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Maryland Procurement Manual – 4. Solicitation Preparation

4.1 Drafting the Solicitation
4.2 Using Third Party Consultant Contracts
4.3 Procurement Review Group
4.4 Review and Approval Process

 

4.1 Drafting the Solicitation

Once an agency has identified a need, the work of drafting the solicitation can begin.  Start with the State’s most current template for the procurement method selected.  If a previous solicitation is available, the procurement officer may refer to the scope of work content from that solicitation, including any subsequent amendments or contract modifications, as a starting point for drafting the new solicitation.  The procurement officer may consider any feedback provided by the vendor community during the previous procurement.

4.1.1 Procurement Officer Determinations
Depending on the procurement method selected, the procurement officer may need to write a determination justifying the use of that method.  A determination is defined as a written procurement decision by a public official or employee that is based on written findings, and is typically a separate document, which is retained in a procurement file.[35]  For each of the following procurement methods, refer to the indicated COMAR section for specifics on what to include in the respective determination.

Procurement Method COMAR Requirement
Sole Source COMAR 21.05.05.02B
Emergency
(While not technically a “determination,” the basis and justification of an emergency procurement must be included in its record.)
COMAR 21.05.06.02.D.2(a)
Expedited
(For Use by MPA and Maryland Aviation Administration only)
COMAR 21.05.06.03.A.1(a) and C
Intergovernmental Cooperative Purchasing
(This determination is made by a Primary Procurement Unit:  STO, DBM, DGS, DOIT, MDOT, MPA, or DPSCS as authorized.  Typically, an agency sends the basis for the determination to the Primary Procurement Unit, which is then reviewed and adopted by the Primary Procurement Unit.)
COMAR 21.05.09.04

4.1.2 Minimum Qualifications
Given that “effective and broad-based competition” is one of the principal policies and purposes of Maryland’s procurement regulations (see COMAR 21.01.01.03.G), deciding who enters that competition by setting Minimum Qualifications must be carefully considered.

In general, Minimum Qualifications speak to base characteristics of a bidding or proposing entity such as experience, licensure, and certifications that are necessary for a bidder or offeror to perform the contract. Minimum Qualifications should be objectively evidenced by specific proof.

  • For example, a Minimum Qualification that requires “extensive experience” in a particular area may not only be difficult to quantify but also difficult to prove because offerors’ ideas of “extensive” may differ drastically from each other and from those of the soliciting agency.
  • On the other hand, requiring two years of experience within the last five years of providing food service to a minimum of 500 individuals per year could be objectively documented by one or more references.

Another consideration in writing Minimum Qualifications is stating who can satisfy them.  Typically, the bidder or offeror is expected to meet the Minimum Qualifications.  However, the solicitation may state that Minimum Qualifications can be met by subcontractors, subsidiaries, parent companies, or attributing the experience of individuals to a new firm.

With regard to Minimum Qualifications, the procurement officer should consider the following:

  • Are Minimum Qualifications appropriate for the solicitation;
  • Are the Minimum Qualifications written in a way that does not overly restrict competition;
  • Are the Minimum Qualifications drafted as pass/fail requirements limiting subjective interpretation;
  • Do the Minimum Qualifications state the minimum amount of experience rather than the preferred amount of experience;
  • Do the specifications apply Minimum Qualifications to the proposing entity and not the proposing entity’s staff where possible; and
  • Consider the procurement method before establishing Minimum Qualifications:
    • For RFPs, Minimum Qualifications may not be necessary where an RFP allows an agency to weigh the experience and capabilities of each offeror during the evaluation process.  In fact, the State RFP template specifically includes “Offeror Qualifications and Capabilities” as one of the evaluation criteria.  Offerors with less experience or capability would receive a lower ranking in this category than offerors with more, so it is often not necessary to limit the pool of offerors at the outset when ultimately the best offerors will receive a higher technical evaluation. (However, Minimum Qualifications may be necessary where the Minimum Qualification is a mandatory component of the work to be performed, e.g., the vendor or its key personnel must have license, certification, or permit to perform the scope of work.)
    • For IFBs, Minimum Qualifications assist in determining responsibility.[36] Unlike RFPs, IFBs have no evaluation component, so Minimum Qualifications often are appropriate to ensure that bidders are capable of performance and serve as the primary mechanism for making that determination.  To that end, the Minimum Qualifications should be written such that the requirement and associated proof objectively demonstrate the bidder’s ability to perform under the contract.

