Current through Register Vol. XLI, No. 24, June 14, 2024
Section 148-1-7 - Purchasing Methods7.1. General. Contracts requiring more than 6 months to fulfill are filed with the State Auditor.7.2. Delegated Procurement.7.2.1. Spending units may make delegated purchases without processing the purchase as a formal solicitation through the Purchasing Division, provided that the spending unit adheres to the most current Purchasing Division procedures and requirements established by the Director. The spending unit must keep records of these purchases on file and make them available for public inspection during the normal office hours of the spending unit.7.2.1.a. Delegated Procurement Thresholds - West Virginia Code § 5A-3-10 establishes the standard delegated procurement threshold at $25,000 or less, but also permits the Director to increase that amount up to $100,000. West Virginia Code § 5A-3-11 creates a standard no bid threshold at $2,500 but also permits the Director to increase that limit. Accordingly, the following delegated procurement limits have been found to be in the best interest of the spending units and the State and are hereby applied to spending unit transactions. No Bids Required - $0 - $5,000 in aggregated spend
Verbal Bids Required - $5,000.01 - $20,000 in aggregated spend
Delegated wvOASIS Solicitation Required - $20,000.01 - $50,000 in aggregated spend
Spending units may request a higher Delegated wvOASIS Solicitation Required limit of up to $100,000 from the Director in writing. The request should include an explanation of why increasing the delegated limit is in the best interest of the spending unit and the State. The explanation should include a discussion of staff qualifications for staff designated to oversee procurement, internal controls and tracking that the agency has in place to conduct delegated procurements, planned or completed procurement training, and any procurement certifications held by procurement staff. Additionally, the Purchasing Division reserves the right to withdraw an agency's increased delegated authority at any time should it determine that doing so would be in the best interest of the State.
7.2.2. If an agency fails to comply with the procedures and requirements established for delegated procurements, or shows significant deficiencies in the processing of transactions exceeding delegated procurement limits, the Director has the ability to: 7.2.2.a. Suspend or reduce purchasing authority for that spending unit.7.2.2.b. Require the spending unit to provide additional reports and documentation relating to delegated procurements for Purchasing Division review.7.2.2.c. Require the agency to submit to additional oversight that the Director deems appropriate, or7.2.2.d. Require that the agency personnel responsible for delegated purchases participate in remedial training provided by the Purchasing Division.7.2.3. Calculating Spending Thresholds. Spending thresholds are determined as the aggregated spend by a spending unit for the same commodity or service over any 12-month period.7.3. Central Procurement. Purchases of commodities, services or printing that exceed the delegated procurement limit granted to a spending unit shall be made by the Purchasing Division.7.4. Open End Contracts and Statewide Contracts.7.4.1. The State may secure open end contracts to obtain commodities, services, or printing to supply the repetitive needs of the spending units in the form of statewide contracts, blanket orders, or spending unit contracts.7.4.2. If the Director establishes an agency open end contract, any spending unit covered by the contract is required to use it. The Director may grant a spending unit a waiver that permits the spending unit to purchase from a source other than the open-end contract.7.4.3. If the Director establishes a statewide contract, all spending units are required to use it, unless the contract is designated as non-mandatory. The Director may grant a spending unit a waiver that permits the spending unit to purchase from a source other than the statewide contract.7.4.4. Granting of a waiver from an open end or statewide contract will be considered on a case-by-case basis and will only be granted if the Director determines that granting the waiver is in the best interest of the state. A waiver will only be granted if the spending unit can show that any one of the following conditions exists:7.4.4.a. The vendor is unable to deliver the commodity or service by the required delivery date, assuming that the spending unit is not imposing an unreasonable delivery deadline;7.4.4.b. The vendor is unresponsive to ordering requests;7.4.4.c. The vendor has refused to perform.7.4.4.d. The agency can procure the same commodity or service at a lower price from another entity.7.5. Direct Award Procurement.7.5.1. The Director of Purchasing may approve the purchase of commodities, services or printing directly from a vendor as a direct award procurement without competitive bidding, if the conditions described in W. Va. Code § 5A-3-10c are followed.7.5.2. Agencies are encouraged to solicit competition rather than process a direct award request. The Director has authority to reject direct award requests whenever competition is believed to be available.7.5.3. All direct