1. 1 Procurement Reform Roadshow Fall 2014

2. 1.Reviewing Procurement Reform Initiatives 2.Drafting the Accountability Template 3.Crafting a Robust Rider A 4.Discussing “What’s Changed” 2

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4. o DHHS contracting and procurement has improved significantly under Commissioner Mayhew’s leadership. o The current reform effort seeks to build upon the substantial reforms implemented since 2011. o Key areas to target: o Process: Ensure structure, uniformity and efficiency in the Department’s procurement and contracting process. o Language / Content: Bolster the content and language to make certain that contracts include clearly defined deliverables, performance expectations and payment terms. 4

5. o Reforms began in September—this process remains ongoing. o Ensure that all DHHS contracts contain measurable outcomes, meet clear performance targets and provide value to the people of Maine. o Simplify and standardize the Department’s contracting process, such that drafting contracts is as straightforward as possible for DHHS staff. o Ensure that key parties—with different areas of expertise— have the opportunity to review and sign off on all DHHS contracts. o Create a predictable process that operates with a defined structure on an established timeline. 5

6. o Reforms are designed to encourage upfront thinking; to boost communication in the process; and add clarity around when steps should occur. o Pre-Approval Template: modeled on the Grant Pre-Approval Template. o Checklists: Contract initiation; Contract; RFP. o Soft Rollout: Announced changes August 14 SMT; implemented September; continue to seek feedback throughout the fall. o Not looking for perfect 6

7. o Not a radical change: The process should look much the same—just more clear-cut, structured and organized (move planning up front). o Seeking feedback: In August; throughout the fall. o One Department—fostering partnership, teamwork: Everyone is working hard, but functional contract management and procurement process must be a true partnership and team effort. o DCM personnel realignment by program office. o Increased staff support for DCM / program contract administrators. 7

8. Legal Audit Office of Continuous Quality Improvement (OCQI) 8

9. Delayed payments Working at risk No services to clients 9

10. o Better contracts. o Well thought out. o Tightly drafted. o Thoroughly reviewed. o More timely execution. o No mad dash in July. o No providers working at risk. o Better management and results. o Trust but verify. Certainty in getting what we paid for. o Ensuring first rate service delivery for the people of Maine. 10

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12. Contract Concepts An enforceable agreement between two or more parties to perform a specified act Involves consideration – something of value that is exchanged by the parties The promise in a contract is recognized by law as a duty; a remedy is prescribed if the promise is breached Ends when the terms are fulfilled (or fulfillment is not possible) 12 Pacta sunt servanda (agreements shall be kept)

13. A contract is required to purchase a service (i.e., not an item/commodity) The law requires that procurement of both goods and services be done through competitive bidding [5 M.R.S.A. §1825- B(1)] Statute also provides for very limited circumstances under which awards may be made on a non-competitive basis (sole- source) 13

14. Unlawful Purchasing - is the procurement of a service or a commodity without following the State’s purchasing rules. Making open market purchases for items that are available through the warehouse or through a Master Agreement; Allowing a contractor to begin work before the contract is approved and finalized by the State Purchases Review Committee; 14

15. Unlawful Purchasing - is the procurement of a service or a commodity without following the State’s purchasing rules (cont.) Allowing a contractor to continue working after a contract’s expiration date while an amendment is pending Assigning a contractor work that is not included in the scope of the contract to “use up” funds that were not needed to accomplish the original purpose 15

16. 5 MRSA §1819 - Unlawful Purchases. Whenever any department or agency of the State Government, required by chapters 141 to 155 and rules and regulations adopted pursuant thereto, applying to the purchase of services, supplies, materials or equipment through the State Purchasing Agent, shall contract for the purchase of such services, supplies, materials or equipment contrary to chapters 141 to 155 or the rules and regulations made hereunder, such contract shall be void and have no effect. If any such department or agency purchases any services, supplies, materials or equipment contrary to chapters 141 to 155 or rules and regulations made hereunder, the head of such department or agency shall be personally liable for the costs thereof, and if such services, supplies, materials or equipment are so unlawfully purchased and paid for out of state moneys, the amount thereof may be recovered in the name of the State in an appropriate action instituted therefor. 16

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18. 18 Program need to purchase Service Research, Plan and Develop Procurement Strategy RFIRFPCONTRACT DHHS RFP Cycle: Every 4 years

19. GOAL: Informational gathering tool Products Services WHEN TO USE Understand the marketplace of services available Determine the scope of work for an RFP Collect Budgetary Information 19

20. An effective RFI: Announces to the marketplace that there will be competitive procurement Introduces the RFP process that will follow from the RFI Obtains budgetary and financial data Achieves a greater understanding of products and services available ***FIRST STEP: CONTACT DCM – RFP TEAM*** 20

21. 21 RFI DO’SRFI DO NOT’s Work with DCM and DAFS to release RFI Award contract from response to RFI Review Responses receivedDraft RFP based on ONE response from RFI Analyze Responses receivedAssume sole source justification because one response received from RFI Draft RFP based on information received from RFI Underestimate the value of an RFI

22. Program RFP Manager (Program) reviews standard RFP documents. RFP template. RFP template Pre-approval template. Pre-approval template Program drafts Scope of Service. [2 – 4 weeks] Draft outline of Scope of Work based on summary and performance measures in Pre-Approval Template. Obtain DHHS General Counsel approval of outline. Draft RFP including Scope of Work language—refer to RFP Sample Scope of Work Template. Proofread RFP including Scope of Work language for typographical and grammatical errors. Complete GOVRFP form for RFP with budget of more than $1 million annually. 22

