MATERIALS MANAGEMENT HOME | HU HOME | SEARCH
Howard University
Purchasing Policies and Procedures Manual
  You are at: HU Home > Administration > Provost > Materials Management > Purchasing Policies and Procedures Manual

Purchasing Manual
VI. Competitive Bidding
<< Return to the Contents

Page Index:
Policy
Procedures
   A. Preparation for Invitation for Bids
      1. Small Purchases
      2. Telephone Quotations
      3. Informal Bids
      4. Formal Bid
   B. Vendors to be Solicited
   C. Receipt and Opening of Bids
      1. Bid Changes
      2. Late Bids
      3. Bid Withdrawal
      4. Bid Opening
         a. Contract Award Letter
         b. Unsigned Bids
      5. Samples
      6. Performance Bonds
   D. Bid Evaluation and Award
      1. Definition of the Lowest Responsible Responsive Bidder
      2. Tie Bids
      3. Failure to Meet Bid Specifications
      4. Failure of All Bidders to Meet Bid Specifications
   E. Exceptions to the Normal Competitive Bidding Process
      1. Sole Source/Best Source Requests for Purchases
      2. Emergency Requirements
      3. Professional Services


POLICY

  • Competition shall be obtained from a sufficient number of qualified vendors by the Central Purchasing Activity for all commodities and services that are procured by Howard University. The Materials Management Department (MMD) shall be responsible for obtaining the best value for purchases by evaluating bids on the basis of price and other pertinent factors (e.g., quality, service). The lowest responsible responsive bidder shall be selected for all purchases when in the best interest of Howard University.
  • All exceptions to the competitive bidding procedure must be approved by MMD. The MMD Director has the authority to exempt purchases from the competitive bidding procedure if the purchases qualify as "Exemptions to Competitive Bidding Procedure".
  • The procedures for preparing and administering bids shall be determined by the estimated amount on the Request for Purchases, as dictated by the parameters of the competitive bidding procedure. Competitive prices shall be solicited by the following methods for purchases within the specified dollar amounts: $0 - $2,500 Verify cost is fair/reasonable; $2,501- $15,000 Telephone Quotations; $15,001 - $25,000 Informal Bid; $25,001 and up Formal Sealed Bid.
  • All informal and formal bids submitted by bidders shall be binding for 30 to 45 days after the bid opening date. MMD shall be impartial in conducting business with all vendors.

PROCEDURES

A. Preparation for Invitation for Bids

The buyers will be responsible for preparing invitations for bids and executing the bid solicitation process. The following paragraphs set forth the procedures to be used for soliciting competition, and the documentation required for the process.

University Purchasing Policy is amended effective February 15, 1995 to permit the procurement of goods and services by means of negotiation more so than formal advertisement for small purchases not exceeding $2,500 reducing administrative costs for acquisition of items considered as small purchases. In addition to reducing administrative cost, other benefits for increasing this limitation include improved opportunities for minority and small business enterprises to obtain a fair proportion of University purchases and contracts; elimination of costly and time consuming paper processes thus expediting the issuance of orders; delivery of goods and services permitting the full utilization of negotiation techniques and expertise of MMD personnel to expand and further assure the University obtains quality materials and service in addition to fair and reasonable prices.

1. Small Purchases

Small purchases is defined as those requirements for materials and services where the aggregate amount involved in any one transaction does not exceed $2,500. 

$0 - $2,500. - Small purchases may be accomplished without securing competitive quotations and bids if the price quote is considered to be reasonable and terms and delivery dates are conducive to our needs. In situations where prices are determined to be questionable, competitive quotations will be obtained by the buyer. Regardless, MMD will be responsible to assure reasonableness of pricing is monitored in both cases based on personal knowledge and market conditions. When necessary conduct a comprehensive cost analysis of the procurement transaction.

2. Telephone Quotations

For purchases estimated to be over $2,500, quotations from a minimum three different vendors should be obtained by the buyer. The buyer shall obtain telephone quotes from the selected vendors and record the results on the Telephone Quotation Form. The successful bidder and pertinent bidder information shall be recorded on the Telephone Quotation Form.  

$2,500.01 - $15,000. - Purchases in this range estimated not to exceed $15,000 may be solicited  by the buyer orally by telephone quotation, provided the supplier is located in the local area. Written quotations shall be obtained for purchases not in excess of $15,000 in such circumstances as where suppliers are located outside of local area; detailed specifications are involved; a large number of items are included in a single proposal, or obtaining oral quotations is not considered logical or efficient. In cases where the University has negotiated a purchasing agreement/contract or a Federal Supply Schedule contract is available this information shall be used in lieu of obtaining individual quotations each time a purchase is contemplated. In the case where oral quotations are obtained informal records shall clearly document the propriety of placing the order at the price indicated with the supplier concerned. Such documentation shall consist of notations on the informal record noting the names of suppliers contacted to include the supplier representative providing the quotation, their prices, terms, and conditions as quoted by each. Further the basis of award decision shall be documented. In any case a minimum of three quotations shall be solicited.

