.1057

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Presenter Contact Information
Karla Ravida Bureau of State Expenditures Office
of the State Comptroller kravida_at_osc.state.ny.us

John Corbett Bureau of State Expenditures Office
of the State Comptroller jcorbett_at_osc.state.ny.u
s
OSC Website www.osc.state.ny.us
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Presenter Contact Information

• Dan Ryan
• Bureau of Contracts
• Office of the State Comptroller
• dryan_at_osc.state.ny.us

OSC Website www.osc.state.ny.us