Purchasing Methods

The following methods may be used to procure goods and/or services:

Small Dollar Purchases

Institutions may make non-recurring purchases totaling less than $10,000, cumulatively in expense or revenue, without documenting any quotes or proposals from multiple vendors. Purchasers should take appropriate steps, e.g. conducting price comparisons, processing appropriate agreement documents, etc., to ensure that such Small Dollar Purchases are made based upon terms, conditions and pricing that are in the best interest of the Institution.

Informal Solicitations

Institutions may make purchases totaling less than $50,000 in expense or revenue based upon written, telephone or electronic bids. For purchases totaling $10,000 - $49,999.99, bids must be solicited from at least three (3) Responsive/Responsible Bidders/Proposers. Informal bids do not require an original signature, and bids may be written, electronically transmitted or telephoned. Complete file documentation shall be maintained.

Formal Solicitations

A formal solicitation process shall be used when the estimated aggregate total of the expense or revenue is $50,000 or more, including renewal terms of multi-year awards. Written sealed bids must be solicited from fifteen (15) vendors or the number of vendors on the Registered Vendors List--whichever is less and to all that request the specific ITB/RFQ/RFP. The Purchasing Director must approve the use of less than fifteen (15) vendors. In addition, if the annual estimated aggregate total of the purchase is $100,000 or more, solicitations must be sent in a manner that verifies proof of delivery.

The types of formal solicitations are provided below.

Request for Information (RFI)

An RFI may be used to gather information regarding the capabilities, including technical aspects and services offered, by various Suppliers/vendors for particular goods or services. The information resulting from the RFI shall typically be followed by a competitive process for the actual procurement.

Request for Quotation (RFQ)

Goods, materials, and supplies (cumulatively called "goods") should be awarded to the lowest Responsive and Responsible Bidder pursuant to an RFQ.

An RFQ may be used to procure services, if the specifications for delivery of such services are defined to a level of detail such that award is made to the lowest Responsive and Responsible Bidder. Examples of this type of services may include, but are not limited to:

  • pest control
  • security services
  • moving and hauling
  • refuse collections
  • charter services
  • printing services, and maintenance services

Request for Proposals (RFP)

  • For competitive procurements of goods and/or services, where cost is not the only determining factor for award.
  • An RFP shall specify all steps and evaluation criteria as necessary to finalize selection of the successful proposer.
  • A multi-step RFP process should be used when additional steps are necessary to qualify and/or demonstrate the goods and/or services proposed.

Determining Type of Solicitation

  • For competitive procurement of goods, an RFQ is appropriate, and in general, a purchase order may be used to finalize the purchase.
  • For competitive procurement of services, an RFP is more appropriate, and a purchase order is generally not sufficient to serve as the written contract for the services.
  • For procurement of services which will require TBR System Office approval, the Standard RFP Format shall be used.

Reverse Auction

A reverse auction process allows for specified goods or services to be made electronically during a specified time period. When conditions are favorable, Institutions may elect to use a reverse auction procurement method to achieve maximum competition among qualified Respondents, and to obtain the highest level of quality at the lowest price for goods or services. An award shall be made to the lowest Responsive and Responsible bidder.

Procurements under another State Entity’s Bid Process

Institutions may purchase goods or services using the competitive procurement process of another state entity. The process of the other state entity, except for the Central Procurement Office, must have specified that other Institutions would be permitted to purchase under the process. Institutions may purchase goods or services using the competitive procurement process of the Central Procurement Office which do not so specify. Institutions are strongly encouraged to include language in their competitive processes to allow extension of their process for use by other TBR and/or UT institutions as well as state departments. This Section does not preclude Institutions from using a Statewide Contract as a bid in accordance with its competitive bidding process.

General Services Administration (GSA) Contracts

When a vendor maintains a General Services Administration (GSA) agreement with the United States of America, or any agency thereof, the Institution’s procurement office may directly negotiate with that vendor for the commodity/services provided for in the GSA agreement. The price shall not be higher than that contained in the contract between the General Services Administration and the vendor affected.