If fewer than three vendors are solicited, the buyer must document the reason on the Telephone Quotation Form. Similar documentation must also be provided if other than the lowest bidder is selected. 

3. Informal Bids

$15,000.01 - $25,000. - Purchases in this range estimated not to exceed $25,000 shall be effected by written quotation in all cases. Written quotation shall be in response to University prepared specifications. Quotations will address pricing, delivery, discounts, terms, conditions, and other factors critical to an award decision. For this policy, request for purchases shall not be divided or broken down into several purchases which are less than $15,000 for the purpose of permitting negotiation or abuse to small purchase methods and procedures. Written documentation supporting the prices paid shall be maintained in the purchase order file. In any case a  minimum of three written quotations shall be required. 

 Each solicitation is assigned a bid number from a consecutive series of numbers to be used for informal solicitations during the year. Bidders are then selected from the appropriate bidders' list and a bid submission date is designated. The date for bid submission should be within two (2) weeks of the date of the solicitation. Bid specifications are prepared by the buyer from the commodity description on the Request for Purchase .

The Request for Informal Bid is prepared by the Buyer, who is responsible for verifying that the bidder's list has been properly referenced and that a bid submission date has been established. The Request for Informal Bid which the bidder completes is sent to all bidders. The original copy is retained by the buyer and filed in the pending informal bid file, by reply date.

Vendors are required to return their bids in a sealed envelope. The Informal Bid is dated and time stamped when it is received and the document is placed in the pending informal bid file.

Buyers should refer daily to the pending informal bid file to determine which bids, if any, are due. Bids are received and opened simultaneously, reviewed, and tabulated on the Bid Tabulation Sheet. In accordance with established policies, awards are made to the lowest responsible responsive bidder. Awards not made to the lowest responsible responsive bidder will be determined by the MMD Director and justification for action taken will be indicated in the designated area on the Bid Tabulation Sheet. The Bid Tabulation Sheet will be available for inspection by the public upon request.

The name of the successful bidder is typed on the Request for Purchases, and the comptroller's copy of the Request for Purchases is sent to Accounts Payable.

4. Formal Bids

$25,000 - and above - Requirements in excess of $25,000 shall be obtained by the competitive formal bid process (Invitation for Bid). The exception to this requirement shall be in cases where the University has established a contract with the supplier or a Federal Supply schedule exists under the provisions of GSA contracts; or university negotiated long standing agreements.

All formal bids are assigned a bid number from a consecutive series of numbers to be used for formal solicitations during the year. The buyer also assigns a bid opening date and time. As a general rule, the bid opening date should be within two (2) to three (3) weeks from the date of solicitation.

Bid specifications are prepared by either the user department, if the commodity is of a highly technical nature (scope of work, architectural or engineering plans), or by MMD if the commodity or service is of a more general nature. If the procurement is for construction or renovation, a date is assigned for bidders to visit the site.

The assigned buyer completes an Invitation for Bid form which describes the commodities under bid, and sets forth the general conditions and specifications for the bid. Solicitations involving less than $25,000 will be reviewed by the Procurement Analyst; those in excess of $25,000 must be reviewed by the Director or Deputy Director if so delegated. The original copy of the Solicitation and Award form is filed in the open formal bid file, by bid opening date. A memorandum of solicitation is prepared by the buyer and sent to the user department, advising that the solicitation is under way.

As vendors submit their sealed bids to MMD the buyer records on the bid envelope the time and date of receipt, and files them unopened in the pending formal bid file with the original copy of the formal bid. At the designated time for the public bid opening, all bids will be opened and recorded by the Senior Buyer or in his absence the Buyer.

B. Vendors to be Solicited

To the extent practical, bidders will be selected from the bidders' list on a rotational basis so as to ensure complete coverage of entire bidders list. A minimum of three bidders shall be selected from the appropriate bidders' list except in the case of the formal bidding process which requires that all vendors on the bidder's list be solicited when list is a composite of 8 vendors or less.

C. Receipt and Opening of Bids

The sealed bid process is predicated on the assumption that all bidders submit their bids without knowledge of the prices offered by their competitors. To accomplish this it is the University's policy under the formal bidding to have public bid openings and in all cases to require tabulation of bids that are recorded and made available to the public when requested.

1. Bid Changes

Modifications to a bid may be made by a vendor anytime prior to the established bid opening date and time. Although changes may be transmitted by telephone, written confirmation of such changes must be sent by the bidder to MMD either by letter or telegram and must be received prior to bid opening for the change to be instituted. No changes will be permitted after the set date and time for bid opening.

