Transcript Procurement & Contract Management

©2007
Nan McKay & Associates
The New HUD Procurement Handbook
7460.8 REV 2 - Procurement & Contract Management
Hosted by
Carrol Vaughan
©2006
Nan McKay & Associates
©2007
Nan McKay & Associates
HUD Handbook 7460.8 REV 2
 Applies specifically to public housing agencies
for the operation of public housing
 Is not applicable to Indian Housing Authorities
or the operation of the Section 8 Housing
Choice Voucher Program
©2007
Nan McKay & Associates
HUD Handbook 7460.8 REV 2
 Also, does not apply to income generated by the
Central Office Cost Center (COCC)
• Management fees
• Bookkeeping fees
• Asset management fees
 Not considered Federal program income
 Governed by local & State requirements, if
applicable
©2007
Review of Applicable
Regulations
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Procurement Rules
 PHAs are considered “local governments” for
admin purposes
 Operating Fund, Capital Fund = Federal
program grant funds
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Part 85, CFR 24
 Code of Federal Regulations
 Known as the “common rule” because it
applies to all state & local recipients of
Federal funds
 Guidance on development of policy & system,
contract admin., standard of conduct for PHA
employees involved in procurement
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CFR 48
 Code of Federal Regulations
 Deals with acquisition of goods & services
 Covers cost principles in detail
 Used by all recipients of Federal funds
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HUD Handbook 7460.8 REV 2
 Provides very clear direction on what is
mandatory – and what is not
 “Shall” and “must” mean an action is
mandatory, required by statute or regulation
 Should” and “may” mean an action or item is
provided as guidance but is NOT mandatory
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Nan McKay & Associates
HUD Handbook 7460.8 REV 2
 Notes that certain information on PHA
procurements is considered public
• Name of winning contractor, contract price
 Protected from disclosure
• Proprietary business information (technical methods,
detailed pricing, personal information”
 Check State requirements regarding Freedom of
Information law or similar
©2007
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HUD Handbook 7460.8 REV 2
 Fundamental goal of the PHA’s procurement
system should be to provide needed supplies
& services considering
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Cost
Quality
Timeliness of delivery or service
Compliance with applicable laws & policies
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Commonly Used Definitions
New Definitions
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HUD Handbook 7460.8 REV 2
 Consortia: two or more PHAs joining together
for planning, reporting, administrative
functions
 Instrumentality: Branch of the PHA through
which functions or policies are implemented
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HUD Handbook 7460.8 REV 2
 Joint Venture Partner: Participant, other than
PHA, in a business arrangements
 Micro Purchases: Purchases under $2000
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Procurement Authority &
Administration
 PHAs are required to establish & follow a written
procurement policy
 HUD approval not required – however
• May want to have reviewed/approved to be exempt
from prior HUD approval of certain procurement
actions
 May also self certify that PHA policy meets all HUD
requirements
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Delegation of Authority
 Under PBM more decentralization of procurement
function is expected
 Policy required for delegation of procurement
authority
• Limits of authority in terms of dollar value each PHA
classification may make
• Other limitations, e.g., types of contracts an
individual may award
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Delegation of Authority
 Delegation policy should also be clear if
individual staff may further re-delegate any of
his/her authority – and how much!
 Training for site staff is important
• Individual staff will be binding the PHA legally
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General Requirements
 Planning necessary to manage the
procurement function
 Type & extent depends on method & size of
procurement; amount involved
 PHAs are encouraged to enter into
intergovernmental agreements if these
agreements provide economy & efficiency
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General Requirements
 Equipment Leasing
• May be financially advantageous for PHA to consider
leasing instead of purchasing equipment
 Evaluate each case on factors:
• Length of period the equipment is to be used
• Financial & operating advantages of different types
of equipment
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General Requirements
• Cumulative rental payments for the estimated period of use
vs. net purchase cost
• Maintenance & service costs
• Potential obsolescence of equipment because of
technological advances
• Trade in value
• Imputed interest
• Availability of servicing capability
 PHA staff
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Documentation Required
 Revised handbook requires that PHAs
maintain records sufficient to detail each
procurement action
 Must be in writing & kept in procurement file
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Documentation Required
 Rationale for method of procurement used
 Solicitation documents
 Selection of contract if not apparent
• Not needed if using firm, fixed price
 Information regarding selection & rejection
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Documentation Required
 Basis for the contract price
 Contract administration issues/actions
 Records must be maintained for 3 years after
final payment is made & any actions closed.
