DAR File No. 38503

Administrative Services, Purchasing and General Services

Rule R33-4

Specifications

Notice of Proposed Rule

(Repeal and Reenact)

DAR File No.: 38503
Filed: 05/13/2014 10:30:59 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The reason for the repeal and reenactment is because the Division of Purchasing and General Services is updating this rule to comply with the provisions of the Procurement Code, Title 63G, Chapter 6a, and to match recent legislation (S.B. 179 of the 2014 General Legislative Session, including S.B. 190 from the 2013 General Legislative Session, and S.B. 153 from the 2012 General Legislative Session).

Summary of the rule or change:

This rule establishes general procurement provisions, prequalifications, specifications, and small purchases. This rule also provides additional requirements and procedures and must be used in conjunction with the Utah Procurement Code. This rule is being updated to comply with the provisions of the Utah Procurement Code, Title 63G, Chapter 6a, and to match recent legislation. The substantive changes are that this rule establishes the thresholds for approved vendor lists and small purchases.

State statutory or constitutional authorization for this rule:

• Title 63G, Chapter 6a

Anticipated cost or savings to:

the state budget:

The state's budget will not be affected, because this rule simply establishes general procurement provisions, prequalifications, specifications, and small purchases. If there is any impact, it is created by the statute. This rule merely implements the statute.

local governments:

Local governments' budgets will not be affected, because this rule simply establishes general procurement provisions, prequalifications, specifications, and small purchases. If there is any impact, it is created by the statute. This rule merely implements the statute.

small businesses:

Small businesses' budgets will not be affected, because this rule simply establishes general procurement provisions, prequalifications, specifications, and small purchases. If there is any impact, it is created by the statute. This rule merely implements the statute.

persons other than small businesses, businesses, or local governmental entities:

No other person's budget will be affected, because this rule simply establishes general procurement provisions, prequalifications, specifications, and small purchases. If there is any impact, it is created by the statute. This rule merely implements the statute.

Compliance costs for affected persons:

There is no compliance costs for any person, because this rule simply establishes general procurement provisions, prequalifications, specifications, and small purchases. If there is any impact, it is created by the statute. This rule merely implements the statute.

Comments by the department head on the fiscal impact the rule may have on businesses:

There is no fiscal impact on businesses. If there is any impact, it is created by the statute. This rule merely implements the statute.

Kimberly Hood, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Administrative Services
Purchasing and General Services
Room 3150 STATE OFFICE BLDG
450 N STATE ST
SALT LAKE CITY, UT 84114-1201

Direct questions regarding this rule to:

• Alan Bachman at the above address, by phone at 801-538-3105, by FAX at 801-538-3313, or by Internet E-mail at [email protected]
• Paul Mash at the above address, by phone at 801-538-3138, by FAX at 801-538-3882, or by Internet E-mail at [email protected]
• Chiarina Bautista at the above address, by phone at 801-538-3240, by FAX at 801-538-3313, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

07/01/2014

This rule may become effective on:

07/08/2014

Authorized by:

Kent Beers, Director

R33. Administrative Services, Purchasing and General Services.

[R33-4. Specifications.

R33-4-1. General Provisions.

4-101 General Purpose and Policies.

(1) Purpose. Specifications shall be drafted with the objective of clearly describing the purchasing agency's requirements and of encouraging competition. The purpose of a specification is to serve as a basis for obtaining a supply, service, or construction item, or technology adequate and suitable for the purchasing agency's needs in a cost effective manner, taking into account, to the extent practicable, the costs of ownership and operation as well as initial acquisition costs.

(2) Use of Functional or Performance Descriptions. Specifications shall, to the extent practicable, emphasize functional or performance criteria while limiting design or other detailed physical descriptions to those necessary to meet the needs of the purchasing agency. To facilitate the use of the criteria, using agencies shall endeavor to include as a part of their purchase requisitions the principal functional or performance needs to be met. It is recognized, however, that the preference for use of functional or performance specifications is primarily applicable to the procurement of supplies and services. This preference is often not practicable in construction, apart from the procurement of supply-type items for a construction project.

(3) Preference for Commercially Available Products. It is the general policy that requirements be satisfied by standard commercial products whenever practicable.

4-102 Availability of Documents.

Except for testing and confidential data, specifications and any written determination or other document generated or used in the development of a specification shall be available for public inspection.

4-103 Emergency Authority.

In the event of an emergency, as determined by the procurement officer, the purchasing agency may procure by any reasonable means, with any available specifications, without regard to the provision of these rules.

4-104 Procedures for the Development of Specifications.

(1) Provisions of General Application.