2. Late Bids

A late bid is considered to be a bid which arrives at MMD after the scheduled bid submission time. For formal and informal bids, late bids are not accepted. All late bids shall be returned unopened, to the bidder, with the designation LATE BID on the envelope and the evidence of  MMD date and time stamp.

3. Bid Withdrawal

Bidders shall be permitted to withdraw their formal or informal bids at any time prior to the bid opening. Bidders must submit their intention to withdraw bids in writing to the MMD Director for appropriate action.

4. Bid Opening

All formal bids shall be publicly opened by the Buyer, in his/her absence the Procurement Analyst, normally at the time and date specified in the bid. All bidders and the general public are invited to attend. Each bid shall be opened, the bid quotations read, and quotations recorded on the Bid Tabulation Sheet. Bidders will not be permitted to amend their bids and must abide by terms and conditions as set forth in their bids. The bid Tabulation Sheets and bid files will be available for public inspection once a successful bidder has been selected.

The bid award should be made to the lowest responsible responsive bidder. If the lowest bidder is not selected, justification for the action must be indicated on the Bid Tabulation Sheet and approved by the MMD Director.

The successful bidder's name is placed on the Request for Purchases and the document encumbrance to verify fund availability.

a. Contract Award Letter

A notice of award confirmation shall be sent to all bidders, successful and unsuccessful, for awards over $15,000 identifying awardee. The notice will indicate the following:

  •  Name and address of the bidder.
  •  Bid name, bid number, and description. 
  •  Amount of contract award and the name of the awardee

b. Unsigned Bids

All bids submitted in writing to MMD must be signed by an authorized representative of the vendor. The vendor's pre-qualification statement exhibits the signatures of all authorized contracting personnel and shall be referenced by MMD personnel to ascertain that proper vendor personnel are signing contracts. All unsigned bids will be returned to the vendor with a written explanation of why the bid has been returned.

5. Samples

Samples may be required for bids for various commodities. Bidders must submit samples no later than the bid opening date and at their own expense. When samples have been submitted to MMD, they become the property of the MMD and may be kept to insure that materials delivered meet the original specifications contained in the solicitation. If samples have not been damaged or are no longer needed, the MMD will return them to the bidder upon written request.

6. Performance Bonds

Performance bonds may be required where one or any combination of the following conditions are present:. 

  • The commodity is of high value, e.g., over $25,000. Value criteria is based on individual items, not on the total amount of the bid.
  • The University could sustain material damages, monetary losses and/or interruption of University operations, if vendor failed to deliver commodity.

The Materials Management Director or, in his absence, the Deputy Director, shall determine if a performance bond is required. Should this requirement be considered necessary it will be set forth in the bid solicitation by indicating that a performance bond will be required from the successful bidder. Successful bidders have five working days to submit their performance bond to MMD. If the performance bond is not submitted within the designated time, then the bidder shall be considered to be in default and appropriate action shall be taken, which may include the selection of the next lowest responsible bidder or re-solicitation of bids.

All performance bonds must meet the following requirements:. 

  • The surety company issuing the bond must be licensed to do business in the District of Columbia.. 
  • Chief officials of corporations, partnerships, and individual businesses must sign the surety bonds, and indicate their position in the organization. 

Performance bonds may be submitted in the following forms:

  •  Specific Performance Bonds - this bond is submitted on an individual bid basis and shall be expressed as a certain percentage of the total bid amount.
  •  Blanket Performance Bond - this type of bond is based on the estimated value of purchase orders the vendor expects to obtain from the University during the fiscal year. Bonds may be submitted anytime during the fiscal year, but shall become effective on the approval date and continue to be effective to the end of the fiscal year. This alternative allows the bidder to use a single bond to secure several bids throughout the year.

Blanket performance bonds must cover one hundred percent of all Howard University contracts and purchase orders held by the vendor at any one time.

D. Bid Evaluation and Award

Contract awards will normally be made to the lowest responsible responsive bidder. The following paragraphs describe the criteria for determining the lowest responsible responsive bidder, as well as other pertinent factors and circumstances that enter into bid evaluation.

1. Definition of the Lowest Responsible Responsive Bidder

The lowest responsible responsive bidder is defined as the bidder who submits the lowest bid quotation in accordance with all requirements set forth in the bid specification, with consideration given to such factors as:

  • lowest price - offered as determined by appropriate cost analysis.
  • reliability and integrity - does not have a record of contract default or malfeasance in attempting to secure a contract.
  • financial ability - has a sound financial condition as evidenced by financial statements.. service and delivery - capable of delivering the specified products, in the required quality and quantity, on time.

The lowest bidder is not always the lowest responsible responsive bidder. Judgment must be exercised in evaluating the criteria to determine the lowest responsible responsive bidder and, therefore, obtaining the best value for the University.

