About this Policy
Bids and Proposals
Policy Number: 26201
Dec 10, 2019
Dec 12, 2017
UM System Procurement
Chief Procurement Officer
UM System Procurement
- Reason for Policy
- Policy Statement
- Related Information
This policy outlines requirements for purchases that require processing through a competitive solicitation.
To ensure large dollar acquisitions provide the maximum value for the University.
Purchases over $10,000 require a competitive solicitation from qualified suppliers or be purchased from approved group purchasing organization contracts. All solicitations, except construction, in the form of quotations, bids or proposals for goods or services, must be made by UM System Procurement unless otherwise delegated in writing by the Chief Procurement Officer.
When preparing competitive solicitations, a sufficient number of suppliers should be contacted/solicited to ensure fair and open competition in the procurement process. A minimum of three (3) suppliers should be included in a competitive process unless it is determined that it is impracticable to identify three (3). UM System Procurement staff preparing the documents shall have the discretion to use the most appropriate method to inform potential suppliers of the University’s needs and to determine to whom the requests should be sent while taking into account the complexity of the specifications, expected costs, time constraints and the number of known suppliers. UM System Procurement staff will determine the amount of time the potential suppliers need to prepare bids and proposals and submit/deliver them to the University.
A request for a quotation, bid or proposal may be issued through various methods including mail, fax, email, etc. Quotations are allowed for solicitations between $10,000 and $99,000 at the discretion of the UM System Procurement. However, purchases estimated to cost $100,000 or more require advertisement for the solicitation of bids and will be available on the Procurement website. It is the sole responsibility of interested suppliers to seek information, not that of the University to disseminate information regarding open solicitations.
Request for Bids
A Request for Bid is awarded to the lowest responsible and responsive bidder whose bid conforms to the specifications and meets all other requirements and criteria set forth in the Request for Bid.
Request for Proposals
A Request for Proposal (RFP) is used when multiple factors are to be considered in making a decision based on best value. For example, a RFP might be used for highly technical equipment, software, or for an acquisition that includes a major service component. The proposal that is determined to provide the best value for the University will be accepted.
Criteria for award must be set in advance of the closing date for receipt of proposals. It should include all factors necessary to determine best value and be weighted according to the relative importance of each factor. UM Procurement must approve the allocation of weights for each decision criteria.
Price must always be used in determining best value when using a RFP process. An exception to this policy can only be granted by the Chief Procurement Officer. Other criteria established beyond price are to be established at the time of proposal development and are determined by criteria critical to obtaining the best overall value for the University.
Standard Terms and Conditions
Standard Terms and Conditions, as applicable to specifications, bid requests, purchase orders and contracts, are approved by the Chief Procurement Officer and approved as to form by the General Counsel's Office. No changes, deletions, exceptions or additions to the Standard Terms and Conditions shall be made unless written approval has been secured from the Chief Procurement Officer.
Construction and Prevailing Wage
For all applicable solicitations, the appropriate prevailing wage rates must be applied to and included in replies to such solicitations. More information is included in Related Information.
Receipt of Bids/Proposals
Solicitations valued under $100,000 may be received by any method as approved by UM System Procurement. Solicitations valued at $100,000 or more must be returned to the University as a sealed document or through UM Procurement's electronic bid portal, unless an exception has been granted by the Chief Procurement Officer. Sealed documents may not be viewed until after the received by date and time has passed.
The University always reserves the right to waive informalities in bids and proposals and to reject any and all bids and proposals.
UM System Procurement shall conduct all negotiations, except on delegated purchases or purchases transacted under department delegation of authority. However, UM System Procurement will be available to assist an ordering department upon request.
The University will allow all actual or prospective bidders, respondents, offerors, or contractors that believe they are aggrieved by the solicitation or award of a contract be offered administrative adjudication. All complaints should be directed to the author of the bid and made in writing containing the following:
- Clear indication that the communication is a formal, written protest
- Name and address of the protestor
- Appropriate identification of the solicitation such as the bid or proposal number
- Statement of reasons for the protest
- Supporting exhibits, evidence or documents to substantiate any claims
Formal protests on the process shall be filed as soon as the bidder becomes aware of the issue and must be made prior to the bid/proposal award. When a protest is filed, the contract will not be awarded until the protest has been settled. An exception may apply if agreed upon by the UM System Procurement and requesting department in the event that it is determined that the award of the contract without delay is necessary to protect substantial interests of the University.
