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Major Topics

Child Nutrition Program Purchasing Regulations and Processes Distance Education Workshop February 5, 2009 Wanda Shockey, MEd, RD, LD. Major Topics. State Regulations Federal Procurement Regulations – Newest! Conflict in Ethics Regulations Purchasing Cooperatives Contracts

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Major Topics

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  1. Child Nutrition Program Purchasing Regulations and ProcessesDistance Education WorkshopFebruary 5, 2009Wanda Shockey, MEd, RD, LD

  2. Major Topics • State Regulations • Federal Procurement Regulations – Newest! • Conflict in Ethics Regulations • Purchasing Cooperatives • Contracts • Informal Purchases – Quotes • Formal Purchases – Bids

  3. Arkansas Procurement Laws & Regulations

  4. Arkansas Regulations & Ethics for Child Nutrition Programs Arkansas State Regulations Specific to Education Entities: • 6-21-301 Definitions • 6-21-304 Manner of Making Purchases • 6-21-603 Interest in Certain Contracts Unlawful- Exception • 6-21-601 School Officials Prohibited From Having Interest in Sales of School Supplies • 6-24-101- Act 1599 of 2001 Disclosure of Relationships with Vendors or Potential Vendors

  5. Arkansas Code: 6-21-301 Definitions • (1) Commodities-all supplies, goods, material, equipment, services • (2) Open market purchases- purchases which do not require competitive bids • (3) Purchases- acquisition of commodities • (4)Purchases price- full sale or bid price • (5)Purchasingofficial-designated agent of the district authorized to contract for the district

  6. Arkansas Code: 6-21-304 Manner of Making Purchases State Requirements • (a)(1) Bids (Formal) are required for purchases of $10,000 or more • (a)(2) Open (Informal) market purchases may be made if less than$10,000 • (a)(3) Commodities (Purchased Goods) can NOT be split as a purchase to prevent required bidding

  7. School Districts • For Formal Bidding, as a minimum, districts must follow state regulations ? or federal regulations ? or local regulations ? State - $ 10,000 Federal - $ 100,000 Local District - $ 5,000 (Varies by individual district) 1995 Arkansas Attorney General’s Opinion SPECIFIC to SCHOOL FOOD SERVICE Requires formal bids with aggregate of $5,000 or more. Which is MOST Strict $$$$$$$ ???

  8. Arkansas Code: 6-21-305 Exemptions From Bidding Requirement • (a)(1)(A)Emergency (Requires Documentation) • (a)(1)(B) Superintendent must attach description of emergency to purchase order • (a)(2) Only available from the federal government • (a)(3) Utility services • (a)(4)Used equipment • (a)(5)Single source (Be careful to document justification) • (b) All exemptions require a written explanation attached to purchase order

  9. Arkansas Code: 6-21-601 School Officials Prohibited From Having Interest in Sales of School Supplies • (a) Unlawful for anyone with authority over purchases in schools to have any interest in the sale of a commodity (Purchased Goods). • (b) Unlawful for person to receive a reward or pay for influencing the purchase of a commodity (Purchased Goods). See Stronger Legislation and Rules for Act 1599 of 2001

  10. Arkansas Code 6-21-601 School Officials Prohibited From Having Interest in Sales of School Supplies • (c-d) Unlawful for anyone with responsibility of purchasing to receive anything of monetary value or to share the reward with any other person with authority over purchases. http://arkansased.org/rules/pdf/current/ade_209_ethical_guidelines_rules.pdf (e) Anyone convicted shall be fined and shall be removed from office.

  11. Arkansas Code 6-21-603 Interest in Certain Contracts Unlawful- Exception • (a) Unlawful for board member to have interest in any purchase over $500. • (b) Shall not apply on purchases made using open competitive bid and let to the lowest bidder. (But now have Act 1599 !!!)

  12. ADE Ethics Rules and Regulations • “RULES AND REGULATIONS GOVERNINGETHICAL GUIDELINES AND PROHIBITIONSFOR EDUCATIONAL ADMINISTRATORS, EMPLOYEES, BOARD MEMBERS AND OTHER PARTIES” • Ark. Code Ann. §§6-11-105, 6-24-101 http://arkansased.org/rules/rules_current.html

  13. 3.00 DEFINITIONS • 3.01 “Administrator” means • any superintendent, • assistant superintendent or his/her equivalent, • school district treasurer, • business manager, or • other individual responsible for entity-wide purchasing. The determining factor for being considered an “administrator” for the purposes of these regulations and compliance with Act 1599 of 2001 is the actual or implied authority of an individual to make purchases on behalf of the entire organization. This definition excludes many building principals (whose purchasing authority is often limited to their own school), but could include athletic directors or others. Classified employees serving in food services, business/accounting or other capacities may also be considered “administrators” under Act 1599 when they exercise autonomous system-wide purchasing authority.”

  14. State Ethic Rules VIOLATE Federal Ethics • Arkansas Ethics Rules • 15.00 REGISTRATION, TRAVEL, CONVENTIONS AND SEMINARS • 15.01 Board members, administrators (food service) and employees of a public educational entity are prohibited from receiving any payment or reimbursement from a vendor for any registration, travel, lodging, food, entertainment or other expenses not directly associated with an educational interest or business interest of the public educational entity. VIOLATION OF FEDERAL REGULATIONS FOR ADMINISTRATORS INVOLVED IN PURCHASING FOR CHILD NUTRITION PROGRAMS. • 15.02 Board members, administrators and employees of a public educational entity are prohibited from receiving any trip or attending any convention or seminar which is paid for by a vendor when the purpose for the trip or attendance at the convention or seminar is not directly associated to an educational interest or business interest of the public educational entity. VIOLATION OF FEDERAL REGULATIONS FOR ADMINISTRATORS INVOLVED IN PURCHASING FOR CHILD NUTRITION PROGRAMS.

  15. Why are these violations? • Arkansas rules are stating vendors can pay for registration, travel, conventions and seminars if these are educationally related. • Federal Regulations: 7 CFR Part 3016.36 (b) (3) (iv) This regulation states: "…employees…will neither solicit nor accept gratuities, favors, or anything of monetary value from contractors, potential contractors, or parties….“

  16. MAJOR Rule • The most restrictive regulations must be used when determining the procurement method to be used when federal funds will pay for the items to be procured. • For example: If the local school district policy is more restrictive than the state and federal regulations, all procurement with federal dollars must follow the local school district policy/regulation.

  17. MAJOR Rule • Open and Free Competition Competitive Prices are Best for Child Nutrition Programs • Do NOT Restrict Competition via specifications, timelines or material changes after the bid period.

  18. Close Your Eyes and Breathe!!!

  19. You CAN Meet the Challenges!!!

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