Procurement Options in Public Emergencies
The California Department of Education (CDE) Nutrition Services Division (NSD) has been receiving inquiries and concerns from agencies where distributors are temporarily unable to fulfill their contractual obligations. Food service directors have reported that this situation is causing delayed, incomplete, insufficient, and cancelled deliveries leading to inventory shortages, and causing concern about running out of food.
The following options are available in lieu of formal procurement procedures, and as remedies to the lack of proper and complete distribution of food. These options do not require Child Nutrition Program (CNP) operators to terminate existing contracts:
Conduct an Informal Procurement
CNP operators may use the micropurchase method if the costs of goods and services are at or less than $10,000. Micropurchases may be awarded without soliciting competitive quotes if CNP operators consider the price as reasonable and they equitably distribute purchases among qualified suppliers. CNP operators cannot intentionally split procurements into smaller purchases to circumvent other purchase methods.
CNP operators may use the small purchase method if the costs of goods and services do not exceed the applicable small purchase threshold. The current federal small purchase threshold is $250,000. Some schools have more restrictive thresholds, so be sure to check and comply with your local threshold if it is stricter. This purchasing method allows a CNP operator to enter into a short-term contract using the small purchase method, while determining the need to rebid on another long-term contract using the formal procurement method (e.g., Invitation for Bid or Request for Proposal). These short-term contracts must not extend beyond the 2021-22 school year and may not be renewable.
If the emergency situation yields insufficient time to conduct a competitive solicitation, then a non-competitive procurement may be conducted.
Conduct a Noncompetitive Procurement
CNP operators can use this method in the event of a public exigency or emergency (2 CFR 200.320). Emergency is defined as a “sudden, unexpected occurrence that poses a clear and imminent danger, requiring immediate action to prevent or mitigate the loss or impairment of life, health, property, or essential public services.” (California PCC Section 1102). Supply chain disruptions related to the COVID pandemic are considered an emergency and would be an appropriate use of this method. Any contract resulting from the use of noncompetitive proposals in a public emergency must be of a limited duration, until time permits the completion of an appropriate competitive procurement.
At this time, it is anticipated that the supply chain disruptions caused by the COVID-19 will persist minimally through the 2021-22 School Year (SY). Therefore, CNP Operators affected by these disruptions and entering into a noncompetitively procured contract may find the need to define limited duration through the end of the 2021-22 SY.
The CDE recommends that agencies consult with legal counsel on whether an exigency or emergency situation exists and whether conducting a noncompetitive procurement would be allowable.
For more information please refer to the CDEs Procurement in Child Nutrition Programs/Frequently Asked Questions web page.
If you have any questions regarding this subject, please contact our Procurement Resources Unit (PRU) by email at SFSContracts@cde.ca.gov.