Unit 5 Introduction to Procurement for Public Housing
Unit 5 Introduction to Procurement for Public Housing Authorities Sealed Bids
2 Learning Objectives • Understand when to use the sealed bid method of procurement • Understand the basic process and requirements for awarding contracts under the sealed bid method • Define responsive and responsible bidders
3 Sealed Bidding • Used mostly for construction contracts and the purchase of commodities (e. g. , equipment and supplies) • Used when the cost estimate is more than the $100, 000 Federal simplified acquisition threshold or the limit specified in the PHA’s Procurement Policy • Dependent upon good specifications • Two or more bidders willing in the open market • Can award on the basis of price • Can award a fixed-price contract
4 The Sealed Bid Process… … 5 Basic Steps Advertise Invitation for Bid Open Bids Publicly Determine responsive and responsible bidder with the lowest bid Execute fixed-price Contract (attach forms) Manage Contract
5 Invitation for Bid (IFB) • Develop a Statement of Work (SOW) • Develop/reassess Independent Cost Estimate (ICE) • Determine if Plans & Specifications (P/S) are needed ▫ Hire an Architecture & Engineering firm using applicable procurement method • Draft final P/S and obtain Wage Rates, as applicable • Finalize bid documents
6 IFB (cont. ) • Publicly advertise for bids ▫ Local newspapers, trade periodicals, etc. ▫ Mail advertisement to potential bidders • Hold a pre-bid conference to discuss IFB, if necessary ▫ Attendance is desirable but not mandatory ▫ Issue addenda to clarify significant issues • Receipt of bids ▫ Time-date stamp all bids received ▫ Secure in a private place • Publicly open bids received on due date ▫ Official reads name of bidder and cost of bid and records in official Bid Tabulation ▫ Do not discuss results or intentions to award
7 IFB (cont. ) • Analyze bids received to satisfy responsiveness requirement ▫ Verify that all required documents in the IFB have been provided, including the bid bond submittal • Complete a Price (or Cost) Analysis of bids received against each other if competitive, or by using other sources and the ICE • Verify potentially successful contractor’s responsibility before contract award • Write justification and/or recommendation letter to the file selecting successful entity • Notify unsuccessful bidders • If required, obtain PHA Board’s approval
8 Responsive Bidders • A bidder or offeror which submits a reply or bid which conforms to the material terms and conditions of the solicitation • The PHA’s Contracting Officer must assess the responsiveness by ensuring that all required documents were provided (e. g. , bid bond) as noted in the solicitation or request • Makes bidders or offerors to a solicitation eligible entities to be considered for award! • Per § 85. 36(d)(2)(ii)(D) PHA’s shall award contracts to the lowest responsive bidder
9 Responsible Contractors • A bidder/offeror that has the ability to perform successfully under the terms and conditions of the proposed contract/agreement ▫ Per § 85. 36(d)(2)(ii)(D), PHAs shall award contracts to the lowest responsible bidders • In determining responsibility, the PHA’s Contracting Officer shall consider the bidder’s ▫ Satisfactory record of integrity & business ethics ▫ Compliance with public policy ▫ Performance record & experience ▫ Financial & technical resources
10 IFB – final steps • • Notify selected contractor of intent to award contract Contract agreement is executed by the parties Conduct a pre-construction conference Obtain insurance documents, Performance and Payment Bonds, etc. • Issue the Notice to Proceed ▫ Outlines start/completion timeframes • Manage the contract per administrative procedures in place at the PHA!
11 Administration • Modifications and withdrawal by bidder are allowed before the bid opening. • Bids must be opened on scheduled date, time and place. ▫ Any postponement must be issued via an official addendum mailed with sufficient time (7 days) • Any issues brought forth in the bid opening are taken under advisement only…no opinions given! • Generally, no withdrawals allowed after bid opening unless an obvious error is evident.
12 Administration (cont. ) • Corrections are allowed after bid opening, if justified. • If deductive alternates are used, you have to take them in a specific order as outlined in the bid documents. ▫ Inverse priority order - the less important, less costly items are selected first • Cannot pre-price future work. ▫ E. g. , PHAs shall not bid base work and include options to additional work • Cannot negotiate price!
13 Required Forms for Sealed Bids • Attachments to solicitations (i. e. , IFB) : �HUD-5369, Instructions to Bidders for Contracts �HUD-5369 -A, Representations, Certifications, and Other Statements of Bidders �HUD-5369 -B, Instructions to Offerors Non- Construction �HUD-5369 -C, Certifications and Representations of Offerors Non-Construction Contract �Any applicable wage determinations
14 Required Forms for Sealed Bids (cont. ) • Attachments to contract or agreement : • HUD-5370, General Conditions for Construction Contracts • HUD-5370 -C, General Conditions for Non. Construction Contracts (either Section I or both Sections I & II) • Any applicable wage determinations
15 Remember… • Use when cost estimate above $100, 000 Federal Simplified Acquisition threshold (or PHA’s limit) • Open on scheduled date, time and place • Award based on price • Award to responsive and responsible bidders • Cannot negotiate price • ICE required • Price/Cost Analysis required
16 References and Resources • 24 CFR 85. 36(d)(2) • PHA Procurement Handbook 7460. 8 REV 2 Chapter 6 • For applicable wage rates, visit the Department of Labor at www. wdol. gov • For a list of acceptable sureties, visit the Department of Treasury’s Financial Management Service at www. fms. treas. gov/c 570 • For HUD’s Limited Denial of Participation List, visit www. hud. gov/offices/enforce
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