Methods of Solicitation and Selection

The required feature that principally distinguishes an RFP from an IFB is the listing of evaluation factors. These factors typically include not only responsibility factors (such as financial, human, and physical capacity to perform), but also technical factors (such as the degree to which the proposer is expected, based on information submitted and available, to achieve the performance objectives, to provide the quality expected, and on the relative qualifications of the proposer's personnel). Many RFPs go beyond listing these factors in order of importance, and also describe the evaluation process in detail, listing weights for each factor, illustrating the scoring method, and specifying the procedure for weighing price into the selection.

• offerors can more accurately respond to your needs rather than solely rely on the technical specifications alone;
  
  
• proposers will be able to clearly present the information you need to conduct your evaluation; and
  
  
• the appearance of favoritism or unethical practice in offeror selection will be diminished.

The competitive proposal process involves a subjective evaluation process and discussions that are typically confidential. Public acceptance and acceptance by disappointed offerors might be less than in the case of sealed bids, if the evaluation and selection process is not well documented and disclosed in advance.

Best Practices

Evaluation and Award - The following is a listing of elements commonly found in the competitive proposal method of procurement.

• Both a technical and cost proposal are requested so that they may be evaluated, frequently by separate staff. Where the appearance of technical objectivity is important, it is a better practice to initially evaluate the technical proposals without knowledge of costs, so that an objective and impartial evaluation can be obtained.
  
  
• The evaluation factors to be considered in the award are identified in the RFP along with the relative importance of each. While this requires only the ranking of the factors without quantifying the importance or describing the process for applying the factors to proposals, some agencies disclose their selection process in detail.
  
  
• Disclosure Disadvantages. Disclosing the specific weights and scoring processes may encourage proposers to distort their proposals, and may strengthen the disappointed proposer's attack on the agency decision;
  
  
• Disclosure Advantages. The full description of the process guides proposers in understanding your needs, bolsters the objectivity of your evaluation team, encourages candor from the proposers during negotiations, and encourages competition through the perception of fair treatment.
  
  
• Many standard RFPs notify prospective offerors that award may be made on the basis of initial proposals submitted without any negotiations or discussions. The implication is clearly, that the initial proposal should be their best effort.

Proposal guarantee - Although performance bonds are often appropriate and required by RFPs, the use of a proposal guarantee is less common than bid guarantee. Because the proposers generally have unavoidable opportunity during negotiations to render their proposals unacceptable, part of the purpose of bid guarantees cannot be achieved in the case of proposals. (See Section 4.3.3.3.2, "Bid guarantee" and Section 8.2.1, "Performance Bonds") However, if it is particularly important that the initial proposals be firm commitments by the offerors, that frivolous proposals not be submitted, or that proposers be able to provide performance bonds, then a proposal guarantee in the form of a cashier's check, letter of credit, or approved bond may be cost-effective.

The Federal Approach

1. Best value selection methodology affords the agency an opportunity to structure the source selection process in a way that is suitable for the nature of the agency’s requirement. No longer is the emphasis on defining one’s “minimum needs,” with its corollary selection process of choosing the lowest price technically acceptable proposal. While that approach will probably be the one most often used by grantees, agencies are now encouraged to structure selection procedures based on the realities of their requirements, and they are not expected to force-fit all acquisitions into a lowest-price-technically-acceptable-proposal mold when that may result in unacceptable performance risks or preclude the agency from selecting products that are a better value to them than the lowest price products or services.
   
   
2. When the agency decides that its requirements are sufficiently defined to use the lowest price technically acceptable selection process, the evaluation factors that establish the requirements of acceptability must be stated in the solicitation. Solicitations must specify that award will be made on the basis of the lowest evaluated price of proposals meeting or exceeding the acceptability standards for non-price factors.
   
   
3. When the agency decides that its requirements are not defined with sufficient precision, or where there are performance risks, so that selection of the lowest priced proposal is not in the best interests of the agency, then a tradeoff process should be used to select the best value proposal. In this case the importance of the non-price evaluation factors that will affect the contract award must be stated in the solicitation. The Federal approach in the solicitation is to state whether all evaluation factors other than price, when combined, are significantly more important than, approximately equal to, or significantly less important than price. This permits the agency to make tradeoffs between price and technical merit. It also permits the offerors to know what is important to the agency - whether to focus on higher quality at the expense of cost, or lower cost at the expense of quality. It is not necessary to publish the specific weights (numerically) of the individual evaluation factors, only their relative importance (i.e., conceptually or adjectivally). However, there is nothing that prohibits the disclosure of weights, and in some cases the disclosure of weights can aid offerors in the development of their approach. By disclosing weights, offerors can focus on those criteria which are truly important to the grantee.
   
   
4. It is important to note that the perceived benefits of the higher priced proposal must merit the additional cost, and the rationale for tradeoffs must be documented in the file. It is not sufficient to say in the file that company X received a higher total score than company Y, and therefore deserves the award. Scores, without substantive explanations of the relative strengths and weaknesses of the competitive proposals, including the perceived benefits to the agency, are an insufficient basis for paying a higher price. The file must explain why company X represents the best value to the agency. The necessity of documenting the specific reasons why proposal A offers a better value to the grantee than proposal B is why a mathematically driven selection decision is not appropriate.

Proposal Evaluation Mechanics

Proposal Evaluation Criteria

1. Past Performance - The solicitation should advise offerors of your approach in evaluating past performance, including evaluating offerors that have no relevant performance history, and should also advise offerors to identify past relevant contracts for efforts similar to your requirement. The solicitation should also allow offerors to provide information on problems encountered on the identified contracts and corrective measures taken. This evaluation should also consider the past performance of key personnel and subcontractors that will perform major or critical aspects of the work. This evaluation of past performance, as one indicator of an offeror’s ability to perform the contract successfully, is separate from the responsibility determination discussed in Section 5.1.
   
   
2. Technical Criteria - Technical factors regarding the specific methods, designs, and systems proposed to be used by the offeror will be considered and they must be tailored to the specific requirements of your solicitation. These factors must represent the key technical areas of importance that you intend to consider in the source selection decision. Technical factors should be chosen to support meaningful comparison and discrimination between competing proposals. If the agency has established minimum standards for determining technical acceptability of proposals, these standards must be clearly set forth in the solicitation.
   
   
3. Key Personnel - An evaluation of key personnel is often suggested when the procurement involves services or requirements where management of the work is a critical factor in determining its success. Qualifications and experience of key personnel may be an important evaluation factor. Some agencies have required oral presentations by key personnel during which the agency officials may ask these key personnel relevant questions to determine the depth of their knowledge in critical areas.
   
   
4. Cost or Price - Cost or price must be considered in every procurement, even those for professional services (e.g., legal, accounting, etc.), unless the services are those defined by Federal statutes as requiring a qualifications-based selection. 121 Competition normally establishes price reasonableness. Therefore, when contracting on a fixed price basis, comparison of the proposed prices will normally satisfy the requirement to perform a price analysis and no cost analysis will be necessary.
   
   If the contract Is to be a cost reimbursement one, then a cost realism analysis should be performed to determine what the grantee should realistically expect to pay for the proposed effort. Grantees should never simply accept at face value the total estimated cost in the proposal and base a selection decision on the proposed amount since many offerors tend to understate the estimated cost in hopes of winning the contract as the “low bidder.” A cost realism analysis would use each offeror’s specific labor and overhead rates as estimating factors (assuming they are not understated) and the agency’s own estimates for labor hours, travel, materials, etc. The award decision would be made with the cost realism analysis in mind.
   
   
5. Relative Importance of Price and Non-Price Factors - The solicitation must advise offerors if the selection is to be made on a “best value” basis. And as already noted, the solicitation must also advise offerors if price is approximately equal to, less than, or greater in importance than the technical evaluation factors as a whole.
   
   

Competitive range is a difficult concept to define in specific terms which would apply to all potential procurements, because professional judgment must be used in establishing the competitive range. Procedures and factors for determining the competitive range may differ from procurement to procurement.

The competitive range can be determined so that it is:

• Not used to unfairly eliminate offerors;
  
  
• Based on factors and criteria known to all offerors;
  
  
• Applied uniformly to all proposals; and
  
  
• Well documented in the procurement files.

One of your considerations may be that as many offerors as possible be given the opportunity to be considered within the competitive range, so as to attain the goal of full and free competition. Only those offerors whose proposals are determined to be so deficient or so out of line as to preclude meaningful negotiation need be eliminated from the competitive range.

The competitive range can consist of those offerors whose proposals have a reasonable chance of being selected for award, i.e., are acceptable as submitted or can be made acceptable through modification. All responsible offerors whose proposals are determined to be within the competitive range would be invited to participate in any oral and/or written discussions.

While it is not possible to identify all of the specific steps and analyses that could be performed in determining which proposals are within the competitive range, the following are provided for consideration in making this determination:

• The determination of which proposals are within the competitive range is usually made by the evaluation team (or procuring official, if there is no evaluation team).
  
  
• Competitive range determinations can be made using cost/price, technical and other factors identified in the solicitation.
  
  
• Detailed independent estimates prepared by the initiating department or project office can be considered when assessing the cost/price aspects of competitive range.
  
  
• The evaluation team's scoring of offerors' technical and management proposals is a logical basis for establishing which proposals are within the competitive range, as is scoring of other evaluation/award criteria specified in the solicitation. However, you may paint yourself into a corner if you commit to competitive range determinations based on predetermined "cutoff scores."
  
  
• Borderline proposals need not automatically be excluded from the competitive range, if they are reasonably susceptible of being made acceptable. Remember that as a general rule, if there is doubt as to whether a proposal should be in the competitive range, the goal of competition is served by including it.
  
  
• Only those proposals that are judged to be so deficient or so out of line as to preclude further meaningful negotiations need be eliminated from the competitive range.
  
