Procurement And Contract Management Handbook
Procurement and Contract ManagementHandbookProcurement and Contract Operations DivisionSeptember 2020Version 1.0
ContentsProcurement and Contract Management Handbook . 0Handbook Purpose and Organization . 3Chapter 1 - Purchasing Authority . 5Contract Oversight Team . 5Staff Development and Certification . 6CPA Training and Certification . 7Conflict of Interest and Ethics . 8Vendor and Employee Communication . 9Chapter 2 - Procurement Planning . 10Needs Assessment . 10Request for Information Procurement Planning Method . 10Acquisition Planning . 11Complex Procurement Planning . 11Complex Procurement Risk Assessment . 12Chapter 3 - Procurement Method Determination . 14Procurement Method Requirements . 14Non-delegated Procurement Methods . 14Delegated Procurement Methods . 15Spot Purchases. 15Competitive Purchasing Methods . 16Special Purchases . 17Chapter 4 - Solicitation Development . 18Formal Solicitation Development Process . 18Solicitation Development . 18Affirmations, Certifications, and Clauses . 18Scope of Work . 19Best Value . 20Evaluation Criteria . 20External and Internal Solicitation Reviews . 21Contract Advisory Team Review. 21
HUB Review . 22Solicitation Posting and Advertisement . 22Advertisement and Notification Methods . 23Solicitation Cancellation or Changes . 24Vendor Conference . 24Chapter 5 – Vendor Selection . 25Receipt and Screening Process . 25Purchaser Review of Responses . 25Stakeholder Notification . 25Evaluation Process . 26Evaluator Briefing . 26Evaluation Results and Internal Approval . 27Vendor Compliance Verifications . 27Chapter 6 – Contract Formation and Award . 28Contract Negotiations . 28Best and Final Offer. 28Contract Development . 28External and Internal Contract Approvals . 29Contract Risk Assessment . 30Special Contract Requirements. 31Contract Execution. 32Award Notifications and Posting . 33Post Award Processes . 34Procurement Debriefing Process . 34Vendor Protest Process . 34Procurement File Documentation . 34Re-Procurement Planning . 35Chapter 7 – Contract Management . 35Contract Management Function . 35Contract Planning . 35Vendor Performance Review . 38Special Contract Management Requirements . 39HUB HSP Requirements. 391 PageOAG - Procurement and Contract Operations Division
Major Information Resources Projects . 39Vendor Performance Reporting . 40Contract Close-out . 40Contract Termination . 40Contract Management File Documentation . 41Appendix A: Procurement and Contracting Best Practices. 43Appendix B: Vendor Compliance Verifications . 44Appendix C: Purchasing Accountability and Risk Analysis Procedure . 45Appendix D: Acronym Key. 46Appendix E: Glossary of Key Terms . 482 PageOAG - Procurement and Contract Operations Division
Handbook Purpose and OrganizationThe Office of the Attorney General (OAG) Procurement and ContractOperations Division (PCO) is responsible for managing the procurementand contract management function for the agency. The purpose of theProcurement and Contract Management Handbook (“Handbook”) is toidentify the procurement and contracting processes for OAG staff. Theseprocesses describe how the OAG complies with statute and rule inaccordance with the Texas Comptroller of Public Accounts (CPA) TexasProcurement and Contract Management Guide Version 1.3 (“CPA Guide”).This Handbook also complies with the Contract Management Handbookrequirement pursuant to Texas Government Code, § 2261.256.Procurement and contracting processes from acquisition planning throughcontract close-out are provided, in accordance with the procurement cycleidentified in the CPA Guide. Agency policies and procedures provide thedirection and instruction for creating the handbook and implementing theprocesses. Quality assurance reviews are conducted to ensure compliancewith processes, policies, and procedures. This structure is illustrated inFigure 1: Procurement and Contracting Administrative Structure.Figure 1: Procurement and Contracting Administrative Structure3 PageOAG - Procurement and Contract Operations Division
The complete appendices to this Handbook include the following: AppendixAppendixAppendixAppendixAppendixA: Procurement and Contracting Best Practices;B: Vendor Compliance Verifications;C: Purchasing Accountability and Risk Analysis Procedure;D: Acronym Key; andE: Glossary of Key Terms.Some of the purchasing and contract management functions andresponsibilities described in this Handbook may be delegated to the ChildSupport Contract Operations Division.4 PageOAG - Procurement and Contract Operations Division
Chapter 1 - Purchasing AuthorityThe CPA and the Texas Department of Information Resources (DIR) aregranted purchasing authority for the state. Under this authority, the CPA andDIR establishes statewide contracts to support state purchasing needs andimprove efficiency in procuring certain goods and services. The CPA alsodelegates some purchasing authority directly to state agencies.The PCO is responsible for implementing the OAG delegated purchasingauthority.1 The delegated and non-delegated purchasing authority is basedon the type and value of the purchase. Table 1: Purchasing Authority,identifies the types of delegated and non-delegated purchases and theirmonetary limits.Table 1: Purchasing Authority2Non-Delegated Purchases Goods exceeding 50,000Services exceeding 100,000Delegated Purchases One-time purchases for