©2007
Internal Controls
 Under decentralized procurement system the
Housing Manager (site manager) is generally
designated as “Contracting Officer”
 May order/receive & authorize payment
 Other internal controls needed
• Site based budgets
• Appropriate purchasing thresholds
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Ethics Chapter
 Revised handbook includes strong emphasis
on ethical behavior
 Ethical standards apply to PHA employees
and those with vested interest – Board of
Commissioners
 Requirements are included ins 24 CFR
85.36(b)(3) & explained in handbook
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Ethics Chapter
 All employees/others must act to ensure fair,
competitive access to procurement
opportunities by responsible parties
 All employees/others must conduct
themselves in a manner that fosters public
confidence in the integrity of the PHA
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Ethics Chapter
 Clear requirement for a written code of
standards that govern the performance of
PHA employees engaged in award &
administration of procurement actions
 PHA must observe conflict of interest
provisions that include . . . . .
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Ethics Chapter
 Employees cannot participate in selection,
award of administration of a contract if there is
a financial or other form of conflict of interest –
real or perceived
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Ethics Chapter
 Employees/others may not enter into a contractual
arrangement if there is a direct or indirect interest
during tenure – or for one year thereafter.
Examples:
• Present or former member of the Board or any
immediate family member.
• Employee who formulates policy or influences
decisions or their immediate family members
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Ethics Chapter
 No present or former employee/other may sell
supplies, services or construction to the PHA
for one year following the date such
employment ceased.
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Ethics Chapter
 Gratuities, Kickbacks, Confidential Info.
• All solicitations & contracts above small purchase
threshold must include clauses that prohibit
gratuities & kickbacks
 May not accept gratuities while employed or for one
year after employment
• PHA may set rules for non-substantial financial
interest – must be included in Procurement Policy
• Gratuities include money, gifts, favors
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Ethics Chapter
 Kickbacks & Anticompetitive Practices
• Breach of ethical conduct for any payment, offer of
employment to be made as an inducement for award
 Use of Confidential Information
• Disclosure is considered a breach of standards
• Includes contents of bid prior to opening
• Names/firms that submitted bids
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Ethics Chapter
 Use of Confidential Information
• PHA generated information related to a
procurement
 Cost estimates
• Any information that would have a direct
bearing on award of the process
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Ethics Chapter
 Sanctions must be established and are to be
enforced including civil and administrative remedies
& should be included in Procurement Policy
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Oral/written warnings
Suspension w/wo pay
Termination
Dismissal from position (Commissioner)
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Small Purchase Procedures
Small purchase limit – set at
$100,000
• State may have lower
limit that the PHA must
observe
PHA may establish a Micro
Purchase threshold of up to
$2,000 per purchase
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Nan McKay & Associates
Micro Purchases
 Threshold may be up to $2,000, included in
Procurement Policy
 PHA does not need competitive quotations if
price is considered reasonable
 Micro purchases should be distributed among
appropriate vendors
 Does not replace Petty Cash process
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Micro Purchases
 PHA may use purchasing cards (debit or credit) to
facilitate micro purchases to help reduce transaction
costs
 Additional quotes not needed
 Must establish reasonable procedures
• Limiting type or amount of purchases allowed
• Procedure for reviewing purchases prior to payment
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Small Purchases Above Micro
Purchase Limit
 Quotations may be in writing, orally, fax, catalogs,
internet advertisement, public display of
advertisement
 PHA may want to establish dollar thresholds for
written or oral quotations
 Quotation evaluation involves comparison of quotes
 If only one response, statement of reasonableness
should be included in file
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Small Purchase Documentation
 Revised handbook advises PHA to keep
documentation to a minimum!
