In a simple world, buying decisions are easy. Find a product that fits your needs and your budget, then buy it. Purchasing products or services for the public sector is a much more complex process that is governed by fiscal responsibility, established procedures and state law.
Although not an exact science, the purchasing process that ITD and other Idaho agencies follow is based on sound principles that safeguard public funds and protect both employees and providers. It specifies when bids and quotes must be obtained, when contracts are necessary and who can authorize the purchases.
Perhaps the most common mistake ITD employees make in procuring supplies or services is doing it on their own, explains Purchasing Agent Tina Klamt. All purchases, regardless of amount, must be made through the purchasing department… from paperclips to laptop computers, from desk chairs to laboratory equipment.
An onerous process? It may seem so on the surface, but it’s designed to save money, time and effort, Klamt explains. If employees simply call Purchasing before ordering or buying goods and services, they also can avoid complicated reporting and documentation.
Calling first benefits the state, the transportation department, taxpayers, and employees.
“The philosophy is that we want to get the best price available,” Klamt says.
Contracts for highway construction and professional consulting agreements for the Division of Highways are covered by different procedures than for the rest of the department.
Do your homework: If you need a specific item, be prepared to describe it in detail to purchasing staff. Often generic or after-market items will suffice and cost less than those provided by original suppliers. In addition to explaining the item or service needed, have a clearly defined purpose or justification. A description of how the item or service will be used and whether it must be compatible with existing equipment is very helpful.
Know your limits: ITD policy authorizes purchases of up to $1,500 without a quote. That is somewhat more restrictive than the $5,000 annual limit allowed by Idaho law. Despite the limit, however, all purchases must be authorized by the Purchasing Agent, even if quotes are not required. In short, call Purchasing first.
Bids, quotes and buying: All ITD purchases that exceed the $1,500 limit must go through the bid or quote process. Purchasing prefers soliciting quotes from at least three potential providers, rather than requesting formal bids. The latter can be legally challenged; specifications in quotes cannot. Both take about the same length of time. Employees are encouraged to identify potential suppliers and ask that they be contacted for quotes. Carefully articulating specifications for the item or service is essential.
Exemptions: Purchases from Correctional Industries, rehabilitation services and legal and direct advertising are exempt from the bidding requirement. All commercial printing, regardless of cost, must have bids or quotes in advance; there are no exceptions under Idaho law.
Contracts: The Purchasing Office can establish annual, renewable contracts with providers of goods and services. Contracts are based on competitive bidding and require employees to provide clear specifications for the item or a scope of work for services needed. It often is advantageous to have more than one provider under contract for similar goods or services. That gives ITD employees options in purchasing major goods or services without requiring numerous bids or quotes. Even with a contract in place, employees must go through the Purchasing Office to place an order.
Professional services: The purchasing office has established procedures for contracting for professional services that are in keeping with state purchasing rules. Professional services are defined as those provided by independent contractors who have professional knowledge of science or practical application of a body of knowledge such as legal, medical, and engineering. These agreements do not need to be bid but are limited to one year or $50,000.
Sole-mates: Occasionally, products or services are available from only one supplier, called sole-source providers. Bids or quotes are not necessary in those instances. But the Purchasing Agent must make the determination. Employees may believe items and services are available from only one source when other providers might exist. Purchasing staff will do the research.
Emergencies: The Purchasing Agent can approve the procurement of items or services that cost less than $5,000 without bids or quotes in the event of a genuine emergency, such as after-hours car repairs or items/services required for public health or safety. Events that qualify as emergencies are rare. If they occur, employees must notify the Purchasing Office as soon as possible the next business day.
In the districts: Although the Purchasing Office at Headquarters oversees the department’s purchasing process, authority has been delegated to each district for local purchases. The same procedures apply to all, but to arrange for goods or services in each of the districts, contact the district supply operations supervisor. The first call still should be to the appropriate district Supply Office.
Questions: The role of the Purchasing Office is to facilitate the acquisition of goods and services. Klamt welcomes the opportunity to explain ITD’s procedures and encourages employees who have questions to contact her at 334-8088.