Purchasing & Procurement Oversight Committee Agendas & Minutes

PURCHASING & PROCUREMENT OVERSIGHT COMMITTEE (PPOC) Special Meeting Notes EDA Conference Room – 6th Floor – Ruppert Sargent Building June 3, 2016 Call to Order: Chair Cross called the meeting to order at 9:05 a.m. Committee Member Attendance: A roll call was taken by Jessica Spencer. Members Present – Martin Cross, Vice-Mayor Linda Curtis, Barbara Franklin, and Tammy Waldroup Members absent – William Brown, Velma Green, James Gervais, Eugene Johnson, and Jason Samuels. Staff and Citizen Attendance: Legal Representation: none. Staff Present – Steven Lynch, Leonard Sledge, Lavinia “Lin” Whitley, Jessica Spencer, Pam Croom, and Brenda Bailey. Citizens in Attendance: none. Statement of purpose for the special meeting: Mr. Sledge stated the special meeting was called in recognition of the fact there is work to be done to obtain more value from the time spent on the committee by asking what the current committee wants to accomplish and how best to leverage the committee’s expertise to achieve the city’s goals. It is not about just giving the committee information. It is time to step back and review the mission to determine what is it that the committee wants to accomplish and how best to assist the committee. Mr. Cross added he had previously spoken with Ms. Spencer about calling a meeting to discuss purpose and expectations and appreciates the timeliness of this meeting where ideas, thoughts and concerns can be discussed openly. His goal for this discussion is to understand the goals, mission, and purpose of the committee and for all members to be on the same page. Ms. Franklin shared that she hopes this discussion will provide a clearer direction of the role and expectation of the members. Mr. Cross hopes to acquire clear direction on the scope and authority of the committee. Mr. Lynch spoke to the three components of responsibility listed in the By-Laws: 1) Review purchasing and contractual procedures and practices of all agencies and departments of the City. 2) Recommend improvements that would result in cost effectiveness, simplicity, greater fairness and broader representation of the community. 3) Monitor the participation of small and minority businesses in the city’s procurement process. Mr. Cross asked if the details of the above information are easily accessible. He was informed that each member has a book with a copy of the by-laws, purchasing manual and disparity study summary and all information is posted on the city website. 1 Ms. Curtis stated that the focus of the committee has been reviewing reports presented at the meetings and no details have been discussed. As a council member, she has had outside inquiries regarding the procurement process. She feels an overview of the process will help her be more effective when answering the inquiries. Mr. Sledge recommended starting a “bucket list” and the first item should be an overview for City Council at the next council meeting. Mr. Lynch pointed out that the By-Laws are as broad or narrow as the committee wants to interpret and utilize them. Ms. Curtis suggested a smaller committee format for a review every three years of the By-Laws as a larger group may not be as effective. Barbara Franklin volunteered to work on the By-Laws subcommittee. General Discussion, Statements and Questions from the Committee Members: Mr. Sledge clarified that staff is interested in making sure the information provided and the format of the information is what the committee has requested and needs. Ms. Franklin advised the current information provided is unclear, many of the goals are never being met, it’s discouraging and she would like more transparency. Ms. Croom asserted that the Architecture & Engineering category reaches the goal, but only every three years due to the nature of the contract. Ms. Franklin shared that people have told her Hampton’s process is difficult, daunting and no support is provided. It was mentioned that there is a difference between bidding with the city and applying for SWaM certification, which is a state process. There was some discussion about the SWaM certification and it is a daunting process with little support. The tax assessor refers new businesses to Consolidated Procurement and Economic Development when issuing the business license. Going forward, Ms. Bailey informed the group that she will provide more clear information to the walk- ins to assist in the SWaM certification process to track and drive greater results. Mr. Sledge requested Ms. Bailey to immediately direct any inquiries to Ms. Spencer or Ms. Croom. There was discussion about reporting information annually vs. quarterly to get a better idea of whether the goals are actually being met. Ms. Whitley asserted that quarterly percentages are misleading because the dollar figure behind the percentage provides better information and an analysis of the data would be more effective. She offered to provide training sessions to educate the committee on the data analysis. She is also willing to offer training to vendors so the bids don’t seem so overwhelming to complete. There was discussion about percentage statistics provided and that more explanation of the percentages is needed. Mr. Cross suggested that a smaller group be formed to determine the reporting needs. He volunteered to work on the reporting subcommittee. There were questions about what is being done to implement the Disparity Study recommendations. Mr. Sledge suggested that status updates be given to the PPOC on any recommendations implemented. Ms. Spencer shared that the packet provided today includes the executive summary of the Disparity Study for the committee’s review. Ms. Franklin asked about outcomes and best practices of the implementation process. While some of the recommendations include additional costs to implement, all recommendations are under consideration and staff can provide updates at quarterly meetings. Purchasing Manual – Distribution and Discussion: Ms. Whitley provided a Procurement Quick Guide handout. She gave an overview of the mission, goals, methods and definitions of procurement processes. She also stated the Procurement Procedures Manual is available on the Procurement website and offered to provide a periodic overview of the procurement procedures as needed. The city operates under the Virginia Public Purchasing Act (VPPA) which provides the guidelines of public purchasing. She briefly reviewed the procurement cycle and answered the committee’s questions about the five methods of procurement as utilized by City of Hampton and Schools. 