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Procurement Policies
Procurement means purchasing, renting, leasing, or otherwise acquiring supplies, services, or construction. Established procurement policies at federal, state, and local levels ensure fair and equal treatment of all persons and organizations which wish to conduct business with LEAs. Procurement policy is detailed in 7CFR Part 3016 for public agencies and in 7CFR Part 3019 for private nonprofit agencies. Many LEAs have established more restrictive procedures than required in federal regulation.
Public agencies must follow the minimum standards detailed in 3016.36(b-I); private nonprofit agencies must use 3019.40-.48. These regulations detail the procedures an LEA must follow during procurement. The requirements at the local and/or state level may be more restrictive (in which case, they must be followed), but if the local and/or state policies are less restrictive, the federal standards must be followed.
LEAs are cautioned to adhere strictly to the requirements of the procurement process (request for proposal or invitation to bid). Organizations, agencies, companies or individuals responding to the proposal or bid must also adhere to the process. LEAs must develop their own specifications (rather than relying upon the specifications from one potential contractor) in order to assure fair competition for awards. LEAs have broad discretion in gathering information for use in connection with procurements; however, information from potential bidders must be appropriately modified to develop tailored specifications. If otherwise, these potential bidders must be excluded from competing for such procurements. LEAs are prohibited from awarding contracts to potential contractors that drafted procurement documents.
Regulations governing all LEAs are contained in 7CFR Part 3017 (Government-Wide Debarment and Suspension) and 7CFR Part 3021 (Government-Wide Requirements for a Drug-Free Workplace). Review the regulations to assure the documents and procedures conform to the regulations.
If an institution purchases $25,000 or more in goods and/or services from any individual, company or group, the documents used to contract with them must include a clause verifying that the contractor has not been excluded or disqualified from doing business with the federal government.
Failure to comply with specific solicitation and contract terms is a violation of the regulations requiring competitive procurements and contrary to good business practices. If an LEA discovers a contract which does not comply with the procedures detailed in the regulations, they may not extend or renew the contract, but must initiate a new procurement action at the end of the current contract period.
Several procurement rules which must also be followed are contained in 7CFR Part 210. Some of those requirements include:
"Buy American." LEAs are required to purchase, to the maximum extent practicable, domestic commodities or products for use in program meals. "Domestic commodity or product" is defined as one that is produced in the United States and is processed in the United States substanially using agricultural commodities that are produced in the United States. Substantially means that over 51 percent of the final processed product consists of agricultural commodities that were grown domestically. This provision should be included in all bid specifications to ensure compliance. The provision applies to all funds in the food service account, not just federal reimbursement.
Locally Produced Foods. LEAs are encouraged to purchase locally produced foods to the maximum extent practicable. This does not absolve LEAs of their obligation to adhere to all applicable procurement requirements, that all purchases must be made competitively, consistent with all state and federal procurement laws and regulations. Purchases of this type would usually qualify as small purchases under procurement requirements and therefore be made using informal procedures. LEAs should check with the Utah Department of Agriculture for more information on locally produced foods.
Donated Commodities. All federally donated commodities must accrue only to the benefit of the school food service.
Food Service Management Companies. The content of the request for proposals or invitation to bid and the contract is specified in the regulations. Proposed documents must be submitted to the SA prior to releasing for approval. (See Contracting with Food Service Management Companies: Guidance for School Food Authorities.)