4.1.3 Best Practices for Drafting Specifications

  • Start the drafting process early enough to allow careful consideration of requirements, including those that have been published before, and ample time for review, updates, and revisions;
  • Write clear, concise, unambiguous specifications so both the State and contractor operate under the same set of expectations during contract performance;
  • Use terms consistently throughout the solicitation document;
    • For example, the word “assessment” should not be used in one place while “test” is used in another and “examination” is used elsewhere when all refer to the same contract activity; and
    • A related best practice is defining the terms used in a solicitation such that there is no dispute during contract performance regarding their meaning; and
  • Avoid using passive voice in writing the solicitation;
    • For example the following sentence: “The assessment will be completed by June 30 of each contract year.” In this example, it is unclear whom the actor is or who is responsible for completing the assessment. A sentence in active voice, by contrast, discloses the actor: “The Contractor shall complete the assessment by June 30 of each contract year.”

4.1.4 State Agency Subject Matter Experts – Security, Insurance, and Auditing
State procurement typically requires contractors to comply with various physical and information technology security measures, insurance levels, and independent auditing requirements. Deciding when these provisions are appropriate often requires the expertise of colleagues within the State. For example, the standard IT security requirements in the State procurement templates may merit revisions or additions, with assistance from the experts within DOIT.  Choosing the appropriate types and amounts of insurance may require the input of the STO.  Deciding whether an independent audit of operational controls is required based on the contractor’s access to personally identifiable information, protected health information, or information critical to an agency’s mission, may be a question for internal auditors within DBM. For more information regarding specific questions and state contracts, an agency may contact its Control Agency procurement analyst.

4.1.5 Program Guidance – Program Personnel Input
In crafting specifications, an agency should capture the input and comments of the State’s program personnel for the contract.  In some agencies, the program personnel will provide an initial draft of the scope of work; in others, program requirements are discussed with procurement officials, who ultimately write the specifications.  In all cases, obtaining the feedback and input of the program personnel for the contract is critical.  A procurement officer should ask the program personnel about best practices within the industry that may translate into specifications for the solicitation. If the procurement has been done before, the procurement officer may also want to ask what program needs have changed since the last procurement and what could be done better this time.  Upon incorporating changes to the specifications based on program personnel comments and input, key program personnel should review a final draft of the specifications before publication.

4.1.6 Technical Evaluation Criteria Order of Importance
For RFPs, an agency must consider the relative importance of each technical proposal evaluation criteria.  In the State’s RFP template, these criteria are listed in descending order of importance. While the template criteria and their ordering are appropriate for some solicitations, they may need to be adjusted for others.

4.1.7 Weighting of Technical vs. Financial Factors
The RFP must state the relative importance of technical versus financial factors.[37]

Typically, equal weighting of offerors’ technical and financial proposals provides the procurement officer with the most flexibility in determining the overall ranking of proposals to ascertain the best value award recommendation.

The RFP may give greater weight to technical factors when the quality of the technical proposal and the services to be provided under the scope of work support such a finding.  The agency must then conduct a cost-benefit analysis to determine whether the higher cost to the State is justified by the added value of purchasing the more expensive option.

Conversely, the RFP may give financial factors greater weight than technical factors when pricing is paramount and the type of services to be provided under the scope of work support such a weighting.

4.1.8 Contract Performance Tools
Listed below are some contract performance tools available to a procurement officer. Consult your procurement analyst, Assistant Attorney General (AAG), and other relevant resources to determine inclusion of these measures in a specific solicitation.

  • Payment and Performance Bonds

A performance bond is a contract surety bond, which guarantees that a contractor will fulfill its contractual obligations under a project.  The bond is put in place as a protection for the project owner and the State in case the contractor does not perform.

A payment bond is a contract surety bond, which guarantees that a contractor will pay its subcontractors, material suppliers or laborers for the work and materials provided in accordance with the agreement made between the two parties.