 Information supporting purchase (paper or
electronic) should be retained for
management review purposes
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Small Purchases – Petty Cash
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Should be used for very small, one time purchases
Should be included in Procurement Policy
Must be in compliance with CFR 24 85.36
Amount of fund, maximum for each purchase,
procedures to appoint Petty Cash Administrators to
be included in Procurement Policy
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Small Purchases
 No requirements for bid, payment,
performance bonds for small purchases
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Small Purchases
 For construction contracts greater than $2000, less
than $100,000 PHAs must incorporate clauses
contained in HUD Form 5370-EZ “General
Conditions” plus applicable Davis Bacon decision
 For maintenance contracts greater than $2000, less
than $100,000 clauses from HUD 5370-C & wage
decisions must be included (includes non routine
maintenance)
©2007
Small Purchases
 Required clauses include:
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Examination of contractor records
Rights of Ownership & Proprietary Interest
Energy Efficiency
Procurement of Recovered Materials (EPA)
Termination for Cause & for Convenience
 For contracts of $10,000 or more
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Small Purchases
 The revised handbook notes that small
purchases are not sealed bidding
 Contracting Officers (including site staff) may
– and are encouraged to – negotiate price &
other terms of purchases
©2007
Specialty Contracts
 Revised handbook clarifies distinction
between employment contracts and
contracting for independent services
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Employment Contracts
 Part of the personnel process, not procurement
 Subject to rules, policies governing such process,
developed by PHA
 Often used to employ executive directors
 Old ACC requires contracts in excess of two years
to be approved in writing by HUD Local Office; new
ACC does not specify term
• Suggests 2- year term with three 1-year options
©2007
Independent Contracts
 Considered to be procurement actions
 Subject to standards of 24 CFR 85.36
 No employer-employee relationship
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Evaluating Cost & Price
 Generally comparison of proposed prices is used to
establish price reasonableness
 Proposed prices should be compared with the initial
cost estimate
 In sole source or non competitive proposals PHAs
must perform cost analysis except under certain
conditions
• Ref. 10.3.A.2 & 10.3.B
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Evaluating Cost & Price
 May use an alternate method if adequate
number of responses is not received without
having to do a formal cost analysis
 Compare proposals to past contract prices for
same or similar items/services
• Inflation, market changes should be
considered
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Evaluating Cost & Price
 Published catalog or market prices
• Any discounts should also be offered to PHA
• May consider paying more if the PHA requires
more than general commercial customers do,
e.g., longer warranty periods, servicing
• Goal is to ensure PHA doesn’t pay more than
other buyers for the same item or services
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Estimating Cost & Price
 Professional estimate, prepared by the PHA
or an outside party (consultant)
• Level of analysis should be commensurate
with the complexity of the procurement
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HUD Review Requirements
 PHAs can be exempted from the required preaward review of contracts under two
circumstances:
• HUD, at PHA request, certifies that its
procurement system is determined to meet
the standards under 24 CFR 85.36
• OR . . . .