  
• Competitive range determinations are significant documents in the procurement file. This documentation is helpful to serve as a basis for debriefing offerors, and for responding to inquiries and protests. Many systems notify, in writing, any offerors whose proposals have been eliminated from consideration for award. Such notification occurs at the earliest practicable time after this determination is made.
  
  
• Written and/or oral discussions are usually conducted with all offerors determined to be within the competitive range.
  
  
• At the conclusion of discussions with offerors in the competitive range, the procuring official may ask all offerors to submit their best and final offers in writing. This combines complete fairness for each offeror, with competitive incentive for each to make its best realistic offer. For a discussion on best and final offers, reference Section 4.5.5.2, "Request for Best and Final Offer."

Negotiation - A procedure that includes the receipt of proposals from offerors, permits bargaining and usually affords offerors an opportunity to revise their offers before award of a contract.

Discussion - Any oral or written communication between a procurement official and a potential offeror (other than communication conducted for the purpose of minor clarification) whether or not initiated by the procurement official, that (1) involves information essential for determining the acceptability of a proposal, or (2) provides the offeror an opportunity to revise or modify its proposal.

Clarification - A communication with an offeror for the sole purpose of eliminating minor irregularities, informalities, or apparent clerical mistakes in a proposal.

You may wish to obtain clarifications from one or more proposers, or hold discussions with all proposers immediately after receipt of proposals. However, it is also possible to proceed with evaluations and determination of a competitive range as described in the following sections, before discussions are held. Most typically, the first discussions are oral presentations made by a short list of proposers within a competitive range. If discussions are held with any proposer at any phase of the procurement, holding discussions with all remaining proposers (not already excluded from the competitive range as described in Section 4.5.3, "Competitive Range") will increase the likelihood and the appearance of the most accurate and objective evaluation and negotiation.

You are not required to conduct discussions with any offeror provided: (1) the solicitation did not commit in advance to discussions or notified all offerors that award might be made without discussion, and (2) the award is in fact made without any written or oral discussion with any proposer. Normally, however, you will need to conduct discussions. If this is the case, you will preserve the competitiveness and fairness of your procurement by conducting discussions with all offerors who submitted proposals in the competitive range. The competitive range is determined on the basis of cost or price and other factors and includes the proposals that have a reasonable chance of being selected for award. The content and extent of the discussions is a matter of your judgment based on the particular facts of the procurement.

Confidentiality has many advantages during the evaluation process. The name and number of proposals received is not normally considered a public record and need not usually be released to the competitors or the public at large. Your control of this information may ease the proposers' competitive tension and allow you to conduct more meaningful negotiations. Competitive information provided relative to both the technical and cost proposals may include trade secrets protected by statute and can usually be kept confidential during the evaluation process, and, in some instances, after the award of contract. However, state public information laws and the Federal Freedom of Information Act can also affect your latitude, particularly if there is public interest in the procurement and inquiries are made by non-competitors.

If you enter negotiations or discussions (as opposed to simple requests for clarification) with one offeror, an automatic impression of unfairness is avoided by entering them with all remaining offerors. An occasional mistake is to circumvent the process merely by requesting "clarifications" when you are in fact conducting discussions. If the questions, and the concurrent opportunity to respond, are sufficient to lead an offeror into areas of perceived deficiency in its proposal, discussions have been held. If discussions are held, what should the content be or how should they start? Competition and fairness are served by conducting meaningful discussions with offerors.

This includes advising them of deficiencies in their proposals and affording them the opportunity to satisfy the requirements by the submission of revised proposals. You are not, however, obligated to afford offerors all-encompassing discussions, or to discuss every element of a technically acceptable, competitive-range proposal that has received less than a maximum possible score. Also, if a proposal is technically unacceptable as submitted and would require major revisions to become acceptable, you are not required to include the proposal in the competitive range for discussion purposes.

Sometimes you may be in the uncomfortable position of having concluded discussions only to discover there is a significant mistake or an aspect the evaluators do not understand in one proposal. Since allowing one bidder to correct its proposal would constitute discussions with that firm, discussions must reopened with all bidders in the competitive range and the must be allowed the opportunity to submit revised proposals.

During discussions with offerors, you may be requested to ask all proposers to submit proposals with an advantageous approach proposed by one of them. Someone on your team may suggest that a technique used by proposer A would complement proposer B's approach well and could result in an advantageous offer from B. Also, after price proposals have been evaluated, someone may suggest that a proposer with a high technical score should be asked if it can meet a price which happens to be the price of a competitor. Such techniques are considered technical leveling, technical transfusion or auctioning The disadvantage of these techniques is that proposers may react adversely. Because they are concerned about their position relative to their competitors, and want to keep their strengths confidential from their competitors, they may become more secretive in their discussions with you if they sense you may relay their ideas, pricing, or positions to their competitors. This is not to discourage discussion of price or suggesting major revisions in a proposal, but rather to discourage the disclosure, even indirect, of one proposer's information to another. They may hold back their strengths and valuable information, waiting for a BAFO. This can greatly inhibit the negotiation of the most advantageous proposal.

The purpose of the request for revised proposals, like the original request for proposals, is to harness the competitiveness and creativity of the proposers to produce the most advantageous proposal for your customers. You and the proposer may understand only gradually each other's capabilities and constraints. Each written proposal may raise new questions and new possibilities. You can elicit the best improvement each time a revised proposal is prepared by listing clearly the deficiencies of the current proposal as you understand it.

Although you expect proposers to respond primarily to your requests in preparing revised offers, you also want to learn how your requests affect other aspects of their proposals. Based on the format of the proposals and the nature of the changes you are requesting, you may require that revised proposals be submitted in a form that will both easily allow you to identify the changes and also form the basis of a coherent contract, if accepted.

Private parties in bilateral negotiations would probably make counter-offers to each other to advance the process. There are disadvantages to your making a counter offer in a competitive proposal procurement. Not only would a counter-offer on your part extinguish the proposer's last offer, it would place the proposers (possibly more than one) in the position to accept or reject. Therefore counter-offers are usually not made by procuring agencies.

A best and final offer (BAFO) can be requested of each offeror in the competitive range at the conclusion of discussions (negotiations) with those offerors. If an offeror does not respond to your request, your procedures may allow you to consider the most recent offer to be the best and final offer.

During the course of the evaluation process of the competitive proposal procurement, you have entered into discussions (negotiations) and clarifications 124 with those offerors still in the competitive range. 125 As a result of those discussions, you may have amended some parts of the solicitation and may have asked for revised proposals during the negotiation process. You now feel that you have completed negotiations and are ready to ask for and then evaluate the offerors' best and final offers. If you believe there is a significant possibility that even if a BAFO is requested, you will probably want to improve further on the next offers, then you are not ready to request BAFOs and should, instead, request revised offers. This provides the offerors an opportunity to respond to the requests and to provide their best offer in response to the current solicitation.

The ability to enter into discussions with offerors in the competitive range is one of the greatest advantages of utilizing the competitive proposal method of procurement. This process allows offerors to resolve questions and concerns they may have about the commodity or service being procured and the public agency to resolve questions and concerns it may have about the offerors' proposals. At some point during the negotiation process, a decision is made that all out-standing issues have been resolved to the satisfaction of the parties involved. This is the time to formally conclude the discussions by requesting that each offeror remaining in the competitive range submit its best and final offer. The request normally would include the following elements:

• Specific notice that discussions are concluded;
  
  
• Notice that this is the opportunity for the offeror to submit a best and final offer;
  
  
• A definite, common cutoff date and time that allows a reasonable opportunity for the preparation and submission of the best and final offer; and
  
  
• Notice that the final offer must be received at the place designated by the time and date set in the request and is subject to any provisions dealing with late submissions, modifications and withdrawals of proposals set forth in the solicitation.

Following receipt of the best and final offers, you will evaluate them in accordance with terms of the solicitation and recommend award in accordance with those terms.

Request for subsequent best and final offers - It is the preferred practice to only ask for one "best and final offer." Requests for additional best and final offers should be avoided if at all possible. 126 However, additional technical or price/cost-related issues may surface as a result of the offeror's final submission or other factors that preclude a reasonable justification for contractor selection and award. If it is clearly in the procuring agency's best interests, discussions may be reopened and the issues resolved. Again, at the conclusion of the round of discussions, an additional request for best and final offers would be issued to all offerors still within the competitive range.

You may accept one of the initial proposals if it can be clearly demonstrated that acceptance of the most favorable initial proposal without discussion would result in a fair and reasonable price. Therefore, as a general matter, it is advantageous for solicitations to contain a notice that award may be made without discussion of proposals received, and that proposals should be submitted initially on the most favorable terms possible, from a price and technical standpoint.

You are not required to conduct discussions with any offeror provided: (1) the solicitation did not commit in advance to discussions or notify offerors that award might be made without discussion, and (2) the award is in fact made without any written or oral discussion with any proposer. This is often the case where the proposal is for services where rates are regulated and the competition is on the basis of service, e.g., certain types of insurance. If you accept an initial offer, the determination of fair and reasonable price will be an important document in your file. Normally, however, you will need to conduct discussions.

Firm offer - A promise to undertake specified obligations in exchange for consideration which promise may be accepted for a specified or implied period of time; a firm offer cannot be withdrawn during the period for which it remains firm.

Your solicitation normally states a date and time by which offers must be submitted, and a period following that date during which the offers remain firm. (See Section 4.3.2.3, "Solicitation") Competition is best served and unnecessary alternate proposals are avoided by allowing proposers to withdraw or modify their proposals up to the time due. However, after the due date, the proposals are usually firm and cannot be withdrawn during the validity period. To ensure the legitimacy of proposals and discourage frivolous proposals, you should have the right to accept an initial proposal without regard to whether the proposer has had second thoughts.