Performance and payment bonds are required for construction projects over $100,000.

  • Bid Bonds

A bid bond is issued as part of the solicitation process by the bidder or offeror to the State to provide a guarantee that the winning bidder or offeror will execute the contract under the terms of its bid or proposal.

When issuing bid, performance and payment bonds for non-construction projects, see BPW Advisory 1996-3.

  • Performance Guarantees

A Performance Guarantee is issued by an insurance company or bank to a contractor to guarantee the full performance of the contract according to the plans and specifications.

  • Liquidated Damages

Liquidated damages are damages whose amount the parties designate during the formation of a contract for the injured party to collect as compensation upon a specific breach of the contract.  Liquidated damages are included when actual damages may be difficult to ascertain.  Such damages should be reasonably proximate to the loss the State is anticipated to incur as a result of such breach.

A solicitation with an MBE participation goal must contain a liquidated damages provision.[38]

  • Incentives

A solicitation may include provisions to incentivize achievement of performance goals through stipends or bonuses, or impose service level credits in connection with performance failures.  In the absence of specific disincentives or service level credits, the contract should include provisions to protect the State in the event of nonperformance.

4.1.9 Bid Form/Financial Proposal Form
When preparing the Bid Form for an IFB or the Financial Proposal Form for a RFP, best practices are to utilize an Excel worksheet that provides the procurement officer the ability to lock down cells and set up formulas to calculate the Total Bid Price or the Total Evaluated Price based on the unit prices entered by the bidders or offerors.  This allows the procurement officer to confirm that all prices were entered by the bidder or offeror and limits errors on the submissions.

Best Practice Tip:  Test your Bid or Financial Proposal forms prior to posting the solicitation by entering prices in the unlocked cells to be utilized by the bidders or offerors to make sure the calculations/formulas are correct in the locked cells, and by trying to enter data in the cells with the formulas to ensure they are locked.

When requesting prices on the Bid Forms and the Financial Proposal Forms, each line on the price form should match a specific deliverable in the scope of work.  Historical data from previous contracts for the goods and services is often used to calculate usage needs and requirements for the new contract.

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4.2 Using Third Party Consultant Contracts

Do you need to contract with an Industry/Subject Matter Expert?
In drafting a complex solicitation and conducting the associated procurement in which the State may not have the subject matter expertise, an agency may consider procuring a consultant with knowledge in that particular field.  Engaging such a consultant or consulting firm provides access to industry standards, emerging best practices, financial trends, market familiarity and informed analyses that may benefit a procurement project.  Consultants may assist with drafting the specifications, responding to vendor questions, and assisting with the evaluation of offeror proposals, among other tasks.  If an agency chooses to engage a consultant to assist with a procurement, it should also require the consultant to execute a Non-Disclosure Agreement and Conflict of Interest Affidavit.  Consultants retained by the State to assist with the drafting of the solicitation or assisting in the selection for award are prohibited from submitting a proposal or assisting another in submitting a proposal for the subject solicitation or working for the selected awardee for a period of time.[39]

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4.3 Procurement Review Group

The Procurement Review Group (PRG) is a standing group within each agency, established by the head of that agency, charged with reviewing solicitations, task orders solicitations, proposed sole-source contracts, and contract renewal options expected to exceed $200,000 in order to maximize opportunities for MBE [40] and VSBE participation on State procurement contracts.  For some agencies, small business reserve designations or preferences are also determined at PRG.

4.3.1 Setting Minority Business Enterprise (MBE) Participation Goals
The participants of the MBE PRG must include the agency chief or senior procurement official and the MBE Liaison officer and may also include the procurement officer and program representatives.  These members should work together as a team to review the scope of work and subcontracting opportunities using projected line item estimates.  BPW Advisory 2001-1 http://www.bpw.maryland.gov/Pages/adv-2001-1.aspx Section E provides the review and assessment guidelines to be implemented by the PRG.  Once the MBE participation goal is established, the PRG must determine if subgoals apply based on GOSBA Guidelines.

