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U.S. Department 400 Seventh St. S.W. Of Transportation Washington, D.C. 20590 Federal Transit Administrator Administration C-13-01 November 6, 2001 Dear Colleague: Welcome to the Federal Transit Administration’s Best Practices Procurement Manual website. Since the original publication of the manual on May 7, 1996, we have added a number of new topics and have identified a variety of additional best practices. Many thanks to all of you who have contributed ideas, topics, and “best practice” content, as well as those who have helped to make this document as “customer-friendly” as possible. We continue to actively seek grantee and industry comments, suggestions for new topics, and “best practice” proposals, so the manual can be kept up-to-date and relevant to your needs. Your thoughtful contributions will help ensure that America’s transit systems keep our communities safe and moving. Sincerely, Jennifer L. Dorn Administrator FEDERAL TRANSIT ADMINISTRATION BEST PRACTICES PROCUREMENT MANUAL Preface Purpose This Manual provides recipients of Federal Transit Administration (FTA) funds suggestions on conducting third party procurements to assist them in meeting the standards of FTA Circular 4220.1E (the Circular). The Manual consists of suggested procedures, methods, and examples which FTA encourages. These are based on the Federal acquisition process, Comptroller General decisions, and "Best Practices" of grantees and others in the industry. Please Note, Suggested Procedures Are Not Mandatory. The Manual is envisioned as an ongoing and expanding document. It will be updated periodically with both new subjects as well as additions or changes to existing subjects. The additions/changes will be based on: (1) changes in statutes, (2) the result of recent court decisions, (3) the need for further clarification, and (4) new or innovative practices of grantees. The Manual is located on the Internet World Wide Web under the FTA Homepage. The internet location enables FTA to provide its customers with the latest and newest information using the fastest means possible. Additionally, FTA solicits "best practices" of its grantees and others in the industry. After review by FTA, new and or innovative practices will be added to the manual. FTA is being assisted in this endeavor by Leon Snead & Company, P.C. Their Internet address is: [[email protected]]. All proposed "best practices" should be sent to this Internet Address. Scope The Manual consists of 11 chapters and Appendices as follows: 1. Purpose and Scope 2. Procurement Planning & Organization 3. Specifications 4. Methods of Solicitation and Selection 5. Award of Contracts 6. Procurement Object Types: Special Considerations 7. Disadvantaged Business Enterprise 8. Contract Clauses 9. Contract Administration 10. Close-Out 11. Disputes Appendix A: Governing Documents Appendix B: Examples Appendix C: Reserved Appendix D: Annotated FTA Circular 4220.1E. For a copy of this Circular, go to www.fta.dot.gov/ftahelpline/fta_c4220_1E.doc. Format The Manual is divided into 11 Chapters and Appendices (see above). This format will allow FTA to send updates as necessary and allows you to locate them easily. As sections of the Manual are updated, the last revision date is indicated for that section in parentheses. Introduction You are responsible for ensuring full and open competition and equitable treatment of all potential sources in the procurement process. You are also responsible for planning, solicitation, award, administration and documentation of all Federally funded contracts. During the procurement process, the Procurement Officer is responsible for making comprehensive business judgments based upon the application of sound procurement policies and procedures. This Manual will not make business judgments for the Procurement Officer. It will aid him/her in performing the steps necessary to ensure public funds are expended properly and will protect the integrity of the grantees' procurement process. Best Practices Procurement Manual – Recent Updates to BPPM Page 1 BEST PRACTICES PROCUREMENT MANUAL RECENT