As in the case of sealed bids, it is important to the integrity of your procurement that all offers are serious and not submitted for exploratory reasons or to cast a certain light on other offers. Although the negotiation process, in contrast to sealed bidding, reduces the incentive to this sort of gamesmanship, the concern is still valid, particularly where you may wish to accept an initial offer. It will be important to proceed from offer to offer, eliminating offerors from the competitive range on a firm basis, to ensure that you arrive smoothly at a conclusion. It is customary, therefore, not permit proposals to be withdrawn after submission.

The terms of your solicitation and your requests for revised offers or BAFOs can state a period during which the offers remain firm. (See Section 4.3.2.3, "Solicitation") A good practice is to note this period on the offer form used by proposers to summarize their proposals.

Solicitations also often state that modifications or withdrawals will be permitted until the time due. In the case of a revised offer or BAFO, your solicitation can provide that the withdrawal of the offer would result in the continued validity of the most recent offer.

Your decision not to include a proposer in the competitive range or to recommend award to another proposer may have to be explained to the public and to the offeror. 129 If the reasons and rationale are documented, you can proceed with confidence. Here, the advantages of an objective, quantified scoring process 130 implemented by a qualified committee become obvious; even if you choose not to reveal the details of the scoring, you will be more convincing when speaking with the support of a wealth of independent, objective data. In some cases, the details of the scoring may be subject to disclosure as public information after the contract is awarded.

By notifying the disappointed firm expeditiously, you will not permit doubts to grow, you can approach the firm on the basis of openness and candor, and you will share the common perspective of the events to date of your decision, rather than any subsequent developments which may cast a different light. Be prepared to discuss the reasons with the offeror. This may be a good opportunity to educate a firm or individual on the competitive proposal process. Avoid comparisons to the successful offeror. Focus on the strengths and weaknesses of the offer itself -- be specific. If done properly and professionally, you may see this "smarter" proposer again in a future procurement. This is your ultimate goal, to maximize competition.

On the other hand, unless your procedures require you to notify the disappointed proposer immediately, you may be able to wait to inform the firm until contract award is made to the successful proposer. Particularly if you have reason to believe a firm is inclined to dispute or delay the action, you may be able to proceed unilaterally without encouraging any delaying tactics. To maximize the likelihood of award without delay, this alternative school of thought faces a number of problems. The disappointed firm may be suspicious because you have not contacted him/her about any further discussions, or may otherwise learn that its offer is not being considered for award. If you wait until award is made (which is a public action), the proposer will be left with only two choices, to do nothing or to file legal action. If the firm chooses the first course of action, he/she may be reluctant to propose on your jobs again because they may believe "games" were played. If the proposer chooses the second course of action, to file either a protest or a lawsuit, this may result in a delay in the commencement of contract performance and substantial other costs to your agency.

Click here to return to the top of the document

Public procurement essentially operates in an environment where full and open competition is the primary goal or aspiration and, in many cases, is a mandate. 131 However, there may be very legitimate reasons or situations when, as opposed to "full and open" competition, limited or no competition exists The FTA, through the requirements set forth above, has established guidelines when sole source procurements may be used if FTA funds are involved.

Even though we will address federal requirements in this section, you should also be aware of any limitations or restrictions that your state law or agency regulations may place on you.

Because procurement by sole source is a noncompetitive procurement, it is treated as an "exception-to-the-norm" in public procurements and, as a result, your ability to use it requires justification and, frequently, pre-approval before you award a sole source contract. In this context, "justification" equates to paperwork and documentation, the bane of all procurement professionals but a necessary part of our genetic make-up.

As quoted above, FTA Circular 4220.1E establishes a matrix that should be followed in justifying the use of noncompetitive or sole source procurements.

Step One - You must first determine that your requirement cannot be obtained under small purchase procedures, 132 sealed bids, 133 or competitive proposals. 134 Does more than one source exist? Does adequate time exist to obtain your requirement through a competitive process? Is Item B (for which competition exists) an acceptable substitute for Item C (for which there is only one source)?

• Stated another way, contracting officers should take reasonable steps to avoid using sole source procurement except in circumstances where it is both necessary and in the best interest of the agency.
  
  
• If one of the three methods can be used (or is feasible), even if you would rather not, sole source is not an option for you.

Step Two - If one of the competitive processes is not feasible in your situation, you may use sole source procurement if at least one of the following circumstances is present:

• The item is available only from a single source - In justifying the use of this circumstance, you will frequently address such factors as:

• The public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation- Two factors: public exigency or emergency and no time to competitively procure!
  
  
• When your agency's need for the supplies or services is of such an unusual or compelling urgency that the agency would be seriously injured unless sole source procurements were utilized, it can be justified.
  
  
• In an emergency situation, it is not unusual for health and safety issues to be a factor in the decision to proceed with a sole source.
  
  
• If the agency itself is responsible for being short of time -- i.e., lack of advance planning, delays in procurement administration due to shortage of procurement personnel or incompetence of procurement personnel, money in the budget balance expires the end of next month, particular caution should be exercised in making a determination regarding whether the emergent consequences of delay warrant noncompetitive negotiation and to what extent the agency contributed; an independent opinion may be warranted.
  
  
• If the emergency is to repair a hole in the roof of your maintenance facility where a tree limb fell through it because of the storm last night, is the sole source procurement a patch job or a replacement of the roof because it was getting old anyway? One school of thought is that you should only perform the minimal work necessary to alleviate the exigency or the emergency. Don't use it as an excuse to do remedial work or buy a year's supply of something you intended to do competitively next month anyway.
  
  
• While many state laws parallel the other conditions under which Federal funds may be used for non-competitive proposals, state laws for emergency situations are often more restrictive. Furthermore, the most critical delay in an emergency may be obtaining your agency's authority, e.g. at a monthly board meeting; inquire about (and recommend changes to, if appropriate) your Board's policy for emergency procurements.
  
  
• FTA authorizes noncompetitive negotiations - You may have a situation you feel warrants the utilization of sole source procurements but it doesn't quite fit into one of the other circumstances. You are a small transit property with a vehicle monitoring system you installed last year. The accuracy and utility of the system is exceeding all expectations and you now need to display the schedule adherence information in three new downtown transfer locations. Could you go sole source to Brand X? If you justify why (compatibility requirements, interfaces with proprietary software, unavailability of interested competition,, etc.), this may be the sort of procurement you should discuss with the FTA and request its permission to use sole source.
  
  
• After solicitation of a number of sources, competition is determined inadequate - You have issued an IFB and only received one bid from a responsible contractor, but you cannot determine its price to be reasonable. If you are satisfied about the bidding environment and the reasons why you only received one bid, you can negotiate a sole source contract to arrive at a reasonably priced contract.
  
  
• The item is an associated capital maintenance item as defined in 49 U.S.C. Section 5307(a)(1) that is procured directly from the original manufacturer or supplier of the item to be replaced. - This topic is discussed in greater detail in Section 4.6.3, "Associated Capital Maintenance Item."

Step Three - DOCUMENTATION of justification. It is recommended that you document very thoroughly and carefully the rationale you went through to justify your sole source procurement. Your agency may have very specific requirements for "Findings and Determinations" that must be followed. You may have pre-approval requirements at a certain dollar threshold that must be met -- your Board of Directors may require its approval of any proposed sole source procurement in excess of $250,000 prior to the commencement of the negotiations. You may have other documentation requirements peculiar to your agency, state, or local government that you must meet prior to the initiation of negotiations which must be met.

Single Offer after Competitive Solicitation - As previously discussed in Section 4.4.3, "Single Bid," you may conclude after receiving only a single bid that competition is inadequate and that you should negotiate with the single bidder to establish a fair and reasonable price. You may be in this situation because you only received one bid or proposal from one source or you have determined that the competition you received was otherwise "inadequate." To proceed in this case, you must meet the requirements for noncompetitive negotiation. However, you do not need to issue a new solicitation because your requirement is adequately stated. You may, after meeting the requirements of the previous section, proceed to negotiate a reasonably priced contract using the negotiation procedures discussed in Sections 4.5.2, "Evaluation of Proposals," through 4.5.8, "Debriefing Unsuccessful Offerors."

All Other Cases - In other circumstances you have justified, it is recommended that you request a proposal from the source. There is no need to advertise - there will be no competition! Your request for a proposal can be as formal as you want -- from letter requests up to a full blown solicitation document. Regardless of the form used, you want to:

• refer to, or attach, all terms and conditions of the solicitation. You still need to comply with federal representation and certification requirements. You still will want to have special and general provisions. You may have additional agency requirements that must be met. What is the DBE goal for this procurement -- how will it be met?
  
  
• refer to, or attach, the specifications or statement of work for the supply or service being procured.
  
  
• request the applicable cost or pricing data. 135

Allow adequate time for the contractor to prepare its proposal prior to submission back to you.

Review the proposal with impacted internal agency staff -- really prepare for your negotiations with this sole source.

Negotiate the final terms and conditions of the contract using the negotiation procedures you would use in your competitive proposal method of procurement. 136 These negotiations can be more pointed and open because there is no competitive environment involved -- the integrity of a procurement process is not involved so issues like "technical leveling" and "transfusion" do not have to be considered.

As discussed in Section 5.2, "Cost and Price Analysis," {and as required by FTA Circular 4220.1E Section 9.h.(2)}, a cost analysis is required. This includes verifying the proposed cost data, the projections of the data, and the evaluation of specific elements of costs and profit.

Associated capital maintenance item - Equipment, tires, tubes, or material, each costing at least 0.5 percent of the current fair market value of rolling stock comparable to the rolling stock for which the equipment, tires, tubes, and material are to be used. 138

In order to "qualify" to use this circumstance to justify sole source, the FTA has established the following requirements:

• The item must be an associated capital maintenance item as defined above.
  