(a) Application of Section. This section applies to all persons who may prepare a specification.

(b) Specification of Alternates May Be Included. A specification may provide alternate descriptions of supplies, services, or construction items where two or more design, functional, or performance criteria will satisfactorily meet the purchasing agency's requirements.

(c) Contractual Requirements Not to Be Included. To the extent feasible, a specification shall not include any solicitation or contract term or condition as a requirement for time or place of bid opening, time of delivery, payment, liquidated damages, or qualification of bidders.

(d) Use of Existing Specifications. If a specification for a common or general use item has been developed in accordance with subsection (2) (a) of this section or a qualified products list has been developed in accordance with subsection (2) (d) of this section for a particular supply, service, or construction item, or need, it shall be used unless the procurement officer makes a written determination that its use is not in the purchasing agency's best interest and that another specification shall be used.

(e) The procurement officer should provide for the periodic review of specifications to determine whether any existing specification needs revision, or a new specification is needed to reflect changes in:

(i) the state of the art;

(ii) the characteristics of the available supplies, services, or construction items, or technology;

(iii) needs of the using agency;

(iv) a new technology that the acquiring agency does not currently possess; or

(v) technology that is new or subject to future advancements during the course of any contract term.

(f) The procurement officer may allow others to prepare specifications for the purchasing agency's use in making procurements when there will be no substantial conflict of interest involved and it is otherwise in the best interests of the purchasing agency as determined by the procurement officer.

(2) Special Additional Procedures.

(a) Specifications for Common or General Use Items.

(i) Preparation and Utilization. A standard specification for common or general use shall, to the extent practicable, be prepared and utilized when a supply, service, or construction item is used in common by several using agencies or used repeatedly by one using agency, and the characteristics of the supply, service, or construction item as commercially produced or provided remain relatively stable while the frequency or volume of procurements is significant, or where the purchasing agency's recurring needs require uniquely designed or specially produced items.

(ii) Final Approval. Final approval of a proposed specification for a common or general use item shall be given only by the procurement officer.

(iii) Revisions and Cancellations. All revisions to or cancellations of specifications for common or general use items may be made upon approval of the procurement officer.

(b) Brand Name or Equal Specification.

(i) Brand name or equal specifications may be used when the procurement officer determines that a specification is in the purchasing agency's best interest.

(ii) Designation of Several Brands. Brand name or equal specification shall seek to designate as many different brands as are practicable as "or equal" references and shall state that products substantially equivalent to those designated will be considered for award.

(iii) Required Characteristics. Unless the procurement officer authorized to finally approve specifications determines that the essential characteristics of the brand names included in the specifications are commonly known in the industry or trade, brand name or equal specifications shall include a description of the particular design and functional or performance characteristics which are required.

(iv) Nonrestrictive Use of Brand Name or Equal Specifications. Where a brand name or equal specification is used in a solicitation, the solicitation shall contain explanatory language that the use of a brand name is for the purpose of designating the standard of quality, performance, and characteristics desired and is not intended to limit or restrict competition.

(c) Brand Name Specification.

(i) Use. Since use of a brand name specification is restrictive, a specification may be used when the procurement officer or designee makes a written determination. The determination may be in any form deemed acceptable to the chief procurement officer, as a purchase evaluation, or a statement of single source justification. The written statement must state specific reasons for use of the brand name specification.

(ii) Competition. The procurement officer shall seek to identify sources from which the designated brand name item or items can be obtained and shall solicit sources to achieve whatever degree of competition is practicable. If only one source can supply the requirement, the procurement shall be made under Section 63G-6-410 of the Utah Procurement Code.

(d) Qualified Products List.

(i) Use. A qualified products list may be developed with the approval of the Chief Procurement Officer, or the head of a purchasing or using agency authorized to develop qualified products lists, when testing or examination of the supplies or construction items prior to issuance of the solicitation is desirable or necessary in order to satisfy purchasing agency requirements.

(ii) Solicitation. When developing a qualified products list, a representative group of potential suppliers shall be solicited to submit products for testing and examination to determine acceptability for inclusion on a qualified products list. Any potential supplier, even though not solicited, may offer products for consideration in accordance with any schedule or procedure established for this purpose.

(iii) Testing and Confidential Data. Inclusion on a qualified products list shall be based on results of tests or examinations conducted in accordance with prior established requirements. Except as otherwise provided by law, trade secrets, test data, and similar information provided by the supplier will be kept confidential when requested in writing by the supplier. However, qualified products lists' test results shall be made public, but in a manner so as to protect the confidentiality of the identity of the competitors by, for example, using numerical designations.]

