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Uniform Guidance

Procurement Standards for Federal Grants

Overview | Timeline | General Procurement Standards | Competition | Methods of Procurement | Inclusion | Recovered Materials | Cost and Price | Pass-Through Entity | Bonding Requirements | Contract Provisions | Accountability for Equipment and Supplies


The Office of Management and Budget's (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (commonly called 'Uniform Guidance') was officially implemented in December 2014 by the Council on Financial Assistance Reform (COFAR - now dissolved). The Uniform Guidance (UG) – a 'government-wide framework for grants management' – is an authoritative set of rules and requirements for Federal awards that combined and supersedes guidance from earlier OMB circulars. The Guidance was drawn from:
  • OMB Circulars A–21, A–87, A–110, and A–122 (which have been placed in past OMB guidances)
  • Circulars A–89, A–102, and A–133
  • Circular A–50 on Single Audit Act follow-up.
The reforms that comprise the UG aim to reduce the administrative burden on award recipients and, at the same time, guard against the risk of waste and misuse of Federal funds. Among other things, the UG does the following:
  • Removes previous guidance that is conflicting and establishes standard language;
  • Directs the focus of audits on areas that have been identified as at risk for waste, fraud and abuse;
  • Lays the groundwork for Federal agencies to standardize the processing of data;
  • Clarifies and updates cost reporting guidelines for award recipients.

Implementation Timeline

Swarthmore College has delayed implementation of the UG Procurement Standards until July 1, 2018, as provided by the waiver of the procurement rules stated in COFAR FAQ [pdf], Section 110-6, released November 26, 2014. In the interim, the OMB Circulars will apply to grants and cooperative agreements.

Swarthmore College Purchasing Procedures for Federal Grants

1. General procurement standards (§200.318)

Procurement Policy. The College has a Purchasing policy and procedures. Recipients of Federal funds are directed to follow both the College’s Purchasing Policy and the Purchasing Procedures for Federal Grants. The combined policy and procedures conform to applicable Federal law and UG procurement standards.
  • Conflict of Interest. The College's Staff Conflict of Interest Policy [pdf] is in compliance with UC Procurement Standards. College employees, officers, and agents are directed to review the policy and self-identify conflicts in writing before participating in the selection, award, or administration of a contract.
  • Contractor Performance. College employees, officers, and agents must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. Contract managers may utilize the Supplier/Contractor/Consultant Evaluation Form to track performance.
  • Duplicate Items. College employees, officers, and agents should avoids acquisition of unnecessary or duplicative items. Consideration should be given to consolidating or breaking out procurements to obtain a more economical purchase. Where appropriate, an analysis will be made of lease versus purchase alternatives, and any other appropriate analysis to determine the most economical approach.
  • Group Purchasing Organizations. To foster greater economy and efficiency, and in accordance with efforts to promote cost-effective use of shared services across the Federal Government, College employees, officers, and agents are encouraged to enter into Group Purchasing Organizations (GPOs) that utilize a competitive bidding process where appropriate for procurement or use of common or shared goods and services.
  • Surplus. College employees, officers, and agents are encouraged to use Federal and State excess/surplus property services, such as GSAExcess, PA Department of General Services, or the Federal Surplus Property Program whenever such use is feasible and reduces project costs. The College also has an account with GovDeals, a non-governmental liquidity service.
  • Value Engineering. The College is encouraged to use value engineering clauses in contracts for construction projects of sufficient size to offer reasonable opportunities for cost reductions. Value engineering is a systematic and creative analysis of each contract item or task to ensure that its essential function is provided at the overall lower cost.
  • Contractors. College employees, officers, and agents must award contracts only to responsible contractors possessing the ability to perform successfully under the terms and conditions of a proposed procurement. Consideration will be given to such matters as contractor integrity, compliance with public policy, record of past performance, and financial and technical resources.
  • Suspension and Debarment. Federal funding Verification of the status of a proposed supplier can be obtained from the List of Parties Excluded From Federal Procurement or Non-procurement Programs, issued by the General Services Administration (GSA) located at The System for Award Management (SAM), the Official U.S. Government system. SAM documentation will be maintained by the PI for each purchase, utilizing purchase orders or PCards.
  • Record Retention. The College must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.
  • Time and Materials. The College may use a time and materials type contract only after a determination that no other contract is suitable and if the contract includes a ceiling price that the contractor exceeds at its own risk. Time and materials type contract means a contract whose cost to a College is the sum of: The actual cost of materials; and direct labor hours charged at fixed hourly rates that reflect wages, general and administrative expenses, and profit. Since this formula generates an open-ended contract price, a time-and-materials contract provides no positive profit incentive to the contractor for cost control or labor efficiency. Therefore, each contract must set a ceiling price that the contractor exceeds at its own risk. Further, the College awarding such a contract must assert a high degree of oversight in order to obtain reasonable assurance that the contractor is using efficient methods and effective cost controls.
  • Disputes. The College alone must be responsible, in accordance with good administrative practice and sound business judgment, for the settlement of all contractual and administrative issues arising out of procurements. These issues include, but are not limited to, source evaluation, protests, disputes, and claims. These standards do not relieve the College of any contractual responsibilities under its contracts. The Federal awarding agency will not substitute its judgment for that of the College unless the matter is primarily a Federal concern. Violations of law will be referred to the local, state, or Federal authority having proper jurisdiction.