  
• The item must be procured directly from the original manufacturer or supplier of the item to be replaced.
  
  
• Prior to execution of the contract, you must first certify in writing to the FTA that such manufacturer or supplier is the only source for such item, and that the price of such item is no higher than the price paid for such item by like customers.

Approval of the FTA is not required -- just certification of the grantee (you).

When you read these requirements carefully, you are still essentially justifying a sole source {as in FTA Circular 4220.1E Section 9.h.(1)(a)} and certifying that fact to the FTA. Also, even though you are certifying that the price of the item is no higher than the price paid for such item by like customers, you are still required to perform a cost analysis as part of the contract negotiation and award process.

Click here to return to the top of the document

4.6.4 Unsolicited Proposals

FTA Circular 4220.1E permits a great number of procedures that vary from the classic procedures discussed in most of this Manual. For example, a variation that has long-been recognized in public procurement is referred to as the two-step, sealed bidding method of procurement. While it has some characteristics of both sealed bidding and competitive proposals, it complies with all FTA Circular 4220.1E requirements for the competitive proposal process. This process allows, in the first phase, for the submission of unpriced technical proposals in response to the request. In the second phase, only those firms that have been found to be technically qualified in the first phase are invited to submit sealed bids, as though it were a regular sealed bid procurement. Award is then made to the lowest, responsive and responsible bidder.

Two-step bidding is a two phase process generally consisting of a technical first phase composed of one or more steps in which bidders submit unpriced technical proposals (and discussions are held with offerors of those proposals, if necessary) to be evaluated by the transit property, and a second phase in which those bidders whose technical offers are determined to be acceptable during the first phase have their priced bids considered.

The process is designed to:

• Obtain the benefit of sealed bidding by award of a contract to the lowest responsive, responsible bidder, and, at the same time,
  
  
• Obtain the benefit of the competitive proposal method of procurement through the solicitation of technical offers and conducting discussions to determine the acceptability of the technical offers.

The process may be recognized by your state law as a separate method of procurement or may be allowed as a variation of a sealed bidding statute, particularly in those states where limitations on the use of the competitive proposal method exists.

Conditions for Use

Transit properties generally follow one of two stated policies. Either this method may be used when it is not considered practical to initially prepare a definitive purchase or contract description which is suitable to permit an award based on price. Or alternatively, in the absence of factors or laws that require the use of sealed bidding, some authorities 139 establish a preference of the two-stepped process over negotiations when all of the following conditions are present:

• Available specifications are not definite or complete or may be too restrictive without technical evaluation (and any necessary discussion), of the technical aspects of the requirement to ensure mutual understanding between each source and the Authority;
  
  
• Definite criteria exist for evaluating technical proposals;
  
  
• More than one technically-qualified source is expected to be available;
  
  
• Sufficient time will be available for use of the two-step method; and
  
  
• A firm-fixed-price contract or a fixed-price contract with economic price adjustment will be used.

This process normally includes the following steps:

Solicitation phase - In addition to the normal requirements for an IFB, 140 the first phase solicitation also generally provides:

• That unpriced technical offers are requested; 141
  
  
• That the procurement is a two-step sealed bid procurement and that priced bids will be considered in the second phase and only from those bidders whose unpriced technical offers are found to be acceptable in the first phase;
  
  
• The criteria to be used in evaluating the unpriced technical offers;
  
  
• That the Authority, to the extent determined to be necessary, may conduct oral or written discussions regarding the technical offers;
  
  
• A statement that bidders should submit proposals that are acceptable without additional explanation or information and that the Authority may make a final determination regarding the acceptability of the proposals based solely on the basis of the proposals as submitted and may proceed with the second step without requesting further information from any bidder;
  
  
• That bidders may designate those portions of the technical offers which contain trade secrets or other proprietary data which are to remain confidential; and
  
  
• That the item being procured shall be furnished generally in accordance with the bidder's technical offer as found to be technically acceptable and shall meet the requirements of the solicitation.

Amendments to solicitation in two-step process:

• Amendments issued prior to the receipt of technical offers are important to all prospective bidders as in a "normal" IFB. 142
  
  
• Amendments issued after receipt of the technical offers need be submitted only to those bidders who submitted unpriced technical offers and they should be allowed to submit new technical offers or amend those previously submitted. 143

Receipt of unpriced technical offers. Unless required by law, unpriced technical offers need not be publicly opened.

• Offers are typically opened in front of two or more authority employees as witnesses.
  
  
• Offers are usually not disclosed to unauthorized persons.

Evaluation of unpriced technical offers should be in accordance with the criteria set forth in the solicitation. The unpriced technical offers should be categorized as

• Acceptable;
  
  
• Potentially acceptable (i.e., reasonably susceptible of being made acceptable); or
  
  
• Unacceptable, in which case the contracting officer records in writing the basis for this finding and makes it part of the procurement file. 144
  
  
• Any proposal which modifies or fails to conform to the essential requirements or specifications of the solicitation can be considered nonresponsive and categorized as unacceptable.
  
  
• When an unpriced technical offer has been determined to be unacceptable, the bidder may be notified of that fact and is not normally afforded additional opportunities to submit supplemental information amending its technical offer.

• Discussions can be conducted in accordance with the principles discussed in Section 4.5.4 involving the competitive proposal method of procurement.
  
  
• Once discussions have commenced, any offeror who has not been notified that its offer has been found unacceptable may submit supplemental information amending its technical offer at any time until the closing date established.
  
  
• Such submission may be made at the request of the Contracting Officer, or upon the offeror's own initiative.

Phase Two of the process may be initiated without discussions if there are a sufficient number of acceptable proposals to ensure adequate price competition under Phase Two. Based upon the results of Phase 1, you may wish to revise the technical specifications (minimum technical requirements) in your Phase 2 IFB, in a manner that does not conflict with the final unpriced proposals. While you have no assurance that the prices will be close to each other, you know to what degree the proposals have competitive technical merit.

The procedures discussed in Section 4.4, "Sealed Bids," can be followed in Phase Two. Each bidder who submitted an unpriced offer that was determined to be acceptable in Phase One is invited to submit a priced offer. The IFB states that the bidder shall comply with the specifications and the offeror's acceptable technical proposal. No additional public notice or advertisement of the IFB need be given because such notice was given during the Phase One Process.

Award would be made to the lowest, responsive responsible offeror as discussed in Section 4.4, "Sealed Bids."

The Federal Supply Schedule program has provided Federal agencies with a simplified process of acquiring commonly used supplies and services in varying quantities at lower prices while obtaining discounts associated with volume buying. Congress, in enacting Section 1555 of the Federal Acquisition Streamlining Act of 1994 (Public Law 103-455), 145 extended the cooperative purchasing provisions of GSA enabling legislation:

However, Section 4309 of the National Defense Authorization Act for Fiscal Year 1996 146 suspended the authority of the Administrator of the General Services to allow state and local governments to use the federal supply schedules. The provision suspended the authority until the later of the period ending 18 months after the date of enactment of this Act or the period ending 30 days after the date after the Administrator has reviewed a General Accounting Office report that assesses the effects of state and local governments use of the federal supply schedules and has submitted the report and comments on the report to Congress. The Act also directed the General Accounting Office to include in its report to the Administrator an assessment of the impact on costs to federal agencies from the use of federal supply schedules by state and local governments.

In light of this recent legislation, what is the status of state and local government (including most transit properties theoretically) being able to use the GSA federal supply schedules? It is understood that at least one transit property (Washington Metropolitan Area Transit Authority) has at least limited authority from the GSA to utilize the federal supply schedules. However, we are not aware of other Authorities being able to utilize those Schedules. With this legislation, we must await at least until August 1997 (18 months from the date of enactment of the Defense Authorization Act of 1996) before we know what the GSA and GAO reports to Congress will say and it could be longer than that if the required reports are later than then. This does not appear to be a source that we should expect to be able to use anytime soon.

At such time as this matter is clarified, the FTA, through this Manual, will provide instruction and guidance to its grantees

One of the challenges of a transit authority's procurement office is to try to be more responsive to its customers from timeliness and cost-efficient perspectives. It is almost inevitable that someone will take months trying to decide what is required and then is perplexed that the procurement staff cannot procure it "yesterday!" We devoted an extensive discussion in Chapter 2 on the importance of planning in the procurement process and the need for cooperative efforts among the different staff elements of the Authority.

One of the ways that Federal and State governments (to a greater extent) and local governments (to a much lesser extent) have tried to address the timeliness issue is through the use of "schedule" contracts that can be mandated for use on a government-wide basis. If an entity at the state-wide level has a contract that consolidates all requirements for sedans and buys those off a schedule contract, all public purchasers theoretically benefit from this larger quantity buy and do not have to go through a procurement process to obtain those benefits.

Ascertain if your State has a schedule program. It may be for standard commodities such as office supplies and equipment including vehicles of all sorts and sizes as well as computer equipment on either a lease or purchase basis.

Ascertain if your authority is eligible to participate in the program and, if so, how.

• Is an intergovernmental agreement required before you can participate?
  
  
• Is the order issued with the State agency or the contractor?
  
  
• Do you have any flexibility to make minor changes to the item being bought?
  
  
• How is the order funded?

These questions, and obviously many others, all must be worked out with the "parent" agency. It may be difficult to track all of this information down the first time, but after you go through the process once, it will be much easier with each successive procurement you process through these centralized contracts. You will then be able to gauge the savings in time and money that may accrue to your agency by using these contracts.

The same questions can be addressed at the local level. A program might exist at a city, county, parish, school district or any other public special districts. One of the most effective ways to participate in cooperative purchases at the local level is through some sort of inter-local cooperative purchasing agreement. To be able to do this may require special legislative authority, but most States have some sort of Intergovernmental 147 and/or Inter-local 148 Cooperation Act. These statutes usually define not only what can be the subject of agreements consummated pursuant to their provisions, but also define who can participate and under what conditions.

