State Financial Law

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(No Transcript)
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Presenters Contact Information
Anne Phillips Associate Counsel Office of
General Services anne.phillips_at_ogs.state.ny.us
[phone]
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Executive Law
State Finance Law
Case Law
UniformCommercial Code
CONTRACT
FederalLaws (e.g. Intellectual Property, Telecom)
Procurement Council Guidelines
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Pre-1995 Public Contracting

• Historical Context
• Purchase of Traditional Commodities
• - Capable of standardization
• - Articles of commerce (food, salt, linens)
• Public entities were predominantly large
  institutions
• Services were bought individually by
  government agencies

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Pre-1995 Public Contracting
Prior governing statute (174 State Finance Law)
provided minimal guidance for procurement and
competitive bidding. Agencies were essentially
relegated to contract awards for commodities to
the lowest price bidder. Contracts for
services or services procurements were not
governed directly by statute.
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Post-1995 Procurement Stewardship Act

• Major Change in the Framework for Public
  Procurements
• State Finance Law, Article 11
• Effective Date 4/1/95
• Sunset Date 6/30/06

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Procurement Stewardship Act

• Underlying Principles and Legislative Findings
• Responsibility of OGS and State Agencies in
  cooperation with OSC and DOB to
• Provide for the wise and prudent use of public
  money in the best interests of the taxpayers of
  the state
• Guard against favoritism, improvidence,
  extravagance, fraud corruption and
• Facilitate the efficient and timely
  acquisition of commodities and services of the
  highest quality at the lowest practicable cost
  within available resources.

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Procurement Stewardship Act
State agencies shall provide the states primary
line of defense for protecting the integrity of
the states procurement process and shall be
responsible for ensuring that the decisions made
in executing that process are made in accordance
with the highest standards of professional
practice.
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Procurement Stewardship Act

• Provide a level playing field among
  competitive bidders to enhance competition.
• Requires a procurement record a documented
  process which provides a balanced and fair
  method, established prior to receipt of offers,
  for evaluation of bids.

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Procurement Stewardship Act
Procurement Council established to review,
examine and develop improvements to procurement
process and competitive solicitation of bidding
for commodities, services and technology.
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Procurement Council State Finance Law 161

• Nineteen Members
• - Chair Commissioner of OGS
• - OSC
• - DOB
• - State Agency Representatives
• - Designated members
• Procurement Guidelines
• Procurement Policy
• Quarterly Meetings
• Strategic Plan

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Cooperative Efforts to Improve Public Procurement
Process

• Multi-agency Cooperative efforts (OSC, OFT,
  OGS, municipalities)
• Effort to coordinate information and expertise
  on statewide level
• Support necessary legislative and regulatory
  changes for best practice government
  procurement and competitive bidding
• Forum for exchange of views by participants
  with opposing or different interests in
  procurement

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Government Procurement Competitive Bidding
Comprehensive Statutory Scheme Procurement
Stewardship Act Article 11 State
Purchasing Section 160 Definitions
161 State Procurement Council
162 Preferred Sources
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Government Procurement Competitive Bidding
Section 163 Purchasing services and
commodities (Sunset
6/30/05) 163-a Vendor preparation
of specifications for
technology
procurements prohibitions 164
Exemptions 165 Purchasing
restrictions
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Government Procurement Competitive Bidding
Section 166 Requirements for financed
equipment acquisition
167 Transfer and disposal of
personal property
168 The management of surplus
computer equipment
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Government Procurement Competitive Bidding

• Procurement Guidelines
• Detailed Guidance to State agencies on how to
• conduct procurements
• Summarizes in one place the multiple
  approaches to procurement
• Identifies essential elements of successful
  procurements
• Provides valuable technical guidance on
  different approaches for structuring a
  procurement
• Provides examples of good procurement practices

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Government Procurement Competitive Bidding

• Definitions
• Commodity
• Service
• Technology
• Costs
• Price
• Provides a foundation of commonly understood
  concepts to apply within public procurement
  infrastructure

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Government Procurement Competitive Bidding

• Definitions
• Invitations for Bids (IFBs)
• Competitive Bidding Methodology
• Primarily used for procurement of commodities
• Basis for Contract Award
• - Meet specifications
• - Lowest price

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Government Procurement Competitive Bidding

• Request for Proposals (RFPs)
• Competitive Solicitation Methodology
• Primarily used for procurement of services and
  technology
• Basis for Award
• - Pre-established evaluation criteria where
  cost is not necessarily the determining factor
• - Best Value to the purchaser is the
  determinative criteria

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Government Procurement Competitive Bidding

• Best Value
• Documentation Other Requirements
• Best Practices Before You Solicit
• Document the intended basis for award (such as
  meeting mandatory requirements, best value
  or lowest price).
• Determine the technical and financial
  evaluation criteria and relative weight.
• Quantify criteria whenever possible, to
  optimize quality,
• cost and efficiency.
• Determine and document the evaluation and
  selection
• process.
• Advertise the procurement.