goods that do not exceed 50,000Purchases of services that do not exceed 100,000Purchases of perishable goodsPurchases of publications directly from publisherFuel, oil and grease purchasesDistributor purchasesEmergency purchasesProprietary purchasesContract Oversight TeamThe OAG procurement and contracting function is guided by thecollaboration and input of key stakeholders. This strategic collaboration isformalized through the Contract Oversight Team (COT). COT members arestaff who advise on procurement and contracting processes to ensure they1TEX. GOV’T. CODE § 2155.131 retrieved m/GV.2155.htm.2Pursuant to 34 TEX. ADMIN, CODE § 20.82, the CPA delegates one-time purchases of goods,including goods for resale that do not exceed 50,000, and services for resale that do not exceed 100,000.5 PageOAG - Procurement and Contract Operations Division
support the PCO function. The COT Charter defines the responsibilities, goalsand scope of this team.3Figure 2: Contract Oversight Team, illustrates the relationships between theCOT and the divisions responsible for the procurement and contractingfunctions.Figure 2: Contract Oversight TeamStaff Development and CertificationStaff development is managed in the divisions. Staff are responsible formaintaining certifications and completing required training commensuratewith their job responsibilities. 4 The divisions are responsible for enrolling3COT f 1&e YKtqyk&cid a501ba5b-c81c-4d6f-ba3d-328ae053531e4The purchaser may hold the Certified Texas Contract Developer (CTCD), Certified TexasProcurement Manger (CTPM) or Certified Texas Purchaser (CTP) certifications. The contractmanager may hold the Certified Texas Contract Manager (CTCM) certification.6 PageOAG - Procurement and Contract Operations Division
staff in CPA-required training and ensuring staff obtains necessarycertification(s). See the section on CPA Training and Certification below foradditional information.A Staff Development Plan (SDP) is developed for each new purchaser orcontract manager, in accordance with the Staff Development Policy. It is thepractice of the PCO that new staff are also matched with senior staff, for onthe-job training. The SDP at minimum, addresses the following: certification and continuing education needs;conflict of interest statement;file documentation and records retention;introduction to the E-PRO System;overview of procurement and contracting functions;procurement and contracting policies and procedures; andstaff responsibilities.Additional staff development opportunities are driven by business need, suchas the implementation of new policies and procedures. Informal staffdevelopment activities are offered for CPA continuing education credit.National procurement and contracting best practices are shared with staff forself-directed learning. These practices are included in Appendix A:Procurement and Contracting Best Practices.CPA Training and CertificationThe CPA is responsible for developing and managing the statewide trainingand certification program for public procurement professionals. The trainingand certifications required for procurement and contracting staff areprovided in Table 2: CPA Training Requirements.7 PageOAG - Procurement and Contract Operations Division
Table 2: CPA Training RequirementsPurchasingThresholdType ofCertificationTraining RequirementsOver 5,000& purchasingis 15% ormore of jobdutiesOver 15,000None requiredBasic Texas PurchaserCourseCertified TexasContract Developer(CTCD)No continuing educationrequiredCPA CTCD Training,24 hours of continuingeducation required5Contractvalue over 5,000,000 &contractmanagementactivities are50% or moreof jobactivitiesCertified TexasContract Manager(CTCM)CPA CTCM Training,24 hours of continuingeducation required6TestingRequirementsNo, receives aCertification ofCompletionYes, score of 80 orbetterYes, score of 80 orbetterThe complete training and certification requirements are provided in the CPAGuide and at .Conflict of Interest and EthicsStaff with procurement and contracting responsibilities are required to abideby a strict code of conduct in accordance with the delegated purchasingauthority. These staff are required to adhere to the same ethical standardsas the CPA staff. Conflict of interest and ethics standards are mandated instatute and rule, as referenced in agency and PCO policies.These standards are designed to ensure that staff maintain the highest levelof integrity and ethics in procurement and contracting. Staff are alsorequired to abide by agency and PCO policies and procedures in performingtheir responsibilities.In compliance with the Conflict of Interest and Ethics Policy, to ensureunderstanding and compliance with requirements, procurement staffcomplete a Conflict of Interest Statement annually. In addition, theNondisclosure and Procurement Integrity Statement is completed by all PCO56If renewing under a dual certification, 36 hours of continuing education are requiredv. sup8 PageOAG - Procurement and Contract Operations Division
