RECOMMENDATIORECOMMENDATIONSNSOF THE OF THE GOVERNOR’S GOVERNOR’S TASK FORCE ONTASK FORCE ONCONTRACTING CONTRACTING AND AND PROCUREMENT PROCUREMENT REVIEWREVIEWReport Overview

PD Customer Forum

September 2002

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Executive Order D-55-Executive Order D-55-0202 Created Three Member Task Force:

– Annette Porini, Chairperson, Chief Deputy Director, Department of Finance

– Cliff Allenby, Director, Department of Developmental Services

– David Janssen, Chief Administrative Officer, County of Los Angeles

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Task Force CharterTask Force Charter Review the state’s contracting and

procurement procedures and recommend any statutory, regulatory or administrative changes necessary to “ensure that open and competitive bidding is utilized to the greatest extent possible” by state agencies.

Include recommendations regarding any statutory or regulatory changes necessary to ensure adequate oversight of the contracting and procurement authority utilized by state agencies.

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Purpose of Purpose of RecommendationsRecommendations The recommendations of the

Task Force are designed to strengthen the contracting and procurement processes of the State of California by improving the quality and openness of the process and implementing a set of checks and balances to ensure its integrity.

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Reform ThemesReform Themes

Ensuring High Quality Open Process System of Checks and Balances

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Ensuring High QualityEnsuring High Quality

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Recommendation 1Recommendation 1 DGS should broaden the scope of the

Quality Assurance (QA) Program so that state agencies conducting any state procurement are required to do so under authority granted by DGS, including orders placed with contractors holding leveraged procurement instruments established by DGS, such as California Multiple Award Schedules (CMAS) and Master Agreements.

Implementation: Short-term

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Recommendation 2Recommendation 2

DGS should adopt a policy that prohibits the acquisition of large scale information technology (IT) system integration projects through the use of CMAS or Master Agreement orders.

Implementation: Short-term

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Recommendation 3Recommendation 3

DGS should adopt a policy that requires state agencies to continue to solicit and obtain three price quotations, including at least one certified small business CMAS contractor, before placing an order with a CMAS contractor.

Implementation: Short-term

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Recommendation 4Recommendation 4

DGS should develop written standards and criteria that will apply to any CMAS agreements established for vendors that do not hold federal General Services Administration (GSA) supply schedules.

Implementation: Short-term

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Recommendation 5Recommendation 5

DGS should perform random audits or compliance reviews of state agencies’ contracting and procurement transactions executed under authority granted by DGS, including services contracts.

Implementation: Long-term

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Recommendation 6Recommendation 6 DGS should establish consistent

standards tied to dollar thresholds that must be met in order for a state agency to be granted higher levels of procurement authority. These standards should take into consideration training, certification, demonstration of competency, and demonstrated capability to conduct self-audit or assessment through various means.

Implementation: Long-term

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Recommendation 7Recommendation 7 DGS should develop a uniform set of

policies, procedures and processes to apply to all state contracts and procurements to ensure the outcomes are consistent and fair, and foster competition. As a part of this recommendation, DGS should undertake an initiative to align the laws governing contracting and procurement of goods, services, and IT, including the award protest processes.

Implementation: Long-term

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Recommendation 8Recommendation 8 DGS should develop and deliver a

comprehensive training and certification program for state contracting and procurement officials. Signature authority of individuals at state agencies should be linked to the level of training, experience and proficiency achieved, as should the procurement authority of each state agency.

Implementation: Long-term

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Recommendation 9Recommendation 9

DGS should adopt clear standards of conduct for contracting and procurement officials. Violators of the standards should be subject to disciplinary action, including possible dismissal from state service.

Implementation: Long-term

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Recommendation 10Recommendation 10

DGS should adopt clear standards of conduct for vendors that do business with the state. Violators of the standards should be subject to suspension or debarment.

Implementation: Long-term

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Recommendation 11Recommendation 11

DGS should meet with industry representatives to develop model contract terms and conditions that will protect the state’s interests, and mitigate risks for all parties.

Implementation: Short-term

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Recommendation 12Recommendation 12

DGS facilitate industry and state stakeholder participation in continuous improvement of contracting and procurement processes through the establishment of advisory councils.

Implementation: Short-term

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Open ProcessOpen Process

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Recommendation 13Recommendation 13

DGS should establish a single point of entry for the processing of contracts and procurements for review and approval, regardless of their category (goods, services or IT), and implement an integrated document tracking system.

Implementation: Short-term

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Recommendation 14Recommendation 14 DGS should implement a comprehensive

eProcurement system for all state contracts and procurement transactions, to include:– Public access to opportunities & historical

information;– Policies & procedures, decision support &

training;– Product and pricing comparisons; – Rules-based approval routing; – Reverse auctions; &– Data capture for all transactions and reports

Implementation: Long-term

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System of System of Checks and Checks and BalancesBalances

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Recommendation 15Recommendation 15

DGS should begin providing further legal review in all high-risk contracting or procurement transactions.

Implementation: Short-term

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Recommendation 16Recommendation 16 DGS should develop and deliver

training to state agencies on conducting an initial, high risk review of contract and procurement transactions, using criteria established by DGS. State agencies should forward to DGS for review and approval, those contracts that meet any of the high-risk criteria.

Implementation: Short-term

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Recommendation 17Recommendation 17

DGS should develop electronically based model contract templates with standard terms and conditions for use by state agencies in order to expedite review processes for low risk contracts and procurements.

Implementation: Long-term

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Recommendation 18Recommendation 18

Each state agency should be required to designate a single official responsible for all contracting and procurement within the state agency.

Implementation: Short-term

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Recommendation 19Recommendation 19

DGS should authorize individual signature authority for contracting and procurement officials, based on position held, experience, training and certification.

Implementation: Short-term

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ConclusionConclusion

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Recommendation 20Recommendation 20

After six months, and again after twelve months, DGS should evaluate the effectiveness of its efforts to implement all short-term recommendations, and prepare a report to the Governor on the status of those efforts.

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