1. Procurement in the CACFP

2. www.doe.in.gov/cacfp 2

3. Independent Center Independent center means a child care center, at- risk afterschool care center, emergency shelter, outside-school-hours care center or adult day care center which enters into an agreement with the State agency to assume final administrative and financial responsibility for Program operations. 3

4. Sponsor of Affiliated Centers Sponsoring Organization of Affiliated Centers means a public, private for-profit, or private non-profit organization that is entirely responsible for the administration of the food program in: Two or more care centers, outside-school-hours care centers, or adult day care centers; and They are part of the same legal entity as the sponsoring organization. 4

5. Sponsor of Family Day Care Homes Sponsoring organization of family day care homes means a public or nonprofit private organization that is entirely responsible for the administration of the food program in one or more day care homes. 5

6. Sponsor of Unaffiliated Centers Sponsoring Organization of Unaffiliated Centers means a public or nonprofit private organization that is entirely responsible for the administration of the food program in: A child care center, emergency shelter, at-risk afterschool care center, outside-school-hours care or adult day care center which is a legally distinct entity from the sponsoring organization. 6

7. What is Procurement? Procurement is simply the purchasing of goods & services. 7

8. What is a Vendor? Consumer Club: Sam’s Club, Costco Commercial Food Service Company: GFS, Sysco, etc. Catering Company Fresh Food Market Local Butcher Shop Food Service Management Company 8

9. Disclosure This is the act of identifying related party transactions. Institutions are required to mark and describe the disclosure on the documentation form. Required when using Program funds. 9

10. Who must follow procurement rules? All Institutions must comply with the procurement rules. An institution is any organization that has an agreement with the Indiana Department of Education to operate one of the Child Nutrition Programs. Facilities can be DCHs, affiliated centers, or unaffiliated centers that have an agreement with a sponsoring organization (an institution). Facilities are not required by regulation or policy to conduct procurements that uphold free and open competition; i.e., they are free to purchase food and other items according to their own practices. 10

11. Why is Procurement necessary? Institutions agree to follow Federal Regulations when they receive money from CACFP. Federal procurement regulations for private non profit institutions, for-profit institutions and public institutions. Must be able to demonstrate free and open competition Does not apply to facilities—but they should be encouraged to do so

12. Where to find procurement rules Federal Cost Principles 2 CFR 225 (States, Local, & Indian Tribal Governments) 2 CFR 230 (Non-Profit Organizations) Uniform Administrative Requirements for Procurement 7 CFR 3016.36 (State & Local Governments) 7 CFR 3019.44 (Non-Profit Organizations) Program Regulations for Procurement 7 CFR 226.22 (CACFP) 7 CFR 225.17 (SFSP) 12

13. §226.22 Procurement Standards (a) This section establishes standards and guidelines for the procurement of foods, supplies, equipment, and other goods and services. These standards are furnished to ensure that such materials and services are obtained efficiently and economically and in compliance with the provisions of applicable Federal law and Executive orders. 13

14. Why is Procurement Important? Many stakeholders are interested when Federal funds are used Funds are used effectively and efficiently, no waste or abuse Procurement is about establishing a sound competitive process that uses free and open competition Procurement cannot duly restrict or eliminate competition 14

15. Procurement 15 (Small Purchase Threshold) Informal Small Purchase (required bids from 3 sources) Formal Sealed Bids (IFBs) & Competitive Proposals (RFPS) (requires public advertising)

16. The Informal Procurement Process 16 Develop your specs in writing Identify and notify at least 3 sources eligible, willing and able to provide product or service. Document & evaluate bidders’ response to your specs Determine most responsive & responsible bidder at best price Manage the Contract

17. The Informal Procurement Process 17 Develop your specs in writing Identify and notify at least 3 sources eligible, willing and able to provide product or service. Document & evaluate bidders’ response to your specs Determine most responsive & responsible bidder at best price Manage the Contract 1.Develop Specifications What is the product or service? Describe it with detail, for example, milk in gallons or ½ pints; 1% or skim milk? How often do you need delivery