Never underestimate the buying power (in terms of quantity you) bring to the local public government buying community, particularly in such areas as diesel, vehicle parts, office supplies and vehicles.

There is some real public relations benefit for your agency by being actively involved in the local government buying community in helping all public bodies get "more bang for the buck" through volume buying of similarly-used commodities

There really is no easy answer! The problem most agencies face with this requirement is not the competitive methods utilized by the State (or local) governmental entity in establishing these contracts -- most States have a small purchase procedures, sealed bidding and sealed proposal methods of procurement that in all likelihood comply with the federal standards set forth in FTA Circular 4220.1E and discussed earlier in Section 4.3.1. Most States similarly buy architect and engineering services in a procedure similar to the federal requirements of the Brooks Act and as discussed in FTA Circular 4220.1E paragraph 9.e and in Section 6.5 "Architect-Engineering Services."

The problem most of us face is squaring State laws or regulations that differ substantively with the FTA requirements of FTA Circular 4220.1E.

• How do we reconcile the requirements of 49 CFR Part 23 dealing with the DBE program with a State contract that does not meet those requirements? If your State has a program that credibly meets the 10% minimum goal contemplated, perhaps you could get a waiver from the FTA and participate in that State program. The problem in many States is that the certification requirements at the State and local level are not as extensive and exhaustive as the requirements imposed upon transit properties by Part 23. Again, because of these differences, you may not be able to participate. Even if your procurement is not suitable for a DBE goal, there is a DBE affirmative action requirement that the State may not meet.
  
  
• Recent changes in the applicability of the Buy America provisions of 49 CFR Part 661 (and discussed in Section 4.3.3.2.2, "Buy America Certification") make compliance with those requirements less of an issue now than it used to be because of the $100,000 threshold. However, for procurements in excess of that amount, you will probably have problems participating because of the certification requirements imposed by Part 661.
  
  
• The current $2,000 threshold of the Davis-Bacon Act may preclude you from participating in any State construction contract because, in all likelihood, any wage rate requirement of the State is going to be a State law issue, not the Davis-Bacon Act.

The list could go on. Under current federal statutory and regulatory guidance and requirements, some of the conflicts between those requirements and the procurement procedures and practices of your State are irreconcilable. Unless the state or local agency is willing to include the FTA requirements in its solicitations and contracts, you may be effectively precluded from participating in those intergovernmental or inter-local procurements. Some relief could come in the future as the FTA continues to examine its policy relative to the applicability of FTA Circular 4220.1E to all procurements if the grantee accepts operating assistance. 150

Federal Government Experience - A number of Federal agencies are now using reverse auctions. The Federal Government began to use this technique with the re-write of the FAR Part 15 in 1997. FAR 1.102.4(e) now states that if a practice is not expressly addressed or prohibited by statute or regulation, Government employees should feel free to innovate and use sound business judgment in making procurement decisions. With respect to auctions, FAR 15.306(e)(3) requires bidders to agree to disclose their prices prior to their participation in an auction event. Based on the FAR, government procurement personnel may use reverse auctions as long as the vendors agree to participate. (Grantees are not required to follow the FAR, and this information on Federal procedures is provided for information purposes).

Navy Department - The Navy Department’s first auction was for aircraft ejection seat mechanisms. This auction lasted 51 minutes, with three bidders, and Navy estimates it saved over 28% off the historical price for these mechanisms. Navy has conducted over fifteen additional reverse auctions since the first in May 2000, for supplies as well as services, using both price and best value as evaluation criteria. Following are some of the "lessons learned" by the Navy Department, as published at their web site: 151

• The reverse auction technique may not drastically change or streamline the procurement process.
  
  
• It is a highly effective pricing tool.
  
  
• Prior to opening the auction, all participating vendors should log on and verify their connection to the system.
  
  
• A set period of time for the reverse auction should be established based on the number of participants and the complexity of the acquisition.
  
  
• The time established for the auction needs to be flexible in case there is an offer at closing time. For example, if a bid is received within one minute of the closing time for the auction, the auction period should be extended for an additional number of minutes to allow bidders to respond to the last bid.

Marine Corps - The U.S. Marine Corps has also published their experiences with reverse auctions. The Marine Corps took concerted efforts to build a database of vendors for various product types and to include more vendors, train them on the reverse auction tool, and get them to participate in their first auction. The result was significantly increased competition. The average auction has lasted 30 minutes with award made directly thereafter. The average savings for the eight auctions thus far have been 25% from the estimated values based on historical and retail prices. The Marine Corps reports that vendors actually prefer this process to the sealed bid process. The Marine Corps Regional Contracting Office Southwest (RCO SW) received the Department of the Navy Competition Excellence Award for the implementation of this innovative practice.

Army - The Army is using reverse auctions for best value types of procurements. Following is an excerpt from the Army procurement procedures guide as reproduced in the DOD Defense Acquisition Deskbook:

Air Force - The Air Force Contracting Policy Memo on Reverse Auctions (February 19, 2001) was issued after research on how reverse auctions are being used in private industry, and the memo provides a number of "lessons learned." Among these were:

• Reverse auctions are being used by industry more for "best value" acquisitions than for lowest price acquisitions. (The Sun Microsystems’ case discussed below under "Private Industry Experience" illustrates this.)
  
  
• Suppliers are normally pre-qualified, including past performance, and then a reverse auction is used for the submission of competitive prices.
  
  
• A responsibility determination is performed on the apparent successful bidder.

The Air Force procured a motorized security gate for one of its facilities and requested technical proposals first. Those firms submitting acceptable technical proposals then submitted prices online through a reverse auction. The apparent low bidder was then required to submit a cost proposal for evaluation. Finding the proposal satisfactory, a contract was awarded. Air Force was pleased with the results of the process.

Treasury Department – The U. S. Treasury Department (IRS) conducted, in May 2001, its first auction and one of the largest Federal auctions to date: $131 million for PCs, laptops and monitors. Treasury estimates it saved about $68 million in a very successful auction. An example of the savings achieved was the reduction in the unit price of a top-end desktop computer from a pre-auction price of $1,434 to $625 (a savings of 56 percent). There were three distributors that submitted bids, representing IBM, Gateway and Dell. The IRS requirements were solicited on a best value basis. 153

Treasury has also had success with small buys. Many of those buys were below $25,000 and several were below $1,000. More than $300,000 in purchases have been made in 2002, with some impressive results. Customs saved 43 percent on the purchase of a shredder and the Financial Crimes Enforcement Network saved 87 percent on two 265-megabyte memory kits. Vendor interest has been great. For example, the Bureau of Public Debt has been averaging 72 bids per auction. In all, close to 2,000 bids have been received from over 330 firms. Another noteworthy achievement is that the Bureau of Public Debt, the ATF and Customs have awarded 100 percent of their auction results to small businesses. 154

General Services Administration (GSA) – GSA maintains a reverse auction web site for Federal agencies. On July 25, 2002 the GSA Federal Technology Service awarded a number of contracts for reverse auction services to various companies ("enablers") that provide services ranging from conducting the complete auction ("Hosted Services") to providing enabling software so that the user agency can conduct its own auctions ("Desktop Services"). The enablers that received GSA contracts are listed on the web site. 155

GSA conducted a reverse auction pilot program from May 2000 to May 2001. GSA reports that various government agencies participating in the pilot program realized savings of 12% - 48% through the reverse auction process. For example, the Defense Financing and Accounting Service paid 22 percent, or $2.1 million less, than normal prices for desktop computers, laptops and printers. The National Institutes of Health (NIH) paid 25 percent, or $395,000, less than normal prices for utility wipes, a type of cleaning supplies. The Coast Guard paid 22 percent, or $300,000, less than normal prices for spare parts for HU-25 Falcon jets.

The Deputy Assistant Commissioner for Service Development, GSA Federal Technology Service, Mr. Manny DeVera, is credited with developing "Ten Commandments for Reverse Auctions:"

1. Link reverse auction strategy to acquisition strategy. When developing the acquisition strategy ask, "Could reverse auctioning apply to this requirement?"
   
   
2. Follow the Federal Acquisition Regulation. These guiding principles still apply. 156
   
   
3. Choose a solid performing enabler. (Enablers are firms that perform reverse auctions.) With the troubles currently being experienced in the digital economy, a few enablers may not be around in the future and could present risks.
   
   
4. Educate suppliers in advance of conducting a reverse auction. Full service enablers provide this service in their fees.
   
   
5. Be prepared for publicity and use it to your advantage. Publicity happens because reverse auctions are relatively new and the media, trade associations, senior government officials and others are all carefully watching the government’s entry into this new way of doing business. Enablers are also aggressively publicizing their activities.
   
   
6. Begin with simple requirements and move gradually to more complex ones. The more experience an organization has with conducting auctions, the more complex requirements they can put out for bid.
   
   
7. Establish the rules of the reverse auction up front. Some examples of these rules are the bid increments to be used, time extensions, logistics and other considerations.
   
   
8. Conduct a mock auction. The adage "practice makes perfect" is very appropriate here.
   
   
9. Consider conducting an auction where bidders bid to provide a quantity of a commodity, as opposed to price based bidding. For example, reverse auctions are being conducted where the buyer has a set amount they want to spend, say $1 million for PCs, and is not focused on the unit cost. In these auctions, bidders base their bids on the number of PCs that they will provide for the $1 million.
   