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Government Procurement Competitive Bidding
Distinction Lowest Price vs. Best Value
State Finance Law, 163
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Government Procurement Competitive Bidding
Lowest Price means the basis for awarding
contracts for commodities among responsive and
responsible offerors. Best Value means the
basis for awarding contracts for services to the
offeror which optimizes quality, cost and
efficiency, among responsive and responsible
offerors. Such basis shall reflect, wherever
possible, objective and quantifiable analysis.
Services include technology.
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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding
Centralized Contracts Centralized Contract
means any contract for the purchase of
commodities or services, established or approved
by the Commissioner of General Services as
meeting the State's requirements including, but
not limited to, any contract let by the federal
government, other state or local governments or
purchasing consortia.
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Government Procurement Competitive Bidding

• Examples of Centralized Contracts
• Vehicles heavy equipment
• Pharmaceuticals medical equipment
• Electronic Value Transfer (credit cards)/
  procurement card
• Fuel Oil, Gasoline, Road Salt
• PCs
• Rubbish Removal
• Telecommunications Systems Services

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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding

• Agency Specific Contracts
• Specialized Requirements Needed to Meet Agency
  Mission
• Consultant Services
• Do Not Call Registry
• Digital Fingerprinting Identification
• Specialized Software
• Entertainment Services

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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding
Preferred Sources State Finance Law 162 To
advance special social and economic goals,
selected providers shall have preferred source
status Procurement from these providers shall be
exempted from competitive procurement provisions.
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Government Procurement Competitive Bidding

• Preferred Status
• Correctional Services Commodities
• Agencies for the Blind Commodities
  Services
• Agencies for the Severely Disabled
  Commodities and Services
• Special Employment for Mentally Ill
  Commodities and Services
• Disabled Veterans Commodities sand Services
• Veterans Commodities and Services
• Qualified Apparel Manufacturer September
  11th Registry

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Government Procurement Competitive Bidding

• Public List of Commodities Services
• Approval by Procurement Council
• Price Approval Not greater than 15 above
  Prevailing Market Price
• Alternate Process for Procurements of Apparel
  Textiles

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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding
Emergency Contracts State Finance Law
163(10(b)) Procurements may be made to meet
emergencies arising from unforeseen causes
without using a formal competitive process. Such
procurements shall be made only under unusual
circumstances and shall include a determination
in the procurement record of the nature of the
emergency and that the procurement was conducted
in a fair and equitable manner.
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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding
Single Source Single Source means a procurement
in which although two or more offerors can supply
the required commodities or services, the
Commissioner or State agency, upon written
findings setting forth the material and
substantial reasons therefore, may award the
contract to one offeror over all others. The
Commissioner or State agency shall document in
the procurement record the circumstances leading
to the selection of the vendor, including the
alternatives considered, the rationale for
selecting the specific vendor and the basis upon
which it determined the cost was reasonable.
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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding
Sole Source Sole Source means a procurement in
which only one offeror is capable of supplying
the required commodities or services.
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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding
Multiple Awards State Finance Law
163(10)(c) The Commissioner or State agency may
elect to award a contract to one or more
responsive and responsible offerors provided,
however, that the basis for the selection among
multiple contracts at the time of purchase shall
be the most practical and economical alternative
and shall be in the best interests of the State,
and further provided that the requirements set
forth herein shall not preclude the Commissioner
from establishing multiple award contracts for
reasons including increased opportunities for
small businesses to participate in State
contracts.
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Government Procurement Competitive Bidding

• Types of Contracts State Finance Law 163
• Centralized Contract
• Agency Specific Contract
• Preferred Sources
• Emergency Contract
• Single Source Contract
• Sole Source Contract
• Multiple Awards
• Piggybacking (Adoption of Another Government
  Entity Contract)

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Government Procurement Competitive Bidding
The Commissioner of General Services may
authorize purchases required by state agencies or
authorized purchasers by letting a contract or by
approving the use of a contract let by any
department, agency or instrumentality of the
United States government and/or any department,
agency, office, political subdivision or
instrumentality of any state or states.
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Government Procurement Competitive Bidding
The Commissioner of General Services is
authorized to let centralized contracts for joint
purchasing by New York State and any department,
agency or instrumentality of the United States
government and/or any state including the
political subdivisions thereof provided however
that any entity incurring a liability under such
contract shall be responsible for discharging
said liability.
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Government Procurement Competitive Bidding
Under this authority, the State can recognize and
use or be a part of contracts of other public
purchasers. In most instances, these other
government entities establish their agreements
using competitive solicitations. This
procurement methodology has proven to be a tool
that provides a means to meet special
requirements or to efficiently and economically
meet the needs of State agencies and Authorized
Users.
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Government Procurement Competitive Bidding
Note These contracts and purchases also need
to be supported by a procurement record and are
subject to OSC approval.
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Government Procurement Competitive Bidding

• Piggybacking Agreements have provided for
  imaging systems, landscape furniture, cellular
  telephone service and mission specific
  consultant services such as Year 2000
  programming.
• Joint Agreements have provided for
  pharmaceuticals (Minnesota multi-state) and
  traffic cones (New England States and New York).

