State Profile : Georgia

by Sophia Morell - StateAndFederalBids.com

Georgia is built on the ingenuity of past entrepreneurs and their businesses, molding not only the state’s economy and industry, but symbolic representation as well. S.H. Rumph of Marshallville was the first to grow peaches in Georgia, establishing the state’s infamous connection with the fruit.[i] The Georgia railroad shaped the state’s reputation as well as its position within the country. Today’s Georgia business owners and private contractors are no less important to the state’s development, especially when they deal directly with the government through public bidding. Government contracting allows private businesses to competitively bid for work with the state and local government entities of Georgia, benefiting both buyer and seller.

Methods and Types of Contracting[ii]

To effectively contract with Georgia government entities, private contractors must be familiar with both bidding procedure and jargon. This includes widely used terms, acronyms (see figure 1.1 for a complete list of common acronyms) and general vocabulary.

Contract Methods

There are four basic requests used when contracting with the government: Request for Quotation (RFQ), Request for Proposal (RFP), Request for Information (RFI) and Request for Qualified Contractor (RFQC).

RFQs are used with very specific requests, when the desired item can be explicitly described. For example, a government entity needing a particular item with distinct specifications would use an RFQ to contact private contractors and request their quote for the item or work. An RFP is similar to an RFQ except that the work being solicited is not as clear-cut. An RFP calls for contractors who can fulfill a unique procurement, providing expertise and creativity as well as completing the actual project. Instead of choosing the lowest bid, as with a RFQ, the procurement officer will choose the vendor who will provide the best value, combining all possible costs while factoring quality of product. An RFI is a less formal solicitation and does not always result in a contract. Procurement departments use RFIs to gather information from vendors in order to determine if a RFQ or RFP is suitable to fill a request. The final type of request, and RFQC, is used to find a vendor with the qualifications needed to fill the request. The more familiar bidders are with contracting terminology and the differences between requests, the more likely they are to find bids and win them.

Contract Types

Contracts are defined and categorized depending on many variables. First, they are defined by who is offering the bid. State contracts are either offered through individual agencies or the state procurement department. This is the same for counties, cities and smaller governments: depending on the projected cost of the request, the bid will be available through either the entity’s procurement department or the agency within the government who is making the request. Individual agencies can advertise and procure their own bids as long as they do not exceed a predetermined cost ceiling, which is determined by the size of the entity. Once this ceiling is hit, the state or local procurement department is responsible for filling the request.

Another distinction is the product requested in the bid. There are two types: contracts to procure goods and contracts to procure services. Though the procedure is not drastically different, different paperwork is required for each type. A contract to procure a good, for example, can specifically describe their request whereas a contract to procure a service must define the time, labor and/or effort of a contractor.

The type of financial transaction also determines the type of contract. Purchase contracts are the most common. This is when the procurer pays for the good or service at one time. Contractors may also rent or lease when the desired product is equipment or an item they would only need temporarily. Contractors may also choose to pay in installments, which is more common with long-term contracts.

The final division is between fixed and open contracts. A fixed quantity contract defines the exact quantities needed when the contract is established. An open contract is used when exact quantities are unknown

Public Notice

Contracts are not the only documents that are required to be posted publicly during the bidding process. Government contractors must also post a Notice if Intent to Award, Notice of Award and the Contract Award. The Notice of Intent declares the government contractor’s intention to award the contract to the successful bidder and a list of all the bidders who did not win the contract and why the unsuccessful bidders were rejected. The Notice of Intent is posted before the actual award and is only required for requests over $100,000. The Notice of Award also declares the awarded bidder and those rejected, along with the reason for rejection. The Notice of Award is publicly posted within one day of the actual awarding of the contract. Finally, the Contract Award must be publicly posted and can generally be found in the same place bids are posted.

Special Approval

Some bids require special approval before they can be publicly posted. Requests for motor vehicles must get approval from the Department of Administrative Services (DOAS) before the bid for the vehicle is posted. Technology products and services must be procured through the Georgia Technology Authority. In all replacement cases, the procurement officer assigned to the request must receive permission from the DOAS to verify the replacement is necessary.

State Level Procurement

The State of Georgia employs private contractors from all industries, from computer technicians to health service providers. But in comparison to the number of available bids, few Georgia businesses are taking advantage of the opportunity to contract with the peach state. This may be because most businesses would not immediately think of the government as a potential customer or know how to make it one.

