NIGP’s 58 th Annual Forum and Products Exposition “Financial Analysis and Other Tools for Determining Bidder Responsibi

1. NIGP’s 58th Annual Forum and Products Exposition“Financial Analysis and Other Tools for Determining Bidder Responsibility” William D. Agee, Jr. C.P.M., C.E.M., CPP, CPE William D. Agee, Jr. & Associates Thomas E. Youngs, Jr., C.P.M., Chief Purchasing Officer County of Allegheny, Department of Administrative Services, Division of Purchasing and Supplies

2. Responsive and Responsible • Public purchasing lives by it • “responsive bidder – a vendor who has submitted a bid which conforms in all material respects to the requirements stated in the IFB.” ‘NIGP Dictionary of Purchasing Terms’ “Financial Analysis and Other Tools for Determining Bidder Responsibility”

3. Responsive and Responsible • Public purchasing lives by it • “responsible bidder or offeror – a bidder or offeror who has the capability in all respects to perform fully the contract requirements, and the experience, integrity, perseverance, reliability, capacity, facilities, equipment, and credit which will also assure good faith performance”. ‘NIGP Dictionary of Purchasing Terms.’ “Financial Analysis and Other Tools for Determining Bidder Responsibility”

4. Lack of Responsibility Results • Poor performance • Incomplete contracts • Awards to non-responsible firms are unfair to other offerors who are capable of satisfactory performance, and tend to discourage them from submitting bids or proposals on future procurements. “Financial Analysis and Other Tools for Determining Bidder Responsibility”

5. Responsibility determination • Responsibility determination “will be made as fairly and honestly as possible using a reasonable exercise of sound judgment and discretion in the review of information provided or otherwise secured through references or other sources.” University of Kentucky, Capital Construction Procurement Section, 00505B01 Determination of Responsibility. By CPMD. Jun. 1998. 30 May 2003, www.uky.edu/Services/CPMD/ukstandards/UK%20Stds%20to%20WEB/Division%200%20Bidding%20Contract%20Conditions/00502B01.pdf “Financial Analysis and Other Tools for Determining Bidder Responsibility”

6. Qualities of responsibility • Experience • Integrity • Perseverance • Reliability • Capacity • Facilities • Equipment • Credit – adequate financial resources • Capability “Financial Analysis and Other Tools for Determining Bidder Responsibility”

7. Qualities of responsibility • Ethics • Available personnel resources • Organization • Performance • Reputation • Management Expertise • Meet required schedule • Adequate accounting system “Financial Analysis and Other Tools for Determining Bidder Responsibility”

8. Qualities of responsibility • Compliance with public policy • Not suspended or debarred • Judgment • Skills • Adequate quality assurance program • Adequate experience with customers of similar size • Technical resources • References “Financial Analysis and Other Tools for Determining Bidder Responsibility”

9. Responsibility determination • “…contracting officer is vested with a wide degree of discretion and, of necessity, must rely upon his or her business judgment in exercising that discretion.” Blocacor, LDA, B-282122.3, August 2, 1999, Where in Federal Contracting, Antonio, Robert. 30 May 2003 www.wifcon.com/pd9103.htm “Financial Analysis and Other Tools for Determining Bidder Responsibility”

10. Necessary to determine responsibility • “Reasonable inquiry” • Reliable evidence • Written documentation of responsibility • Agency must not have been erroneous, arbitrary, capricious, or contrary to law in determination. • Failure of bidder to comply with information requests may be grounds for determination of non-responsibility. “Financial Analysis and Other Tools for Determining Bidder Responsibility”

11. Where to get responsibility info • Suppliers, sub-contractors and customers of bidder • Financial institutions • Business and Trade Associations • Dun and Bradstreet • Financial Records • Annual Reports • Bidder • On-site inspection • Performance records and experience data of personnel in purchasing and contracting offices • Production capacity “Financial Analysis and Other Tools for Determining Bidder Responsibility”

12. Responsibility determination – additional items to consider • Is it relevant as to where contract is being performed? • What if bidder is in bankruptcy? • How many past projects and of what size can be requested as evidence of ability? • When call to obtain information for determination, is this “negotiating”? “Financial Analysis and Other Tools for Determining Bidder Responsibility”

13. Responsibility determination – additional items to consider • What if bidder can acquire requisite financial resources after bid opening date? • What of subcontractors? Does agency have to consider their “responsibility”? • Must inform bidder of non-responsibility determination. • What if non-union? “Financial Analysis and Other Tools for Determining Bidder Responsibility”

14. Responsibility determination • “A responsibility determination is a business judgment which involves balancing the contracting officer’s conception of the [requirements of the contract] with available information about the contractor’s resources and record.” Protest of AHJ Transportation, Inc., Under Solicitation No. JAX-159088, February 2, 1989, PS. Protest No. 88-85 “Financial Analysis and Other Tools for Determining Bidder Responsibility”

15. Financial Resources • Discussion to be led by Mr. Agee “Financial Analysis and Other Tools for Determining Bidder Responsibility”