   
10. The Contracting Officer is in control of the reverse auction event at all times.

Private Industry Experience – The private industry sector has been using reverse auctions since the mid-1990’s. A recent white paper presented data indicating that 20 percent of all private industry firms may be using on-line auctions (real-time bidding) to procure a portion of their goods and services. 158

A current magazine article discusses the experience of one major private industry player in the reverse auction arena – Sun Microsystems. Sun implemented its Dynamic Bidding program in May 2000 with a goal of 20 percent reduction of their targeted budget, and they achieved this in their first pilot auction. It has since been used for more than 100 procurements and covers all the commodities Sun buys. One of the important facets of the Sun method is that the company uses a "best value" approach to source selection with their price auctions. Sun believes its supplier relationships are strategic and it will not switch to an untested company simply to get a lower price. Past performance in areas such as quality, manufacturing flexibility, facility location and engineering support are also considered in the final decision. Sun emphasizes that the reverse auction approach does not replace the strategic relationship between companies. Prices bid are only one factor in the final selection decision process, but the auctions mean that less time is spent on negotiating the price, terms and conditions than was previously the case. "The end result is that it takes Sun an hour to find the true market price, eliminating weeks or even months of negotiating back and forth. It has also resulted in significant bottom-line savings for Sun. They used this process on $1 billion of their direct spend in fiscal year 2001, and have raised the goal for this fiscal year." 159

A recent article in an E-business publication suggested a number of areas that might be good candidates for reverse auctions. 160 The author’s recommendations for reverse auctions include:

• Strategic Relationship is Less Important
  The author believes it is difficult to build cooperative relationships with suppliers through an auction process and thus auctions are more suitable for purchases of off-the-shelf, near-commodity direct materials.
  
  
• Price is Main Decision Factor
  Auctions work best for categories where the main discriminator between suppliers is price.
  
  
• Many Qualified Suppliers
  Auctions need adequate competition to succeed. Where there is limited competition because of a scarcity of suppliers, a commitment of supply is more important than any incremental price savings that could be achieved through an auction.
  
  
• Low to Medium Strategic Importance
  The most strategic categories should not be subject to a stand-alone auction. This would include components critical to the company’s end product. In these cases the auction, if conducted, should be combined with some sort of face-to-face discussions with key suppliers.
  
  
• Purchases Can Be "Lotted"
  It may be cumbersome to run individual auctions for each of many line items. Line items can be bundled into "lots" and suppliers will be required to bid on all the parts in that lot or none. This concept of "lotting" works well with office products.
  
  
• Benchmarks
  When a company is satisfied with a current supplier but feels a need to test the market to ensure they are receiving a competitive price, they may do this through an auction. Potential suppliers can be required to respond to an RFP in order to qualify for the auction. The key is to adequately document one’s service, delivery, payment terms and other "non price" requirements up-front to ensure that suppliers are bidding on an apples-to-apples basis.

Transit Agency Experience – Transit Agency experience with reverse auctions has been extremely limited in comparison to both the private sector and the Federal government. The Los Angeles County Metropolitan Transit Authority (LACMTA) has used this process successfully on a limited basis but does not feel it has significant potential for their needs. 161 LACMTA believes it can work well for common materials but may be inconsistent with good long-term partnership relationships with suppliers. For example, where there is a need for technical support or for quick reaction time in order to meet critical agency needs, the auction process does not lend itself to the kind of agency/supplier relationships that are required for long-term mission success. But LACMTA believes that if price is the only consideration, and supplier partnerships for the commodity also is not a consideration, then reverse auctioning can work well.

The Southeastern Pennsylvania Transportation Authority (SEPTA) conducted a pilot program to test the process on a procurement of fluorescent tubes and they were successful. But they also do not feel that their agency will adopt this technique to any significant degree. One of the lessons learned by SEPTA is the criticality and difficulty of informing potential bidders of the auction and getting them prepared to bid. 162

The Houston Metropolitan Transit Authority (MTA) is considering the use of a reverse auction for furniture. 163

1 - See Section 1.3.2 "Federal Contractual Sphere."

2 - United States v. John C. Grimberg Co., 702 F.2d 1362, 1367 (Fed Cir. 1983) (in banc).

3- See Chapter 6 for a discussion of the procurement methods commonly used for each object of procurement.

4 - FTA Circular 4220.1E Section 7.f.

5 - 49 CFR Section 661.7, Appendix A to Section 661.7, subparagraph (e).

6 - As a practical matter, you may wish to adopt the statutory threshold for the Davis Bacon Act of $2,000 as the micro-purchase threshold for construction services. This is what has been done with the Federal Acquisition Regulation -- See FAR Section 13.601(a) which defines micro-purchases for construction as being limited to $2,000. However, if you have a requirement for $2,300 of construction, you no longer need competitive quotations, but you still need Davis Bacon wage rate submissions and compliance.

7 - FTA Circular 4220.1E Section 8.c.

8 - You must not split a procurement that would be in excess of $2,500 (three widgets worth $1,500 apiece for a total of $4,500) into smaller purchases (three sequential purchases of $1,500) in order to use this method of procurement.

9 - Although it is written for the more detailed "price analysis" required in competitive procurements, FAR Section 15.805 discusses price analysis techniques that may be used or adapted to support your determinations for these micro-purchases.

10 - FAR Section 13.106(a)(3).

11 - These changes were published as part of Federal Acquisition Circular 90-40 in Volume 61 of the Federal Register on pages 39189 through 39199 (61 Fed. Reg. 39189-39199 (July 26, 1996)).

12 - FAR Section 13.103(e).

13 - FAR Section 13.106(a)(3)(i) and 1.603-3(b). See also Section 2.1.2, "Autonomy" regarding decentralization, generally.

14 - FAR Section 13.106(b).

15 - GAO/NSIAD-96-138 (8/6/96). GAO Reports are available on the Internet at the Government Printing Office.

16 - For further information, contact Ms. Sandra Kuykendall at skuykendall@islandtransit.org

17 - See FTA Circular 4220.1E Section 9.e -- "Grantees shall use [the Brooks Act] for contracting for A&E services. . . (emphasis supplied)" See Section 6.5 "Architect-Engineering Services" for a complete discussion.

18 - See Section 6.5 "Architect-Engineering Services."

19 - See discussion of these requirements in Section 8.1.2, "Davis Bacon Act."

20 - A "delivery order" as opposed to a purchase order, is issued typically under the terms of a requirements type contract that has been competitively procured under formal procedures. The delivery order is simply an ordering mechanism under that contract and is not an independent contract like a purchase order.

21 - FTA Circular 4220.1E Section 9.

22 - FTA Circular 4220.1E Section 9.c.(1).

23 - FTA Circular 4220.1E Section 9.c.(3).

24 - See Section 4.4, "Sealed Bids," and FTA Circular 4220.1E Section 9.c.(2)

25 - See Section 4.5, "Competitive Proposals," and FTA Circular 4220.1E Section 9.d.

26 - See Chapter 3, "Specifications," for a discussion of these and other specification issues.

27 - The Brooks Act procedures, required for Architectural and Engineering services and described in Section 6.5, go one step further by prohibiting price competition and requiring selection based solely on technical criteria.

28 - In 1990, the FTA published Procurement Guidelines for Third Party Contracting which included, in Chapter II, Paragraph 7.I, a statement that "All IFBs should be advertised in a manner that promotes participation in the bidding by all qualified and capable firms. Advertising only in the local news media is not normally adequate." This document was canceled by the publication of FTA Circular 4220.1C in 1995 and no further guidelines have been issued. The concept of "all qualified and capable firms" is a viable one under federal law, and suggests that you should tailor your publicity programs to the supply markets for your procurement. This is why we have discussed national and local advertisement in the text of this subsection and why, under the subsequent discussion of mailing lists, it is important that all known firms that provide the item or service being procured be solicited.

29 - If you are interested in more details about the CBD and other federal government policies relating to publicizing contract actions, those details are spelled out in FAR Part 5. FAR Section 5.207 details with the specifics of preparing and transmitting the notices for inclusion in the CBD.

30 - If you are not satisfied with the performance of the current contractor, the appropriate remedy is not to arbitrarily decide not to issue the firm a solicitation for the follow-on procurement. If your performance concerns are well documented, you have two alternatives. First, include the firm on the list, address performance record under any appropriate technical criteria If it is ultimately the apparent awardee, address your performance concerns as part of the responsibility determinations -- the firm may be able to address your concerns at this time to your satisfaction. Second, if the performance concerns are irretrievably deep, it may even be possible to initiate debarment or suspension at the local, State, or Federal level. Debarments and Suspensions as well as Responsibility Determinations are specific topics that are discussed in subsequent sections of this Manual.

31 - If you do receive names of firms from the consultant that prepared the specifications, it is recommended you try to ensure there are no conflict of interest situations existing (e.g., the recommended firm is wholly-owned subsidiary of the specification preparer) or that the specifications are not drafted in such a manner as the only product that will meet the specification requirement is the product of the firm they want added to the list. Don't let this caveat discourage your solicitation of recommendations from that consultant (they are a very good source), just be sensitive to the firms provided.

32 - While the IFB requirements of Section 9.c.(2) are good practices for both IFBs and RFPs, the evaluation criteria requirement of Section 9.d.(1) is relevant only to RFPs and is discussed in Section 4.5.1, "Solicitation & Receipt of Proposals."

33 - As a matter of information only, reference is made to the FAR Section 14.201-1 and 15.406-1 for the "Uniform Contract Format" and FAR Section 14.201-9 for the "Simplified Contract Format" used in bidding fixed price contracts. These are optional formats used by Federal departments which include a good discussion of what is included in those formats and why.

34 - A very helpful item to include with your solicitation package is an address label which includes the exact address you want offers mailed to and a separate address label which includes your street address and room number for offers that are delivered to you. With these labels, offerors can affix the applicable one to their offer and you will be assured it is coming to the right place. It is also a good idea for you to include the solicitation number on the labels which is of aid to your mailroom and your staff responsible for receipt of offers.