R33-4. General Procurement Provisions, Prequalifications, Specifications, and Small Purchases.

R33-4-101. Prequalification of Potential Vendors.

General procurement provisions, including prequalification of potential vendors, approved vendor lists, and small purchases shall be conducted in accordance with the requirements set forth in Sections 63G-6a-402 through 408. All definitions in the Utah Procurement Code shall apply to this Rule unless otherwise specified in this Rule. This administrative rule provides additional requirements and procedures and must be used in conjunction with the Procurement Code.

 

R33-4-102. Thresholds for Approved Vendor Lists.

(1) Public entities may establish approved vendor lists in accordance with the requirements of Sections 63G-6a-403 and 63G-6a-404.

(a) Contracts or purchases from an approved vendor list may not exceed the following thresholds:

(i) Construction Projects: $2,500,000 per contract, for direct construction costs, including design and allowable furniture or equipment costs, awarded using an invitation for bids or a request for proposals;

(ii) Professional and General Services, including architectural and engineering services: $100,000; and

(iii) Information Technology: $500,000

(b) Thresholds for other approved vendor lists may be established by the Chief Procurement Officer or head of a procurement unit with independent procurement authority.

 

R33-4-103. Specifications.

(1) Public entities shall include in solicitation documents specifications for the procurement item(s).

(2) Specifications shall be drafted with the objective of clearly describing the procurement unit's requirements and encouraging competition.

(a) Specifications shall emphasize the functional or

performance criteria necessary to meet the needs of the procurement unit.

(3) Persons with a conflict of interest, or who anticipate responding to the proposal for which the specifications are written, may not participate in writing specifications. Procurement units may retain the services of a person to assist in writing specifications, scopes of work, requirements, qualifications, or other components of a solicitation. However the person assisting in writing specifications shall not, at any time during the procurement process, be employed in any capacity by, nor have an ownership interest in, an individual, public or private corporation, governmental entity, partnership, or unincorporated association bidding on or submitting a proposal in response to the solicitation.

(a) Rule R33-4-104(3) does not apply to the following:

(i) a design build construction project; and

(ii) other procurements determined in writing by the chief procurement officer or the head of a procurement unit with independent procurement authority.

(b) Violations of this Rule R33-4-104(3) may result in:

(i) the bidder or offeror being declared ineligible for award of the contract;

(ii) the solicitation being canceled;

(iii) termination of an awarded contract; or

(iv) any other action determined to be appropriate by the chief procurement officer or head of a procurement unit with independent procurement authority.

(4) Brand Name or Equal Specifications.

(a) Brand name or equal specifications may be used when:

(i) "or equivalent" reference is included in the specification; and,

(ii) as many other brand names as practicable are also included in the specification.

(b) Brand name or equal specifications shall include a description of the particular design and functional or performance characteristics which are required. Specifications unique to the brands shall be described in sufficient detail that another person can respond with an equivalent brand.

(c) When a manufacturer's specification is used in a solicitation, the solicitation shall state the minimum acceptable requirements of an equivalent. When practicable, the procurement unit shall name at least three manufacturer's specifications.

(5) Brand Name Sole Source Requirements.

(a) If only one brand can meet the requirement, the procurement unit shall conduct the procurement in accordance with 63G-6a-802 and shall solicit from as many providers of the brand as practicable; and.

(b) If there is only one provider that can meet the requirement, the procurement unit shall conduct the procurement in accordance with Section 63G-6a-802.

 

R33-4-104. Small Purchases.

Small purchases shall be conducted in accordance with the requirements set forth in Section 63G-6a-408.  This administrative rule provides additional requirements and procedures and must be used in conjunction with the Procurement Code.

(1) "Small Purchase" means a procurement conducted by a procurement unit that does not require the use of a standard procurement process.

(2) Small Purchase thresholds:

(a) The "Individual Procurement" threshold is a maximum amount of $1,000 for a procurement item;

(i) For individual procurement item(s) costing up to $1,000, an entity subject to these rules may select the best source by direct award and without seeking competitive bids or quotes.

(a) The single procurement aggregate threshold is a maximum amount of $5,000 for multiple procurement item(s) purchased from one source at one time; and

(b) The annual cumulative threshold from the same source is a maximum amount of $50,000.

(3) Whenever practicable, the Division of Purchasing and General Services and entities subject to these rules shall use a rotation system or other system designed to allow for competition when using the small purchases process.

 

R33-4-105. Small Purchases Threshold for Architectural and Engineering Services.

(1) The small purchase threshold for architectural or engineering services is a maximum amount of $100,000.

(2) Architectural or engineering services may be procured up to a maximum of $100,000, by direct negotiation after reviewing the qualifications of a minimum of three architectural or engineering firms.

