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FAQs by Topics | Return to Executive Order page
Questions and Answers will be frequently added. Please visit this page often. References to MM 02-12 also apply to MM 02-12 Addendum #1 and all future addenda.
FAQs in Chronological Order
1. Question: Can we use a CMAS or Master Agreement vendor for a purchase under $100,000 as a non-competitive bid?
Answer: Management Memo 02-12 requires departments to solicit and obtain three offers for CMAS and Master Agreement orders valued at $100,000 or less. See Attachment A to the Management Memo.
2. Question: For a CMAS or Master Agreement order, does Management Memo 02-12 require departments to use a formal bid package to obtain the three bids?
Answer: Management Memo 02-12 does not require formal bids, it requires departments to solicit and obtain three offers. Departments can continue using their internal processes already in place to solicit offers, provided that the process is fair and competitive.
Further clarification answer: No, in accordance with the purchasing delegation guidelines issued on May 14, 2001, you are not required to obtain bids for transactions less than $5,000 unless the price cannot be determined to be fair and reasonable.
3. Question: For a CMAS or Master Agreement order, does the 5% Small Business Preference apply to bids conducted under Management Memo 02-12?
Answer: Management Memo 02-12 does not require formal bids, it requires departments to solicit and obtain three offers. As this is not a formal bid process, the 5% Small Business Preferences does not apply. For CMAS orders, Procurement Division will continue our policy of waiving the administrative fee to departments that place orders with certified Small Businesses as an incentive to meet their Small Business participation goals utilizing the CMAS Program.
Further clarification answer: No, the Management Memo requires offers from 3 CMAS or Master Contract contractors. These offers are not considered bids so therefore, the 5% Small Business preference does not apply. For CMAS orders, Procurement Division will continue our policy of waiving the administrative fee to departments that place orders with certified Small Businesses as an incentive to meet their Small Business participation goals utilizing the CMAS Program.
4. Question: For commodities or IT purchases, including IT CMAS and IT Master Agreements, can departments still award based upon "best value" - or must awards be based on price alone?
Answer: Management Memo 02-12 does not eliminate the "best value" component of the CMAS or Master Agreement Programs. Departments must identify the criteria they will use to select the contractor providing best value in their solicitation document, and can award based upon that criteria provided that the process is fair and competitive.
Further clarification answer: By solicitation document, we mean any solicitation documentation.
5. Question: The Management Memo does not appear to address CMAS or Master Agreement orders valued at less than $5,000. Are solicitations and offers required?
Answer: Same as #2. Management Memo 02-12 does not require formal bids, it requires departments to solicit and obtain three offers. Departments can continue using their internal processes already in place to solicit offers, provided that the process is fair and competitive.
Further clarification answer: For all transactions less than $5,000 departments shall obtain at least two price quotations from responsible suppliers whenever there is reason to believe a response from a single source is not a fair and reasonable price.
6. Question: Did the Management Memo change delegated bidding requirements less than $5,000?
Answer: No, in accordance with the purchasing delegation guidelines issued on May 14, 2001, you are not required to obtain bids for transactions less than $5,000 unless the price cannot be determined to be fair and reasonable.
7. Question: We entered into a CMAS contract with a vendor. We would like to extend the time base only on this contract. Since time only extensions are not covered we are presuming this can be done without bid?
Answer: Yes. You may extend a contract for time only without bidding.
Further clarification answer: So long as there is "no further consideration" to the contractor whatsoever in a time-only extension.
8. Question: When do you expect the review period to be complete and the new non-interim guidelines to be published?
Answer: Executive Order D-55-02 requires a report of "preliminary findings and recommendations within 90 days". We have no additional information beyond that at this time.
9. Question: If a state agency orders items from PIA, are those orders exempt from the Governor's Executive Order?
Answer: Yes, all interagency agreements are exempt per MM 02-12, paragraph 4.
10. Question: For CMAS and Master contract awards, are we required to choose the lowest offer or are we allowed to use selection rationale to justify using an offer other than low cost?
Answer: The MM states that you must obtain offers from 3 vendors. These offers may consider "best value" for determining the award. Best value may be determined to be lowest cost, best delivery, best maintenance service, etc. If the lowest cost has been determined by the department to be their "best value" for the acquisition, then that would be the award criteria. Approvals for all transactions must be in accordance with the MM 02-12 interim guidelines.
11. Question: Is Department Director approval required for all CMAS and Masters (MSA, MPA, MRA, SPS, WSCA) over $100,000 even if we solicit and obtain competition?
Answer: Yes. Attachment B of the MM states that Department Director approval or immediate next highest ranking official is required for all CMAS and Master contracts between $100,000 and $500,000.
Further clarification answer: In addition, pursuant to MM 02-12 Addendum #1, Agency approval is now required."
12. Question: Are Local Government entities exempt from the Executive Order and Management Memo when procuring Information Technology from Contracts by DGS such as CAL-Store, CMAS and WSCA?
Answer: Local governments are not subject to this Management Memo. See Paragraph 5 of the MM 02-12. As always, local government must follow their purchasing guidelines.
