CONTRACTING/PROCUREMENT GUIDELINES

Are state agencies and educational institutions required to have WBE goals on their contracts/procurements?
State agencies and educational institutions have never been "required" to set goals on all of their contracts/procurements. Goals to utilize WBE firms should be set on specific contracts/procurements only when it is determined that there are available certified firms to provide the product or service being sought. This was true prior to the passage of I-200 and has not changed since its passage. Prior to December 1998, some agencies and institutions set participation goals on the contracts/procurements they administered and rejected bids/proposals that did not reflect participation at or above those levels. This practice was discontinued with the passage of the initiative. Currently, each state agency/educational institution has the authority to establish voluntary goals on individual contracts/procurements. When they do, prospective bidders/proposers are alerted that a specific level of WBE utilization has been deemed achievable on a specific contract/procurement. However, meeting the goal(s) is not a requirement or even a factor to be considered in determining who is awarded the contract/procurement.

What WBE bid/solicitation clauses are not permissible?
Provisions that condition award of a contract upon attainment of the WBE goals established for a specific contract/procurement cannot be used, nor can clauses indicating points will be awarded to a bidder whose proposal includes WBE utilization equal to the stated goals. Provisions that allow a contract/procurement to be awarded to a bidder whose proposal included WBE utilization equal to the state goals, notwithstanding that the bid was not the lowest dollar amount.

What practices other than goal setting on individual contracts can state agencies and educational institutions use to encourage utilization of WBE firms on state contracts/procurements?
Include WBE firms on lists of vendors to be notified of their contracting/procurement opportunities. Avoid bundling of contract/procurement work scopes, unless project feasibility is jeopardized.

Is there anything wrong with purchasing agents using the same vendor year after year?
With the passage of I-200, this could be viewed as "preferential treatment;" particularly, if there is evidence that there are certified businesses ready, willing and able to provide the product or service. This practice does not encourage competition - meaning existing firms have little or no incentive to pass on to their customers in the form of lower prices the improvements in product quality and production efficiencies occurring in their industry. Vendors are typically motivated to make their product or service more attractive, in terms of pricing and quality, to a customer when that customer has multiple sources from which to acquire the product or service. Unless the purchasing agent periodically determines that there are no new vendors who can supply a better quality product or service at a lower price, then the public is not assured it is getting the best value for its money. Indeed, when purchasing agents do not solicit new vendors, choosing instead to purchase from the same supplier year after year, all other businesses (including those new businesses owned by non-minority male vendors), have no opportunity to introduce their products and services to the State.

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