2 Ms. Curtis asked if the department can specify a brand for the product they’re purchasing. Ms. Whitley advised the department can clarify specifications without naming a brand. A vendor would not be awarded the bid if a product offered did not meet the specification requirements. Department purchases of $5,000 to $9,999 require three quotes with one quote from a MBE/WBE vendor and will be awarded to the lowest bidder. Ms. Curtis asked about the meaning of “If available”. Ms. Whitley responded that a good faith effort must be made by the purchaser to obtain a quote from a MBE/WBE vendor in the Hampton Small Business Directory first, then the Virginia Department of Small Business and Supplier Diversity Directory. Ms. Curtis asked what percentage of purchases fall into the under $30,000 category. That information has been reported to the committee in past meetings, but has been removed from the current reports provided. Ms. Whitley said she would check to see if a report could be run for the information. Ms. Franklin asked who secures quotes and selects vendors. Ms Whitley informed the group that all purchases are made according to city code and there is a random sampling of bids to ensure compliance. Ms. Franklin inquired about proprietary purchases. Ms. Whitley advised her of the policy as listed in the Procurement procedure manual. Ms. Whitley explained the different types of bid processes. Ms. Curtis questioned why a “pulled” bid is reissued. This can give the perception to some that a department was seeking a specific vendor: There was discussion of vendor perceptions of past practices and processes. Ms. Whitley explained that bids can be “pulled” for a number of reasons such as the scope of work in the solicitation was not clear or all encompassing, the department determines the specifications have changed, the bid could also be cancelled after the quotes are received because the quotes are over the budgeted amount of the project therefore it cannot be awarded. Mr. Cross inquired if the number of “pulled” bids can be provided to the committee. Ms. Whitley will provide this information at the next quarterly meeting. Ms. Curtis asked who evaluates the bid. The bid process is dictated by the Virginia Public Procurement Act. Ms. Curtis inquired how to combat underbidding where a vendor underbids and is unable to complete the work. Ms. Whitley responded that Procurement will meet with the vendor to ask for working papers and added that a contract can be terminated for non-performance. Ms. Waldroup asked if there is a contract compliance review; contracts are reviewed quarterly and on an annual basis. Each contract is reviewed by the City Attorney’s office before they are signed. The contract administrator of each contract (who is in the department that originated the bid/contract) is responsible to be sure the vendor is meeting the terms of the contract. Ms. Curtis asserted that an articulable, definable criteria needs to be established and any challenges need to be documented and evaluated. Ms. Whitley stated that ITB’s can be awarded in part or whole, allowing an untested vendor to prove themselves. She added that some vendors will hire sub-contractors to do work they aren’t able to complete themselves. Ms. Franklin asked how Procurement would arrive at the decision to split a contract. This is a determination made by the department that originated the bid and is determined by their needs. Procurement guides departments in this decision. There was discussion about the contractor’s questionnaire that is used to determine their ability to do the work. Because contracts are awarded to the lowest responsive and responsible bidder, Ms. Curtis asked how a determination is made when more than one vendor has a matching bid. Ms. Whitley explained the steps which include looking for a vendor in Hampton. If no Hampton vendor is available, it would be awarded to the vendor closest to Hampton. These steps are required per the Virginia Public Procurement Act. Discussion continued about the bidding process, timeliness, transparency and what work is being solicited. Committee members would like to view the solicitations at the quarterly meetings. Committee Vacancies-Recommendations: Ms. Spencer advised there are two vacancies on the committee due to Mr. Ken Johnson and Mr. Ernest Sanchez resignations. City Council appoints new members but does consider recommendations for appointments from the PPOC. City Council will review 3 the board bank applications when selecting new committee members. Vice-Mayor Curtis commented that board bank applications under consideration should be current applications. Members were encouraged to inform any interested parties to complete the on-line application. No recommendations were given. Committee Members-Closing Comments: Mr. Cross thanked all participants and offered that this session was very informative in understanding the Procurement process. He outlined the committee’s next steps to be established by August 15: (1.) Provide procurement information to entire committee, possibly via webinar. The handout was very helpful. (2.) Establish subcommittee for By-Laws review. (3.) Establish subcommittee to determine reporting needs for future quarterly meetings. Communicate expectations for subcommittees to meet between the July and October quarterly meetings. Mr. Cross volunteered to participate on the reporting subcommittee and Ms. Franklin volunteered to participate on the By-Laws subcommittee. Future action items to be addressed:  Provide an overview to City Council on the procurement process at the next Council meeting  Provide an overview on the procurement process at the next PPOC meeting and on a yearly basis or when new members join  Review the By-Laws every three years  Share public bid information with the PPOC at quarterly meetings  Review how many bids are pulled and the reasons why  Review contract sanctions and debarment procedures Public Comments: There were no public comments. Adjournment: There being no further business, Mr. Cross adjourned the meeting at 11:28 a.m. Next meeting: The next meeting will be held at 12:30 p.m. Wednesday, July 20, 2016 in the EDA Conference Room, 6th Floor, Ruppert Sargent Building located at 1 Franklin Street, Hampton, VA 23669. Respectfully submitted, Jessica R. Spencer Minority Business Coordinator JRS/bsb 4