staff working on a procurement. These statements ensure understandingand compliance with requirements to: abide by the same ethical standards as the CPA staff;disclose any personal or financial conflict of interest, and recusethemselves from involvement in procurement and contractingdecisions;protect sensitive procurement information from disclosure; andreport any actual, potential, or apparent conflict of interest orviolation of ethical standards.There may be additional conflict of interest or ethics forms required by otherdivisions.Vendor and Employee CommunicationCommunication between a vendor and OAG staff is appropriate under certaincircumstances. For example, specific OAG staff may need to communicatewith vendors to gather information on goods or services prior to a purchase.For less complex purchases, this communication may be conductedinformally through email or phone calls.For more complex competitive purchases that require a formal solicitationprocess, staff are encouraged to use the Request for Information (RFI)planning method, described in Chapter 2 – Procurement Planning.To ensure consistency in vendor communication, staff are required to followthe guidelines provided in the Vendor and Employee Interaction andCommunication Policy. These guidelines establish communicationexpectations for purchasing and contracting staff to ensure transparency andprevent any perception of impropriety in the life cycle of a contract.9 PageOAG - Procurement and Contract Operations Division
Chapter 2 - Procurement PlanningNeeds AssessmentDivisions begin the procurement planning process with the identification ofthe procurement need. The PCO uses informal or formal procurementplanning processes based on the type and value of the procurement. Forexample, the need for a one-time goods purchase up to 5,000 does notrequire a competitive process or a formal planning process. Divisions cangenerally determine the need for this type of purchase by market researchor purchase history.While the need for an informal procurement may be easily determined,procurements at certain thresholds generally require formal planning.Procurements expected to exceed 25,000 in value are required to beposted to the Electronic State Business Daily (ESBD) 7, and in accordancewith the CPA Guide, require a formal procurement process. Division staffbegin the procurement planning process with identification of theprocurement need, by soliciting input from key stakeholders to include:contract managers, Subject Matter Experts (SMEs), or other relevant staff.Regardless of the planning process, the procurement need is generallyidentified by division staff through a Purchase Requisition (PR) submission inthe E-PRO electronic purchasing system.8 E-PRO requires that the requestorprovide information that further defines the procurement need. In somecases, the purchaser may provide technical assistance to the division, priorto submission of the PR.Request for Information Procurement Planning MethodThe Request for Information (RFI) is a formal procurement planning methodthat may be used as part of the needs assessment process. The purpose ofthe RFI is to solicit information from the vendor community that may informa competitive procurement. For example, an RFI may be issued to solicitfeedback on the market costs for professional or consulting services notpreviously procured.7TEX. GOV’T CODE § 2155.083 retrieved m/GV.2155.htm.8In some cases, obtaining legal services is exempt from procurement requirements pursuant to TEX.GOV’T. CODE § 2155.005.10 P a g eOAG - Procurement and Contract Operations Division
The RFI is posted to the ESBD to ensure transparency and to solicit inputfrom the broadest pool of potential vendors. This method is preferable overcontacting a limited number of vendors, as the formal RFI process canprevent the perception of vendor bias.Acquisition PlanningThe anticipated contract start date generally determines the timeline forcompleting the procurement. The purchaser or contract developer, incollaboration with key stakeholders, establishes the planning approach forprocurements with a value under 100,000. For example, thepurchaser/contract developer may choose to hold a formal planning meetingor informally discuss the procurement process with stakeholders.Complex Procurement PlanningPCO considers procurements of 100,000 or more complex procurements,requiring a formal acquisition planning process. Complex procurementsgenerally require a planning team and an acquisition plan, in accordancewith the Acquisition Planning Policy.While each solicitation is unique, membership for a planning team isillustrated in Figure 3: Acquisition Planning Meeting.11 P a g eOAG - Procurement and Contract Operations Division
Figure 3: Acquisition Planning MeetingThe team meets to discuss the procurement process and develop theAcquisition Plan which addresses the following: thethethethethebusiness need for the procurement;procurement roles for the team members;timeline for procurement milestones;procurement risk and management approach; andsolicitation posting and reporting requirements.The development of the acquisition plan ensures that more complexprocurements are sufficiently planned, and roles and responsibilities areclearly defined.Complex Procurement Risk AssessmentThe National Institute of Governmental Purchasing (NIGP) defines RiskManagement as:12 P a g eOAG - Procurement and Contract Operations Division