13. Question: For clarification purposes, please distinguish the CAL-Store DGS computer store contract and the State Store, Inc.
Answer: CAL-Store is a name for three master contracts awarded by DGS; State Store, Inc. is a privately owned company.
14. Question: Please provide clarification with regards to IT Goods and Services referenced in MM 02-12. Under WSCA and Cal-Store agreements it states Master Agreement purchases are limited to $500,000. Does this mean that we can purchase up to $500,000 from WSCA as long as we have three offers?
Answer: Yes, you may purchase up to $500,000 if you obtain three offers and all of the other criteria of the EO and MM 02-12 are met, i.e., required approvals, establishing essential need, etc.
15. Question: If when agencies are doing their 3 quotes/requests for offers/bids (whatever we are calling them) and they get them from, say the three CAL-Store contractors, if those contractors utilize a small business, will there be any type of a preference given or is it strictly on low dollar?
Answer: Award is to be based on the evaluation criteria established by the ordering agency. Preferences are not considered when placing orders against CAL-Store, CMAS, and Master agreements.
16. Question: Do the interim guidelines apply to Small Business, DVBE, or other vendors that are not on CMAS or Master Service Agreements?
Answer: The interim guidelines only apply to the use of CMAS and master agreements and/or the use of non-competitive bid contracts. You still have the ability to receive two quotes from certified small or disabled veteran businesses, and award to a certified small or disabled veteran business supplier. This applies as long as the order is placed under a purchasing delegation and is under $100,000.00.
17. Question: Will food and pharmaceutical contracts be exempt?
Answer: Yes, they will. A list of exempt contracts are now available on our internet site.
18. Question: Are state price schedules for Prison Industries included in the directions given in the management memo or are they still mandatory?
Answer: Prison Industry contracts remain mandatory and are exempt under Paragraph 4 of the Management Memo.
19. Question: The MM doesn't say anything about proprietary software. Does the silence mean that we need to bid out software?
Answer: Proprietary software is no longer a justification for a non-competitively bid contract. If the software can be competitively bid, then it falls within the purchasing delegation guidelines for information technology (IT) goods and services. If it cannot be bid, then "yes" the software must be justified and approved in accordance with the MM 02-12.
20. Question: We are in the process of buying out existing leases on PC equipment. We must buy the lease from the company who originally leased us the equipment or continue to make lease payments. Does this fall under "Non-Competitive IT Goods Purchase" requirements as shown in the MM thereby requiring approval by our Agency, DGS, and DOF?
Answer: Yes if you are using the Master Rental Agreement. The buyouts fall under the non-competitively bid section of the MM 02-12 and those requirements must be followed.
21. Question: Who is responsible for reporting CMAS and Master Agreement orders greater than $100,000 to DGS?
Answer: The awarding agency.
22. Question: Is a contract amendment that actually only reduces the contract amount and/or scope subject to the MM 02-12?
Answer: No.
23. Question: We have an office trying to use a "MSA" for carpet cleaning. The cost is $250. Do they really have to get (3) bids?
Answer: No. See answer to Question 5.
24. Question: The state has negotiated a Microsoft Select Agreement with Microsoft (Level D discount) that leverages the purchasing power of the state. Are purchases for software under the state's Microsoft Select Agreement subject to the provisions of the Management Memo?
Answer: Yes, since multiple sources (called Large Account Resellers) can provide offers. Several of these sources are available through CMAS and CAL-Store.
25. Question: Our agency uses Transportation Management's (TM) rate agreements to contract with a variety of carriers to satisfy our diverse transportation needs. TM's rate agreements are approved offers that are evaluated and accepted by the agency on a shipment-by-shipment basis with the individual bill of lading comprising the contract of carriage. Under Executive Order D-55-02 & Management Memo MM 02-12, does our agency need to obtain 3 offers for each shipment?
Answer: No, as long as these agreements are less than $5,000.
26. Question: Transportation Management's Uniform Price Schedule for local office moves has a maximum dollar amount of $10,000 before the competitive bid process is required. How is this maximum dollar amount affected by the Executive Order and Management Memo?
Answer: Transportation Management's Uniform Price Schedule's maximum dollar amount has been reduced to $5,000 to be consistent with MM 02-12 Addendum #1. Any transportation services contract exceeding $5,000 will require a competitive bidding process.
27. Question: Can we modify the Notice of Contract Award form?
Answer: No. No modifications to the form will be allowed.
28. Question: Do I fill out the Notice of Contract Award form for a competitively bid contract?
Answer: No. It is only for those CMAS and Masters contracts over $100,000 for IT goods and/or services or non-IT services and that are subject to MM 02-12 Addendum #1.
Further clarification answer: The Notice of Contract Award form has been revised (6/25/02) to add reporting of all executed non-competitively bid contracts regardless of dollar amount.
29. Question: How do I know who the two highest ranking officials in my department are?
Answer: Ask your director and/or legal counsel.
30. Question: Next ranking official is who? We have several people that are at the next rank from the Director.
Answer: The Director must designate one of those persons as the next ranking official.
31. Question: Are subvention contracts exempt from MM 02-12?
Answer: See MM 02-12 Addendum #1 Attachment D, paragraph d.
