Getting What Getting What You Pay For!You Pay For!

Florida Department of Financial Services

DFS Mission StatementDFS Mission Statement

To safeguard the people of Florida To safeguard the people of Florida and the state's assets through and the state's assets through financial accountability, education, financial accountability, education, advocacy, fire safety and advocacy, fire safety and enforcement.enforcement.

Contract and GrantsContract and Grants

Recent database query Recent database query May 2008May 2008

Contractual Service Object Codes Contractual Service Object Codes ––$472,000,000$472,000,000

Grant Object Codes Grant Object Codes ––$2,100,000,000$2,100,000,000

““The only way to control a project and thus The only way to control a project and thus its cost, is to carefully describe what needs its cost, is to carefully describe what needs to be done to be done ……, who is going to do it , who is going to do it ……, when , when it needs to be completed it needs to be completed …… and how all and how all activities are to be executed activities are to be executed …”…”

R. van R. van RoestRoest

PlanningDetermine the goals

and objectives

Scope of WorkIdentify the tasks

needed in order to meetthe objectives

ProcurementProvider selection process

Price/Cost AnalysisAgreement

Documentation of all terms of the agreement including the

Scope of Work and Deliverables

Payment Processing and Closeout

MonitoringActivities to help determine compliance withterms and conditions, delivery of services,

and appropriate use of funding

Scope of Work/DeliverableScope of Work/DeliverableContracts or grants mustContracts or grants must––

Adequately identify the tasks the provider Adequately identify the tasks the provider is required to perform. is required to perform.

Identify the mechanism that triggers the Identify the mechanism that triggers the process of compensating the provider process of compensating the provider and/or provides a measurement of the and/or provides a measurement of the providerprovider’’s progress. s progress.

Scope of Work/DeliverableScope of Work/DeliverableContracts or grants mustContracts or grants must––

Adequately identify the tasks the provider is Adequately identify the tasks the provider is required to perform. required to perform.

So both parties have a common So both parties have a common understanding of all required tasks. understanding of all required tasks.

Scope of Work/DeliverableScope of Work/Deliverable

Identify the mechanism that triggers the Identify the mechanism that triggers the process of compensating the provider process of compensating the provider and/or provides a measurement of the and/or provides a measurement of the providerprovider’’s progress. s progress.

Contracts or grants mustContracts or grants must––

Adequately identify the tasks the provider is Adequately identify the tasks the provider is required to perform.required to perform.

Scope of Work/DeliverableScope of Work/DeliverableIdentify the mechanism that triggers the Identify the mechanism that triggers the process of compensating the provider process of compensating the provider and/or provides a measurement of the and/or provides a measurement of the providerprovider’’s progress. s progress.

The agency can verify the contracted The agency can verify the contracted services have been received, measure services have been received, measure providerprovider’’s progress and conclude s progress and conclude whether or not payment is due.whether or not payment is due.

Scope of Work/DeliverableScope of Work/Deliverable

Scope of work Scope of work Sometimes known as Sometimes known as ––•• Statement of WorkStatement of Work•• Provision of ServicesProvision of Services•• Manner of ServicesManner of Services•• Services OverviewServices Overview•• Project TasksProject Tasks•• Etc.Etc.

Scope of workScope of workDeveloping a good scope of work begins Developing a good scope of work begins during the planning stage when we are during the planning stage when we are identifying the funding source, researching identifying the funding source, researching the laws and rules that apply, and the laws and rules that apply, and determining the goals and objectives of our determining the goals and objectives of our project.project.

Scope of workScope of work

»»Intent of program/projectIntent of program/project»»Allowable activitiesAllowable activities»»Specific restrictionsSpecific restrictions»»Allowable uses of fundingAllowable uses of funding

Scope of workScope of work

Next, use that Next, use that information to identify information to identify the tasks the provider the tasks the provider is required to perform is required to perform for our agreement.for our agreement.

