purchasing directors’ meeting december 9, 2004 4:00 p.m. state purchasing
TRANSCRIPT
Purchasing Directors’ Meeting
December 9, 20044:00 P.M.
State Purchasing
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Purchasing Directors’ Meeting Purchasing Directors’ Meeting December 9, 2004 Agenda December 9, 2004 Agenda
• Welcome / Meeting Overview
• State Purchasing Mission
• MyFloridaMarketPlace Update
• Roadmap to Excellence in Contracting Follow Up
• Fuel Tax Issues
• Next Meeting Location / Time
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State Purchasing MissionAlignment with Agency Mission
DMS Mission
To deliver resource saving solutions to our customers in order to enable them to better serve the people of Florida.
State Purchasing Mission
To gladly deliver useful and innovative purchasing services in order to provide effective program support to all state agencies.
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State Purchasing Mission Tasks
• Deliver state term contracts that provide the right commodities and services at lower cost
• Improve quality of state term contract presentation • Support completion of MFMP roll-out• Retire legacy systems• Assist CFEG procurements• Implement centralized vendor performance rating system• Implement centralized contract management system• Implement internal processes and procedures
(paperless)• Complete next waves of training and certification
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State Purchasing Mission Goals (Measures)
• Achieve 5% cost savings over last price paid on all contracts awarded this year for similar products and services. Achieve an average 28% savings over MSRP for all contracts.
• Increase customer satisfaction by 20% (compared to SP survey FY 03-04)
• Facilitate three CFEG initiatives through Gate 2 (procurement) and into Stage 3
• Deliver two new innovations– eForms solution – centralized vendor performance rating system
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State Purchasing MissionSteve and Charles’ Expectations
• Cost Savings– At least 28% below MSRP
– At least 5% below last price paid
• Level of Service will not be reduced• 20% Improvement in Customer Focus• State Purchasing will be seen as an asset• State Term Contracts will be easy to use• Highly trained and motivated teams
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State Purchasing MissionRuss’s Expectations
My goals: • Achieve 5% cost savings over last price paid on all state
purchasing agreements awarded this year for similar products and services. Achieve an average 28% savings over MSRP on all state purchasing agreements.
• Increase customer satisfaction by 20% (compared to SP survey FY 03-04)
• Deliver two new innovations: eForms solution; centralized vendor performance rating system
Key task: • Review & revise existing training materials; incorporate
rule changes; recruit and schedule other trainers
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Purchasing Directors’ Meeting Purchasing Directors’ Meeting December 9, 2004 Agenda December 9, 2004 Agenda
• Welcome / Meeting Overview
• State Purchasing Mission
• MyFloridaMarketPlace Update
• Roadmap to Excellence in Contracting Follow Up
• Fuel Tax Issues
• Next Meeting Location / Time
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MyFloridaMarketPlace Update
Contract Issues
Tentative Agreement with Accenture, subject to LBC approval in January -- moving ahead
SPURS Sunset Plan
Are you aware? prepared?
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MyFloridaMarketPlace UpdateFrom Sourcing to Punchout - Goal
Sourcing
Contract
User View
Core
(line item bid)
Non-core
(% discount) All else
Contract (periodically refresh) Non-contract
Punch-Out via MFMP
Customized view for non-MFMP EU’s
Commercial
Contract items
marked
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Purchasing Directors’ Meeting Purchasing Directors’ Meeting December 9, 2004 Agenda December 9, 2004 Agenda
• Welcome / Meeting Overview
• State Purchasing Mission
• MyFloridaMarketPlace Update
• Roadmap to Excellence in Contracting Follow Up
• Fuel Tax Issues
• Next Meeting Location / Time
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Roadmap to Excellence in ContractingFactor Contributing to Current Deficiencies
Inadequate systems exist for monitoring and rating vendor performance.
We recommend a uniform vendor monitoring and rating system be created which incorporates links to contract monitoring reports, vendor websites, closeout evaluations, and a method for other agencies to access performance evaluations.
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State Term Contract User
Survey(Active)
Contractor Performance
Rating(?)
Contract Management
Software(?)