UPDATES TO BPPM Revision Date Section No. Subject October 2005 1.3.3.10 Disposition of Surplus (Revised) October 2005 4.6.4 Unsolicited Proposals (New) October 2005 7.2.4 Prompt Payment Mechanisms (Revised) October 2005 7.3.5.4 Good Faith Efforts to Meet Contract Goals (Revised) October 2005 7.3.5.5 Counting DBE Participation toward the Goal (Revised) October 2005 Appendix A.1 Federally Required and Other Model Contract Clauses- #28 (Revised) April 2005 2.3.2 Independent Grantee Cost Estimate (Revised) April 2005 2.4.3.1 Fixed Price Contracts (Revised) April 2005 2.4.4.3 Progress Payments (Revised) April 2005 5.3.2 Debriefing of Offerors (Revised) April 2005 6.1.7 Partnering (Revised) April 2005 8.2 Surety Bonds (Revised) April 2005 8.2.1 Performance Bonds (Revised) April 2005 10.3 Record Retention (Revised) April 2005 Appendix B.20 Independent Cost Estimate (ICE) Form (New) March 2004 1.3.3.5 Intergovernmental Agreements, Joint Procurements, Piggybacking/Assignments (Revised) March 2004 4.4.3 Single Bid (Revised) March 2004 6.5 Architect-Engineering Services (Revised) Best Practices Procurement Manual – Recent Updates to BPPM Page 2 March 2004 Appendix A.2 Dear Colleague Letters (Revised) November 2003 1.1.1 FTA Circular 4220.1E (Revised) November 2003 1.1.7 FTA Procurement System Reviews (PSRs) (Revised) November 2003 1.1.9 Procurement System Self-Assessment Guide (New) November 2003 1.3.3.4 Real Estate Contracts (Revised) November 2003 1.3.3.11 Operating Assistance, Preventive Maintenance, CMAQ and JARC Projects (Revised) November 2003 4.1.2 Consolidation of Micro-Purchases (New) November 2003 4.3.2.4 Pre-Bid and Pre-Proposal Conferences (Revised) November 2003 4.3.3.2.2 Buy America Certification (Revised) November 2003 4.5.2 Evaluation of Proposals (Revised) November 2003 6.6 Insurance (Revised) November 2003 9.4 Approval of Subcontractors (formerly Section 5.1.5) Best Practices Procurement Manual - Table of Contents Page 1 FEDERAL TRANSIT ADMINISTRATION BEST PRACTICES PROCUREMENT MANUAL TABLE OF CONTENTS 1 - Purpose and Scope 1.1 Assistance, Guidance and Requirements (5/98) 1.1.1 FTA Circular 4220.1E (11/03) 1.1.2 FTA Waivers and Approvals (6/03) 1.1.3 Master Agreement (6/03) 1.1.4 Federal Acquisition Regulation (FAR) (6/03) 1.1.5 FTA Dear Colleague Letters (6/03) 1.1.6 Locating FTA Documents 6/03) 1.1.7 FTA Procurement System Reviews (PSRs) (11/03) 1.1.8 FTA HelpLine (6/03) 1.1.9 Procurement System Self-Assessment Guide (11/03) 1.2 Identifying a Contract (5/98) 1.2.1 Offer, Acceptance, Consideration (5/98) 1.2.2 Oral v. Written (5/98) 1.2.3 Mutual and Unilateral Mistakes (5/98) 1.2.4 Procurements Often Overlooked (5/98) 1.3 Applicability of Federal Requirements (5/96) 1.3.1 Recipient and Subrecipient (5/96) 1.3.2 Federal Contractual Sphere (5/96) 1.3.3 Types of Contract Actions (5/98) 1.3.3.1 Supplies, Services, Equipment and Construction (5/98) 1.3.3.2 Legal and Associated Services (5/98) 1.3.3.3 Employment Contracts (5/98) 1.3.3.4 Real Estate Contracts (11/03) 1.3.3.5 Intergovernmental Agreements, Joint Procurements, Piggybacking/Assignments (3/04) 1.3.3.6 Subgrants (6/03) 1.3.3.7 Equipment Leases (5/98) 1.3.3.8 Revenue Contracts (1/02) 1.3.3.9 Transit Oriented Joint Development Projects (7/02) 1.3.3.10 Disposition of Surplus (10/05) Best Practices Procurement Manual - Table of Contents Page 2 1.3.3.11 Operating Assistance, Preventive Maintenance, CMAQ and JARC Projects (11/03) 1.3.3.12 E-Commerce (6/03) 2 - Procurement Planning & Organization 2.1 Organization of Procurement Functions (5/96) 2.1.1 Scope of Responsibility (5/96) 2.1.2 Autonomy (5/96) 2.2 Long Term Planning (5/96) 2.2.1 Contract Period of Performance Limitation (6/03) 2.2.2 Multi-year vs. Multiple-Year Contracting (7/02) 2.3 Annual Planning (5/96) 2.3.1 Sources and Contents (5/96) 2.3.2 Independent Grantee Cost Estimate (4/05) 2.4 Source Selection Plan (5/96) 2.4.1 File Documentation (5/96) 2.4.2 Full and Open Competition (5/96) 2.4.2.1 Full and Open Competition Principle (5/96) 2.4.2.2 Restraints on Competition (5/96) 2.4.2.2.1 Brand Names (6/03) 2.4.2.2.2 Written Standards of Conduct and Conflicts of Interest: Personal