award requests made to the Director shall be publicly advertised and made available for review by vendors registered with the Purchasing Division. Should this advertisement cause interest from a vendor with the ability to provide the commodity or service, the Director may: (a) reject the direct award request and require the spending unit to submit a requisition for public advertisement and formal bidding;(b) accept the direct award request and approve the direct award contract; or(c) take other action as necessary.7.5.4. The Director may require potential direct award requests at any dollar level above $5,000 to be subject to review, approval and processing in the same manner described in these rules.7.5.5. The Director must issue prior approval or disapproval for the purchase of used equipment directly from the vendor without competitive bids. If disapproved, the Director must return the request to the spending unit and direct another method of purchasing. Notwithstanding the foregoing, approval to purchase used equipment under this subsection is contingent upon meeting all of the requirements applicable to a direct award procurement.7.6. Emergency Procurement. 7.6.1. Delegated Emergency Procurement. Spending units are permitted to procure commodities and services for immediate delivery on an emergency basis without competitive bidding and without prior approval of the Purchasing Division if the emergency procurement is necessary to avoid or abate an emergency and either: the procurement is under the spending unit's delegated limit; or the emergency is discovered outside the normal operating hours of state government and requires immediate action to avoid further damage to state property, or to address a serious safety concern. Any delegated emergency procurement undertaken by a spending unit will be processed as an agency procurement rather than a central procurement in wvOASIS.7.6.2. Non-Delegated Emergency Procurement. Spending units are permitted to procure commodities and services for immediate delivery on an emergency basis without competitive bidding in all other emergency circumstances not covered by 7.6.1. above by first obtaining prior written approval from the Purchasing Division. The approval request should contain a description of the emergency circumstances, the proposed remedy, the cost of the remedy, and the proposed contract duration. The Director shall review a spending unit's written request and issue written approval or disapproval. Any non-delegated emergency procurement undertaken by a spending unit hereunder will be processed as an agency procurement rather than a central procurement in wvOASIS.7.6.3. Reporting Emergency Procurement. All emergency procurements will be identified, reported to the Purchasing Division pursuant to W. Va. Code § 5A-3-4(a)(2) and W. Va. Code § 5A-3-15, and posted publicly to the Purchasing Division's website. 7.6.3.a. Any delegated emergency procurement completed under Section 7.6.1. must be reported to the Purchasing Division within 30 days of the emergency being approved so that the Purchasing Division can perform the public posting. The report to the Purchasing Division must include a copy of the emergency determination/approval with enough detail to clearly understand why the situation is an emergency, any bids obtained, and documentation evidencing what was purchased and at what price, along with any executed contract documents.7.6.3.b. Any non-delegated emergency procurement approved by the Purchasing Division will be posted publicly to the Purchasing Division's website and include a copy of the emergency procurement request and approval by the Purchasing Division. Within 30 days of the emergency approval, the agency must also provide the Purchasing Division with documentation evidencing what was purchased and at what price, along with any executed contract documents, which will also be posted to the website.7.6.4. Emergency procurements conducted under this section should include three bids, written or documented verbal, if obtaining those bids would not significantly impair the spending unit's ability to prevent or abate the emergency. A record of any bids obtained must be maintained in the spending unit's contract file and available for inspection upon request.7.6.5. What qualifies as an emergency under this subsection must be evaluated on a case-by-case basis and will include unforeseen events or circumstances, including delays by contractors, delays in transportation, or an unanticipated volume of work, as well as procurement of specific commodities for immediate delivery related to an official declaration of emergency by the Governor or federal officials.7.7. Best Value Procurement. 