Five Methods To Follow For Successful Federal Procurement Efforts – Rea CPA

Five Methods To Follow For Successful Federal Procurement Efforts

Procurement standards in 2 CFR 200.317 through 200.326 of the UGG

Looking for a little more clarification when it comes to how your entity should handle purchases, bids, and proposals? Read on for a brief summary of these federal procurement standards and additional considerations associated with CFR 200.317-200.326.


Read Also: Uniform Guidance Procurement Standards Compliance


Micro Purchase

The aggregate dollar amount is not to exceed $10,000. The entity must attempt to distribute purchases equitably among qualified suppliers.

Small Purchase

The aggregate dollar amount is between $10,000 and the Simplified Acquisition Threshold (SAT) of $250,000. The entity must obtain and document price or rate quotations from an adequate number of qualified sources. However, price/cost analysis is not required before obtaining such quotes.

Sealed Bids

Purchases greater than $250,000 that lends itself to a firm, fixed-price contract and selection of the successful bidder can be made principally on the basis of price (i.e. construction type contracts).

Competitive Proposals

Purchases greater than $250,000 that do not meet the requirements for sealed bid purchases. This is similar to the request for proposal (RFP) process many entities are already familiar with. Proposals must be solicited from an adequate number of sources and the entity must have a WRITTEN method for evaluating the proposals.

Noncompetitive Proposal

This method is only used if:

  • The item is only available from a single source.
  • The public need or emergency for the requirement will not allow for competitive solicitation.
  • The Federal awarding agency or pass-through entity expressly authorizes.
  • After solicitation of a number of sources, competition is determined inadequate (i.e. limited proposals received under the competitive RFP process).

With this method, we would caution entities to be sure to have all the necessary documentation needed to support the noncompetitive proposal process. In other words, entities should expect this method and supporting documentation to be scrutinized during the audit process.

  • Written procedures are required to be implemented with board-approved policies. These written procedures will likely be a key part of any audit or oversight monitoring.

For school districts: Please remember these rules apply to food service (006) funding as well; since these funds are considered program income of the Child Nutrition Cluster. After going through an audit cycle under these new procurement rules, we noted some specific situations that you will want to make sure you address.

It is especially important to clearly define how to determine what an aggregate purchase is, and how that applies to your foodservice purchases.

Be careful when entering into agreements (sponsorship for example) that obligate your foodservice department to purchase specific brands or products. This obligation can be determined restrictive of competition and result in non-compliance.

Be careful when entering into agreements (sponsorship for example) that obligate your foodservice department to purchase specific brands or products. This obligation can be determined restrictive of competition and result in non-compliance.


Read Also: Prevent A Nutrition Cluster Finding


Also, be sure you are reviewing your policies and procedures for USDA and ODE requirements. These are additional requirements specifically for foodservice procurement above and beyond the overall UG requirements. Some of the USDA requirements include:

  • Clauses and procedures for Byrd Anti-Lobbying, termination for cause and for convenience, Equal Employment Opportunity, and Contract work/Safety Standards Act.
  • Procedures for small, minority, and women’s businesses and labor surplus firms.

Other common themes we have noticed when applying these procurement rules is that it is not one size fits all. Each entity has very specific and unique situations that must be evaluated to determine the correct procurement method. For example, when an IDP student expressly names a service that is to be provided to the school.

These types of situations may require you to document the justification for other than free and open competition. Be sure you are reaching out to your trusted advisors to help you through these unique situations.

By Cody Dial (Millersburg Office)

Looking for more insight? Check out these resources:

Key Changes To The 2019 OMB Compliance Supplement

Be In The Know When It Comes To The Schedule Of Expenditures Of Federal Awards

Six Policies & Procedures All Government Entities Should Implement, Update

Sign up for updates!