GOSBA’s website is home to an online MBE Toolkit which includes a Sample PRG Template in Word, a Sample PRG Template in Excel, and an MBE Program Subgoal Worksheet.  The toolkit is available at https://gomdsmallbiz.maryland.gov/Pages/Reporting-Tool-MBE.aspx under “MBE Program Resources”.

4.3.2 Setting Veteran-Owned Small Business Enterprise (VSBE) Participation Goals
VSBE goal setting may use a PRG process similar to the MBE PRG goal setting process. An agency must determine the potential for VSBE participation for each contract. See BPW Advisory 2012-1 http://www.bpw.maryland.gov/Pages/adv-2012-1.aspx.

4.3.3 Review of Solicitations & Task Orders $25M and Above by GOSBA
For any procurement solicitation or task order that is expected to result in an award valued over $25 million, the agency must submit the solicitation or TORFP and PRG documentation to GOSBA for review and approval prior to publication, per a 2014 Directive and reconfirmed in an Executive Memorandum dated April 10, 2019.  This is in addition to any review and approval required by a Control Agency.

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4.4 Review and Approval Process

4.4.1 Agency Internal Review and Approval
Once the solicitation is drafted, a procurement officer will need to obtain necessary internal approvals.  These approvals may include sign off by one’s supervisor or Agency Head (or designee), but in all events should follow the internal approval procedures established by each agency.

4.4.2 Office of the Attorney General (OAG) Review
Sending the draft solicitation to an agency’s assigned AAG for review is a best practice following internal approval of a solicitation.  An AAG must review the contract that results from the solicitation for legal form and sufficiency prior to execution by the State.  The solicitation and its attachments are incorporated by reference as part of the contract; therefore, it is best to have the AAG review and provide advice before publishing a solicitation to confirm the solicitation meets legal requirements and minimize possible issues with the specifications.

4.4.3 Control Agency Review and Approval
If a solicitation is expected to exceed an agency’s delegated approval threshold, an agency must receive the appropriate Control Agency’s review and approval before its publication. Control Agency review should occur as soon as possible after completion of all internal approvals and AAG review to allow the Control Agency a reasonable time to review.[41] Control Agency review may take several weeks depending on the complexity of issues to be addressed and the time an agency needs to address those issues for clarity and sufficiency of the scope of work; associated pricing forms; Minimum Qualifications if any; evaluation weighting; SBR, MBE, and VSBE participation goals and subgoals, if any; vendor direct solicitation lists; and vendor response time, among other things.

4.4.4 Department of Human Services (DHS) Hiring Agreement Review and Approval
A hiring agreement is an agreement between a contractor and DHS by which the contractor agrees to give potential candidates identified by DHS first priority to fill job openings on the contractor’s State contract.  The procurement officer submits a “Determination Request Form” and the scope of work for the solicitation to the DHS Hiring Agreement Office for approval to include a hiring agreement in the solicitation or receive a waiver.

Best Practice Tip:  Any solicitation that includes Key Personnel requirements should be considered to include a Hiring Agreement.

4.4.5 Procurement of Banking, Investment and Other Financial Services
STO is delegated the authority to procure banking, investment and other financial services.[42]  Any agency seeking to procure these types of services should contact STO with the scope of work describing the services required.  STO may: (1) Allow the requesting agency to use an existing contract previously procured under STO authority to provide the needed services; (2) Allow the procurement to proceed under STO authority (it would conduct the procurement on behalf of the requesting agency); or (3) Issue a waiver allowing the requesting agency to proceed with acquiring services through that agency’s procurement office.  If STO does not issue the waiver, the requesting office cannot move forward with its solicitation.

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[35] See COMAR 21.01.02.01(34)

[36] See COMAR 21.01.02.01(77) for definition of “responsible.”

[37] COMAR 21.05.03.02.A(2)

[38] SFP 14-303 (b) (6) and COMAR 21.07.01.14.  See also https://goma.maryland.gov/Documents/MBE_Toolkit/Liquidated_Damages_Guideline.pdf

[39] SFP § 13-212.1

[40] Or the DBE Program for USDOT assisted contracts.

[41] See COMAR 21.02.03.02.C (6).

[42] Per COMAR 21.02.01.04(E)

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