2. Competition (§200.319)

All procurement transactions must be conducted in a manner providing full and open competition consistent with the standards of this section. In order to ensure objective contractor performance and eliminate unfair competitive advantage, contractors that develop or draft specifications, requirements, statements of work, or invitations for bids or requests for proposals must be excluded from competing for such procurements. Some additional situations considered to be restrictive of competition include but are not limited to:
  • Placing unreasonable requirements on firms in order for them to qualify to do business;
  • Requiring unnecessary experience and excessive bonding;
  • Noncompetitive pricing practices between firms or between affiliated companies;
  • Noncompetitive contracts to consultants that are on retainer contracts;
  • Organizational conflicts of interest;
  • Specifying only a “brand name” product instead of allowing “an equal” product to be offered and describing the performance or other relevant requirements of the procurement; and
  • Any arbitrary action in the procurement process.
The College must conduct procurements in a manner that prohibits geographical preferences in the evaluation of bids or proposals, except in those cases where applicable Federal statutes expressly mandate or encourage geographic preference. Nothing in this section preempts state licensing laws. When contracting for architectural and engineering (A/E) services, geographic location may be a selection criterion provided its application leaves an appropriate number of qualified firms, given the nature and size of the project, to compete for the contract.
The College requires that procurement solicitations:
  • Include a clear and accurate description of the technical requirements for the material, product, or service to be procured. Such description must not, in competitive procurements, contain features which unduly restrict competition. The description may include a statement of the qualitative nature of the material, product or service to be procured and, when necessary, must set forth those minimum essential characteristics and standards to which it must conform if it is to satisfy its intended use. Detailed product specifications should be avoided if at all possible. When it is impractical or uneconomical to make a clear and accurate description of the technical requirements, a “brand name or equivalent” description may be used as a means to define the performance or other salient requirements of procurement. The specific features of the named brand which must be met by offers must be clearly stated.
  • Identify all requirements which the offerors must fulfill and all other factors to be used in evaluating bids or proposals.
  • Ensure that all prequalified lists of persons, firms, or products which are used in acquiring goods and services are current and include enough qualified sources to ensure maximum open and free competition. Also, the College must not preclude potential bidders from qualifying during the solicitation period.  (§200.320)

