The information provided below is pertinent only to Arizona school districts unless otherwise noted.
Written quotations vs. RFP – threshold:
Q: Our district requested written quotations and three vendors replied with varying amounts – two were above the formal bidding threshold and one was below the formal bidding threshold. Will our district be required to prepare a formal Request for Proposals (RFP) for this purchase?
A: As long as the District expends an amount below the formal bidding threshold, the District will not be required to prepare a formal RFP.
Textbooks Direct from Publisher:
Q: ARS Sections 15-721 and 722 allow the Governing Board to purchase textbooks directly from the publisher. Are supplemental workbooks and similar items included in the definition of ‘textbooks’, and therefore excluded from the bidding process?
A: If supplemental workbooks, etc. are for K-8 grades and adopted by the governing board in accordance with ARS Sections 15-721 and 722, they are included in the definition of textbooks and may be purchased directly from the publishers without going through formal competitive procurement procedures. All high school workbooks, instructional aids and other materials must be competitively procured if the cost is over the procurement threshold.
Is it OK to contract with the second-place non awarded vendor on original bid if the awarded vendor breached the contract:
Q: A district awarded a contract via the bid/RFP process and the vendor breached the contract, therefore cancelling it. Can the district then award a contract to a vendor that was in second-place on the original bid? Or must the district go back out to bid?
A: The district could award a subsequent contract to the second-place bidder if the second contract is for the same goods or services and for the same timeframe outlined in the original bid/RFP and the second-place vendor will honor their original bid amount.
Procurement authority and decisions:
Q: Does our Governing Board need to approve procurements?
A: The USFR and School District Procurement Rules allow the Governing Board to delegate to a designee procurement authority including the authority to make determinations, award contracts, make sole source and emergency procurements, and approve change orders and contract modifications. The board’s delegation must be done through the adoption of a governing board policy in accordance with AAC R7-2-1007.
Q: What are the procurement rules for purchasing goods and services from employees and governing board members?
A: There are different rules based upon whether the purchase is for goods or services, if the purchase is for goods or services, and if the District’s average daily membership (ADM) is less than or greater than 3,000. See the tables below per the USFR manual and ARS section 38-503(C).
Need to bid for services provided by bond counsel and underwriters:
Q: If a district issues general obligation or refunding bonds, would the District need to bid for the services provided by the bond counsel and underwriters, even though the fees are usually taken directly from the bond proceeds?
A: The district would need to follow School District Procurement Rules if the cost of the services provided by the bond counsel or underwriters exceeded the bidding threshold. If the cost of the services were below the bidding threshold, then oral or written quotations would be needed.
Exempt from procurement procedures if vendor is on an ADE approved list:
Q: Is a school district exempt from procurement procedures if a vendor is chosen from the Arizona Department of Education approved list of food commodity processors?
A: The list of food commodity processors was not compiled using procurement procedures; therefore, a district would still need to follow appropriate procurement procedures if the cost of processing was expected to exceed State procurement thresholds.
State procurement guidelines for grant proposals:
Q: In writing a 21st Century grant proposal, a district must identify specific service providers that will be used during the grant. If payment to a specific provider identified will exceed the procurement limits, does the district need to follow state procurement guidelines?
A: Prior to applying for the grant, the district should estimate the total payments to be made to the service provider. If the payments will exceed the procurement thresholds, the district should issue bids or RFPs, or seek the required quotations, prior to applying for the grant. The procurement specifications should include that the award of the service contract is contingent upon award of the grant. The selected vendors should then be listed in the grant proposal.
Our tax-exempt status determination:
Q: How do we respond to a vendor or outside organization requesting our tax exempt status determination?
A: According to IRS Code Section 170(b) and 170(c), a governmental unit [as described in 170(c)(1)] is classified as a charitable organization. However, no determination letter is needed from the IRS since you are a governmental entity.
OK to grant preference to local bidders?
Q: Can a District or Charter School grant a preference to local bidders in order to help increase business within the community?
A: According to a similar question posed to the Attorney General’s office, local preference is contrary to your duty to act in the public interest to purchase goods/services at the lowest price. Such criteria as response time, shipping charges, etc. are appropriate so long as those matters are legitimate concerns for the particular procurement, the criteria are identified in the invitation to bid and the vendor responses are evaluated on the same scale.
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