Doing Business with Fairfax County: A Procurement Law Primer

September 21, 2010General Counsel, P.C.

Agenda

•Governing Law•Methods of Procurement•Preparing to Respond to an Opportunity•Getting Paid•Restrictions on County Contractors•Remedies for Vendors

Governing LawThe Legislative Underpinnings

Governing Law

•For solicited business—the standard rules:▫Virginia Public Procurement Act (VPPA)▫Fairfax County Purchasing Resolution

•Alternative related to projects with public-private ownership:▫Public-Private Education Facilities and

Infrastructure Act of 2002 (PPEA)

Procurement Categories

•Goods•Services

▫Professional (e.g. doctor, architect, engineer)

▫Consultant (e.g. business coach)▫Non-professional (everything else)

•Construction•Insurance

Methods of ProcurementThe County’s Rules for Making Purchases

Methods of Procurement•General Rule: Competitive Procurement

▫Competitive Sealed Bidding▫Competitive Negotiation

•Exceptions to Competitive Procurement*▫Small Purchase▫Open Market▫Sole Source▫Emergency▫Insurance▫Proposals under PPEA

(* for the full list of exceptions, see the County Purchasing Resolution)

Competitive ProcurementSealed Bidding Negotiation

• Used when County knows exactly what it wants to purchase

• The default method for goods, construction, and non-professional services

• Used when County does not know exactly what it wants to purchase

• Must be used for professional services

• May be used for goods or non-professional services IF the County determines that negotiation is preferable to sealed bids

• May be used for certain construction projects (e.g., design-build projects)

Competitive Procurement (cont.)Sealed Bidding Negotiation

• Starts with an “Invitation to Bid”

• Describes specifically what County wants to procure

• Starts with a “Request for Proposals”

• Describes generally what County wants to procure

• Specifies the factors that County will use to evaluate the proposals

Competitive Procurement (cont.)Sealed Bidding Negotiation

• Invitation to Bid is posted for at least 10 days

• Potential vendors can select on eVA to receive relevant Invitations to Bid

• Bidders must get bids in by the deadline

• Request for Proposals is posted for at least 10 days (if estimated amount over $50,000)

• Potential offerors can select on eVA to receive relevant public Requests for Proposal

• Offerors must get offers in by the deadline

Competitive Procurement (cont.)Sealed Bidding Negotiation

• Contract awarded to “responsive and responsible” bidder with the lowest price

• County picks at least two offerors for to interview (the “short list”)

• Contract awarded to offeror with the “best” proposal

• Note: the “best” proposal doesn’t necessarily have the lowest price

Competitive Procurement (cont.)Sealed Bidding Negotiation

• County may not cancel the Invitation to Bid or reject all of the bids just to avoid awarding the contract to a particular bidder

• County must justify in writing a finding that the apparent low bidder is not a responsible bidder

• County may reject all the bids if it believes a rebid will increase competition

• County may not cancel the Request for Proposals or reject all of the bids just to avoid awarding the contract to a particular bidder

• County may reject all the offers if it believes a re-proposal will increase competition

Exception #1: Small Purchase

•When:▫Purchase amount is less than $5,000

•Rules:▫None, but preference given to vendors

registered with eVA and/or with existing contracts

Exception #2: Open Market

•When: ▫Purchase of goods, insurance, construction,

consultant services, or non-professional services

▫Estimated cost between $5,000 and $50,000

•Rules:▫$5,000-$10,000 estimate: three oral or

written quotes▫$10,001-$50,000 estimate: four written

bids

Exception #3: Sole Source

•When:▫“There is only one source practicably

available”•Rules:

▫The sole source gets the contract▫County must post notice that the contract

was awarded on a sole-source basis

Exception #4: Emergency

•When:▫“Circumstances arise causing curtailment

or dimunition of essential service”•Rules:

▫Do not have to go through full competitive procurement process

▫County should get quotes from a few vendors if time allows

Exception #5: Insurance

•When: ▫County purchases insurance

•Rules:▫Purchase directly through an insurance

broker; do not advertise or use competitive procurement methods

Exception #6: PPEA

•When: ▫A proposal is made by a vendor or the

County under the Public-Private Education Facilities and Infrastructure Act of 2002

•Rules:▫The proposal is evaluated as required in

the PPEA, and is exempt from competitive procurement

Piggybacking on Another Agency’s Contract•County may skip all these procurement

steps if there is an existing contract off of which it may make the purchase

•Examples:▫State contracts▫Cooperative purchasing arrangements

•When you make a bid, you may specify whether other government agencies may purchase at the same terms

Preparing to Respond to an OpportunityThe Steps You Can Start Taking Now

Important Registrations

•Register your business in Fairfax if it is located in Fairfax or does business in Fairfax

