Division of Purchase and Contract

North Carolina Procurement ConferenceRaleigh – April 24-25, 2012

New Legislation of Interest

Sam Byassee, State Purchasing Officer

Division of Purchase and Contract

Powers and Duties of the SecretaryG.S. §143-49

Two legislative changes:

- S.L. 2011-338 (Act to Modernize Procurement Methods)

- S.L. 2010-194 (Act Increasing the Authority of the Secretary of DOA)

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Division of Purchase and Contract

S.L. 2011-338An Act to Modernize Procurement Methods

Increases procurement flexibility by expressly authorizing:

- Negotiation

- Reverse Auctions

- Electronic Bidding

- Best Value Procurement

- Use of Cooperative Purchasing Agreements

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Division of Purchase and Contract

S.L. 2011-338, continued

Miscellaneous Provisions:

Combines “supplies, materials, equipment and personal property” into one term, “Goods”

Clarifies when AG must assist negotiation of a services contract greater than $100,000If contract involves “work performed by an independent contractor requiring specialized knowledge, experience, expertise or similar capabilities wherein the service rendered does not consist primarily of acquisition by this State of equipment or materials and the rental of equipment, materials and supplies.”

- Contract is not the result of a competitive bidding process.

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Division of Purchase and Contract

S.L. 2011-338, Miscellaneous provisions continued

Requires DOA to determine, and utilize, aggregate demand for all State agencies in making purchasing decisions, when possible

Authorizes DOA to obtain “spend” reports from State agencies, departments and institutions, giving a more accurate picture of aggregate demand for commodities and enabling better strategic sourcing

Clarifies that purchase from “certified sources of supply” applies to term contract for both goods and services

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Division of Purchase and Contract

S.L. 2010-194 Act Increasing the Authority of the Secretary of DOA

Omnibus legislation, but four provisions directly affect the procurement process:

Attorney General must review (term) contracts greater than $1 million

DOA assigned additional contract compliance-related duties

No State entity may award a “cost plus a percentage of cost” contract

Contracts must include standard clause allowing review of contractor records by State auditors

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Division of Purchase and Contract

Attorney General Review of Contracts

DOA (P&C) and all agencies, departments and institutions must submit all proposed contracts greater than $1 million to the “Attorney General or the Attorney General’s designee” for review

- DOT has separate provision that exempts road construction-related purchases

- UNC has separate provision requiring University General Counsel to review

Originally applied only to term contracts, but S.L. 2011-326 expanded to “all contracts for supplies, materials, printing, equipment and contractual services.”

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Division of Purchase and Contract

Attorney General Review of Contractscontinued

Purpose of AG review is to ensure:

- Contract is in proper legal form

- Contains all clauses required by law

- Is legally enforceable

- Accomplishes its intended purpose

- NOT an assessment or opinion of the “policy merit or lack thereof”

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Division of Purchase and Contract

DOA Contract Monitoring Responsibilities

Added to G.S. §143-49 – Powers and Duties of the Secretary:

Monitor and enforce statewide term contracts (cannot delegate)

Develop rule, regulations and procedures for agency contract monitoring

With OSP, create Contracting Specialist career path (agency personnel)

With OSP and UNC-SoG, to develop a contract management training and certification program (administered by OSP)

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Division of Purchase and Contract

Additional DOA Duties (in S.L. 2010-194)

Implement a Quality Management System (to ensure better service)

With AG, develop rules, regulations and procedures for “orderly and efficient submission” of proposed contracts for review

Work with UNC-SoG to study and recommend improvements to State procurement laws (including feasibility of adopting ABA Model Procurement Code)

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Division of Purchase and Contract

S.L. 2011-360Multiple Award Schedule Contracts

Intent. – The intent of multiple award schedule contracts is to evaluatevendors based upon a variety of factors, including discounts, total lifecycle costs, service, warranty, distribution channel, and past vendor performance. Multiple award schedule contracts allowmultiple vendors to compete and be awarded a contract based upon the value of their products or services and result in competitive pricing, transparency, administrative savings, expedited procurement, and flexibility for State purchasers.

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Division of Purchase and Contract

Multiple Award Schedule Contractscontinued

“Not later than August 31, 2011, the Department of Administration shall issue requests for proposals for multiple award schedule contracts” for all:

ground maintenance equipment (mowers, weeders, etc.)

construction equipment (dozers, graders, etc.)

communications equipment (communications systems, routers, switches, etc.)

forestry equipment (knuckleboom loaders, harvesters, etc.)

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Division of Purchase and Contract

Multiple Award Schedule ContractsCommunications equipment

State CIO authority under Chapter 147:§ 147‑33.95.  Procurement of information technology.

(a)       Notwithstanding any other provision of law, the Office ofInformation Technology Services shall procure allinformation technology for State agencies.

§ 147‑33.96.  Restriction on State agency contractual authority with regard to information technology;

(a)       All State agencies covered by this Part shall use contracts for information technology acquired by the Office for any information technology required by the Stateagency that is provided by these contracts. Notwithstandingany other statute, the authority of State agencies to procureor obtain information technology shall be subject to compliance with the provisions of this Part.

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Division of Purchase and Contract

Multiple Award Schedule ContractsS.L. 2011-360 continued

Limitation. – Any contract awarded under subsection (c) of this section [requiring RFPs] shall be in addition to any existing term contracts for ground maintenance equipment, construction equipment, communications equipment, and forestry equipment. Nothing in this section shall limit the ability of the Department of Administration to issue additional term contracts for the specific purchase of equipment otherwise available through a multiple award schedule contract.

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Division of Purchase and Contract

Statutory Provisions to ExpireJune 30, 2012

American Recovery and Reinvestment Act provisions:

G.S. §143-52(b) – Use competitive bids to maximum extent practicable

G.S. §143-53(e) – DOA and OERI to develop rules for ARRA- related solicitations

G.S. §143-53.1 (b) – Benchmarks for Universities and Community Colleges apply to ARRA purchases

G.S. §143-55 – Purchases with ARRA funds not required to use State term contracts

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