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HUD Review Requirements
 The PHA self certifies that its procurement
system meets the standards of CFR 24 85.36
– and the HUD Handbook
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HUD Review Requirements
 Exemptions are granted for a one year period
and may be automatically renewed unless the
PHA is found not be in compliance, e.g.,
auditor report
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HUD Approval Required
 Non competitive procurements over the small
purchase threshold
 Brand name only procurements over small
purchase threshold
 Awards to other than low bidder over small
purchase threshold
 Proposed modifications detailed in Forms 5370,
5370-C, 5370-EZ
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HUD Approval Required
 Use of QBS for other than A/E, joint venture
partners or energy service contracts
 Professional service contracts if the total term
exceeds two years (old ACC)
 Legal services over $100,000
 Procurements that exceed the amount noted under
a Notice of Deficiency or corrective action under
Capital Fund
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HUD Approval Required
 Contracts that exceed five years, including options
• Field offices must determine there is no practical
alternative
 Solicitations related to energy performance
contracting & utility add ons
 Contracts by PHA whose procurement procedures
are out of compliance
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State or Local Laws & PHA
Procurement
 Any PHA that is located in a state or locality
that has procurement laws or rules must
comply with those rules
 Generally if Federal & locality rules conflict,
the more stringent law applies
• E.g., small purchase threshold
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Exceptions to Local Pre-emption
 Geographic Preferences – cannot be used in
the evaluation of offers
 State Prevailing Wage – Davis Bacon or HUD
Determined Wage Rates preempt any State
prevailing wage rate when the State wage is
higher than the applicable Federal rate.
©2007
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Cooperative Business
Relationships
 Intergovernmental Agreements for Procurement
Activity
• Initial contract must have been procured in
accordance with 24 CFR 85.36
• Can result in significant economy & efficiency for
PHA
• May only be used for procurement of common
supplies & services
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Cooperative Business
Relationships
 Intergovernmental Agreements for
Procurement Activity
• PHA’s files should include copy of the
Agreement
• Agreement must be between the PHA and a
state or local agency – may be another PHA
©2007
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Selecting Joint Venture Partners
 For provision of PHA administrative or
management functions of public housing, or
provision of supportive and social services
 May select one of two options
• QBS, using RFQ and negotiations of price
• Sole source proposal
 Conditions apply . . . .
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Selecting Joint Venture Partners
 Joint Venture Partner by Sole Source
• Resources or services would not be otherwise
available to the PHA on the open market
• Resident group is able to act as partner in
performing the functions needed to provide
supportive or social services.
 Team members are selected to provide services
 Paid on a cost reimbursement basis only
 Check for Conflict of Interest Issues
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Consortia
 QHWRA authorizes PHAs to form a special
type of consortium (Section 13 Consortium)
 Participating PHAs submit join PHA Plans,
may combine all or part of their funding &
program administrative duties
 Consortium must comply with procurement
laws
©2007
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 24 CFR 85.36 applies to any HOPE VI or
Mixed Finance procurement activity whenever
Federal funds are used
 If public & private funds are co-mingled, 24
CFR 85.36 applies
 Does not apply if the PHA is not spending
Federal funds
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Important Definitions
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
• Community & Supportive Services: Part of a
HOPE VI plan that addresses the service
needs of residents
 PHAs are obligated under the terms of HOPE
VI grants to provide a range of services for
residents to make progress toward self
sufficiency
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Development Partner: For profit or non profit
partner of the PHA that carries out the
physical revitalization of a mixed finance
project and bears financial risk
• Development partners must be selected using
the PHA’s procurement process
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Instrumentality: An entity formed whose
assets, operations and management are
legally controlled by the PHA that utilizes
public housing funds to create public and
affordable housing
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Mixed Finance: Combined use of Federal
public housing funds and privately financed
sources to development public housing units
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Owner Entity: Owns the public housing units
in a mixed finance development; may be a
partnership that includes a PHA or a separate
entity altogether
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Operating Subsidy Only Project: Public