Scope of WorkScope of Work

““The only way to control a project and thus The only way to control a project and thus its cost, is to carefully describe what needs its cost, is to carefully describe what needs to be done to be done ……, who is going to do it , who is going to do it ……, when , when it needs to be completed it needs to be completed …… and how all and how all activities are to be executed activities are to be executed …”…”

R. van RoestR. van Roest

Scope of WorkScope of Work

What needs to be done What needs to be done ––

Identify the objective of the project.Identify the objective of the project.

Identify every task the provider is Identify every task the provider is expected to complete.expected to complete.

Scope of WorkScope of Work

Who needs to do it Who needs to do it --

Identify staffing levels, staff Identify staffing levels, staff qualifications, specific staff qualifications, specific staff responsibilities, and documentation responsibilities, and documentation requirements.requirements.

Scope of WorkScope of WorkWhen it needs to be completed When it needs to be completed ––

Identify beginning and ending criteria Identify beginning and ending criteria for each task.for each task.

Identify all timelines.Identify all timelines.

Link every task to a deliverable(s).Link every task to a deliverable(s).

Scope of WorkScope of Work

How all activities are to be executedHow all activities are to be executed--

Identify how each task will be performed Identify how each task will be performed and the performance standards for each.and the performance standards for each.

Identify how the provider will document Identify how the provider will document those efforts.those efforts.

Scope of WorkScope of Work

Pitfalls of a poor Scope of WorkPitfalls of a poor Scope of Work--

1.1. Difficulty in monitoring.Difficulty in monitoring.2.2. Intended tasks not performed.Intended tasks not performed.3.3. Unnecessary work /expenses incurred Unnecessary work /expenses incurred

because of misunderstandings.because of misunderstandings.4.4. Inability to achieve project objectives.Inability to achieve project objectives.5.5. Inability to make the provider comply with Inability to make the provider comply with

your expectations.your expectations.

DeliverablesDeliverables

““At the heart of every At the heart of every large project is a small large project is a small

project trying to get project trying to get out.out.””

M.H. RobertsM.H. Roberts

DeliverablesDeliverables

A tangible and measurable event A tangible and measurable event or item that must be produced to or item that must be produced to complete a project or part of a complete a project or part of a project.project.

DeliverablesDeliverables

•• Generally, is the triggering mechanism Generally, is the triggering mechanism for payment.for payment.

•• Should be made up of tasks found in Should be made up of tasks found in the scope of work.the scope of work.

•• Specific, quantifiable, measurable, and Specific, quantifiable, measurable, and verifiable.verifiable.

DeliverablesDeliverables

May be as simple as the May be as simple as the completion of a single task or completion of a single task or as complicated as a bundle of as complicated as a bundle of various tasks. various tasks.

DeliverablesDeliverables

#1$25,000

#2$25,000

#3$25,000

#4$25,000

#1

#2

#3

#4

#5

#6

$100,000.00

Tasks (SOW) Deliverables

$100,000.00

DeliverablesDeliverables

Difficulty in developing Difficulty in developing deliverables may be an deliverables may be an indication of a vague scope of indication of a vague scope of work.work.

DeliverablesDeliverablesPitfalls of poor deliverables Pitfalls of poor deliverables ––

1.Provider meets deliverables but 1.Provider meets deliverables but services not performed.services not performed.

2.2.Scope creep occurs.Scope creep occurs.

3.Cost overruns.3.Cost overruns.

4.4.Project objectives not met.Project objectives not met.

5.5.Provider & Agency confusion/frustration.Provider & Agency confusion/frustration.

Training offeredTraining offered•• Advancing AccountabilityAdvancing Accountability –– Developed to Developed to

increase accountability over the use of state funds by increase accountability over the use of state funds by sharing best practices in contract and grant management sharing best practices in contract and grant management with state agency staff as well as recipients and subwith state agency staff as well as recipients and sub--recipients of state and federal funding.recipients of state and federal funding.

•• Florida Single Audit ActFlorida Single Audit Act –– Two part training Two part training designed to 1) Provide an introduction to the Florida designed to 1) Provide an introduction to the Florida Single Audit Act and 2) Provide guidance and DFS Single Audit Act and 2) Provide guidance and DFS expectations for developing a state project compliance expectations for developing a state project compliance supplement.supplement.