7.7.1. The term best value procurement means a request for proposal as described in W.Va. Code § 5A-3-10b or an Expression of Interest as described in W.Va. Code § 5G-1-1.7.7.2. Requests for Quotation are the preferred method of procurement, but a spending unit may utilize a best value procurement method to procure goods, services, or printing, excluding construction. To utilize a request for proposal, the spending unit must provide adequate justification explaining why an evaluation based on price and compliance with specification alone would not be adequate. The Director shall review each request to utilize a request for proposal and may permit the use of a request for proposal if he or she determines in writing that it is in the best interest of the state.7.7.3. A request for proposal must contain provisions for a two-part evaluation, the first part being technical aspects of the proposal and the second part being cost to the State. The two components are evaluated, scored, and combined to form a total score. The highest scoring vendor will be awarded a contract.7.7.4. Expressions of interest may only be used to procure architectural, engineering, or other services contained within Chapter 5G, Article 1 of the West Virginia Code.7.8. Purchases from contracts issued by other public agencies and entities. 7.8.1. The Director may approve a request by a spending unit to purchase from, join as a party, or otherwise utilize contracts issued by agencies of the federal government, agencies of other states, other public bodies, or other state agencies. The Director may also sign an agreement with a vendor that has the effect of adding state spending units to a contract issued by agencies of the federal government, agencies of other states, other public bodies, or other state agencies. The Director may, but is not required to, designate such a contract as a statewide contract and require that spending units utilize it. The Director may also lead, participate in, or join after issuance cooperative purchasing arrangements with other public agencies and entities created by public agencies. Before undertaking any activity authorized by this section, the Director shall determine that the contracts being utilized and/or created are valid, properly awarded, financially advantageous, and comparable to what can be obtained through competitive bidding. The last requirement will be satisfied if the contract was created or is to be created from a competitive procurement method.
The Director shall require spending units, or the Purchasing Division if acting without a spending unit request, to prove that their requests to use such contracts do not conflict with existing contracts that the spending unit is required to utilize.
7.8.2. All spending unit requests to take an action authorized under this subsection must be submitted in advance to the Director with necessary evidence and documentation to show that such action is in the best interest of the State. The Director shall approve only those requests submitted with evidence that justifies use of such contracts. Any request that is not supportable shall be returned to the spending unit.7.9. Multiple Awards.7.9.1. The Director may elect to award a contract to more than one vendor when the Director determines in writing such action would be in the best interest of the State. In arriving at a determination, the Director will consider the following factors, insofar as they are applicable:7.9.1.a. The quality, availability, and reliability of the supplies, materials, equipment, or service and their adaptability to the particular use required;7.9.1.b. The ability, capacity, and skill of the bidder;7.9.1.c. The sufficiency of the bidder's financial resources;7.9.1.d. The bidder's ability to provide maintenance, repair parts, and service;7.9.1.e. The compatibility with existing equipment;7.9.1.f. The need for flexibility in evaluating new products on a large scale before becoming contractually committed for all use; and7.9.1.g. Any other relevant factors.7.9.2. In situations where a multiple award is necessary, the Director shall place a written explanation into the public file. If a multiple award is requested by a spending unit, that spending unit must provide written justification to the Director. The Director's decision shall be final in all cases.7.10. Negotiation When All Bids Exceed Available Funds.7.10.1. Spending units must submit a valid maximum budgeted amount for each requisition to the Purchasing Division. The maximum budgeted amount may not be disclosed to any vendor prior to the bid opening and may not be changed after the bid opening.7.10.2. If all bids meeting requirements exceed the funds available for the purchase, the Purchasing Division may negotiate a lower price within budget with the lowest bidder meeting specifications. If the negotiation does not lead to the budget amount being met, the Director may negotiate a lower price with the next lowest bidder and continue negotiations with participating bidders after negotiations close with the preceding bidder. In conducting discussions, there may be no disclosure of any information derived from proposals submitted by competing bidders.7.10.3. If the Purchasing Division solicits bids utilizing a best value procurement, and there is more than one bidder, the Director may negotiate a lower price with the highest ranked bidder. If the Director does not award the contract to the highest scoring bidder, he or she may close negotiations with that bidder and enter into negotiations with the next highest scoring bidder and may continue to do so in like manner with the remaining responsive and responsible bidders. The Director may not extend an offer to any bidder that is not first extended to the prior bidders in order of rank Nothing contained herein is intended to supersede the requirements contained in Chapter 5G, Article 1 or the West Virginia Code.7.10.4. If agencies fail to provide a valid maximum budgeted amount, the Director shall not permit negotiation.7.10.5. The Director shall determine the method of negotiation.7.11. Discussion and Final Offers. 