1. Vendor Responsibility
OGS Approach
and Learning Lessons
State Purchasing Forum
May 18 and 19, 2005
Presenters: Noreen VanDoren
Monica Wilkes

2. Approach
Standardized forms for OGS and Council of Contracting Agencies include:
SVRQ (Standard Vendor Responsibility Questionnaire) or Certificate of No Change and previous questionnaire OR
UCQ (Uniform Commercial Questionnaire)
Checklist
Profile

3. Agency Conformity Representatives include:
OGS VR workgroup consisting of one representative from each program area,
OGS host agencies, and
Council of Contracting Agencies that
contract for both commodities and services

4. Vendor Responsibility
Used the simplified procedure to identify the basics:
Are vendors responsible?
Do they meet the four VR criteria?
Performance
Integrity
Financial Ability
Legal Authority

5. Visiflow
Created the Visiflow Vendor Responsibility System, a centralized document management system
Stores all VR questionnaires, profiles and checklists for agency

6. Multiple Vendors SVRQ for each vendor
One profile for all contractors provided all information is identical
Attach list of contractors, FEIN and contract numbers to profile
Way for OGS to streamline the process for us when awarding to multiple contractors.

7. Vendors Concerns About the VR Process
Ask vendors to document in writing their reasons for concern about the process. Share concerns with OSC.*
Forward information to OSC VR unit
*Note one written concern received to date!
We have shared with OSC verbal complaints. Airlines and Gaylord Bros.

8. Responsibility Review
Checklist completion
Discriminatory Jurisdiction
DOL
GSA – (excluded parties list system)
Completed SVRQ or UCQ
Any responses which require further
inquiry
GSA is the debarment issues
Explain difference between UCQ and SVRQ

9. DOS Registrations NYS corporations and LLCs must be registered in NYS
Out of state corporations not registered in NYS require at a minimum the company’s current certificate of good standing within their state.

10. Financial Responsibility
Options
Request a report from Dun & Bradstreet
Require D&B or financial records directly from company
Check DOS site for outstanding tax warrants for vendors
Review records by agency finance unit for financial determination

11. Due Process Advise vendor of information of concern
Request written explanation/response within certain time
Consider face-to-face meeting
Prepare minutes if meet in person to include in procurement record

12. Each Contract is Unique
VR must be considered on the basis of the contract under consideration.
Prior experience with vendor without complaints or difficulties is a consideration.
One size does not fit all.
Industry has the same issues.
Decision must be made in the best interests of the State.

13. Example Vendor A is an International firm. They submitted
their SVRQ and a two inch thick document of all
issues and concerns that confront their corporation.
What actions are necessary to review this
company’s VR?

14. Select the Correct Answer
Information overload – send to legal
Skim the entire document
Read every page and analyze every finding
Require the vendor to detail the information that is specific to NYS and address its ability to perform with respect to the NYS contract in question.

15. Correct Answer Correct Answer: D
Based on the contract in question with respect
to its requirements, different levels of review
may be necessary.

16. Example How does one address vendors in bankruptcy? Answer:
Line up with creditors
Reject the bid
Award the bid
Consider the risk for NYS with respect to the contract in question
Award with contingencies

17. Answer Answer the question with more questions:
Did company confirm and complete a plan of reorganization?
If so, what is the final decree?
If not, what was the resolution to chapter 11?
Review current D&B reports.
Include a legal review.

18. Making a determination
What effect would this contract have on NYS?
If award were made to low bidder?
If award were not made to low bidder?
If award were made to low bidder with performance measures in place to ensure the vendor’s continued ability to handle the contract?
If award were made to low bidder with ability to terminate?
If award were made to low bidder with a surety bond in place?
What benefits and risks to the state are you undertaking? Take into consideration.

19. Options to Consider Issue an “Award Pending” until review is completed
Issue a Partial Award
Withhold a portion of award for set time until vendor can reasonably demonstrate satisfactory performance on a limited portion of the contract
Obtain vendor agreement if denying a portion of the award
Reject vendor
If Line item bid – enter agreement to terminate after certain period of time if can’t reach agreement.

20. Integrity Example
One company’s employee fraudulently used state agency letterhead to send a letter to their internal staff
The AG’s office determined the company was not responsible for the action of its employee
Employee terminated
Company vindicated

21. Integrity Example
Contractor providing temporary service workers (sec. staff, cleaners, general laborers) is sued by EEOC for discrimination based on race, age and medical condition.
Contractor denies allegations
Claims rogue employees made up claims
Recommended them for award and OSC approved.

22. Agency Consideration
Contractor held NY State contract for 5 years without any complaints.
Contractor financially able to pay alleged damages.
Should a contract be awarded?

23. Performance Example
Company X had a history of unauthorized product substitutions for more than one contract.
Company X was provided due process.
Company X’s lawyer advised that the error rate was a standard deviation error rate.
OGS demonstrated that a pattern existed for more than one contract period.
Company agreed to a “partial award” while their performance was monitored.

24. Performance Example
Company Y faxed an authorized user a copy of an OGS award and fraudulently inserted their name as the contractor for an item not awarded them.
Due Process was afforded the company and the company was found non-responsible on the basis of misrepresentation of award.
Company must meet established criteria of successful completion of public contract for X number of years before consideration of any future awards.

25. Performance Example
Contractor provides temporary service construction workers to State agencies on centralized contract
DOL alleges prevailing wage violations
Contractor disagrees; waiting for DOL hearing
No prior willful DOL violations so debarment will not be automatic should DOL prevail
Award contract?

26. Financial Example
Company Y filed for bankruptcy; case dismissed in 2002
Upon investigation, outstanding tax warrant discovered
Due process revealed warrant was for company Z
D&B revealed no liens, judgments and suits
Performance issue surfaced
Award pending while review continues.

27. Legal Authority Example
New York State Corporation - Incorporated in 1984
On contract for past 5 years
Checked DOS site & corporation listed as inactive
Company provides proof of financial ability, prior performance & no new reports indicating lack of integrity
Award?
Investigate why inactive

28. Legal Authority Example
Bid submitted by a subsidiary/division of a corporation
Bid & SVRQ list subsidiary name but FEIN of parent corporation
SVRQ responses relate to subsidiary not parent
What should you do?
Noreen to discuss

29. Legal Authority Example
Department of State (DOS) requires Vendor A to be licensed to provide security guard services to NYS
Vendor A is found to be non-compliant with the New York State Security Guard Act contained within Articles 7 and 7-A of the General Business Law
Vendor A is non-responsible as determined by OGS

30. Questions??

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