DFS Vision StatementStatement

The Department of Financial The Department of Financial Services is to be known as the Services is to be known as the most ethical, professional and most ethical, professional and propro--active state agency in active state agency in Florida.Florida.

3030

Contract Procurement InitiativeContract Procurement InitiativeNIGP Conference August 27, 2008NIGP Conference August 27, 2008

Tallahassee, Florida Tallahassee, Florida

3131

Ethics and Responsibilities Ethics and Responsibilities Concerning Public ProcurementConcerning Public Procurement

•• Three areas in public procurement should always be emphasized inThree areas in public procurement should always be emphasized inAgency operationsAgency operations: :

EQUITYEQUITY INTEGRITY INTEGRITY EFFICIENCYEFFICIENCY

•• Equity Equity is emphasized to provide fair access to bidders competing for is emphasized to provide fair access to bidders competing for government business. government business.

•• IntegrityIntegrity is of utmost importance in order to reduce the chance of is of utmost importance in order to reduce the chance of corruption in the procurement process and maintain public confidcorruption in the procurement process and maintain public confidence in ence in the objectivity and fair atmosphere in awarding public contractsthe objectivity and fair atmosphere in awarding public contracts for goods for goods and services. and services.

•• EfficiencyEfficiency measures take a variety of forms that measure the measures take a variety of forms that measure the effectiveness needed to purchase goods and services at the leveleffectiveness needed to purchase goods and services at the level of of quality desired and the lowest possible price.quality desired and the lowest possible price.

Shaping the Procurement Process for DFSShaping the Procurement Process for DFS•• Statutory Rule RequirementsStatutory Rule Requirements•• Accounting & Auditing Standards Emphasized in Accounting & Auditing Standards Emphasized in ““FrontFront--EndEnd”” of of

Procurement ProcessProcurement Process•• Project Team Attended DMS (NIGP)/DFS Training offeringsProject Team Attended DMS (NIGP)/DFS Training offerings•• Used the Used the ““80/20 Rule80/20 Rule”” in Process Developmentin Process Development•• Developed procedures through process mapping and AnalysisDeveloped procedures through process mapping and Analysis•• Defined Roles and ResponsibilitiesDefined Roles and Responsibilities•• Partnered with Multiple Business Areas (e.g. Legal, Auditing, ITPartnered with Multiple Business Areas (e.g. Legal, Auditing, IT, etc.) , etc.) •• ImprovedImproved Documentation for Increased Accountability and Contract Documentation for Increased Accountability and Contract

Management:Management:–– Business Needs Analysis Business Needs Analysis -- Produces a justification for purchases Produces a justification for purchases

based on program area needs and an assessment of its likely costbased on program area needs and an assessment of its likely costs s and savingsand savings

–– Statement/Scope of Work and Deliverables Development Statement/Scope of Work and Deliverables Development -- A A statement/scope of work is a detailed description of products, statement/scope of work is a detailed description of products, services or results that have been clearly established and are dservices or results that have been clearly established and are directly irectly related to the goals and objectives of the division and departmerelated to the goals and objectives of the division and departmentnt

3232

Developed a HighDeveloped a High--Level User Guide Level User Guide

3333

Acct & Auditing Standards Were Brought to FrontAcct & Auditing Standards Were Brought to Front--End of ProcessEnd of Process

• The icon (see left) is placed by text that underscores areas where auditors may require documentation. The audit key is also used to highlight key areas of the DFS purchasing processes. All DFS employees involved with the contracting process are expected to comply with statutory guidelines and key processes included in audits performed by the state Office of the Auditor General.