housing units financed without the use of HUD
capital assistance or HOPE VI funds; HUD
agrees to provide operating subsidy for the
units
• Owners/developers of this type of project must
be procured through a competitive process
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Selection of Development Partner
• QBS method used and price is negotiated with
highest ranked offeror based on responses to RFQ
• Must be a procurement process with full and open
competition
• Cost/price analysis must be completed for all
procurements prior to submission of proposals to
determine value of requested services
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 QBS method is not permitted for the
procurement of program managers or legal
services for HOPE VI or mixed finance
projects
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Procurement Requirements of Selected
Developer
• Not subject to 24 CFR 85.36 unless the PHA
exercises significant functions within the
owner entity with respect to managing units
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Public/Private Partnerships, HOPE
VI, Mixed Finance Development
 Actions NOT considered significant:
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Monitoring units to ensure compliance
Coordinating communications with partners
Providing community/supportive services
Attending construction meetings, reviewing &
approving payment draws
• Maintaining the waiting list
• Review & approval of operating & capital budgets
©2007
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Utility Purchasing, Energy
Conservation, Energy Performance
 Energy Conservation Loans
• PHA obtains a loan to finance energy
improvements
• Subsidy add-on is provided to cover the cost
of amortizing the loan during the contract term
• Amount of add on cannot exceed the cost
savings generated each year by the work
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Utility Purchasing, Energy
Conservation, Energy Performance
 Energy Conservation Loans
• PHA must procure a Comprehensive Energy
Analysis and must have the analysis, list of
improvements and proposed contract
reviewed & approved by HUD
• Improvements must be procured in the same
manner as other purchases by PHA
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Utility Purchasing, Energy
Conservation, Energy Performance
 Energy Performance Contracting
• Allows the PHA to freeze the utility rolling base
• UEL is calculated at pre-retrofit consumption
• PHA keeps 100% of savings resulting from decrease
in consumption
• 75% of savings must be used to pay debt of
efficiency measures installed
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Utility Purchasing, Energy
Conservation, Energy Performance
 Energy Performance Contracting
• Third party contractor must be procured using
open competition
• HUD must approve the comprehensive energy
analysis, RFP for energy contractor, final
contract as negotiated between the PHA and
contractor, following competitive procurement
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Utility Purchasing, Energy
Conservation, Energy Performance
 Utility Purchasing
• PHAs may have an opportunity to purchase utilities
at lower costs because of deregulation and
restructing
• If there are multiple providers of a utility service, the
PHA must conduct a competitive procurement
• If only one provider, PHA is not required to
competitively procure utility services
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Developing a Procurement
Policy
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Procurement Policy Should Include
 Statement on access by public to certain
information
 Clear wording on ethical behavior expected by
PHA employees/others engaged in
procurement activities including:
• Definition of “immediate family”
• Dollar amount for gifts, e.g., $25
©2007
Nan McKay & Associates
Procurement Policy Should Include
 Procurement methods that will be used by the PHA
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Petty cash
Small Purchase (include dollar level)
Sealed Bids
Competitive Proposals
Noncompetitive Proposals
Cooperative Purchasing Agreements
©2007
Nan McKay & Associates
Procurement Policy Should Include
 Conditions for cost & price analysis
 Methods of solicitation to be used for various levels
of procurement
 Bonding requirements for construction contracts
over $100,000
 Contractor Qualifications & Duties
 Different types of contracts the PHA will use
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Nan McKay & Associates
Procurement Policy Should Include
Identification of required contract clauses
Types of specifications the PHA will use
Process for filing an appeal
Assistance available for small and other types of
businesses
 Required Board approval of policy
 Delegation of Contracting Authority
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Nan McKay & Associates
Procurement Policy Should Include
 Disposition Policy (may also be a stand alone
policy)
 Self Certification (if applicable)
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Quick Review of Procurement
Processes
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Procurement and Contracts
Example purchase and procurement method:
Purchase Amt
Procurement Method
Less than $50
Petty cash. Receipt from vendor attached to log and
request
$50 to $2000
Micropurchase. One reasonable quote. Equally distributed
among vendors
$2000 to
$100,000
Three quotes (fax, written or email).