and Organizational (6/03) 2.4.2.2.3 Geographic Restrictions (6/03) 2.4.2.2.4 Prequalification (5/98) 2.4.3 Fixed Price v. Cost Reimbursement (5/98) 2.4.3.1 Fixed Price Contracts (4/05) 2.4.3.2 Cost Reimbursement Contracts (6/03) 2.4.3.3 Time and Materials Contracts (5/98) 2.4.3.4 Labor Hour Contacts (5/98) 2.4.3.5 Cost Plus Percentage of Cost Contracts (6/03) Best Practices Procurement Manual - Table of Contents Page 3 2.4.4 Payments (5/98) 2.4.4.1 Payment of the Price (5/98) 2.4.4.2 Advanced Payments (6/03) 2.4.4.3 Progress Payments (4/05) 2.4.4.4 Withholding and Final Payment (5/98) 2.4.5 Indefinite Delivery Contracts (10/99) 2.4.5.1 Definite-quantity Contracts (10/99) 2.4.5.2 Requirement Contracts (6/03) 2.4.5.3 Indefinite-quantity Contracts (6/03) 3 - Specifications 3.0 Overview (6/03) 3.1 Types Of Specifications and Risks (1/98) 3.1.1 Design Specifications (1/98) 3.1.2 Performance Specifications (1/98) 3.1.3 Brand Name or Equal (1/98) 3.2 Using Consultants to Prepare Specifications (1/98) 3.3 Specifications for Equipment and Supplies (1/98) 3.4 Specifications for Construction (1/98) 3.5 Statements of Work for Services (1/98) 4 - Methods of Solicitation and Selection 4.0 Overview (5/96) 4.1 Micro-Purchases (6/03) 4.1.1 Purchase Cards BART (6/98) 4.1.2 Consolidation of Micro-Purchases (11/03) 4.2 Small Purchases (5/96) 4.3 Competitive Procurement Methods (5/96) 4.3.1 Overview -- Sealed Bids v. Competitive Proposals (5/96) 4.3.2 Common Elements of Solicitation Process (5/96) 4.3.2.1 Advertising and Publicizing Solicitation (5/96) 4.3.2.2 Solicitation Mailing List (5/96) 4.3.2.3 Solicitation (5/96) Best Practices Procurement Manual - Table of Contents Page 4 4.3.2.4 Pre-Bid and Pre-Proposal Conferences (11/03) 4.3.2.5 Amendment of Solicitations (5/96) 4.3.3 Common Elements of Offers (5/96) 4.3.3.1 Receipt of Offers (5/96) 4.3.3.2 Federally Required Submissions with Offers (5/96) 4.3.3.2.1 Certification Regarding Debarment, Suspension, and Other Responsibility Matters (5/96) 4.3.3.2.2 Buy America Certification (11/03) 4.3.3.2.3 Lobbying Certification (6/03) 4.3.3.3 Other Submissions (5/96) 4.3.3.3.1 Acknowledgment of Solicitation Addenda (5/96) 4.3.3.3.2 Bid Guaranty (5/96) 4.4 Sealed Bids (Invitation for Bids) (5/96) 4.4.0 Overview (5/96) 4.4.1 Solicitation (5/96) 4.4.2 Bid Opening (5/96) 4.4.3 Single Bid (3/04) 4.4.4 Responsive Bidder (5/96) 4.4.5 Bid Mistakes (5/96) 4.4.6 Bid Withdrawal (5/96) 4.5 Competitive Proposals (Request for Proposals) (5/96) 4.5.1 Solicitation & Receipt of Proposals (5/96) 4.5.2 Evaluation of Proposals (11/03) 4.5.3 Competitive Range (5/96) 4.5.4 Discussions and Clarifications (5/96) 4.5.5 Additional Submissions (5/96) 4.5.5.1 Request for Revised Proposals (5/96) 4.5.5.2 Request for Best and Final Offer (5/96) 4.5.6 Award Based on Initial Proposals (5/96) 4.5.7 Withdrawal of Proposals (5/96) 4.5.8 Debriefing Unsuccessful Offerors (5/96) Best Practices Procurement Manual - Table of Contents Page 5 4.6 Non-Competitive (Sole Source) Proposals (5/96) 4.6.1 Justification for Use (5/96) 4.6.2 Negotiation of Contract (5/96) 4.6.3 Associated Capital Maintenance Item (5/96) 4.6.4 Unsolicited Proposals (10/05) 4.7 Special Procurement Methods (5/96) 4.7.1 Multi-Step Procurements (5/96) 4.7.2 Governmental Prices and Contracts (5/96) 4.7.2.1 Procurements from General Services Administration Schedules (5/96) 4.7.2.2 State and Local Schedules (6/03) 4.7.2.3 State versus FTA Requirements (5/96) 4.7.3 E-Commerce: Reverse Auctions (6/03) 5 - Award of Contracts 5.0 Overview (1/98) 5.1 Responsibility of Contractor (5/98) 5.1.1 General Standards of Responsibility (5/98) 5.1.2 Special Standards of Responsibility (5/98) 5.1.3 Obtaining Information for Determination of Responsibility (5/98) 5.1.4 Determination and Documentation (5/98) 5.2 Cost and Price Analysis (6/03) 5.3 Award Procedures (5/98) 5.3.1 Public Announcements of Contract Awards (5/98) 5.3.2 Debriefing of Offerors (4/05) 5.4 Documentation of Procurement Action (5/98) 5.4.1 Sealed Bid Procurements (5/98) 5.4.1.1 Abstract of Bids (5/98) 5.4.1.2 Documentation of Award Decision (5/98) 5.4.2 Negotiated Procurements (5/98)