3434

Audit Key

3535

Roles & Responsibilities Roles & Responsibilities DFS RoleDFS Role LocationLocation SpecificsSpecifics

Attorney ReviewerAttorney Reviewer Located in the Division of Legal Located in the Division of Legal ServicesServices

••Attorney specifically assigned to a particular contractAttorney specifically assigned to a particular contract••Contact person for the Division Purchasing Liaison regarding queContact person for the Division Purchasing Liaison regarding questions of legality within the stions of legality within the purchasing documentpurchasing document••Has a timeframe of 5 working days to turn around initial legal rHas a timeframe of 5 working days to turn around initial legal review unless unforeseen eview unless unforeseen circumstances arisecircumstances arise••Attorney serves only as an advisor to the evaluation teamAttorney serves only as an advisor to the evaluation team••Attorneys should attend and complete contract training for best Attorneys should attend and complete contract training for best practices offered by DMSpractices offered by DMS

Chief of StaffChief of Staff Located in the Office of the Chief Located in the Office of the Chief Financial OfficerFinancial Officer

••Approves the posting of formal solicitations and the membership Approves the posting of formal solicitations and the membership of the evaluation / negotiation of the evaluation / negotiation teamteam••Approves posting of the agency decision for vendor selectionApproves posting of the agency decision for vendor selection••Provides final approval and execution of all purchases $50K or aProvides final approval and execution of all purchases $50K or above and in accordance with bove and in accordance with the established purchasing approval thresholdsthe established purchasing approval thresholds

Contract AccountantContract AccountantLocated in the Accounting Located in the Accounting Section of the Bureau of Section of the Bureau of Financial Service, Division of Financial Service, Division of AdministrationAdministration

••Is an accountant located in the Bureau of Financial Services, DiIs an accountant located in the Bureau of Financial Services, Division of Administrationvision of Administration••Processes payments for DFS contractsProcesses payments for DFS contracts••Collaborates as necessary with the Purchasing Agent and DivisionCollaborates as necessary with the Purchasing Agent and Division Contract ManagersContract Managers

Contract AdministratorContract AdministratorLocated in Purchasing Services Located in Purchasing Services of the Bureau of General of the Bureau of General Services, Division of Services, Division of AdministrationAdministration

••Responsible for maintaining a contract file on all contractual sResponsible for maintaining a contract file on all contractual services for DFServices for DFS••Serves as a liaison for the contract managers and DFS; ensures tServes as a liaison for the contract managers and DFS; ensures that the contract route slip and hat the contract route slip and contract are fully executedcontract are fully executed••Responsible for ensuring that the executed contract file is loadResponsible for ensuring that the executed contract file is loaded on to the contract databaseed on to the contract database

Contract NegotiatorContract Negotiator Located throughout the Agency Located throughout the Agency (see Chapter 9)(see Chapter 9)

••Must be Must be certified in contract negotiationcertified in contract negotiation through curriculum designated by the Department of through curriculum designated by the Department of Management Services and the DFSManagement Services and the DFS••Can lead or be a member of an evaluation team as needed by the DCan lead or be a member of an evaluation team as needed by the DFSFS••Should have subject matter expertise in the technical specificatShould have subject matter expertise in the technical specifications of the contractions of the contract

Division Contract ManagerDivision Contract Manager Located throughout the Agency Located throughout the Agency (see Chapter 9)(see Chapter 9)

••Responsible for enforcing performance of the contract terms and Responsible for enforcing performance of the contract terms and conditionsconditions••Serves as liaison with the contractor by:Serves as liaison with the contractor by:ooApproving invoices certifying delivery received as requiredApproving invoices certifying delivery received as requiredooTracking performance measures to ensure timely completionTracking performance measures to ensure timely completionooMaintaining all documents from vendor selection to the closeoutMaintaining all documents from vendor selection to the closeoutooConducting monitoring to be assured that the contract provisionsConducting monitoring to be assured that the contract provisions are being complied withare being complied with••Notifies the Help Desk of Notifies the Help Desk of ALLALL personnel changes (both internal and contractor) throughout thepersonnel changes (both internal and contractor) throughout thelife of the contract. This includes any/all network and passworlife of the contract. This includes any/all network and password access changes (See AP&P 4d access changes (See AP&P 4--03).03).••Completes contract closeoutCompletes contract closeout••Recommend completion of the contract management training throughRecommend completion of the contract management training through curriculum designated by curriculum designated by the Department of Management Services and DFS. Some training isthe Department of Management Services and DFS. Some training is a requirement to be a a requirement to be a named contract manager.named contract manager.••May serve as a consultant for the writing of the Statement of WoMay serve as a consultant for the writing of the Statement of Work used in the solicitation rk used in the solicitation documentdocument••Monitors the contract, contractor performance, deliverables and Monitors the contract, contractor performance, deliverables and paymentspayments••Maintains contract documentationMaintains contract documentation••Shall serve as a project manager for the contract, where necessaShall serve as a project manager for the contract, where necessaryryNOTE:NOTE: Contract Managers are Contract Managers are NOTNOT to be involved in the evaluation process (see Section 8.1)to be involved in the evaluation process (see Section 8.1)