Agency Procurement Officer Check

Before bids are offered to the public, an Agency Procurement Officer (APO) must review them. The APO first determines if a preexisting statewide or agency contract can fulfill the request. If there is no preexisting contract, the APO will then calculate the cost of the request. If it is under $5,000 the request may be fulfilled without public bidding. If the request is between $5,000 and $10,000 and within the agency’s procurement budget, or Delegated Purchasing Authority (DPA), the agency’s APO can purchase the request through competitive bidding. If over $10,000 the request must be processed through the State Procurement Department (SPD). In a nutshell, the APO must first determine if a request can already be fulfilled, then the cost of the request and then, depending on cost, whether the individual agency will pay for it non-competitively or competitively or if the request must go through Georgia’s SPD

Georgia State Procurement Department

The Georgia State Procurement Department (SDP) fulfills agency requests for goods or services over $10,000. Once the SDP receives the request, it is reviewed for both for completeness and competitiveness. If a request is deemed too competitively restrictive, the SPD will adjust it so more private contractors will be able to participate in the bidding. After these checks are finished and changes are made, the bid is posted on the State Procurement Website and is available for a predetermined time for public bidding. The SPD determines the responsibility of bidders before the contract is granted. Characteristics of non-responsible bidders include a “history of nonperformance or performance problems on other contracts (public or private), a record of financial difficulty, business instability, criminal sanctions, civil sanctions, and/or tax delinquency”[iii] Bidders must also be in good standing (i.e. not be suspended or debarred from contracting with the government). A winner is chosen by the SPD from the qualified bidders and a Notice of Award is issued. The agency is then responsible for providing the winner with all information needed to complete the request.

As well as being responsible for agency bids over $10,000 the Georgia SPD also manages bids for goods and services ordered in large quantities for different state entities, including local governments. These statewide requests are advertised on the Georgia State Procurement Site.

Pre-Bid Procurement

In order to expedite a bid that exceeds budget, the agency’s purchasing agent must receive approval from the State Procurement Department. With the approval of the SPD the agency’s procurement department handles the bids like any other and awards it to the winning bidder.

State Department and Agency Procurement

When a bid does not exceed $10,000 the agency that placed the request is authorized to post and award the bid through it’s own procurement department. Depending on cost, the request can be fulfilled either non-competitively or competitively.

Requests valued under $5,000 can be contracted non-competitively. In other words, the agency is not required to post these requests publicly and instead chooses a private contractor without having to compare prices. Though the State Procurement Department recommends that the agency does compare prices and services with at least three different contractors, it is not required. Requests that are procured without comparing prices and services are referred to as ‘sole source’ contracts. Sole source contracts are usually granted when the contractor has experience working with the agency or an established expertise with the particular project, can best satisfy the technical requirements, is the least expensive contractor, or the contractor has exclusive rights over the desired product. Once the agency has justified the sole source status the contract can be awarded.

Competitive procurement is substantially more complex than it’s noncompetitive counterpart. As with all requests, agencies must determine if their request can be fulfilled by a preexisting contract. If it cannot, the agency then determines the cost of the request. If it is between $5,000 and $10,000 and does not exceed the procurement budget the agency may begin advertising the bid competitively. Agency-level competitive bidding is a multi-step procedure. The major components of this process are outlined below.

Minimum Bid Policy – Agency procurement departments must review at least six bids for requests between $5,000 and $10,0000, three of which must be a minority business.

eQuote Bids - eQuote bids are used primarily for simple purchases which are procured through Requests for Quotes (RFQs), not Requests for Proposals (RFPs). The eQuote system is used for both agency and state procurement. Competitive agency bids are required to be posted for at least three days.

Public Opening – The agency must post requests publicly, usually on their agency procurement website. All bids must include a summary, closing date and contact information.

Bids are awarded to contractors with the lowest bid as well as a responsive and responsible history. The agency procurement department will notify the winner and post the results publicly, generally in the same location that the bid was originally posted.

Major Metropolitan Areas - Atlanta

Not only the capital of Georgia, Atlanta is a major business hub. It’s corporate inhabitants, such as Coca-Cola and Delta Airlines, and locally based businesses make up a culturally and historically rich economic neighborhood.

The City of Atlanta Department of Procurement (Atlanta DOP) actively contracts with private businesses. As outlined on their webpage, the city of Atlanta collects bids from individual agencies and advertises through the city procurement page. Occasionally the Atlanta DOP holds a pre-bid conference before vendors submit bids, which are reviewed by DOP staff. The bidders and their proposals are open to the public, though not publicly posted. Both the requesting agency and the Office of Contract Compliance (OCC) review the bids before the DOP chooses the contract winner. From there, the DOP notifies the contractor and publicly posts the results.

In order to bid, vendors must register with iSupplier, the Atlanta Procurement portal. Vendors are required to provide their company’s name, company address and individual user information (name, email address and phone number).

[i] "Georgia Peach History." Georgia Peach Commission. <http://www.gapeaches.org/>. [ii] The information describing “Methods and Types of Contracting” through “Department and Agencies” was ascertained through the Georgia Procurement Manual, which outlines the steps contractors need to take in order to sell to the Georgia state government.

Government Going Green

by Sophia Morell - StateAndFederalBids.com

Going green’ is no new initiative. In the private sphere, businesses have been supporting this environmentally friendly trend since it became marketable. There are ‘green’ television episodes on prime time and recycled clothing is all the rage. Individuals are also jumping on the green-wagon. Recycling efforts have increased, family cars are becoming hybrid and general conservation is ‘in.’
The US government is also involved in green efforts. The current stimulus packages being given to local and state governments are in part to promote environmentally friendly endeavors, as are many of Obama’s personal presidential goals. He has exemplified these goals with his focus on an alternative energy resource and making the United States an environmentally conscious nation.

In his proposed 2010 budget, Obama calls on both American citizens as well as government agencies to reform their usage of environmentally harmful goods and services. In addition to this encouragement, he proposed a $10.5 billion budget for the EPA. This is a $2.7 increase from the projected 2009 budget. The EPA plans to spend this money in four specific areas: clean water, green house gas reduction, water safety and security and a robust super fund. The super fund program cleans up the US’ most toxic and contaminated sites. In order to fulfill these goals, the EPA will most likely increase the number of contracts available for public bidding.

Overall, the government’s investment in green ventures will bring the United States into a more sustainable and stable position, as well as creating opportunities for private vendors to participate in environmentally friendly procurement.

These green initiatives will have an impact on government purchasing. Along with making procurement more efficient, the Obama administration is also concentrating on purchasing with the environment in mind. And Obama is not the first president to realize the importance of green purchasing. In 2007 President Bush signed an executive order that required federal bids for electronics and transportation to be more environmentally sustainable. The “Strengthening Federal Environmental, Energy and Transportation Management” order set environmental goals which effected the acquisition, material, energy efficiency, recycling, distribution and design of the consumer electronics industry. This order had a significant financial impact, redirecting the $65 billion information technology budget towards greener technology.

But how will this environmentally sensitive purchasing affect the private vendor? First, it is currently often more expensive to produce a green product. This means the government will be spending more to receive the same goods and services as they did before. Vice President Biden, for example, announced on April 22, 2009 that $300 million would be given to state and local governments throughout the United States to “expand fleets of clean vehicles and the fueling infrastructure necessary to support them.” Some of this money will also go towards transit authorities.

This will create a government demand for clean vehicles and necessary fueling which private contractors throughout the nation will supply through bidding on government contracts.

Nonspecific stimulus packages are also being used in efforts to become greener. Some governments are choosing to use their federal stimulus to fund environmentally friendly ventures within their state. The Pennsylvania Energy Development Authority (PEDA) has designated $3.8 million towards their Environmental Protection Agency. According to John Hanger, the agency’s secretary, this money “will create 155 jobs and attract $19 million from private sources.” Outside of the $3.8 millions, there are also grants for up to $1.5 million available “for green initiatives like solar, wind, waste recovery and alternate fuels for transportation.”

Along with their efforts to expand green purchasing on a large scale, government agencies are also reevaluating smaller expenditures. A major push by the Environmental Protection Agency (EPA) is their Environmentally Preferable Purchasing Program, which focuses on buying green office supplies online. Green purchasing criteria includes products that are recyclable, durable, reusable, rechargeable, energy-efficient, remanufactured and generally more sustainable. In their message to government agencies, the EPA outlines how to negotiate with private vendors for purchasing green goods and services. To review these criteria refer to “Buying Green Online: Greening Government E-Procurement of Office Supplies,” Appendixes A and B.

1 “The U.S. Environmental Protection Agency 2010 Budget.” A New Era of Responsibility: Renewing America’s Promise. April 20, 2009. <www.whitehouse.gov/omb>
2 “Green Government Procurement, the New Paradigm for Consumer Electronics.” CEA International Insiders Series. April 14, 2009. <www.ce.org>
3 “Clean Cities Program to Fuel Clean Vehicles and Alternative Fueling Infrastructure.” Government Technology. April 22, 2009 <http://www.govtech.com/gt/643895>
4 “Green Initiatives Funded in Pennsylvania with Stimulus Funds.” Government Technology. April 22, 2009 <http://www.govtech.com/gt/643895>
5 “Buying Green Online: Greening Government E-Procurement of Office Supplies.” EPA Environmentally Preferable Purchasing Program. April 20, 2009. <www.epa.gov>

The Obama Effect

by Sophia Morell - StateAndFederalBids.com

The future of government contracting has recently been a hot topic. Since the Obama administration moved into the White House, government procurement and purchasing departments across the country have been severely scrutinized due to the president’s efforts to reorganize government spending. The administration plans to “create a transparency around contracting” and improve the “acquisition workforce.”[i]

These changes, this reorganization, should not be interpreted as a decrease in contracting opportunities. On the contrary, the president’s 2010 fiscal year proposed budget, and his main focuses for the future, actually dictate the need for more work from the private sector. Both the stimulus packages for local and state governments and Obama’s goals for his presidency, specifically improvements in the healthcare and education systems as well as developing a new energy source, will provide government contracts.

Local and State Stimulus

The Obama Administration’s American Recovery and Investment Act designates $144 billion for state and local governments. This money will be spent within the communities to stimulate the economy on a small, local level, which will then accumulate and eventually affect the nation’s economy as a whole. Though specific amounts are not currently available, recovery.gov will post “detailed state maps (which) will be available to assist your tracking.”

You can also request a copy of the Recovery and Investment Act by clicking here or going to the White House website.

President Obama’s Term Goals

Education

Educational institutions are microcosms, a shrunken version of what is outside its walls. Students do not only learn while at school, they also consume food, use facilities and materials, create waste and make messes. To keep public schools running the state or local government often employs private businesses to provide the necessary goods and services. Obama’s proposed budget designates $46.2 billion for the Department of Education in 2009, a $1.2 billion increase. In 2010 there is a $500 million increase from 2009, with a projected $46.7 billion expected to be spent on education. This budget boost means not only an increase for those already contracting with public schools, but also for new contracts. The budget calls for “states to build comprehensive, coordinated, high-quality early childhood ‘Zero to Five’ systems,” which would require the employment of private construction companies across the nation. An improvement of in-school technology is also called for. Both suppliers and technicians of such technology would have the opportunity to bid such contracts.[ii]

Healthcare

The Department of Health and Human Services is also expected to get a boost in their budget. A proposed $7.9 billion increase in 2009 would be focused on the “adoption of health information technology and utilization of electronic health records.”[iii] This is a substantial national undertaking. In order to update this technology in every hospital and medical entity across the country the government will need to contract with many private companies, even with those outside of the technology field. First the records system will need to be designed, coordinated and implemented nationally. Facilities will need to be built, maintenance performed and repairs made. Especially in the beginning of this process the government will need private companies to perform many of these tasks. Childcare, education and other human services will also receive a financial boost, providing those in need with help from independent companies. Because the initiatives in this portion of the budget are so specific it is much more efficient for the government to use the increased funds for contracts with companies that specialize in these projects.

Energy

A substantial increase from 2008’s $24.1 billion to $33.9 billion was proposed in the budget. This $9.8 billion increase is focused on providing “significant funding for basic research and world-leading scientific user facilities too support transformational discoveries and accelerate solutions” to develop an alternative energy source. Private companies will be granted loans geared towards bout the development of this technology as well as its implementation. As well as loans, the introduction of new energy technology means government contracting. In order to spread these innovations, the government will need the help of private companies: advertising, education, installment, and maintenance are only some aspects of new energy implementation that the government will need outside help for.

[i] Office of Management and Budget, US Government. “Jumpstarting the Economy and Investing for the Future.” A New Era of Responsibility: Renewing America’s Promise. Page 39. [ii] Office of Management and Budget, US Government. “Department of Education.” A New Era of Responsibility: Renewing America’s Promise. Pages 59-60. [iii] Office of Management and Budget, US Government. “Department of Health and Human Services.” A New Era of Responsibility: Renewing America’s Promise. Pages 67-70.