3. Methods of procurement to be followed (§200.320)

College employees, officers, and agents must use one of the following methods of procurement, which are based on spending thresholds. Note that OMB Memorandum M-18-18 [pdf] is the official notification that the Micro-purchase threshold has increased from $3,000 to $10,000 and the Simplified Acquisition threshold was increased from $150,000 to $250,000, effective June 20, 2018
  • Procurement by micro-purchases (<$10,000). Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold. To the extent practicable, the College must distribute micro-purchases equitably among qualified suppliers. Micro-purchases may be awarded without soliciting competitive quotations if the College considers the price to be reasonable.
  • Procurement by small purchase procedures (up to $250,000). Small purchase procedures are those relatively simple and informal procurement methods for securing services, supplies, or other property that do not cost more than the Simplified Acquisition Threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.
  • Procurement by sealed bids (>$250,000), formal advertising. Bids are publicly solicited and a firm fixed price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price. The sealed bid method is the preferred method for procuring construction, if the following conditions apply:
    • A complete, adequate, and realistic specification or purchase description is available
    • Two or more responsible bidders are willing and able to compete effectively for the business
      • Provide sufficient response time prior to the date set for opening the bids
      • Contract award will be made in writing to the lowest responsive and responsible bidder
    • The procurement lends itself to a firm fixed price contract
      •  Factors such as discounts, transportation cost, and life cycle costs must be considered in determining which bid is lowest.
    • If sealed bids are used, the following terms must also apply
      • All bids will be opened at the time and place prescribed int he invitation for bids
      • The invitation for bids must be publicly advertised
      • Any or all bids may be rejected if there is a sound documented reason
  • Procurement by competitive proposals (>$250,000), The technique of competitive proposals is normally conducted with more than one source submitting an offer, and either a fixed price or cost-reimbursement type contract is awarded. It is generally used when conditions are not appropriate for the use of sealed bids. If this method is used, the following requirements apply:
    • Requests for proposals must be publicized and identify all evaluation factors and their relative importance. Any response to publicized requests for proposals must be considered to the maximum extent practical;
    • Proposals must be solicited from an adequate number of qualified sources;
    • The College must have a written method for conducting technical evaluations of the proposals received and for selecting recipients;
    • Contracts must be awarded to the responsible firm whose proposal is most advantageous to the program, with price and other factors considered; and
    • The College may use competitive proposal procedures for qualifications-based procurement of architectural/engineering (A/E) professional services whereby competitors' qualifications are evaluated and the most qualified competitor is selected, subject to negotiation of fair and reasonable compensation. The method, where price is not used as a selection factor, can only be used in procurement of A/E professional services. It cannot be used to purchase other types of services though A/E firms are a potential source to perform the proposed effort.
  • Procurement by noncompetitive proposals. Procurement by noncompetitive proposals is procurement through solicitation of a proposal from only one source. This process may be used if a Single/Sole Source Justification form is completed and when one or more of the following circumstances apply:
    • The item is only available from a single source
    • A public emergency for the requirement will not permit a delay resulting from competitive solicitation
    • Inadequate competition
    • Conflict of interest, Suitability, procurement standards were properly addressed

 4, Inclusion of small and disadvantaged businesses (§200.321)

The College must take proactive steps to ensure Small and Disadvantaged businesses are used when possible. For more information, please check Small Business / Diversity Procedures

5. Procurement of recovered materials (§200.322)

Since Swarthmore College is a private institution, this provision is not a required provision for Federal procurement. However, recognizing that sustainability is of primary importance to the College community, the College may choose to utilize this provision when possible. The guideline 40 CFR 247.1 designates items that are or can be made with recovered materials and whose procurement by the College will carry out the objectives of section 6002 of Resource Conservation and Recovery Act.

6. Contract cost and price (§200.323)

The College must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold ($250K) including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the College must make independent estimates before receiving bids or proposals.
  • The College must negotiate profit as a separate element of the price for each contract in which there is no price competition and in all cases where cost analysis is performed. To establish a fair and reasonable profit, consideration must be given to the complexity of the work to be performed, the risk borne by the contractor, the contractor's investment, the amount of subcontracting, the quality of its record of past performance, and industry profit rates in the surrounding geographical area for similar work.
  • Costs or prices based on estimated costs for contracts under the Federal award are allowable only to the extent that costs incurred or cost estimates included in negotiated prices would be allowable for the College under Subpart E—Cost Principles of this part. The College may reference its own cost principles that comply with the Federal cost principles.
  • The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used.