23. DCM RFP Team reviews draft RFP. [1 – 2 weeks] Review complete RFP package for content and for typographical, grammatical and formatting errors. Return document to Program. Program makes necessary changes to RFP package. [1 – 2 weeks] Proofread complete RFP package for typographical, grammatical and formatting errors. Obtain Office Director approval of RFP package. 23

24. Program submits RFP package to DCM. [1 week] For RFP’s with an annual budget greater than $1 million, Program includes GOVRFP.GOVRFP GOVRFP form is an executive summary of the RFP for Governor's Office to review. 24

25. RFP Team coordinates final review of RFP package. [2 – 4 weeks] Internal group approvals. General Counsel (Kevin Wells or designee) Audit Group (Herb Downs or designee) OCQI – performance measures (Jay Yoe or designee) DCM Director / Deputy Director Deputy Commissioner of Finance / Chief Operating Officer approval. 25

26. DCM submits complete RFP package to DAFS for approval. If RFP exceeds $1million on an annual basis, State Procurement Review Committee (SPRC) reviews. 26

27. ENGAGE DCM-RFP TEAM EARLY! ASK QUESTIONS - Call, email, or meet with DCM DCM takes an active role in the process Posting documents Engaging evaluation members Picking up proposals Distributing evaluation materials Coordinating with DAFS Come to RFP specific training – check SETU for dates and times. To be posted soon. 27

28. Uniqueness: The supplies or services required are unique to a specific contractor Timeframe: Time is of the essence and only one known source can meet the Department’s needs within the required timeframe 28

29. Cost: The total cost of the acquisition is less than $10,000.00 $5,000 or less: competitive process/sole source justification NOT required $5,001 - $10,000: Sole Source Letter of Solicitation Release solicitation letter; Receive MIN of 3 bids; Pick lowest cost (DO NOT NEGOTIATE SUBSTANCE) $10,001+: RFP rules apply 29

30. Emergency: The Bureau of General Services is authorized by the Governor or the Governor's designee to make purchases without competitive bidding because in the opinion of the Governor or the Governor's designee an emergency exists that requires the immediate procurement of goods or services 30

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32. Program drafts Rider A [2 – 4 weeks (Steps 1 through 3)] Review Sample Generic Rider A document. Draft outline of Rider A based on summary and performance measures in Pre-Approval Template. Obtain General Counsel approval of outline (contracts >$750,000). Draft Rider A language / proofread for typographical and grammatical errors. 32

33. SPECIFICATIONS OF WORK TO BE PERFORMED I. TABLE OF CONTENTS [Optional] II. DEFINITIONS [Optional] III. INTRODUCTION/OVERVIEW [General description of purpose of contract with references to appropriate source materials such as grant, RFP, federal and state statutes and rules] IV. DELIVERABLES [Detailed description of specific deliverables with each deliverable under a separate subheading] V. PERFORMANCE MEASURES [Written in collaboration with Office of Continuous Quality Improvement]. 33

34. VI. REPORTS [Detailed description of required reports. Reference and attach sample or template reports] The Provider shall submit reports in accordance with the specifications of the Department, according to the following schedule A. Performance Measurement Reports Report Period Date Due B. Financial Reports Report Period Date Due C. Agreement Closeout Report* Report Period: Date Due 34

35. Program determines if Rider E is applicable and establishes a payment method. Rider B—statewide terms and conditions language provided by DAFS. Rider E—program specific language. Program submits applicable documents to DCM. Riders A, B, E. AAF* authorized by the PFC—to ensure allotment / funding is available. Grant approval notification if federal dollars are being used. BP37XX. Accountability Template *For contracts not included in the approved allocation plan or when making a change to a contract on the plan*. 35

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37. DCM sends allocation letter to providers and reviews contract budget proposals for direct client service agreements. [2 – 4 weeks] DCM Contract Relationship Manager (CRM) takes ownership of the project; partners with Program Administrator (PA) to assemble complete contract package. [1 week] CRM and PA jointly proofread complete contract package for typographical, grammatical and formatting errors. [48 hours] 37

38. CRM coordinates final review of contract package. [1 -- 2 weeks] Internal group approvals. (For contracts worth more than $750,000 annually.) Program Office Director (or designee) General Counsel (Kevin Wells or designee) Audit Group (Herb Downs or designee) OCQI – performance measures (Jay Yoe or designee) DCM Director / Deputy Director 38

39. If contract exceeds $3 million annually, AG Office reviews. [1 – 2 weeks] Internal review by Chief Operating Officer or Deputy Commissioner of Finance for contracts exceeding $250,000 annually. [1 – 2 weeks] DCM coordinates execution of contract. [4 weeks] Send complete contract package to Provider for signature. Obtain Department signature of Provider-signed contract. Submit fully signed complete contract package to Division of Purchases. If contract exceeds $1 million on an annual basis, SPRC reviews. 39

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42. DCM Website Legal Staff Program Point of Contact (PPOC) Office Point of Contact (OPOC) 42

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44. Contract Process RFPs Accountability Template Writing Skills - SETU 44

45. Accountability Template RFPs Contract Documents (Rider A/E) 45

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