Formal protest on the award of the bid/proposal shall be filed within ten (10) calendar days after formal announcement of the award of the contract. Protests filed regarding the bid/proposal award after the ten (10) calendar days will not be considered.
The author may request additional information from the protestor who shall submit the information within the time periods established by the author. A decision on a protest shall be made in writing by the author within ten (10) calendar days after receiving all relevant, requested information. If a protest is sustained, the author’s decision shall include the available remedy or remedies.
An appeal of a decision of the author may be made by the protestor to the Assistant Vice President of Management Services. The written appeal shall contain a detailed statement of the factual and legal grounds upon which reversal or modification is deemed warranted, specifying any errors or information not previously considered. Appeals of a decision to the Assistant Vice President of Management shall be filed not later than ten (10) calendar days after the receipt of such decision. A decision on the appeal will be made as expeditiously as possible. The decision of the Assistant Vice President of Management Services shall be final.
Sole Source Purchases
Unique items or services may qualify as a “Sole Source” purchase. These purchases are to be treated as exceptions to normal bidding procedures. Documentation stipulating the reason for Sole Source must be included with the purchasing requisition. Documentation must be made by a competent expert in the field in which the product will be used; include a statement that, in the professional opinion of the certifying individual, it is the only product that can be used to accomplish the task necessary in an appropriate manner, and must list specific reasons why this is the case; and verification that the product is available only from the source indicated with no other distribution network; and confirm no conflict of interest exists.
A Sole Source with a cost of $100,000 or less may be purchased without bids with approval and within limits delegated by the Chief Procurement Officer. Awards for unique items or services (other than design professional agreements, which require approval of the director, Facilities Planning and Development) of over $100,000 require approval of the Chief Procurement Officer or designee. A Sole Source purchase of $500,000 or greater requires approval from the Board of Curators prior to the purchase.
Blanket Purchase Orders
Blanket Purchase Orders are granted, at Procurement's discretion, to departments for a designated time period. These purchase orders are designed for frequent ordering, receiving and billing from a single vendor during this time frame. Typically these vendors will not accept payment via University issued purchasing card. Items purchased are low in unit price, have numerous product or part numbers, and usage patterns for single items are erratic and non-repetitive by nature, which do not lend themselves to bidding. Requests for Blanket Purchase Orders exceeding $10,000 must be bid or must include a justification for a Sole Source purchase.
Request for Quotation - solicitation to a potential supplier that is awarded to the lowest responsible and responsive bidder whose bid conforms to the specifications and meets all other requirements and criteria set forth in the Request for Quotation.
Request for Proposals - solicitation to a potential supplier that is awarded based on the best value and may include multiple factors in the evaluation of the best value.
Responsible Bidder - one who has the capability in all respects to perform fully the contract requirements, and the integrity and reliability which will assure good faith performance.
Responsive Bidder - one who has submitted a bid which conforms in all material respects to the Request for Bid.
Sole Source - occurs when there is only one supplier available to fulfill a unique purchasing need.
Blanket Purchase Order - a purchase order made with a supplier which contains multiple delivery dates over a period of time. This normally occurs when there is a recurring need for expendable goods.
UM System Procurement:
- Work with departments to issue solicitations for bids or proposals
- Disburse solicitations to suppliers
- Receive bids and proposals from suppliers
- Handle supplier protests
- Negotiate terms with suppliers
- Approve Sole Source purchases and Blanket Purchase Orders
- Notify successful supplier of award
- Issue contract to successful bidder
- Collaborate with UM System Procurement for purchases over specified limits that require solicitation of bids or proposals prior to acquisition of goods/services
- Ensure requisitions are approved by properly authorized employees
- Seek approve from UM System Procurement for Sole Source purchases and Blanket Purchase Orders
This policy combines the following former policies:
- Business Policy Manual 303 – Bids & Proposals (revised 10/20/2010)
- Purchasing Policy Manual 401 – Types of Solicitations
- Purchasing Policy Manual 402 – Methods of Issuance and Receipt of Bids/Proposals
- Purchasing Policy Manual 403 – Time Period for Bids/Proposals
- Purchasing Policy Manual 404 – Advertising and Availability of RFBs and RFPs
- Purchasing Policy Manual 501 – Award of Contracts
- Purchasing Policy Manual 502 – Protest Procedures
- Purchasing Policy Manual 602 – Sole Source
- Purchasing Policy Manual 603 – Blanket Purchase Orders