32. Question: Are competitively bid contracts exempt from MM 02-12?
Answer: Yes, that's one of the categories exempt from MM 02-12.
33. Question: If a contract has Section 27 approval, is it exempt from MM 02-12?
Answer: No. Section 27 covers budgetary approval. Any resultant contract may or may not be covered by MM 02-12 depending upon the method of contracting.
34. Question: What must a state agency buyer do to purchase from the Cal Store (California State Computer Store)?
Answer: The state agency buyer must obtain three offers for the goods/services to be purchased. These three offers may be from any combination of CMAS or Master Agreement suppliers, which includes Cal Store suppliers. If the purchase is over $100,000 but less than $500,000, then it must be approved by the department director (or next highest ranking department official) and your Agency Secretary (or next highest ranking official). All CMAS and Master Agreement purchases including Cal Store, are limited to less than $500,000 with no exceptions.
35. Question: Does the 30% contract amendment rule for non-IT services contracts still apply?
Answer: No.
36. Question: Are Form 20 orders for telecommunication services subject to MM 02-12?
Answer: Only mandatory services ordered off the California Integrated Information Network (CIIN) contract on Form 20s are exempt from MM 02-12. DOIT Directive 1999-01 identifies in its attachment all CIIN mandatory services.
37. Question: Do the dollar limits in MM 02-12 exclude freight and taxes?
Answer: Yes.
38. Question: Where do we show the Director's and Agency Secretary's approvals of the contract?
Answer: At a minimum, approvals should be provided on the Notice of Contract Award and/or Non-Competitive Bid Contract Justification forms, whichever is applicable.
39. Question: What is competitive bidding?
Answer: It is a procurement process that may include such factors as rules for bid submission, application of preferences, advertising, open and fair competition, protest rights for bidders, Small Business and DVBE participation, and bid evaluation and selection criteria, which includes cost or the amount bid as a material factor - dependent on the item purchased.
40. Question: Are CAL-Card purchases subject to MM 02-12?
Answer: CAL-Card is a payment method only. Any purchases made with a CAL-Card must comply with the purchasing delegation rules if the purchase is made using your delegation authority. All CMAS, Master, or non-competitively bid contract where CAL-Card is used as a payment method must comply with MM 02-12 unless exempted.
41. Question: How does the delegation from the Agency Secretary and the Department Director officially take place?
Answer: The delegation to the next immediate ranking official in either situation is only to take place when the Agency Secretary or Department Director is out of town, or when there is a conflict of interest such that it would be inappropriate for the Agency Secretary or Department Director to sign.
42. Question: Do I need to complete the Notice of Contract Award for non-competitively bid contracts and submit it along with a copy of the contract to DGS within 5 days of the award?
Answer: Yes, a copy of the approved Non-Competitively Bid Contract Justification form and approved Std 821 form (if applicable) must accompany a copy of the awarded contract and completed Notice of Contract Award form.
43. Question: If I have an approved Non-Competitively Bid Contract Justification form (i.e. NCB document) showing the Director's and Agency's approvals, do I need to get their signatures again on the Notice of Contract Award form after I awarded the contract and before I submit a contract copy and notice form to DGS?
Answer: No, as long as the NCB document showing the Director's and Agency's signatures has been provided with the Notice of Contract Award form and a copy of the contract.
44. Question: What form do I use to transmit a non-IT services contract over $35,000 and under $100,000 to DGS for contract approval?
Answer: For Master Agreement non-IT services, complete a Std 213 and forward to DGS Office of Legal Services. If it is a CMAS non-IT services contract, include a Std 215 with your Purchase Order and submit pursuant to CMAS instructions.
45. Question: When we competitively bid a move over $5,000, are the vendors required to use the Uniform Price Schedule (UPS) rates and are they required to inform Traffic Management if they do not use those rates?
Answer: No, Traffic Management does not need to be informed because UPS hourly rates do not apply to lump sum bids over $5,000. Work permitted under the UPS that exceeds $5,000 must be competitively bid. The vendors set their competitive prices to complete the entire job and to satisfy all conditions of the solicitation. A contract is then awarded to the lowest responsible lump-sum bidder meeting all solicitation requirements from among the submitted bids.
46. Question: I would like to use CMAS pre-negotiated terms and conditions for an approved NCB contract that we will be issuing. How can I do this?
Answer: If you are issuing the contract under your delegation authority you would reference the CMAS terms and conditions in the body of the contract. You may also use CMAS terms and conditions on a contract that DGS is issuing on your behalf. DGS will issue a separate non-CMAS contract number and reference the CMAS terms and conditions in the body of the contract as per the department's instructions.
47. Question: Are amendments to competively bid contracts exempt from the management memo?
Answer: Whenever you have a contract that was competitively bid, any amendments issued under that contract would go through the non-competitively bid contract process, unless the amended dollars and scope of work were considered in the selection process for the awardee.
48. Question: Are purchases made using Inmate Welfare Funds exempt from Management Memo 02-12 guidelines.
Answer: Yes, because these purchase are not made with state funds and therefore are not subject to state purchasing guidelines. |