3636

DFS RoleDFS Role LocationLocation SpecificsSpecifics

Division DirectorDivision Director Located within each DivisionLocated within each Division

••Provides final approval and signProvides final approval and sign--off on all Legislative Budget Requests leading up to potential off on all Legislative Budget Requests leading up to potential procurementprocurement••Provides approval to proceed with all formal solicitations and aProvides approval to proceed with all formal solicitations and approves final vendor selectionpproves final vendor selection••Provides approval and signProvides approval and sign--off on the Purchasing Needs Analysis for formal solicitations inoff on the Purchasing Needs Analysis for formal solicitations in the the amount of $150,000 or greateramount of $150,000 or greater

Division Purchasing Division Purchasing LiaisonLiaison

Located within each DFS Located within each DFS DivisionDivision

••Key staff contact for the Division and the Purchasing Services tKey staff contact for the Division and the Purchasing Services throughout the solicitation hroughout the solicitation processprocess••Is the owner of the solicitation documents and is responsible foIs the owner of the solicitation documents and is responsible for the solicitation processr the solicitation process••Directly involved in the initial writing of the Statement of WorDirectly involved in the initial writing of the Statement of Workk••Responsible for routing the solicitation document through the deResponsible for routing the solicitation document through the designated stops in the processsignated stops in the process••Ensures that division information is entered into the MFMP systeEnsures that division information is entered into the MFMP systemm

Evaluation Team ChairEvaluation Team Chair Located within each DFS Located within each DFS DivisionDivision

••Serves as the sole point of contact for the evaluation team membServes as the sole point of contact for the evaluation team members throughout the evaluation ers throughout the evaluation process for questions/clarification regarding providerprocess for questions/clarification regarding provider’’s technical responsess technical responses••Provides clarification responses to the evaluation team members Provides clarification responses to the evaluation team members simultaneously via emailsimultaneously via email••Compiles the technical evaluation score and submits it to the IsCompiles the technical evaluation score and submits it to the Issuing Officer (Purchasing suing Officer (Purchasing Agent)Agent)

Evaluation Team MemberEvaluation Team Member Located throughout the DFS, can Located throughout the DFS, can be an individual outside the DFSbe an individual outside the DFS

••Approved by the Chief of Staff, an individual who agrees to servApproved by the Chief of Staff, an individual who agrees to serve on a team to evaluate e on a team to evaluate responses to solicitationsresponses to solicitations••Possesses knowledge of the program area and service requirementsPossesses knowledge of the program area and service requirements for which a formal for which a formal solicitation has been issuedsolicitation has been issued••Independently evaluates the technical responses and designates sIndependently evaluates the technical responses and designates scores utilizing the cores utilizing the appropriate evaluation criteriaappropriate evaluation criteria••Is required to sign a Conflict of Interest form attesting to nonIs required to sign a Conflict of Interest form attesting to non--bias in the evaluationbias in the evaluation

Information Resource Information Resource Management Advisory Management Advisory Group (IRMAG)Group (IRMAG)

Located within each DFS Located within each DFS DivisionDivision

••An individual assigned by the division to serve as the initial pAn individual assigned by the division to serve as the initial point of contact for any technology oint of contact for any technology need such as the purchase of IT goods or services as well as tecneed such as the purchase of IT goods or services as well as technical issues that the division hnical issues that the division requiresrequires••Provides guidance on technology issuesProvides guidance on technology issues••Facilitates a Remedy Request to the DIS HelpdeskFacilitates a Remedy Request to the DIS Helpdesk••Tracks the request until completion, or until the problem is resTracks the request until completion, or until the problem is resolvedolved