(3) Procurement units subject to these rules shall follow the process described in Section 63G-6a-403 to prequalify potential vendors and Section 63G-6a-404 of the to develop an approved vendor list or Part 15 of the Utah Procurement Code for the selection of architectural and engineering services.

(4) Procurement units that are subject to these rules shall include minimum specifications when using the small purchase threshold for architectural and engineering services.

(5) Executive Branch procurement units, to the extent they do not have independent procurement authority, shall involve the Division in the procurement of architectural or engineering services.

 

R33-4-106. Small Purchases Threshold for Construction Projects.

(1) The small construction project threshold is a maximum of $2,500,000 for direct construction costs, including design and allowable furniture or equipment costs;

(2) Procurement units subject to these rules shall follow the process described in the Section 63G-6a-403 to prequalify potential vendors and Section 63G-6a-404 to develop an Approved Vendor List or other applicable selection methods described in the Utah Procurement Code for construction services.

(3) Procurement units subject to these rules shall include minimum specifications when using the small purchases threshold for construction projects.

(4) Executive Branch procurement units, to the extent they do not have independent procurement authority, shall involve the Division of Purchasing and General Services in the procurement of small construction projects.

(5) The chief procurement officer or head of a procurement unit with independent procurement authority may procure small construction projects up to a maximum of $25,000 by direct award without seeking competitive bids or quotes after documenting that all building code approvals, licensing requirements, permitting and other construction related requirements are met. The awarded contractor must certify that they are capable of meeting the minimum specifications of the project.

(6) The chief procurement officer or head of a procurement unit with independent procurement authority may procure small construction projects costing more than $25,000 up to a maximum of $100,000 by obtaining a minimum of two competitive quotes that include minimum specifications and shall award to the contractor with the lowest quote that meets the specifications after documenting that all applicable building code approvals, licensing requirements, permitting and other construction related requirements are met.

(7) If an approved vendor list is not established under Sections 63G-6a-403 and 404, procurement units shall procure construction projects over $100,000 using an invitation to bid or other approved source selection method outlined in the Utah Procurement Code.

 

R33-4-107. Quotes for Small Purchases from $1,001 to $50,000.

(1) For procurement item(s) where the cost is greater than $1,000 but up to a maximum of $5,000, an entity subject to these rules shall obtain a minimum of two competitive quotes that include minimum specifications and shall purchase the procurement item from the responsible vendor offering the lowest quote that meets the specifications.

(2) For procurement item(s) where the cost is greater than $5,000 up to a maximum of $50,000, a procurement unit with independent procurement authority that is subject to these rules or the Division of Purchasing and General Services on behalf of an executive branch procurement unit without independent procurement authority, as applicable, shall obtain a minimum of two competitive quotes that include minimum specifications and shall purchase the procurement item from the responsible vendor offering the lowest quote that meets the specifications.

(3) For procurement item(s) costing over $50,000, a procurement unit with independent procurement authority that is subject to these rules or the Division of Purchasing and General Services on behalf of an executive branch procurement unit without independent procurement authority, as applicable, shall conduct an invitation for bids or other procurement process outlined in the Utah Procurement Code.

(4) Limited Purchasing Delegation for Small Purchases. The Division of Purchasing and General Services may delegate limited purchasing authority for small purchases costing more than $5,000 up to a maximum of $50,000, to an executive branch procurement unit provided that the executive branch procurement unit enters into an agreement with the Division outlining the duties and responsibilities of the unit to comply with applicable laws, rules, policies and other requirements of the Division.

(5) The names of the vendors offering quotations and bids and the date and amount of each quotation or bid shall be recorded and maintained as a governmental record.

 

R33-4-108. Small Purchases of Services of Professionals, Providers, and Consultants.

(1) The small purchase threshold for professional service providers and consultants is a maximum amount of $100,000.

(2) After reviewing the qualifications of a minimum of two professional service providers or consultants, the chief procurement officer or head of a procurement unit with independent procurement authority may obtain professional services or consulting services:

(a) up to a maximum of $50,000 by direct negotiation; or

(b) over $50,000 up to a maximum of $100,000 by obtaining a minimum of two quotes.

(3) Executive Branch procurement units, to the extent they do not have independent procurement authority, shall involve the Division in the procurement of professional services or consulting services.

 

KEY: government purchasing, general procurement provisions, specifications, small purchases

Date of Enactment or Last Substantive Amendment: [March 30, 2012]2014

Notice of Continuation: July 2, 2012

Authorizing, and Implemented or Interpreted Law: 63G-6a