Frequently Asked Questions

What are the most common mistakes that agencies make in service contracting?

The most common mistakes made by procuring agency staff typically do not involve complex issues.  The following are some of the most common issues:

• failure to follow current model language policy (or to submit such a contract for approval processing without an approved rule exception to permit deviations from model language)

• failure to ensure that the written amount agrees with the numerical amount detailed in the Maximum Liability provision

• grant budget errors-- 

  • failure to detail the correct grant budget applicability dates as required;

  • failure to attach budget back-up detail for selected line-items as required

• mathematical errors--

  • on the summary cover

  • in the grant budget (and or back-up detail)

  • elsewhere in the contract documents where it may be applicable

• failure to ensure that the alpha-numeric designations of all contract provisions are in proper sequence and without gaps

• failure to correctly reference all contract document attachments and exhibits

• failure to affix all required signatures to contract documents

• failure to complete all “blanks” in the subject model policy template

• failure to “spell check” and proof read contract documents

• failure to present contract documents for approval with all required procurement documentation (refer to Policy .06a for lists by procurement type)

 What does “RFS” stand for?

It is an acronym for “Requisition For Service.”  It should be a unique agency-assigned tracking number for the subject document.

Are the service contracts for a specific time frame, such as 1 year, 2 years or lifetime?

Yes, all professional service contracts MUST have a specific contract period (with a start date and an end date).  Note:  State agencies may NOT authorize, accept, or pay for professional service outside the contract period of an applicable contract unless approved in writing by the F&A Commissioner (refer to professional service contracting rule 0620-3-3-.07(15)).

What is the maximum number of years for a contract without the need for “re-bid” or “renewal?”

A professional service contract may not exceed a period of 60 months.  However, it is possible to obtain a Rule Exception if a longer contract is justified and in the interests of the state.

What is the average time needed for an agency to re-bid an existing contract for a complex computer application?   

Some complex procurement processes should begin the moment that an existing contract is signed, and for others, six, nine, twelve months would be reasonable.  There is no absolute with such processes that are so “situational.”  A major issue will be simply, “how quickly will the folks involved in the process work?”  It is true that changes (regulatory and otherwise) over time can affect procurement processes.  However, there are many facets of the process that are reasonably static and should commence as early as possible.

What are the responsibilities of an RFP coordinator?

The experience, influence, and consistency of RFP Coordinators are critical to the successful completion of RFP processes.  RFP Coordinator responsibilities include:

(1)    support program staff in drawing the RFP;

(2)    manage the RFP process;

(3)    instruct the Proposal Evaluation Team regarding the RFP process, the terms of the subject RFP, and the evaluation process detailed in the RFP so that team members understand the RFP process and their responsibilities in it;

(4)    manage proposal evaluations;

(5)    oversee proposal reviews for responsiveness to requirements;

(6)    coordinate any consultations and financial reviews;

(7)    oversee proposal scoring calculations; and

(8)    maintain the procurement file with all relevant documents.

An RFP Coordinator should NOT serve as a member of a Proposal Evaluation Team.

What is the minimum amount of time prior to contract expiration that a new RFP should be submitted for initial review?

In policy, agencies are asked to accommodate at least 20 days in their procurement schedule for RFP approval (while it rarely takes for the approval of RFP documents, we have found that it takes procuring agency staff substantial time to address concerns identified in these reviews).   In addition to the review time, the agency must “back up the date” for submitting an RFP for approval by the number of days expected for the RFP process (considering the proposed schedule of events).  Depending upon the nature of the service being bought (and how crucial it is) as well as the complexity of the procurement and the potential for protest, it may also be very advisable to back up the date to allow time for a proposer protest.

When a vendor wins a contract for a large and complex computer system, and some of the components are bid with a zero cost attached, what leverage do I have when those “zero cost deliverables” are late or do not meet specifications? 

In planning such a complex procurement, it is advisable to draft the procurement documents with appropriate liquidated damages that would address potential eventualities as described.  Liquidated damages if properly drafted should provide ample leverage with regard to any deliverable.  (A performance bond would serve a similar purpose, but not as effectively.)  If, in the described situation, such protection was not drafted as a part of the contract obligation, remaining leverage would seem to be limited to the standard Termination for Convenience and Termination for Cause provisions as well as the potential that payments for other deliverables “might be affected” by the failure to meet prerequisite deliverable requirements.

Is it common practice to include, in a complex computer system RFP, a requirement that states the winning vendor must either have an office in Nashville or provide onsite analysts and/or programmers?

Such is sometimes a requirement in IT procurements.  Onsite staff for work is frequently reasonable (and no travel would be paid to accommodate an out of town vendor).  However, note that a requirement for a local office is NOT typically permissible.

What is the significance of using "weights" in RFP scoring? 

The use of weights in an RFP evaluation assumes that one or more items or proposed costs to be evaluated are more important (significant) than others.  By using weights, the state is able to add a mathematical emphasis on things that are more important.  For example, if the state asks for a proposer to propose a cost for apples and oranges, but the state knows that it will probably buy 100 apples and only three oranges, clearly the price of apples is more significant (important) to the state.  However, if the state failed to use weights in the evaluation model, the cost of oranges would be as important as that for apples, and the state would end up paying more over all.

Do “Sole Providers” of a certain service have to go through the RFP process?

The RFP process is the generally preferred method for selecting professional service contractors.  The terms “non-competitive contract” and “non-competitive negotiation” are used in those instances where the procuring agency head has justified (usually based on the uniqueness and availability of the subject service in the market) and the central procurement oversight authority has approved that it is in the state’s best interests to permit procuring agency staff to confer with only one potential contractor in order to obtain the best possible, fair, and reasonable agreement to purchase service.

Is there any guidance from the state on limiting or capping the amount of money in a state contract going to personnel costs (salaries)?

Professional service contracting regulations do not address the amount of funding available for reimbursement under a grant contract for personnel costs.  However, other regulations (of specific agency programs or federal funders) may offer guidance or mandates (compliance with which is the sole responsibility of the procuring agency).

If there is a series of subcontracts, how many steps down that line are still obligated to follow state procurement policy?  For example, we get our money from EPA, we write a state contract with an organization,  they write a subcontract for a service, that entity subcontracts for another service, etc...  How many steps removed from the state treasury do you have to be before state procurement policies no longer apply?

The contract provisions that are specifically named as following to subcontractors (i.e., nondiscrimination, conflict of interest, competitive procurements, etc.) would reasonably follow and apply to all immediate subcontractors providing service pursuant to a contract with the state. 

After a contract is approved and invoices are received, how do I process those invoices?  What do I turn in and to whom?  How will I know invoices are paid?

The contract number and approval (by the person responsible for managing the subject contract) should be affixed on each invoice received and found acceptable for payment.  Processing invoices for payment is the responsibility of each procuring state agency’s fiscal office.   Fiscal staff enter appropriate information and complete necessary steps within the Edison system.   Contact your agency’s fiscal staff for detailed information and access to accounting reports.

Can you explain professional service contracting rule 0620-3-3-.01(8)?  The money we contract with is all federal and we are unsure how this paragraph may impact our program. 

An agreement in which the federal government GIVES funds to the state is NOT governed by professional service contracting regulations, and thus, the agreement does NOT have to follow any service contracting model policy or be approved through the Edison system.  HOWEVER, regardless of the source of funding, ALL expenditures by the state through professional service contracts or grants MUST adhere to professional service contracting regulations.