Over $100,000
Formal advertisement and sealed bid or request for
proposals
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©2007
Small Purchases
 Simplest method of
procurement for supplies,
materials and services
(including professional
and construction) that
don’t exceed small
purchase threshold
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Small Purchases
 Micro purchases
• PHAs may establish a separate micro
purchase limit up to $2,000 per purchase
 PHA may make these purchases without
competitive quotations if the price is
reasonable
• PHA is encouraged to distribute these fairly
©2007
Nan McKay & Associates
Small Purchases
 PHA procurement policy stipulates dollar limit
 Federal statutory limit for “small purchases” is
$100,000
• PHA’s threshold can’t exceed the Federal small
purchase limit or any lower value set by the state or
locality
 Common methods for small purchases are petty
cash and purchase orders
©2007
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Small Purchases
 Petty cash
• Board establishes petty cash limits
• Sales ticket or receipt should always support
each purchase made
• Petty cash should be kept to a minimum since
purchasing in limited quantities doesn’t
provide the best price
©2007
Nan McKay & Associates
Small Purchases
 Purchasing Cards
• Debit or credit cards
 Can be used to reduce transaction costs
 May be useful for on site purchasing tasks
 PHA should establish procedure to ensure
cards are only used for specific purposes
(type or amount of purchase)
 Internal control of cards is essential
©2007
Nan McKay & Associates
Small Purchases
 Purchase orders
• Primary method for procuring goods &
services
• One quote is okay if reasonable, but usually
more prudent to get oral or written quotes from
at least three sources
 Evaluate the quotes and purchase from
lowest, responsible bidder
©2007
Sealed Bidding
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Sealed Bidding
 Invitations for bid (IFB)
• For construction and routine supplies above
limit for small purchases, ou need to prepare
an independent cost estimate and
specifications, and publicize the upcoming
procurement
 Local newspaper or trade journal
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Sealed Bidding
 Invitations for bid (IFB)
• The next step is to prepare the IFB
 Contains specifications, instructions to
bidders, and required contract forms
 Issued to all sources who responded to the
public notice, and any other firm known to the
PHA as able to perform the work
 IFB specifies deadline to submit bids
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Sealed Bidding
 Invitations for bid (IFB)
• PHAs can use the internet to conduct public
procurements as long as the procurements
comply with the CFR 85.36 and the PHA’s
procurement policy
©2007
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Sealed Bidding
 Pre-bid conference
• After the IFB, PHA may hold a pre-bid
conference with prospective contractors
 Notice of any conference is in the IFB
• Nothing at the conference changes the terms
unless an amendment is issued
• Transcript of conference sent to all those on
mailing list, not just at the conference
©2007
Sealed Bidding
 Bid opening
• Each bid must be
date/time stamped upon
receipt
 Sealed bids should be
stored in a locked box,
cabinet or safe until bid
opening
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©2007
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Sealed Bidding
 Bid opening
• Sealed bidding is a public process – any
interested parties are permitted to attend
• At the time stated in IFB, conduct a public bid
opening, reading aloud names of bidders and
prices
• No commitment is made to any bidder at the
bid opening
©2007
Sealed Bidding
 Bid opening
• When the bids have been publicly
opened and read, all the bids are
tabulated, showing names of bidders
and prices
Nan McKay & Associates
©2007
Nan McKay & Associates
Sealed Bidding
 Analysis of bids and award of contract
• Next, determine whether the low bid is
responsive to the IFB (conforms to
requirements) – if so, analyze the low
bidder’s capability to do the work
 Also perform a price analysis, which may be
as simple as comparing prices, to ensure
contract price will be reasonable
©2007
Nan McKay & Associates
Sealed Bidding
 Analysis of bids and award of contract
• Determine if low bid is responsive
 Make sure bidders haven’t imposed any
additional conditions or terms
 Documented previous unsatisfactory
performing is grounds for determining bidder
not responsible
©2007
Sealed Bidding
 Award of contract
• Once you determine low
bidder is both responsive
and responsible, award
contract
• Any bid rejection must be
documented with reasons
Nan McKay & Associates
©2007
Nan McKay & Associates