35 - These representations and certifications have legal significance that should not be overlooked by either the offeror or the agency. The offeror certifies, for instance, that it is not presently debarred or suspended by any federal agency. The contracting officer can rely on that certification and does not have to "look behind it" in determining the firm's responsibility. If it is later discovered that the firm was in fact debarred by a federal agency, it has made a false certification. There are administrative sanctions that can be imposed (contract terminated for default) and possible criminal sanctions under either federal or State laws (or both) for submitting a false statement.

36 - This certification is discussed in more detail in Section 4.3.3.2.3, "Lobbying Certification."

37 - This certification is discussed in more detail in Section 4.3.3.2.1, "Certification Regarding Debarment, Suspension, and Other Responsibility Matters."

38 - This certification is discussed in more detail in Section 4.3.3.2.2, "Buy America Certification."

39 - FAR Part 15.201(f), for example, requires the CO to make available to "all potential offerors," upon request, any information distributed at a pre-solicitation conference. The clear presumption of the FAR is that "potential offerors" may not be (and need not be) present at the confernce.

40 - If you cannot identify who the offeror is in this situation without opening the bid or proposal, it is recommended that you open it in the presence of a witness. Write down the name and address of the offeror only, and reseal the envelope or package. Return it to the offeror with a cover letter that the package was opened only so the offeror could be identified. It is also recommended that a memorandum to the file be made by you and your witness describing what happened and why. You might want to copy the outside of the envelope to show no identification but it is recommended that no copies be made of any of the offer documentation.

41 - See Section 9.2, "Changes" for a more general discussion of the costs of changes.

42 - See also the discussion of timeliness in Section 4.4.2, "Bid Opening."

43 - As a matter of reference, your attention is invited to FAR Section 52.214-7 and 52.215-10 for language addressing late submissions, modifications, and withdrawals of offers that is incorporated in FAR-covered solicitations for IFBs and RFPs respectively. For commentary in the FAR itself relating to those solicitation clauses, See FAR Section 14.304 and 15.412 respectively. Primarily because of the body of law that has developed interpreting these clauses, many transit properties have either adopted this language or have modified it slightly to meet their individual requirements.

44 - Some practitioners erroneously refer to the consequences of a late offer as one of "non-responsiveness." In fact, you never open the offer (unless needed to for identification purposes) and thus cannot determine whether it is responsive to the material requirements of the solicitation (the general definition of responsiveness). Had the offer been received on time, it may well have been responsive but, in this case, the offer is not even considered!

45 -These requirements and applicable clauses will be discussed in depth in Chapter 8.

46 - See also Chapter 8, "Contract Clauses," and Appendix A.1, "Federally Required Model Clauses."

47 - 49 CFR Part 29, "Debarment and Suspension (Nonprocurement) and Governmentwide Requirements for Drug-Free Workplace (Grants)."

48 - "Debarment. An action taken by a debarring official in accordance with these regulations to exclude a person from participating in covered transactions. A person so excluded is 'debarred'." 49 CFR Section 29.105.

49 - "Suspension. An action taken by a suspending official in accordance with these regulations that immediately excludes a person from participating in covered transactions for a temporary period, pending completion of an investigation and such legal, debarment, or Program Fraud Civil Remedies Act proceedings as may ensue. A person so excluded is 'suspended'." 49 CFR Section 29.105.

50 - 49 CFR Section 29.115(b).

51 - 49 CFR Section 29.115(a).

52 - See Section 3b of the Master Agreement, Form FTA MA(12).

53 - Because it is discussed as an aspect of responsibility, and can be objectively determined at any time up to the time of award, late submission of the debarment certification can be permitted.

54 - You may subscribe by writing the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402 or by calling the Government Printing Office Inquiry and Order Desk at (202) 783-3238.

55 - The list can be accessed 7 days a week, 24 hours per day and aside from normal costs of local or long-distance telephone calls, the access is free to the user. To obtain a copy of the user's manual for accessing the system, contact GSA at (202) 501-4740.

56 - GSA advises that responses to these inquiries should be furnished within one working day.

57 - See Section 3b of the Master Agreement, Form FTA MA(12).

58 - The text of the regulation refers to Part 25.108, but this section has been moved to Part 25.104.

59 - The payment to any "person" to influence or attempt to influence an officer or employee of any federal department or agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with the awarding of any federal contract, the making of any Federal grant, the making of any federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any federal contract, grant, loan, or cooperative agreement. 49 CFR Section 20.100(a).

60 - Because the language of the regulations refers to needing the certification and applicable disclosures at time of award, unless your solicitation specified otherwise, failure to submit the executed certification with the offer would probably not be considered a responsiveness issue in a competitive bidding procurement, and would not disqualify the offer.

61 - The "Lobbying Disclosure Act of 1995" (Pub. L. 104-65) made some amendments to 31 U.S.C. Section 1352 which simplified the information that needed to be disclosed on this Form. Those changes are detailed at 61 Fed. Reg.1412 (January 19, 1996) and will be eventually incorporated into a new Standard Form. Three items of the SF-LLL are impacted: Item 10a is amended by revising "Name and Address of Lobbying Entity" to read "Name and Address of Lobbying Registrant"; in Item 10, the statement "(attach Continuation Sheet(s) SF-LLL-A, if necessary)" is removed; and Items 11 through 15 are removed.

62 - See discussion at Section 4.3.2.5, "Amendment of Solicitations."

63 - See discussion at Section 4.3.2.3, "Solicitation."

64 - The requirements of Section 15.m of the Master Agreement mirror those of Section 11 of FTA Circular 4220.1E and refer the grantee to the provisions of 49 CFR 18.36(h).

65 - See Section 6.1, "Construction."

66 - See Section 6.2, "Equipment and Supplies."

67 - See Section 6.3, "Rolling Stock."

68 - See discussion in Section 4.5.4, "Discussions and Clarifications."

69 - As an example of how these and other situations have been addressed in the federal environment, See FAR Section 28.101-4.

70 - See Chapter 3, "Specifications," for guidance on specification development.

71 - See Section 2.4.2.1, "Full and Open Competition Principle," for a discussion of full and open competition and the effect of restraints on competition.

72 - See discussion of advertisement and publicizing invitations in Section 4.3.2.1, "Advertising and Publicizing Solicitation."

73 - One instance requiring discussion is the evaluation of apparent errors; See Section 4.4.5, "Bid Mistakes."

74 - See discussion in Section 4.4.4, "Responsive Bidder."

75 - As stated in the Requirements discussion, discounts, such as prompt payment discounts, should only be used in the calculation of low bid if the history within your agency indicates discounts offered are usually taken advantage of.

76 - FTA Circular 4220.1E, Section 9.c.(2)(c).

77 - You should understand that if an unsuccessful bidder discovers an error, they will likely file a protest (or formal query) almost immediately. It is very important, therefore, that you proceed very carefully. Some procedures, to discourage false hopes and resulting arguments, prohibit the reading of bids that are clearly defective (e.g., missing bid guarantee).

78 - See the extensive discussion of this in Section 4.3.3.1, "Receipt of Offers," where we addressed the considerations that are typically weighed when policies are adopted concerning the receipt of offers. The FAR provision typically used as a "model" is FAR Section 52.214-7.

79 - See, e.g., J.C. Kimberly Co., Comp. Gen. B-255018.2, 94-1 CPD 182 79 (A bid that was hand carried to the bid opening room seconds after the bid opening officer declared that time had arrived was properly rejected as late.) One of the exceptions addressed in FAR Section 52.214-7 and elaborated upon in FAR Section 14.304-1(a)(2) addresses the situation when late receipt of the bid is due solely to mishandling by the agency after receipt at the agency location.

80 - Id. See also, Swinerton & Walberg Co., Comp. Gen. B-242077.3, 91-1 CPD 318.

81 - This paragraph was changed from prior versions of the circular to eliminate the phrase “or acceptance” of a single proposal when discussing what constitutes a sole source procurement. FTA believes that, upon receiving a single bid (or proposal) in response to a solicitation, the grantee should determine if competition was adequate. This determination may include a review of the specifications to determine if they were unduly restrictive or contacting sources that chose not to submit a bid or solicitation. It is only if the grantee determines that competition was inadequate that the procurement should proceed as a sole source procurement. The mere fact that only one bid or proposal was received does not automatically mean competition was inadequate since many unrelated factors could cause potential sources not to submit a bid or proposal.

82 - Section 5.2 - Cost and Price Analysis discusses various price analysis techniques, and they include (among others) comparison to previous purchases, comparison to a valid grantee independent cost estimate, and value analysis.

83 - You may have, for example, data from previous purchases, an independent cost estimate, etc. with which to compare the bid price, but not have a “catalogue or market price of a product sole in substantial quantities to the general public’ as required by paragraph 10.a of the Circular.

84 - "Bid responsiveness involves the question of whether the bid as submitted, represents an unequivocal offer to do exactly what the government has specified, so that acceptance of the bid will bind the contractor to meet the government's requirements in all material aspects." Hankins Lumber Co., Comp. Gen. B-248101, 92-2 CPD ;50.

85 - FAR Section 14.301(a).

86 - FAR Section 14.404-2.

87 - Northwestern Motor Co., Comp. Gen. B-244334, 91-2 CPD 249.

88 - Record Press, Inc., Comp. Gen. B-229570.2, 88-1 CPD 161.

89 - 49 CFR Section 661.13(b) provides:

The grantee shall include in its bid specification for procurement within the scope of these regulations an appropriate notice of the Buy America provision. Such specifications shall require, as a condition of responsiveness, that the bidder or offeror submit with the bid a completed Buy America certificate in accordance with Section 661.6 or Section 661.12 of this part, as appropriate. (emphasis added)

90 - The Comptroller General, in Staples-Hutchinson & Associates, Inc., Comp. Gen. B-245007, 91-2 CPD 491 stated:
Whereas bid responsiveness concerns whether the bid itself as of the time of bid opening unequivocally offers to perform in accordance with all material terms and conditions of the solicitation, responsibility refers to a bidder's ability to perform the contract requirements and is determined not at bid opening but at any time prior to award based on information received by the agency up to that time.