7. Federal awarding agency/pass through entity (§200.324)

The College must make available, upon request of the Federal awarding agency or pass-through entity, technical specifications on proposed procurements where the Federal awarding agency or pass-through entity believes such review is needed to ensure that the item or service specified is the one being proposed for acquisition. This review generally will take place prior to the time the specification is incorporated into a solicitation document. However, if the College desires to have the review accomplished after a solicitation has been developed, the Federal awarding agency or pass-through entity may still review the specifications, with such review usually limited to the technical aspects of the proposed purchase.
The College must make available upon request, for the Federal awarding agency or pass-through entity pre-procurement review, procurement documents, such as requests for proposals or invitations for bids, or independent cost estimates, when:
  • The College's procurement procedures or operation fails to comply with the procurement standards in this part
  • The procurement is expected to exceed the Simplified Acquisition Threshold ($250K) and is to be awarded without competition or only one bid or offer is received in response to a solicitation
  • The procurement, which is expected to exceed the Simplified Acquisition Threshold, specifies a “brand name” product
  • The proposed contract is more than the Simplified Acquisition Threshold and is to be awarded to other than the apparent low bidder under a sealed bid procurement
  • Proposed contract modification changes the scope of a contract or increases the contract amount by more than the Simplified Acquisition Threshold.
The College is exempt from the pre-procurement review when the Federal awarding agency or pass-through entity determines that its procurement systems comply with the standards of this part.
  • The College may request that its procurement system be reviewed by the Federal awarding agency or pass-through entity to determine whether its system meets these standards in order for its system to be certified. Generally, these reviews must occur where there is continuous high-dollar funding, and third party contracts are awarded on a regular basis
  • The College may self-certify its procurement system. Such self-certification must not limit the Federal awarding agency's right to survey the system. Under a self-certification procedure, the Federal awarding agency may rely on written assurances from the College that it is complying with these standards. The College must cite specific policies, procedures, regulations, or standards as being in compliance with these requirements and have its system available for review

8. Bonding requirements (§200.325)

For construction or facility improvement contracts or subcontracts exceeding the Simplified Acquisition Threshold ($250K), the Federal awarding agency or pass-through entity may accept the bonding policy and requirements of the College provided that the Federal awarding agency or pass-through entity has made a determination that the Federal interest is adequately protected. If such a determination has not been made, the minimum requirements must be as follows:
  • A bid guarantee from each bidder equivalent to 5% of the bid price. The bid guarantee must consist of a firm commitment such as a bid bond, certified check, or other negotiable instrument accompanying a bid as assurance that the bidder will, upon acceptance of the bid, execute such contractual documents as may be required within the time specified.
  • A performance bond on the part of the contractor for 100% of the contract price. A performance bond is one executed in connection with a contract to secure fulfillment of all the contractor's obligations under such contract.
  • A payment bond on the part of the contractor for 100% of the contract price. A payment bond is one executed in connection with a contract to assure payment as required by law of all persons supplying labor and material in the execution of the work provided for in the contract.

9. Contracting provisions (§200.326)

In addition to the College's Standard Terms and Provisions [pdf], College contracts utilizing Federal funding must also contain the applicable provisions described in Appendix II to Part 200: Contract Provisions. The Contract Provisions for Agreements Under Federal Awards Addendum [pdf] must be added to applicable contracts.

10. Accountability for equipment and supplies

The College's Purchasing Policy provides details for the disposition of capital equipment that has both (1) an original cost of $5,000 or more and (2) a useful life greater than five years.
Agents and Buyers should be familiar with the following UG sections: