Georgia Procurement for Private Vendors
Georgia is built on the ingenuity of past entrepreneurs and their businesses, molding not only the state’s economy and industry, but symbolic representation as well. S.H. Rumph of Marshallville was the first to grow peaches in Georgia, establishing the state’s infamous connection with the fruit.[i] The Georgia railroad shaped the state’s reputation as well as its position within the country. Today’s Georgia business owners and private contractors are no less important to the state’s development, especially when they deal directly with the government through public bidding. Government contracting allows private businesses to competitively bid for work with the state and local government entities of Georgia, benefiting both buyer and seller.
Methods and Types of Contracting[ii]
To effectively contract with Georgia government entities, private contractors must be familiar with both bidding procedure and jargon. This includes widely used terms, acronyms (see figure 1.1 for a complete list of common acronyms) and general vocabulary.
Contract Methods
There are four basic requests used when contracting with the government: Request for Quotation (RFQ), Request for Proposal (RFP), Request for Information (RFI) and Request for Qualified Contractor (RFQC).
RFQs are used with very specific requests, when the desired item can be explicitly described. For example, a government entity needing a particular item with distinct specifications would use an RFQ to contact private contractors and request their quote for the item or work. An RFP is similar to an RFQ except that the work being solicited is not as clear-cut. An RFP calls for contractors who can fulfill a unique procurement, providing expertise and creativity as well as completing the actual project. Instead of choosing the lowest bid, as with a RFQ, the procurement officer will choose the vendor who will provide the best value, combining all possible costs while factoring quality of product. An RFI is a less formal solicitation and does not always result in a contract. Procurement departments use RFIs to gather information from vendors in order to determine if a RFQ or RFP is suitable to fill a request. The final type of request, and RFQC, is used to find a vendor with the qualifications needed to fill the request. The more familiar bidders are with contracting terminology and the differences between requests, the more likely they are to find bids and win them.
Contract Types
Contracts are defined and categorized depending on many variables. First, they are defined by who is offering the bid. State contracts are either offered through individual agencies or the state procurement department. This is the same for counties, cities and smaller governments: depending on the projected cost of the request, the bid will be available through either the entity’s procurement department or the agency within the government who is making the request. Individual agencies can advertise and procure their own bids as long as they do not exceed a predetermined cost ceiling, which is determined by the size of the entity. Once this ceiling is hit, the state or local procurement department is responsible for filling the request.
Another distinction is the product requested in the bid. There are two types: contracts to procure goods and contracts to procure services. Though the procedure is not drastically different, different paperwork is required for each type. A contract to procure a good, for example, can specifically describe their request whereas a contract to procure a service must define the time, labor and/or effort of a contractor.
The type of financial transaction also determines the type of contract. Purchase contracts are the most common. This is when the procurer pays for the good or service at one time. Contractors may also rent or lease when the desired product is equipment or an item they would only need temporarily. Contractors may also choose to pay in installments, which is more common with long-term contracts.
The final division is between fixed and open contracts. A fixed quantity contract defines the exact quantities needed when the contract is established. An open contract is used when exact quantities are unknown
Public Notice
Contracts are not the only documents that are required to be posted publicly during the bidding process. Government contractors must also post a Notice if Intent to Award, Notice of Award and the Contract Award. The Notice of Intent declares the government contractor’s intention to award the contract to the successful bidder and a list of all the bidders who did not win the contract and why the unsuccessful bidders were rejected. The Notice of Intent is posted before the actual award and is only required for requests over $100,000. The Notice of Award also declares the awarded bidder and those rejected, along with the reason for rejection. The Notice of Award is publicly posted within one day of the actual awarding of the contract. Finally, the Contract Award must be publicly posted and can generally be found in the same place bids are posted.
Special Approval
Some bids require special approval before they can be publicly posted. Requests for motor vehicles must get approval from the Department of Administrative Services (DOAS) before the bid for the vehicle is posted. Technology products and services must be procured through the Georgia Technology Authority. In all replacement cases, the procurement officer assigned to the request must receive permission from the DOAS to verify the replacement is necessary.
State Level Procurement
The State of Georgia employs private contractors from all industries, from computer technicians to health service providers. But in comparison to the number of available bids, few Georgia businesses are taking advantage of the opportunity to contract with the peach state. This may be because most businesses would not immediately think of the government as a potential customer or know how to make it one.
Agency Procurement Officer Check
Before bids are offered to the public, an Agency Procurement Officer (APO) must review them. The APO first determines if a preexisting statewide or agency contract can fulfill the request. If there is no preexisting contract, the APO will then calculate the cost of the request. If it is under $5,000 the request may be fulfilled without public bidding. If the request is between $5,000 and $10,000 and within the agency’s procurement budget, or Delegated Purchasing Authority (DPA), the agency’s APO can purchase the request through competitive bidding. If over $10,000 the request must be processed through the State Procurement Department (SPD). In a nutshell, the APO must first determine if a request can already be fulfilled, then the cost of the request and then, depending on cost, whether the individual agency will pay for it non-competitively or competitively or if the request must go through Georgia’s SPD
Georgia State Procurement Department
The Georgia State Procurement Department (SDP) fulfills agency requests for goods or services over $10,000. Once the SDP receives the request, it is reviewed for both for completeness and competitiveness. If a request is deemed too competitively restrictive, the SPD will adjust it so more private contractors will be able to participate in the bidding. After these checks are finished and changes are made, the bid is posted on the State Procurement Website and is available for a predetermined time for public bidding. The SPD determines the responsibility of bidders before the contract is granted. Characteristics of non-responsible bidders include a “history of nonperformance or performance problems on other contracts (public or private), a record of financial difficulty, business instability, criminal sanctions, civil sanctions, and/or tax delinquency”[iii] Bidders must also be in good standing (i.e. not be suspended or debarred from contracting with the government). A winner is chosen by the SPD from the qualified bidders and a Notice of Award is issued. The agency is then responsible for providing the winner with all information needed to complete the request.
As well as being responsible for agency bids over $10,000 the Georgia SPD also manages bids for goods and services ordered in large quantities for different state entities, including local governments. These statewide requests are advertised on the Georgia State Procurement Site.
Pre-Bid Procurement
In order to expedite a bid that exceeds budget, the agency’s purchasing agent must receive approval from the State Procurement Department. With the approval of the SPD the agency’s procurement department handles the bids like any other and awards it to the winning bidder.
State Department and Agency Procurement
When a bid does not exceed $10,000 the agency that placed the request is authorized to post and award the bid through it’s own procurement department. Depending on cost, the request can be fulfilled either non-competitively or competitively.
Requests valued under $5,000 can be contracted non-competitively. In other words, the agency is not required to post these requests publicly and instead chooses a private contractor without having to compare prices. Though the State Procurement Department recommends that the agency does compare prices and services with at least three different contractors, it is not required. Requests that are procured without comparing prices and services are referred to as ‘sole source’ contracts. Sole source contracts are usually granted when the contractor has experience working with the agency or an established expertise with the particular project, can best satisfy the technical requirements, is the least expensive contractor, or the contractor has exclusive rights over the desired product. Once the agency has justified the sole source status the contract can be awarded.
Competitive procurement is substantially more complex than it’s noncompetitive counterpart. As with all requests, agencies must determine if their request can be fulfilled by a preexisting contract. If it cannot, the agency then determines the cost of the request. If it is between $5,000 and $10,000 and does not exceed the procurement budget the agency may begin advertising the bid competitively. Agency-level competitive bidding is a multi-step procedure. The major components of this process are outlined below.
Minimum Bid Policy – Agency procurement departments must review at least six bids for requests between $5,000 and $10,0000, three of which must be a minority business.
eQuote Bids - eQuote bids are used primarily for simple purchases which are procured through Requests for Quotes (RFQs), not Requests for Proposals (RFPs). The eQuote system is used for both agency and state procurement. Competitive agency bids are required to be posted for at least three days.
Public Opening – The agency must post requests publicly, usually on their agency procurement website. All bids must include a summary, closing date and contact information.
Bids are awarded to contractors with the lowest bid as well as a responsive and responsible history. The agency procurement department will notify the winner and post the results publicly, generally in the same location that the bid was originally posted.
Major Metropolitan Areas - Atlanta
Not only the capital of Georgia, Atlanta is a major business hub. It’s corporate inhabitants, such as Coca-Cola and Delta Airlines, and locally based businesses make up a culturally and historically rich economic neighborhood.
The City of Atlanta Department of Procurement (Atlanta DOP) actively contracts with private businesses. As outlined on their webpage, the city of Atlanta collects bids from individual agencies and advertises through the city procurement page. Occasionally the Atlanta DOP holds a pre-bid conference before vendors submit bids, which are reviewed by DOP staff. The bidders and their proposals are open to the public, though not publicly posted. Both the requesting agency and the Office of Contract Compliance (OCC) review the bids before the DOP chooses the contract winner. From there, the DOP notifies the contractor and publicly posts the results.
In order to bid, vendors must register with iSupplier, the Atlanta Procurement portal. Vendors are required to provide their company’s name, company address and individual user information (name, email address and phone number).
[i] "Georgia Peach History." Georgia Peach Commission. <http://www.gapeaches.org/>.
[ii] The information describing “Methods and Types of Contracting” through “Department and Agencies” was ascertained through the Georgia Procurement Manual, which outlines the steps contractors need to take in order to sell to the Georgia state government.