Competitive Proposals (RFP)
Page 7-11
©2007
Nan McKay & Associates
Competitive Proposals (RFP)
 Sealed bidding is the preferred method for
goods & construction; professional services
(architect, engineer) done through the
competitive process
 Both technical and price factors are
considered
• Allows discussions with each offeror
©2007
Nan McKay & Associates
Competitive Proposals (RFP)
 Begins with PHA describing its needs in a
statement of work (SOW), publicizing the
upcoming procurement, and preparing both
an independent cost estimate and a technical
evaluation plan for analyzing proposals
received
©2007
Nan McKay & Associates
Competitive Proposals (RFP)
 PHA then prepares an RFP which identifies
the technical and price evaluation factors and
format for submitting proposals
 The PHA issues the RFP to the respondents
of the public notice and those on the PHA’s
mailing list
©2007
Nan McKay & Associates
Competitive Proposals (RFP)
 When proposals are received on closing
date, they aren’t publicly opened
•
•
•
•
Kept confidential
There are multiple award factors
It may take days to evaluate all proposals
After selection is made, the basis for the
selection is subject to public inspection
©2007
Nan McKay & Associates
Competitive Proposals (RFP)
 After proposals are received, PHA evaluates
technical and price factors, documents in
writing, and establishes a competitive ranges
of offerors
• Then you notify those offerors whose
proposals are deficient and not considered
Page 7-12
©2007
Nan McKay & Associates
Competitive Proposals (RFP)
 Then, separate negotiations (in person or
phone) with each in competitive range
• After negotiations conclude, PHA establishes a
cut-off date for receipt of best and final offers
 Any offeror in the competitive range can
change its offer
 PHA evaluates and awards contract
©2007
Nan McKay & Associates
Summary of Sealed Bidding vs.
Competitive Proposals
 An important difference is the finality of offers
• In competitive proposals, changes in nature and
price may be made after proposals opened
 Not allowed under sealed bidding
• Competitive method permits discussions with
competing offerors and allows them to change
their proposals, including price
©2007
Nan McKay & Associates
Noncompetitive Proposals
 Procurement through a
sole source or a single
source when only one
offer is received
 Must comply with 24 CFR
85.36(d)(4)
©2007
Nan McKay & Associates
Noncompetitive Proposals
 Follows similar process to competitive
proposals
 Proposal must be evaluated & technical/cost
aspects may be negotiated
 Cost analysis is required because there is no
price competition
©2007
Nan McKay & Associates
Noncompetitive Proposals
 Written justification is required to document
necessity of using this method
•
•
•
•
Description of requirement
History of prior purchases & nature
Specific exception from 24CFR
Statement of unique circumstances
©2007
Nan McKay & Associates
Noncompetitive Proposals
Description of efforts made to find competitive
sources, e.g., type of advertising used
Statement of efforts that will be taken in the
future to promote competition for the
requirement
Signature of the Contracting Officer or higher
approval authority as required by PHA policy
©2007
Nan McKay & Associates
Ethics in Public Contracting
 PHA must have a written code of standards
that governs performance of employees who
engage in award & administration of contracts
 Included in the PHA’s procurement policy
©2007
Nan McKay & Associates
Ethics in Public Procurement
 PHA’s procurement policy should prohibit any
employee from participating in the selection of
a vendor or award of a contract if a conflict –
real or perceived – would be involved
Page 7-25
©2007
Nan McKay & Associates
Ethics in Public Procurement
 Also recommended that policy prohibit
employees who participate in the procurement
process from accepting gifts, gratuities, favors
or kickbacks from current or potential vendors
or contracts
Page 7-25
©2007
Nan McKay & Associates
Ethics in Public Procurement
 Penalties should be established & included in
policy for those employees who breach ethical
standards
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•
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Oral or written warnings/reprimands
Suspension with/without pay
Termination of employment
Dismissal from the office or agency position
©2007
Questions & Answers
Nan McKay & Associates
©2007
Nan McKay & Associates
Thank you for attending!
Our July – September Lunch ‘n’ Learn Calendar is out!
Check out these upcoming sessions:
• How to Reduce Common Rent Calc Errors – July 6
• Fair Housing Issues for Management – July 20
• Navigating PIC/WASS WEBINAR! – Aug 17
• HCV Legislative and Regulatory Update – Sept 14
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