7.11.1. The Director may conduct discussions to obtain best and final offers from bidders to assure full understanding of solicitation requirements. If the Director determines that a best and final offer is necessary from one vendor, all vendors shall be afforded the opportunity to provide best and final offers.7.11.2. All best and final offers shall be treated like a formal bid, except that advertising is not required. All bidders must provide their best and final offers to the Purchasing Division prior to the date and time specified by the Director.7.11.3. Government construction contracts and supplies/material to be used in construction are exempt from this section pursuant to W.Va. Code § 5A-3-11(b)(1) and (2).7.12. Contract Management. 7.12.1. For contracts for commodities and services in the amount of $1 million or less, the Director may prescribe contract management procedures for all state contracts, except government construction contracts. These procedures may include, but are not limited to: 7.12.1.a. Establishing payment benchmarks to assure the State receives value prior to remitting payment;7.12.1.b. Conducting regular meetings between spending unit and vendor to assess contract performance;7.12.1.c. Training spending unit personnel to manage contracts; or7.12.1.d. Using the Office of Technology Project Manager for its projects.7.12.2. For contracts for commodities and services in an amount exceeding $1 million, the following contract management procedures apply: 7.12.2.a. Post Award Conferences. The agency administrator responsible for administering the contract must hold a post award conference with the contractor to ensure a clear and mutual understanding of all contract terms and conditions, and the respective responsibilities of all parties. The agenda for the conference must include, at a minimum, the introduction of all participants and identification of agency and contractor key personnel, and discussion of the following items: 7.12.2.a.1. The scope of the contract, including specifications of what the agency is buying;7.12.2.a.2. The contract terms and conditions, particularly any special contract provisions;7.12.2.a.3. The technical and reporting requirements of the contract;7.12.2.a.4. The contract administration procedures, including contract monitoring and progress measurement;7.12.2.a.5. The rights and obligations of both parties and the contractor performance evaluation procedures;7.12.2.a.6. An explanation that the contractor will be evaluated on its performance both during and at the conclusion of the contract and that such information may be considered in the selection of future contracts;7.12.2.a.7. Potential contract problem areas and possible solutions;7.12.2.a.8. Invoicing requirements and payment procedures, with particular attention to whether payment will be made according to milestones achieved by the contractor;7.12.2.a.9. An explanation of the limits of authority of the personnel of both the agency and the contractor.7.12.2.b. Monitoring -- The agency must develop a comprehensive and objective monitoring checklist which: 7.12.2.b.1. Measures outcomes;7.12.2.b.2. Monitors compliance with contract requirements; and7.12.2.b.3. Assesses contractor performance.7.12.3. Reports. The agency must make the following reports to the Director, on a schedule established by the Director, but not less frequently than once a year: 7.12.3.a. Status Reports. Status reports describe the progress of the work; track the organizational structure of the statement of work in terms of phases, segments, deliverables and products; and describe what work is complete and what work is pending and contrast that status against the contract schedule. If there are any unresolved issues that the agency is contractually obligated to resolve, those issues should be included in the status report and a resolution should be requested.7.12.3.b. Activity Reports. Activity reports describe all activity on the project, regardless of whether substantial progress has been made toward completion of the project. If payment is based on the number of completed transactions, these activities must be specifically set out in the report.7.13. Inspection. 7.13.1. The agency must inspect all materials, supplies, and equipment upon delivery and again prior to final acceptance to insure compliance with the contract requirements and specifications.7.13.2. The agency must report any discrepancies to the Director immediately.7.13.3. If unlisted shortages are discovered, the vendor and the Director must be notified immediately.7.13.4. A contractor may be required to pick up any merchandise not conforming to specifications and replace the merchandise immediately.7.14. Substitutions. Substitution of items called for in a contract is not permitted without the Director's prior approval. The Director will not approve substitution of items unless the substituted items are of equal quality and are offered at the same or lower price.