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Purchasing Methods

Petty Cash Purchases

Purchases under $50.00 may be handled using a petty cash account. Petty Cash Accounts may be established in an amount sufficient to cover small purchases made during a reasonable period, e.g., one month. For all Petty Cash Accounts, Ripley Housing Authority shall ensure that security is maintained, and only authorized individuals have access to the account. These accounts shall be reconciled and replenished periodically.

Small and "Micro" Purchase Procedures

For any amounts above the Petty Cash ceiling, but not exceeding $50,000.00, the PHA may use small purchase procedures. Under small purchase procedures, the PHA shall obtain a reasonable number of quotes (preferably three); however, for purchases of less than $10,000.00, also known as "micro-purchases", only one quote is required provided the quote is considered reasonable. To the greatest extent feasible, and to promote competition, small purchases should be distributed among qualified sources. Quotes may be obtained orally (either in person or by phone), by fax, in writing, or through e-procurement. The award shall be made to the qualified vendor that provides the best value to Ripley Housing Authority. If an award is to be made for reasons other than the lowest price, documentation shall be provided in the contract file. The PHA shall not break down requirements aggregating more than the small purchase threshold (or the micro-purchase threshold) into several purchases that are less than the applicable threshold merely to:

  1. Permit use of the small purchase procedures or,
  2. Avoid any requirements that apply to purchases that exceed the micro-purchase threshold.

Sealed Bids

Sealed bidding shall be used for all contracts that exceed the small purchase threshold and that are not competitive proposals or non-competitive proposals, as these terms are defined in this document. Under sealed bids, the PHA publicly solicits bids and awards a firm-fixed-price contract (lump sum or unit price) to the responsible bidder whose bid, conforms with all the material terms and conditions of the IFB, is the lowest in price.  Sealed bidding is the preferred method for procuring construction, supply, and non-complex service contracts that are expected to exceed the small purchase limit.

Conditions for Using Sealed Bids

Ripley Housing Authority shall use the sealed bid method if the following conditions are present:

  1. A complete, adequate, and realistic statement of work, specification, or purchase description is available;
  2. Two or more responsible bidders are willing and able to compete effectively for the work;
  3. The contract can be awarded based on a firm fixed price;
  4. The selection of the successful bidder can be made principally on the lowest price.

Competitive Proposals

Unlike sealed bidding, the competitive proposal method permits:

  1. Consideration of technical factors other than price;
  2. Discussion with offerors concerning offers submitted;
  3. Negotiation of the contract price or estimated cost and other contract terms and conditions;
  4. Revision of proposals before the final contractor selection;
  5. The withdrawal of an offer at any time up until the point of award.

The award is normally made based on the proposal that represents the best overall value to the PHA, considering the price and other factors, e.g., technical expertise, past experience, quality of proposed staffing, etc., set forth in the solicitation and not solely the lowest price.

Conditions for Use

Where conditions are not appropriate for the use of sealed bidding, competitive proposals may be used. Competitive proposals are the preferred method for procuring professional services that will exceed the small purchase threshold.

Form of Solicitation

Other than A/E services or for the solicitation of development partners, competitive proposals shall be solicited through the issuance of a Request for Proposal (RFP). The RFP shall clearly identify the importance and relative value of each of the evaluation factors as well as any subfactors and price. A mechanism for fairly and thoroughly evaluating the technical and price proposals shall be established before the solicitation is issued. Proposals shall be handled so as to prevent disclosure of the number of offerors, the identity of the offerors, and the contents of their proposals until after the award.  Ripley Housing Authority may assign price a specific weight in the evaluation criteria or the PHA may consider price in conjunction with technical factors; in either case, the method for evaluating price shall be established in the RFP.

Evaluation

The proposals shall be evaluated only on the criteria stated in the RFP. Where not apparent from the evaluation criteria, Ripley Housing Authority shall establish an evaluation plan for each RFP. Generally, all RFPs shall be evaluated by an appropriately appointed Evaluation Committee. The Evaluation Committee shall be required to disclose any potential conflicts of interest and to sign a Non-Disclosure statement. An Evaluation Report, summarizing the results of the evaluation, shall be prepared prior to the award of a contract.

Negotiations

Negotiations shall be conducted with all offerors who submit a proposal determined to have a reasonable chance of being selected for the award unless it is determined that negotiations are not needed with any of the offerors. This determination is based on the relative score of the proposals as they are evaluated and rated in accordance with the technical and price factors specified in the RFP. These offerors shall be treated fairly and equally with respect to any opportunity for negotiation and revision of their proposals. No offeror shall be given any information about any other offeror's proposal, and no offeror shall be assisted in bringing its proposal up to the level of any other proposal. A common deadline shall be established for receipt of proposal revisions based on negotiations.