“A process including the identification and analysis of risk, and the decisionto either accept, or mitigate the exposure to such risk when compared to thepotential impact on the achievement of the organization’s objectives.” 9The OAG has a comprehensive approach to risk assessment andmanagement in compliance with the required purchasing accountability andrisk analysis procedure.10 In accordance with the Procurement RiskAssessment Policy, procurement risk is assessed as part of the acquisitionplanning process.The procurement risk assessment identifies the following: thethethethepotential risks based on risk factors;level of risk;risk management approach; andstaff tasked with managing the risk.This process then informs the contract risk assessment process. Identifyingand managing risks in the early stages of the procurement can avertnegative impacts and ensure timely contract execution. This comprehensiveapproach to risk assessment and management provides the OAG with thebest defense against unintended consequences.9The National Institute of Governmental Purchasing retrieved from: http://www.nigp.org/.TEX. GOV’T. CODE § 2261.256 retrieved m/GV.2261.htm#2261.256.1013 P a g eOAG - Procurement and Contract Operations Division
Chapter 3 - Procurement Method DeterminationProcurement Method RequirementsThe purchaser is required to make the procurement method determination.The following factors are used in in making the determination: best value;11state law and rules;type of good or service; andvalue of the procurement.In some cases, the type and value of the procurement determines thepurchasing authority delegated to state agencies. In other cases, purchasingauthority above certain thresholds must be approved through a delegationrequest. The delegated and non-delegated purchasing thresholds areidentified in Table 1: Purchasing Authority. The purchaser is responsible fordetermining the need for a request for delegation.The CPA Guide provides a detailed procurement method identificationprocess to assist the purchaser.Non-delegated Procurement MethodsThe CPA State Procurement Division (SPD) manages an online procurementsystem for the purchase of goods and services known as Texas SmartBuy.12This web-based system allows agencies to procure non-IT goods andservices through existing contracts that have been competitively procured.The state also creates contracts, referred to as cooperative, set-aside andterm contracts, as non-delegated procurement methods to ensure best valueand improve procurement efficiency. These established contracts aremanaged by the CPA, DIR and the Texas Workforce Commission (TWC) andare required to be used by state agencies, with limited exceptions. The statecontracts most commonly used at the OAG include: DIR contracts;set-aside contracts;11Pursuant to TEX. GOV’T. CODE § 2156.007, the commission or other state agency making apurchase shall award a contract to the bidder offering the best value for the state while conforming tothe specifications required.12Texas SmartBuy retrieved from: http://www.txsmartbuy.com/.14 P a g eOAG - Procurement and Contract Operations Division
term contracts; andtravel service contracts.The CPA Guide provides detailed descriptions of the state contracts, toinclude the circumstances for which exceptions or waivers are granted.Delegated Procurement MethodsState agencies are delegated purchasing authority by the CPA for goods orservices unavailable through established statewide contracts or are exemptfrom CPA or DIR purchasing authority. Potential purchases that exceedestablished delegation thresholds (as identified in Table 1: PurchasingAuthority) are required to be reviewed and approved for CPA delegation.The CPA delegation and review process for solicitations is described inChapter 4 - Solicitation Development.For informal purchases, there are various purchase methods available. Thepurchaser, in collaboration with the requestor, leads the process ofdetermining the procurement method. In addition to state requirements andthe availability of established contracts, other factors that can impact theprocurement method include: frequency and duration of need;purchase amount;requirements or specifications; andtype of goods or services.The most common solicitation methods for informal procurements aredescribed below.Spot PurchasesThe “spot purchase” is a delegated non-competitive method used topurchase goods or services that do not exceed 5,000. This method isfrequently used to procure items to support general business functions. Thepurchaser checks the established statewide contracts to determineavailability of the goods or services. In addition, while not required for spotpurchases, the purchaser is encouraged to identify Historically UnderutilizedBusinesses (HUBs) that can provide the goods or services.The general requisition process for spot purchases is illustrated in Figure 4:E-PRO Purchase Process.15 P a g eOAG - Procurement and Contract Operations Division
Figure 4: E-PRO Purchase ProcessCompetitive Purchasing MethodsCompetitive purchasing methods are generally required when the purchaseexceeds 5,000.13 The methods used for these purchases may require aformal or informal procurement process depending on the purchase amount.For example, if the purchase is over 25,000 the CPA requires the use of aformal competitive purchasing process. In addition, an open marketsolicitation method, is required for competitive solicitations. This methodensures maximum competition by soliciting responses from all availablevendors.Table 3: Open Market Solicitations, describes the type and purpose of theopen market solicitation methods commonly used at the OAG.The CPA Guide requires that emergency procurements be as competitive as possibleunder the circumstances.1316 P a g eOAG - Procurement and Contract Operations Division