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Process for Conducting Procurements

• Developing the Procurement
• Determination of Need
• Form, Function Utility Decisions for
  Centralized Contracts
• - Discretion of OGS Commissioner in
  cooperation with State Procurement Council
  and state agencies,

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Process for Conducting Procurements

• Criteria OGS uses includes, but is not limited
  to
• Availability of a volume discount
• Prior use of the commodity among state
  agencies
• Relative cost of establishing the contract
• Anticipated use and
• Expected actual savings for the State.

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Process for Conducting Procurements

• Drafting Issuing Agency Contracts
• IFB vs. RFP
• NYS Contract Reporter Advertisement
• - Required if Contract Value Over 15,000
• Article 4C Economic Development Law
• - Receipt of offers minimum of fifteen
  business days after notice published
• Appendix A (Standard Clauses for State
  Contracts)

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Process for Conducting Procurements

• Drafting Issuing the Document
• Appendix B (OGS General Specifications for
  Procurement Contracts)
• Non-Collusive Bidding Certificate
• MacBride Certification
• Executive Order No. 127 Providing for
  Additional State Procurement Disclosure
• Responsibility Questionnaire
• Sales Tax Certification

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Government Procurement Competitive Bidding

• Discretionary Thresholds for Purchasing
• State Agencies up to 15,000 50,000
• State Agencies up to 50,000 100,000
• - For recycled commodities or technology
• - For remanufactured commodities or
  technology
• - From small businesses
• - From certified minority/women-owned
  business enterprises

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Government Procurement Competitive Bidding
Use of Mini Bids Another competitive
solicitation technique employs multiple contract
awards where vendors present their qualifications
and agree to standard terms and conditions for a
multiple year contract term with not to exceed
prices backdrop contracts. State agencies
and Authorized Users present their technical
needs to a pool of qualified contractors
(Project Definition or Mini Bid) choosing the
best value solution.
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Government Procurement Competitive Bidding
Use of Mini Bids (continued) This allows the
purchaser to focus on meeting their operational
or functional requirements and cut down on the
contract cycle time often reducing the
procurement time to weeks rather than months.
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Government Procurement Competitive Bidding

• Use of Mini Bids
• Computer Consulting, Systems Integration and
  Training Agreements with categories of services
• Telephone Systems and Maintenance
• Third Party Financing Services
• Microcomputer Systems

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Government Procurement Competitive Bidding

• Bid Evaluation Approvals
• Responsive Offeror
• - Material vs. Non-Material Deviations
• - Clarifications, revisions, discussions,
  where provided in the solicitation
• Responsible Offeror
• - Due Diligence
• - Due Process
• - Prior Contract History
• - No debarment in NYS, other than for
  prevailing wage rate or labor law
  violations

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Government Procurement Competitive Bidding

• Vendor Responsibility Due Process and the
  Opportunity to be Heard
• Procurement determinations arising from the
  need to ascertain the responsibility of a
  vendor/bidder impose a duty on the State agency
  to provide an opportunity to be heard
• It is the policy of the Office of General
  Services (OGS) Procurement Services Group (PSG)
  to provide vendors with an opportunity to
  administratively resolve complaints or inquiries
  related to PSG bid solicitations or contract
  awards. Bidders are encouraged to seek
  resolution of complaints through consultation
  with PSG staff. All such matters will be
  accorded impartial and timely consideration

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Government Procurement Competitive Bidding

• Bid Evaluation Approvals
• Bid Disputes
• - No statutory right
• - Commissioner's responsibility to make an
  award consistent with procurement laws
• Elements of defensible decisions

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Government Procurement and Competitive Bidding

• Bid Evaluation Approvals
• Required Approvals
• Department of Law
• Specialty Contracts
• - Civil Service
• - Office for Technology
• - Division of the Budget
• Office of the State Comptroller

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Government Procurement and Competitive Bidding

• Selection and Contract Award
• Using Bid Documents for Contract Award
• Negotiate Contract

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Government Procurement and Competitive Bidding

• Other Relevant Laws
• Section 112 State Finance Law
• OSC Approval
• Section 97-g State Finance
• Law Centralized Services
• Section 138 State Finance Law
• Non-Assignment of State Contracts
• Section 139-d State Finance Law
  Non-Collusion by Bidders

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Government Procurement and Competitive Bidding

• Other Relevant Laws
• Sections 139-j and 139-k State Finance
  Law Restriction on Contracts and Disclosure
  of Contacts
• Section 144-a State Finance Law Rock Salt
  Preference
• Section 220 and 240 Labor Law
• Prevailing Wage Rate
• Article 2 Uniform Commercial Code
• Sales

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Presenters Contact Information
Anne Phillips Associate Counsel Office of
General Services anne.phillips_at_ogs.state.ny.us
[phone]