2. Tie Bids

In the event that two or more equally qualified bidders submit the same bid amount, which are also the lowest bids, the MMD Director shall award the contract by publicly drawing lots. The drawing shall be conducted in the presence of two witnesses and shall be documented to that effect.

3. Failure to Meet Bid Specifications

Bidders are required to submit bids in accordance with the specifications set forth in the Bid Solicitation and Award form of the Formal Bid. If substitute commodities or variations from the desired specifications are submitted for bid, there shall be appropriate documentation noting this fact. Departures from the requested specifications shall not be considered unless no other bids are submitted and the requesting department, in conjunction with MMD, modifies its requirements. All amendments to bid specifications must be approved by the MMD Director.

4. Failure of All Bidders to Meet Bid Specifications

When all bids submitted do not meet bid specifications, the MMD Director shall review all bids and investigate the reasons for noncompliance. The requesting department shall be contacted and informed of the MMD Director's findings. If the MMD Director determines that it is highly unlikely that the initial specifications can be met by any known vendor, revised specifications will be developed by the using department and the commodity will be re-solicited. However, if the specifications are considered to be reasonable and representative of the commodity, MMD will request bids from other vendors on the bidder's list who may not have been contacted during the original solicitation.

E. Exceptions to the Normal Competitive Bidding Process

Although competition should be required whenever practicable, a degree of latitude should be permitted when competition may not be feasible for specific commodities, services, and circumstances. Single source items, compatible parts, and commodities and services required on emergency bases are major categories of purchases which typically cannot be acquired through the normal competitive bidding process.

1. Sole Source/Best Source Requests for Purchases:

When the department determines a contractor as ‘Sole Source or Best Source’ to provide specified goods/services, they must provide a memorandum to MMD indicating how the determination was made. Sole source applies when there is actually only one source that can provide the goods and services requested. In this instance, the suggested company is the manufacturer and direct distributor of the product or the sole authorized vendor to provide requested services.

Best source justification applies when there is more than one source for the requested product or service. However, there should be justifiable/compelling reasons to select a particular vendor more so than others.

Since the procurement policy of the University stipulates that maximum competition be obtained for purchases, Request for Purchases for sole source and best source vendors must be reviewed and approved by the Director of MMD prior to purchase.

2. Emergency Requirements:

The University does not encourage the issuance of Emergency Purchase Orders caused by poor planning of requestors. However, consideration will be given with adequate justifications to protect the interests of the University. All emergency requests must be approved by the Director of MMD prior to an order being placed with a vendor. An emergency may be defined as:

  • An act of God or other uncontrollable events which may disrupt the normal operation of the University.
  • A situation exists that threatens or endangers the life, health, safety or well being of University Faculty, Students, Staff and/or the interacting General Public.
  • Serious damage to property where immediate remedy is required.
  • Educational programs or other special events will be seriously hampered or disrupted which may embarrass the reputation of the University.
  • Business affairs of the University will be adversely affected.

When an emergency arises, an emergency RFP should be submitted to MMD with written justification. However, whenever possible, informal proposals or telephone quotes must be obtained from more than one vendor and it must be recorded. After approval by the Director of MMD, an emergency PO is issued to fulfill the necessary requirement.

3. Professional Services:

Purchase and contracts for personal or professional services may be exempted from competitive bidding process:

  • Services performed by an individual of special skills, e.g. Doctor, Attorney, Teacher, Accountant, Photographer, etc.
  • Services provided by a university, college, or other educational institutions
  • Educational or vocational training services
  • Experimental, developmental or research work
  • Analysis, studies, or reports
  • Medicines and medical supplies
  • Supplies purchased for authorized resale
  • Perishable or non perishable subsistence supplies
  • Electric power or energy, gas, water or other utility services where the prices are controlled by the Public Service Commission or government agencies
  • Acquisition of training film, motion picture production, manuscripts or similar products or services
  • Technical non personal services involving the assembly, installation, or servicing of equipment of highly technical or specialized nature
  • Parts or components as replacement parts of equipment specially designed by the manufacturer
  • When acquiring construction where a contractor or group of contractors is already at work on the site, and it would not be practicable to allow another contractor to work on the same site
  • Technical equipment requiring standardization and interchangeability of parts
  • Rental of hotel facilities for guest accommodation, or conference where specifications may be vague or requirement may be unique based on individual or group demands
  • Advertisement to attract a particular ethnic or gender group for special research purpose.
2001 Howard University, all rights reserved.
HOWARD UNIVERSITY, 2400 Sixth Street, NW, Washington, DC 20059 - Main Phone: 202-806-6100
HU Webmaster / HU Contacts - WWW Disclaimer
Need help with your Web site? Check out Webcenter