Table 3: Open Market SolicitationsTypePurposeExampleBlanket PurchaseOrderUsed when there is an on-going need, butneed is determined on an “as needed”basis.Court reportingservicesInvitation for Bids(IFB)Used for the purchase of goods andservices when the focus is on pricing.Negotiations are NOT permitted unlessone qualified response is received.Conference planningservicesRequest for Offers(RFO)Used for automated information systems/telecommunications goods and services.Electronic filingservices to supportthe legal functionRequest forProposals (RFP)Used for the purchase of goods orservices. Negotiations and best and finaloffer are permitted.Professional servicesStanding PurchaseOrderUsed when there is an on-going need, andquantities and delivery times are knownor pre-determined.Paper for generalbusiness needsSpecial PurchasesThere are special types of purchases that may not require the competitiveprocess. These purchases can also require certain approvals, inter-agencycollaboration, notification requirements, and reporting. These additionalrequirements are designed to ensure best value, efficiency, andtransparency. Examples of special purchases commonly used at the OAGinclude: automated information systems/telecommunications;emergency purchase;interagency purchase;internal repair;professional services; andproprietary purchase.To avoid any delays in contract formation and award, the additionalrequirements for these special purchases should be identified during theplanning phase of the procurement. The CPA Guide provides detailedinstructions for ensuring compliance with special purchases.17 P a g eOAG - Procurement and Contract Operations Division
Chapter 4 - Solicitation DevelopmentFormal Solicitation Development ProcessFormal solicitation development is a more complex process that includes keystakeholders and is led by the purchaser/contract developer. For purposes ofthis Handbook, solicitation development and contract management areaddressed for the most common formal competitive procurement methodsused at the OAG which include the IFB, RFO, and RFP methods. Theprocedures for completing informal purchases will be detailed in the PCOPurchasing Procedures document to be located on the OAG intranet.The formal solicitation development process is required for solicitations fordelegated goods or services with a value over 25,000. Upon receipt of thepurchase requisition (PR), the purchaser/contract developer generally beginsthe solicitation development process by consulting with the keystakeholders. This process generally includes the following staff: assigned attorney;contract manager;HUB Coordinator14;purchaser/contract developer; andSMEs.The complexity and or value of the procurement may necessitate theinvolvement of other stakeholders to include OAG leadership. Thepurchaser/contract developer consults with the requestor and appropriatemanagement (e.g., PCO leadership) to determine the need for additionalstakeholder involvement.Solicitation DevelopmentAffirmations, Certifications, and ClausesThe OAG requires that solicitation documents contain certain mandatoryaffirmations, certifications, and clauses, to comply with law, as well asmitigate risk to the agency, as referenced in the Essential ContractProvisions Policy. During solicitation development, the purchaser/contractdeveloper and the assigned attorney collaborate to ensure the solicitationdocument includes all the necessary provisions. In some cases, the division14The HUB Coordinator should be included if the potential contract will have an expected value of 100,000 or more.18 P a g eOAG - Procurement and Contract Operations Division
may have additional provisions that are incorporated into the solicitationdocument.Scope of WorkThe development of the solicitation scope of work (“scope”), with the goodsspecifications or services requirements, defines the OAG purchasing intent.The staff submitting the requisi
Procurement and Contract Management Guide Version 1.3 ("CPA Guide"). This Handbook also complies with the Contract Management Handbook requirement pursuant to Texas Government Code, § 2261.256. Procurement and contracting processes from acquisition planning through contract close-out are provided, in accordance with the procurement cycle
Procurement and Contract Management Handbook, v. 1.0 1 General Information 1. PURPOSE The purpose of the Procurement and Contract Management Handbook (Handbook) is to establish consistent procurement and contract management policies and procedures that must be followed by the Health and Human
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certified contract developers and managers who participate in many of the purchasing or contracting functions. This Handbook is designed as a general overview of procurement, consisting of purchasing and contracting, for all TWC employees who participate in the procurement and contract management processes.
In health care in England, perceptions of value have been dominated by a mix of clinical outcomes, system targets, competition mechanisms and encouragement for single units to act autonomously and be judged as single services. What people using health services value most has not been adequately considered or captured. However, a number of recent changes are raising the question of whether the .