MFMP Vendor Performance
Tracking(In Development)
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New Constellation of Integrated Systems (See Nov Meeting for full details)
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Requestor completes transaction in MFMP
VPT System receives
completed survey and
updates vendor’s scores
VPT System generates email to
requestor with link to
survey
Requestor completes optional
survey with pre-populated
header
Is transaction against a STC,
SPA or Agency Term
Contract?
YES
NO
STOP
Is payment made over
$2,500 threshold?
NO
YESNO
(2) Proposed MFMP/VPT SystemSurvey Generation Process
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Roadmap to Excellence in ContractingFactor Contributing to Current Deficiencies
The state’s corporate culture does not foster the sharing of best contracting practices among agencies.
We recommend that DMS create and foster user groups of professional procurement staff that meet on a regular basis to share best practices and common problems. Output from this group could be used to spearhead changes in legislation and policy direction.
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“Professional Procurement Staff”Who Are They? (from NASPO Strategic Plan)
Procurement encompasses the entire process of obtaining commodities and services
– assessing need and planning the acquisition
– preparing and processing a requisition
– determining the contractor source selection method and drafting and issuing a solicitation
– evaluating bids or proposals and awarding a contract
– administering the contract
– receiving and accepting goods or services
– managing delivery, payment, inventory and property disposition
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“Professional Procurement Staff”Who Are They? (from NASPO Strategic Plan)
Purchasing is one component of the procurement process. Procurement also embraces activities such as
– quality assurance
– training and education
– dispute resolution
– system oversight
– streamlining the acquisition and businesses processes
– embedding the best of supply chain management techniques in public policy and process
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Engaging Contract Administrators
• Creating user group of agency contract administrators to supplement purchasing directors
• Meeting scheduled for January 13, 2005, in conjunction with next purchasing directors’ meeting
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Purchasing Directors’ Meeting Purchasing Directors’ Meeting December 9, 2004 Agenda December 9, 2004 Agenda
• Welcome / Meeting Overview
• State Purchasing Mission
• MyFloridaMarketPlace Update
• Roadmap to Excellence in Contracting Follow Up
• Fuel Tax Issues
• Next Meeting Location / Time
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2005 Tax Law Change - Excise Tax on GasolineIRS Changes
• Prior to January 2005, fleet card companies like Voyager and others have been permitted to pass Federal Excise Tax exemptions on gasoline charges forward to tax exempt buyers. Florida is exempt from this tax on gasoline and diesel.
• Tax fraud has led the IRS to change this process. The IRS plans to issue guidance in December 2004 explaining the changes. Industry meeting scheduled for December 18.
• Currently, only IRS registered “Ultimate Vendors” may invoice tax exempt buyers minus this tax on diesel.
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2005 Tax Law Change - Excise Tax on GasolineSolutions
• For State Agencies to receive this exemption for taxes paid on diesel, they have to apply for a refund using IRS Form 8849, Schedule 1 [details on next 2 slides].
• Bidders on the new state term contract must be IRS registered “Ultimate Vendors,” able to invoice agencies the tax exempt rate. When the new contract is awarded, agencies will no longer need to apply for a tax refund.
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2005 Tax Law Change - Excise Tax on GasolineIRS Form 8849 and Schedule 1
• Form 8849 is used by tax exempt purchasers to receive a refund for taxes paid on several types of fuel. The detail provided to agency F&A offices by Voyager can be used to complete the form’s Schedule 1. See the Form’s Instructions for more detail.
• Resulting refund can be reapplied to the agency’s administrative trust fund and subsequently re-allocated to divisions.
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2005 Tax Law Change - Excise Tax on GasolineIRS Form 8849 and Schedule 1
• See Publication 378 Fuel Tax Credits and Refunds (available on the IRS website) for more information.
• http://www.irs.gov/publications/p378
• Forms also available on our website with these meeting materials.
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Purchasing Directors’ Meeting Purchasing Directors’ Meeting December 9, 2004 Agenda December 9, 2004 Agenda
• Welcome / Meeting Overview
• State Purchasing Mission
• MyFloridaMarketPlace Update
• Roadmap to Excellence in Contracting Follow Up
• Fuel Tax Issues
• Next Meeting Location / Time
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Purchasing Directors’ MeetingNext Meeting
Time: 3:00 pm to 5:00 pm
(First hour for contract administrators)
Date: Thursday, January 13, 2005
Location: Betty Easley Center, Room 152