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Micro-Purchasing: An Overview & Best Practices

Understand the concept of micro-purchasing, when it can be used, and the procurement process. Learn about aggregate transactions, competition, reasonable prices, and equitable distribution. Examples provided.

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Micro-Purchasing: An Overview & Best Practices

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  1. Part 5: Micro –Purchasing Option 2 CFR 200.67 2 CFR 200.320

  2. Objectives • Define Micro-Purchasing • Identify when Micro-Purchasing may be used • Understand how to procure using Micro-Purchases

  3. Federal Procurement Roadmap

  4. Federal Procurement Roadmap

  5. What is Micro-Purchasing? • Micro-purchases: • Less than $3,500 per transaction • Spread purchases out among qualified suppliers • No competitive quotes required 2 CFR 200.67

  6. Aggregate • To combine several items • Cost of all food service goods and services purchased in a single transaction • Cost of all items together cannot exceed $3500 if Micro-Purchasing is used.

  7. Transaction • Two or more entities exchange goods, services or money • Under an agreement formed for their mutual benefit • Example: A Sponsor purchases milk, apples, carrots, bread, eggs, and ground beef from a single supplier at the same time. This is a single transaction.

  8. Competition • Awarded without soliciting competitive price quotations • If the price is reasonable.

  9. Purchases • Distributed equitably among qualified suppliers with reasonable prices. • Two ways • at the time of the purchase or • over several purchasing events.

  10. Reasonable Price • Previous purchases • Personal knowledge • Comparison to similar

  11. Recordkeeping • Receipts • Invoices • List of vendors

  12. Distributing Micro Purchases Equitably • Distribute purchases equitably - qualified suppliers • May not purchase from only one source • Written procurement procedures for rotating suppliers

  13. Example : Distributing the Micro-Purchase Equitably • $1000.00 computer paper • Three suppliers in the community • Rotate purchase of computer paper among the suppliers.

  14. Difference Between Micro-Purchasing and Small Purchase Micro-purchase means an acquisition of products or services where the aggregate amount does not exceed $3,0 • Soliciting competitive quotations not required • The sponsor considers the cost(s) reasonable • Single Transaction • Less than $3500 for a single transaction • Competition achieved by distributing transactions equitably.

  15. Example 1: • A Sponsor contracts for Janitorial service • Weekly • $100.00 per week • The contract = $5200.00 • Invoiced monthly

  16. Example 1: • Answer: No The Micro-purchase method cannot be used in this situation: • The janitorial services are contracted on a yearly basis • The value of contract for the year is $5200.00 • The Small purchases standards apply in this setting

  17. Example 2: A CACFP Center Sponsor: • Shops weekly at a retail grocer, • The bill is less than $3500.00. Question: Should the Sponsor be getting quotes from other retailers and select the retailer with the lowest prices, or is this a micro- purchase? .

  18. EXAMPLE 2: Answer: Yes – Micro-Purchasing allowable • Cost per transaction (weekly purchasing) is less than $3500.00 • Not required to get quotes from other retailers • the prices reasonable • Distributes the purchases equitably among qualified suppliers

  19. Example 3 A Sponsor periodically signs a 3 year contract with a vendor. • The 3-year contract cost per year = $2000 • Total contract amount = $6000 Question: Is the threshold determined by the cost per year or by the total contract amount, in applying the procurement methods?

  20. Example 3 Continued Answer: • $6000 value of the procurement transaction as a whole, the small purchase standards apply • 3 year contract for a total amount of $6000 exceeds the micro-purchase threshold

  21. SUMMARY • What is Micro-purchasing • Definitions of terms • Requirements of Micro-purchasing • Examples

  22. Questions

  23. Resources • ODE CNP Procurement webpage • CACPF Policy and Procedure Manual Chapter 14 • 2 CFR 200.67; • 2 CFR 200.320(a)

  24. USDA Non-Discrimination Statement In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, sex, disability, age, or reprisal or retaliation for prior civil rights activity in any program or activity conducted or funded by USDA. Persons with disabilities who require alternative means of communication for program information (e.g. Braille, large print, audiotape, American Sign Language, etc.), should contact the Agency (State or local) where they applied for benefits. Individuals who are deaf, hard of hearing or have speech disabilities may contact USDA through the Federal Relay Service at (800) 877-8339. Additionally, program information may be made available in languages other than English. To file a program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, (AD-3027) found online at: http://www.ascr.usda.gov/complaint_filing_cust.html, and at any USDA office, or write a letter addressed to USDA and provide in the letter all of the information requested in the form. To request a copy of the complaint form, call (866) 632-9992. Submit your completed form or letter to USDA by: (1) mail: U.S. Department of Agriculture Office of the Assistant Secretary for Civil Rights 1400 Independence Avenue, SW Washington, D.C. 20250-9410; (2) fax: (202) 690-7442; or (3) email: program.intake@usda.govThis institution is an equal opportunity provider.”

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