MFMP RequestorMFMP Requestor Located within each DFS Located within each DFS DivisionDivision

••An individual also known as the originator who has the capabilitAn individual also known as the originator who has the capability and access to create a MFMP y and access to create a MFMP requisitionrequisition••Serves as the initial point of contact for PurchasingServes as the initial point of contact for Purchasing

Project ManagerProject Manager Located within or assigned to a Located within or assigned to a DFS DivisionDFS Division

••Responsible for creating and enforcing project plans, performancResponsible for creating and enforcing project plans, performance of the contract terms and e of the contract terms and conditions, serving as a liaison with the contractor, and ensuriconditions, serving as a liaison with the contractor, and ensuring that the contractual terms have ng that the contractual terms have been complied with prior invoice paymentbeen complied with prior invoice payment••In some cases the project manager and contract manager are the sIn some cases the project manager and contract manager are the same personame person

Purchasing Agent (Issuing Purchasing Agent (Issuing Officer)Officer)

Located in Purchasing Services Located in Purchasing Services of the Bureau of General of the Bureau of General Services, Division of Services, Division of AdministrationAdministration

••Key contact in Purchasing Services who provides the Division PurKey contact in Purchasing Services who provides the Division Purchasing Liaison with chasing Liaison with purchasing guidance in determining the best procurement methodpurchasing guidance in determining the best procurement method••Refines the divisionRefines the division’’s first draft of the Statement of Work and solicitation documents first draft of the Statement of Work and solicitation document••Facilitates the solicitation process in coordination with the DiFacilitates the solicitation process in coordination with the Division Purchasing Liaison to vision Purchasing Liaison to ensure timeliness and completenessensure timeliness and completeness••Should complete contract manager training through DMSShould complete contract manager training through DMS••Guides Division Purchasing Liaisons with MFMP proceduresGuides Division Purchasing Liaisons with MFMP procedures

3737

DFS RoleDFS Role LocationLocation SpecificsSpecifics

Responsive BidderResponsive BidderTypically an external private Typically an external private sector party (this description sector party (this description rarely defines a government rarely defines a government agency)agency)

••Entity or vendor who has submitted a bid that conforms in all maEntity or vendor who has submitted a bid that conforms in all material respects to the terial respects to the requirements stated in formal solicitations (Source: Thai, Khi Vrequirements stated in formal solicitations (Source: Thai, Khi V., ., ““Developing and Managing Developing and Managing RFPs in the Public SectorRFPs in the Public Sector””, ISBN 1, ISBN 1--932315932315--0404--07, 2004, NIGP) 07, 2004, NIGP)

Vendor/Provider/ContractorVendor/Provider/ContractorTypically an external private Typically an external private sector party (this rarely defines sector party (this rarely defines a government agency)a government agency)

••May have the description of respondent, vendor, contractor, or bMay have the description of respondent, vendor, contractor, or bidder depending upon the idder depending upon the stage of the procurement processstage of the procurement process••Entities or person providing goods or services in a contractEntities or person providing goods or services in a contract

3838

Purchasing Process OverviewPurchasing Process Overview

3939

Contact Information Contact Information •• Contact DFS Purchasing Services in the Bureau Contact DFS Purchasing Services in the Bureau

of General Services at 850of General Services at 850--413413--2070 2070 http://dfsintranet/Administration/generalservices/http://dfsintranet/Administration/generalservices/default.aspxdefault.aspx

•• Contract Management Issues can be directed to Contract Management Issues can be directed to the DFS Division of Accounting and Auditing, the DFS Division of Accounting and Auditing, Bureau of Auditing at 850Bureau of Auditing at 850--413413--5740 5740

•• http://www.myfloridacfo.com/aadir/AuditingTrainihttp://www.myfloridacfo.com/aadir/AuditingTraining.htmng.htm

4040

Questions?Questions?