•Register for eVA•Obtain SWaM Certification, if applicable•Register to receive updates from the

County on vendor opportunities

Responsive and Responsible

•Prepare to be responsive to the County (“submit a bid which conforms in all material respects to the Invitation to Bid or Request for Proposal”)▫i.e., follow the County’s instructions▫note: brand names are not a material

requirement, but bid must include equivalent goods

•Ensure that your business is a “responsible bidder or offeror” with respect to the contract you are seeking

Demonstrating Responsibility• Pick contracting opportunities that match your

business’s abilities▫For competitive sealed bidding: be a “responsible

vendor”—capable of carrying out the contract requirements and able to assure the County you will perform in good faith

▫For competitive negotiation: be able to meet the criteria specified in the Request for Proposals

▫For noncompetitive procurements: create a personal assurance of responsibility by getting to know the purchasing agents who cover the government agencies you are targeting

• County looks at a number of factors

“Responsible Vendor” Factors

1. The ability, capacity and skill of the bidder to perform the contract or provide the service required;

2. Whether the bidder can perform the contract or provide the service promptly, or within the time specified, without delay or interference;

“Responsible Vendor” Factors (cont.)

3. The character, integrity, reputation, judgment, experience and efficiency of the bidder;

4. The quality of performance of previous contracts or services;

5. The previous and existing compliance by the bidder with laws and ordinances relating to the contract or services;

“Responsible Vendor” Factors (cont.)

6. The sufficiency of the financial resources and ability of the bidder to perform the contract or provide the service;

7. The quality, availability and adaptability of the goods or services to the particular use required;

8. The ability of the bidder to provide future maintenance and service for the use of the subject of the contract;

“Responsible Vendor” Factors (cont.)

9. Whether the bidder is in arrears to the County on debt or contract or is a defaulter on surety to the County or whether the bidder's County taxes or assessments are delinquent; and

10. Such other information as may be secured by the County Purchasing Agent having a bearing on the decision to award the contract.

Getting PaidHow to Access the County’s Money

Payment Methods•Purchasing Card

▫Purchases under $2,500•ACH or Check

▫Must send invoice that includes purchase order number and the name of the agency that made the purchase

▫Generally, submit invoice as soon as you have delivered the goods/services

▫County will not pay on an invoice unless your business has on file an IRS Form W-9 (with the business’s EIN)

Restrictions on County ContractorsThe County’s Way of Ensuring that You Follow Its Rules

Restrictions that Come with a Fairfax Government Contract• Increased Oversight

▫Tax compliance▫Non-discrimination in employment▫Drug-free workplace▫ Immigration status of employees

• Anti-bribery certifications• Compliance with the terms of federal grants• Advertising cannot suggest Fairfax government

endorsement• County has audit rights for three years after

final payment on contract

Withdrawing a Bid/Offer

•Generally, may withdraw at will before deadline

•After deadline, may only withdraw for limited circumstances and in very limited time▫Error in judgment is not basis for

withdrawal

Consequences of Violating Restrictions•Contract damages•Suspension or debarment from future

procurement opportunities

Remedies for VendorsEnsuring the County Follows Its Rules

Appeals of County Contracting Decisions•Appeal of Determination of Nonresponsibility

▫Only applies if bidder was the low bidder•Appeal of Determination of Ineligibility

▫Ineligibility = Suspension or Debarment•Appeal of Denial of Withdrawal of Bid•Protest of Award or Decision to Award

▫May not protest on grounds that winning bidder is nonresponsible

▫May protest on basis that sole source or emergency exceptions did not apply

Appeals of County Contracting Decisions (cont.)•Time: generally, must appeal within 10

days of the relevant decision•Rule: County decision stands unless it was

“arbitrary and capricious”

Contractual Disputes• Notify the County if you have a claim for

money or other relief related to your performance on a County contract

• First, try to settle any dispute amicably• If that does not succeed, send a detailed

description of the claim to the County Purchasing Agent

• County Purchasing Agent makes decision on the complaint within 30 days

• Aggrieved vendor may appeal Agent’s decision to Fairfax Circuit Court within six months

QuestionsKevin R. LearnedGeneral Counsel, P.C.6862 Elm Street, Suite 800McLean, Virginia 22101p: (703) 556-0411e: klearned@generalcounsellaw.com

Links

eVA: http://www.eva.state.va.us/SWaM: http://www.dmbe.virginia.gov/swamcert.htmlFairfax County Department of Purchasing and Supply Management: http://www.fairfaxcounty.gov/dpsm/Current Fairfax Procurement Opportunities:http://www.fairfaxcounty.gov/dpsm/solic.htmFairfax Business Taxes: http://www.fairfaxcounty.gov/dta/businesstax_home.htm