18. The Informal Procurement Process 18 Develop your specs in writing Identify and notify at least 3 sources eligible, willing and able to provide product or service. Document & evaluate bidders’ response to your specs Determine most responsive & responsible bidder at best price Manage the Contract 2. Getting Bids Identify at least 3 sources Eligible, able & willing Share same specifications with each vendor

19. The Informal Procurement Process 19 Develop your specs in writing Identify and notify at least 3 sources eligible, willing and able to provide product or service. Document & evaluate bidders’ response to your specs Determine most responsive & responsible bidder at best price Manage the Contract 3. Document & Evaluate Bids Share same specifications with each vendor Document responses

20. The Informal Procurement Process 20 Develop your specs in writing Identify and notify at least 3 sources eligible, willing and able to provide product or service. Document & evaluate bidders’ response to your specs Determine most responsive & responsible bidder at best price Manage the Contract 4. Determine the best bidder Who is the most responsive? Who is the most responsible?. Who is willing to give the best quality at the best price?

21. The Informal Procurement Process 21 Develop your specs in writing Identify and notify at least 3 sources eligible, willing and able to provide product or service. Document & evaluate bidders’ response to your specs Determine most responsive & responsible bidder at best price Manage the Contract 5. Manage the contract Is the institution receiving the product they contracted for? Is the product of good quality? Is the vendor delivering on time?

22. Bid Documentation 22 SpecificationVendor AVendor BVendor C -Fresh, whole Honey Crisp Apples -Delivered Weekly Monday Business hours -100 apples/week Price/Case

23. Procurement: Proper or Not? 23 PROPER NOT PROPER

24. Procurement: Proper or Not? An independent center staff member needs to buy milk for this week’s meals and looks at three ads in the paper, documents their specifications and ad prices, and determines the cheapest milk in the area. 24

25. Procurement: Proper or Not? A day care home provider needs to buy milk for this week’s meals and stops by a farmers’ market on the way home. 25

26. Procurement: Proper or Not? A sponsoring organization writes specs for fresh carrots but when calling around, the third bidder says it can give them half off frozen carrots. The sponsoring organization buys the frozen carrots on the spot. 26

27. Process Independent center Sponsor-Affiliate Center Sponsor-FDC Homes Sponsor-Unaffiliated Center Small Purchase Threshold is $150,000 Quote for 5 food items Write specifications Choose best vendor Do this QUARTERLY Effective Oct. 1, 2014 Over $150,000, call SA Small Purchase Threshold is $150,000 Quote for 3 highest price administrative expenses Write specifications Choose best vendor Do this ANNUALLY Effective Oct. 1, 2014 Over $150,000, call SA 27

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33. Procedure for Procurement 2 versions Independent Centers and Sponsors of Affiliated Centers Sponsors of FDC homes and Unaffiliated Centers Explains requirements Explains frequency 33

34. Frequency ANNUAL: one time per fiscal year. Should be done in conjunction with the preparation of the annual budget QUARTERLY: every 3 months. Suggested: October January April July 34

35. Summary Use of Federal funds required proper procurement procedures. Must compare prices and keep the playing field level. Must disclose less-than-arms-length transactions Must be able to demonstrate free and open competition Many stakeholders are interested when Federal funds are used Funds must be used effectively and efficiently, no waste or abuse 35

36. www.doe.in.gov/cacfp 36

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38. For Questions, Contact Carol Markle @ cmarkle@doe.in.govcmarkle@doe.in.gov Heather Stinson @ hstinson@doe.in.govhstinson@doe.in.gov Mary Lou Davis @ mldavis@doe.in.govmldavis@doe.in.gov Karen Edwards @ kedwards@doe.in.govkedwards@doe.in.gov Elaine Haney @ mhaney@doe.in.govmhaney@doe.in.gov Kim Cobb @ kcobb@doe.in.govkcobb@doe.in.gov Maggie Boyce @ maggie@doe.in.govmaggie@doe.in.gov 38

39. 39 USDA is an equal opportunity provider and employer.