91 - EDT Construction, Inc., et al., Comp. Gen. B-240343, 91-1 CPD 374.

92 - Although unusual, it is possible that before the time and date set for receipt of bids, a bidder may discover a mistake in a bid it has already submitted to you. If you have included a clause in the solicitation (or adopted a policy) as suggested in our earlier discussion on "Receipt of Offers" (See Section 4.3.3.1) and the problems with late submissions, modifications and withdrawals of offers, they should be followed. Essentially, the bidder is advised that modification of its bid would be treated the same as the original bid -- must be received timely and should clearly identify the bid it is modifying.

93 - See FAR Section 14.406.

94 - See Section R3-202.13 (Mistakes in Bid), Recommended Regulations approved August 2, 1980, implementing The Model Procurement Code for State and Local Governments, approved by the American Bar Association on February 13, 1979 (hereinafter referred to as the Recommended Regulations).

95 - For instance, Amendment Number 1 to the solicitation changed the quantities for line item 4 on the Schedule from 5 to 12. The bid included a Schedule that showed the quantity for line item 4 to be 12. No other amendments were issued and the bidder did not formally acknowledge Amendment No. 1. There was no way it could have used the correct Schedule page unless it had received the Amendment -- clear from the bid that it received Amendment No. 1.

96 - See discussion at Section 4.3.3.2, "Federally Required Submissions with Offers."

97 - The Recommended Regulations to the Model Procurement Code [at Section R3-202.13.4(b)] refers to this type of mistake as "mistakes where intended correct bid is evident." The mistake and the intended bid are clearly evident on the face of the bid document.

98 - The Recommended Regulations to the Model Procurement Code [at Section R3-202.13.4(c)] refers to this type of mistake as "mistakes where intended correct bid is not evident."

99 - You should consider all the long run cost of forcing the bidder to perform unwillingly.

100 - For an extended treatment of this topic (and also as the source for most policies of transit properties on the matter), it is recommended that you review FAR Section 14.406-4 and the Recommended Regulations at Section R3-202.13.5.

101 - See FAR 14.406-4(e) for recommended procedures to follow in the event this type of mistake has been alleged or disclosed.

102 - This is the position taken in the Recommended Regulations at Section R3-202.13.5.

103 - See FAR Section 14.604-4(a) and (b).

104 - FAR Section 52.214-15.

105 - W. A. Scott v. United States, 44 C.Cl. 524, 527 (1909).

106 - See, e.g., Section 2.205 of the Texas Business and Commerce Code which provides:

Section 2.205. Firm Offers.

An offer by a merchant to buy or sell goods in a signed writing which by its terms gives assurance that it will be held open is not revocable, for lack of consideration, during the time stated or if no time is stated for a reasonable time, but in no event may such period of irrevocability exceed three months; but any such term of assurance on a form supplied by the offeree must be separately signed by the offeror.

107 - Nation-Wide Reporting and Convention Coverage, GSBCA No. 8309, 88-2 BCA 20,521 at 103,741.

108 - FTA Circular 4220.1E Section 9.d.(1).

109 - FTA Circular 4220.1E Section 9.d.(1).

110 - FTA Circular 4220.1E Section 9.d.(2).

111 - FTA Circular 4220.1E Section 7.h.

112 - FTA Circular 4220.1E Section 9.d.(4).

113 - FTA Circular 4220.1E Section 9.e.

114 - Sub-paragraph (5), like paragraph 6.g., recognizes the concept of best value. Once again, FTA does not wish to dictate any particular factors or analytic process. Solicitations must, of course, tell potential competitors for the contract what the basis for award will be.

115 - FTA Circular 4220.1E Section 9.e.

116 - This new definition was intended to recognize the concept of best value. The language is intended neither to limit nor dictate qualitative measures grantees may employ.

117 - Federal Register Vol. 62, No. 189, Sept. 30, 1997.

118 - FAR Part 15 was reissued by Federal Acquisition Circular (FAC) 97-02 dated October 10, 1997.

119 - The FAR now sees lowest price technically acceptable proposal selection as one end of the best value spectrum but we hvae distinguished it from best value for clarity of discussion purposes.

120 - Far Subpart 15.101 - Best Value Continuum.

121 - See Section 6.5 - Architect-Engineering Services.

122 - New York City Transit - for more information, call Mr. William DeSantis at (718) 694-4339.

123 - FTA Circular 4220.1E Section 9.d(3).

124 - See discussion in Section 4.5.4, "Discussions and Clarifications."

125 - See discussion in Section 4.5.3, "Competitive Range."

126 - Multiple rounds of best and finals tend to create suspicion in the minds of offerors about what the motive is for the subsequent requests, particularly if does not appear that negotiations are being reopened for a discussion of substantive matters. The preparation of proposals can be a very time-consuming and expensive process and it is possible that, for one of these or some other reason, an offeror may decide not to submit a response to a 3rd or 4th request for a best and final offer. Also, if you make a practice of multiple BAFOs, you may not receive "best" offers in the first round during future procurements.

127 - FTA Circular 4220.1E Section 7.h.

128 - FTA Circular 4220.1E Section 9.d.(4).

129 - A very significant caveat must be issued at this time. If your governing body (city council, county commissioners, board of directors, etc.) has reserved unto itself the sole authority to reject bids for whatever reason, you, as the procurement official, have no authority to make that final determination and notify the bidder until your governing body has concurred with your recommendation.

130 - See Section 4.5.2, "Evaluation of Proposals."

131 - See, e.g., FTA Circular 4220.1E Section 8.a.: "All procurement transactions will be conducted in a manner providing full and open competition."

132 - See discussion of small purchase procedures in Section 4.2, "Small Purchases."

133 - See discussion of sealed bidding procedures in Sections 4.3, Competitive Procurement Methods and 4.4, Sealed Bids (Invitation for Bids)

134 - See discussion of competitive proposals in Sections 4.3, Competitive Procurement Methods and 4.5, Competitive Proposals (Request for Proposals)

135 - See discussion of the submission of cost and pricing data in Section 5.2, "Cost and Price Analysis."

136 - See discussion of negotiations under competitive proposal method at Section 4.5.2, "Evaluation of Proposals."

137 - FTA Circular 4220.1E Section 9.h.(1)(e).

138 - 49 U.S.C. Section 5307(a)(1).

139 - This is also the position taken in FAR Section 14.502.

140 - See discussion at Section 4.4.1, "Solicitation."

141 - One variation that could be used if time is particularly tight, would be to ask, as part of Phase One, that the bidders include a sealed bid in a separate envelope that would only be opened in the event the technical offer was considered acceptable. This creates some additional security on the part of the procurement staff because you would want to ensure that the technical acceptability determination was made without knowledge of the prices for the different offers.

142 - See Section 4.3.2.5, "Amendment of Solicitation."

143 - If, in the opinion of the Contracting Officer, a contemplated amendment would significantly change the nature of the procurement to the extent that other entities (who did not submit unpriced technical offers) would likely become a proposed offeror as a result of the amendment, consideration should be given to canceling the solicitation and issue a new solicitation.

144 - Documentation of an unacceptable finding cannot be over stressed. Disputes over this determination are the most common area of bid protest in the multi-step process.

145 - Codified at 40 U.S.C. Section 481(b).

146 - Public Law 104-106, § 4309, 110 Stat. 186, 670 (1996).

147 - See, e.g., Chapter 741, Texas Government Code, V.T.C.A.

148 - See, e.g., Chapter 791, Texas Government Code, V.T.C.A.

149 - FTA Circular 4220.1E Section 7.e.

150 - FTA Circular 4220.1E Section 4.

151 - Navy web site info for reverse auctions is: http://www.abm.rda.hq.navy.mil/navyaos/acquisition_topics/contracting_/reverse_auctioning/reverse_auctioning. You can also go to the web page address above ending with .mil/ and enter "reverse auctions" in the "search" box and it will take you to the materials on reverse auctions. Navy can be contacted by phone: (215) 697-2850.

152 - Army Source Selection Guide, June 2001, may be found at: http://www.amc.army.mil/amc/rda/rda-ap/docs/assg-2001.pdf. Click on Appendix I for information on On-Line Reverse Auctions.

153 - Contact Mr. Geoff Gauger at Treasury for additional information: (202) 622-0203.

154 - Electronic Bazaar - Reverse Auctions Save Buyers Time, Money by Geoff Gauger. Federal Times, November 4, 2002. This article may be accessed at: http://federaltimes.com/index.php?S=1264522.

155 - http://www.gsa.gov/Portal/gsa/ep/contentView.do?contentType=GSA_OVERVIEW&contentId=10655

156 - Grantees are not required to follow the FAR. However, they are required to follow FTA Circular 4220.1E which would apply to procurements using reverse auctions.

157 - www.firstgov.gov/index.shtml.

158 - The Strategic Need for Real -Time Competitive Bidding in the Public Sector Procurement Process, by David C. Wyld and Randall P. Settoon, September 2002, p.18. This paper may be accessed at: learningcenter.ariba.com/wp_resource.cfm

159 - Reverse Auctions - Strategies and Lessons Learned from a Successful Implementation by Gillian Verga, Jan 2002. This article may be accessed at: http://www.apics.org

160 - When to Use an Auction by Ed Goetting, September 4, 2002. This article may be accessed at: www.line56.com/print/default.asp?ArticleID=3983

161 - For information re LAMTA call the Director of Purchasing at 213-922-7210.

162 - For information about SEPTA’s pilot program call 215-580-8251.

163 - For information about Houston MTA call Paul Como at: 713-739-4803.

Click here to return to the top of the document