Negotiations are exchanges (in either competitive or sole source environment) between the PHA and offerors that are undertaken with the intent of allowing the offeror to revise its proposal. These negotiations may include bargaining. Bargaining includes persuasion, alteration of assumptions and positions, give-and-take, and may apply to price, schedule, technical requirements, type of contract, or other terms of a proposed contract. When negotiations are conducted in a competitive acquisition, they take place after the establishment of the competitive range and are called discussions.

Discussions are tailored to each offeror's proposal and shall be conducted by the contracting officer with each offeror within the competitive range. The primary object of discussions is to maximize Ripley Housing Authority's ability to obtain the best value, based on the requirements and the evaluation factors set forth in the solicitation. The contracting officer shall indicate to, or discuss with, each offeror still being considered for the award, significant weaknesses, deficiencies, and other aspects of its proposal (such as cost, price, technical approach, past performance, and terms and conditions) that could, in the opinion of the contracting officer, be altered or explained to enhance materially the proposer's potential for award. The scope and extent of discussions are a matter of the contracting officer's judgment. The contracting officer may inform an offeror that its price is considered by the PHA to be too high, or too low, and reveal the results of the analysis supporting that conclusion. It is also permissible to indicate to all offerors that cost or price that the government's price analysis, market research, and other reviews have identified as reasonable. "Auctioning" (revealing one offeror's price in an attempt to get another offeror to lower their price) is prohibited.

Award

After evaluation of the revised proposals, if any, the contract shall be awarded to the responsible firm whose technical approach to the project, qualifications, price, and/or any other factors considered, are most advantageous to Ripley Housing Authority provided that the price is within the maximum total project budgeted amount established for the specific property or activity.

A/E and Development Partner Services

Ripley Housing Authority must contract for A/E services using qualifications-based solicitations (QBS) procedures, utilizing an RFQ, and may do the same for soliciting a development partner. Sealed bidding shall not be used for A/E solicitations or development partner solicitations. Under QBS procedures, competitors' qualifications are evaluated, and the most qualified competitor is selected, subject to negotiation of fair and reasonable compensation. Price is not used as a selection factor under this method. QBS procedures shall not be used to purchase other types of services.

Noncompetitive Proposals

Conditions for Use

Procurement by noncompetitive proposals (sole source) may be used only when the award of a contract is not feasible using small purchase procedures, sealed bids, cooperative purchasing, or competitive proposals, and if one of the following applies:

  1. The item is available only from a single source, based on a good faith review of available sources;
  2. 2. An emergency exists that seriously threatens the public health, welfare, or safety, or endangers property, or would otherwise cause serious injury to Ripley Housing Authority, as may arise by reason of a flood, earthquake, epidemic, riot, equipment failure, or similar event. In such cases, there must be an immediate and serious need for supplies, services, or construction such that the need cannot be met through any of the other procurement methods, and the emergency procurement shall be limited to those supplies, services, or construction necessary simply to meet the emergency;
  3. HUD authorizes the use of noncompetitive proposals; or
  4. After solicitation of a number of sources, competition is determined inadequate.

Justification

Each procurement based on non-competitive proposals shall be supported by a written justification for the selection of this method. The justification shall be approved in writing by the responsible contracting officer. Poor planning or lack of planning is not justification for emergency or sole source procurements. The justification, to be included in the procurement file, should include the following information:

  1. Description of the requirement;
  2. History of prior purchases and their nature (competitive vs. non-competitive);
  3. The specific exception in 24 CFR 85.36(d)(4)(i)(A) through (D) which applies;
  4. Statement as to the unique circumstances that require award by noncompetitive proposals;
  5. Description of the efforts made to find competitive sources (advertisement in trade journals or local publications, phone calls to local suppliers, issuance of a written solicitation, etc.);
  6. Statement as to efforts that will be taken in the future to promote competition for the requirement;
  7. Signature by the contracting officer's supervisor (or someone above the level of the contracting officer); and,
  8. The reasonableness of the price for all procurements based on non-competitive proposals shall be determined by performing analysis, as described in this Policy.

Cooperative Purchasing/Intergovernmental Agreements

Ripley Housing Authority may enter into state and/or local cooperative or intergovernmental agreements to purchase or use common supplies, equipment, or services. The decision to use an interagency agreement instead of conducting a direct procurement shall be based on economy and efficiency. If used, the interagency agreement shall stipulate who is authorized to purchase on behalf of the participating parties and shall specify inspection, acceptance, termination, payment, and other relevant terms and conditions. Ripley Housing Authority may use federal or state excess and surplus property instead of purchasing new equipment and property if feasible and if it will result in a reduction of project costs. The goods and services obtained under a cooperative purchasing agreement must have been procured in accordance with 24 CFR 85.36.