State Manufactured Goods and Services

Institutions are required to purchase goods and services from other State agencies, e.g. Department of Correction, Tennessee Rehabilitative Initiative in Correction (TRICOR), Tennessee Business Enterprises, and Community Rehabilitation Agencies (CMRA) / TRUST in Tennessee, whenever such items or services are available therefrom and meet the desired conditions and standards. Such contracts may be based upon non-competitive negotiation.

Procurements under Cooperatives

Pursuant to the Tennessee Inter-local Cooperation Act, T.C.A. § 12-9-101, institutions may purchase goods and services through TBR System Office approved Cooperative Purchasing Agreements. The current approved list of TBR contracted cooperatives may be found at http://www.tbr.edu/purchasing/cooperatives.

Emergency Purchases

Institutions may make purchases of goods or services, without utilizing formal solicitation procedures, to meet bona fide emergencies arising from any unforeseen cause. Bona fide emergency purchases must be approved by the Chancellor, President, Director or their designee, and file documentation of the circumstances of any such emergency shall be maintained. Emergency purchases must be made on a competitive basis and processed by the Institution’s procurement office, if practicable.

Competitive Negotiation/Alternative Competitive Procurement Method

A competitive negotiation process may be used only in cases when the Institution is unable to obtain needed goods and/or services by a traditional competitive bid process. Reasons to use a competitive negotiation process include:

  • Public need will not permit the delay incident to the RFP process;
  • No acceptable proposals have been received after the RFP process;
  • Rates payable for the services are regulated by law;
  • Other circumstances as approved by the TBR System Office.

The requesting party shall work with the Institution’s procurement office to define the process to ensure the safeguarding of the information and provide fairness to the vendors in the process.

Use of the competitive negotiation process requires prior approval of the Chancellor, President, Director or their designee.

File documentation specific to each use of competitive negotiation shall be maintained.

Non-Competitive Procurements

Contracting with Another State/Governmental Entity. Personal, professional and consultant service contracts may be obtained by non-competitive negotiation when the contractor is a State Agency, a political subdivision of the state, or any other public entity in Tennessee, or an entity of the federal government.

Sole Source and Proprietary Purchases

Whenever specifications are not so worded or designed to provide for competitive bidding, a Sole Source or Proprietary Purchase may be allowed. A Sole Source Purchase is available only from a single Supplier; a Proprietary Purchase allows for a competitive procurement process to be used that specifies a particular good or service.

Written justification for Sole Source or Proprietary Purchases must be submitted in writing for approval by the Chancellor, President, Director, or their designee.

In addition to the Justification for Non-Competitive Purchases and Contracts Form, the following additional documentation may also be required as a part of the request:

  • A letter from the Supplier, which details the basis for non-competitive procurement, based upon the factors listed in Section b. (4) below.
  • Letter(s) from business and industry which supports the purchase of a particular good or service as industry or business standard.
  • A letter from the manufacturer specifying their distribution practices, i.e. available only directly or through distributors.
    (Note: All letters mentioned in this section are to be provided on the originator’s company letterhead and must be signed by an authorized official of the company.)

Factors to be considered in determining Sole Source and Proprietary Purchases include the following:

  • Whether the vendor possesses exclusive and/or predominant capabilities or the items contain a patented or copyrighted feature providing superior utility not obtainable from similar products;
  • Whether the product or service is unique and easily established as one of a kind;
  • Whether the program requirements can be modified so that competitive products or services may be used;
  • Whether the product is available from only one source and not merchandised through wholesalers, jobbers, and retailers;
  • Whether items must be interchangeable or compatible with in-place items;
  • Whether the cost of conversion, including but not limited to disruption, retraining, and replacement precludes bidding competitively;
  • Whether the product is to be used in an instructional setting and the intent is to provide instruction on the specific product or diversity of products;
  • For personal, professional and consultant services, whether the use of non-competitive negotiation is in the best interest of the Institution;
  • Other justification(s) as approved by the Chancellor, President, Director or their designee.

Purchases for Resale in Auxiliary Enterprises

Certain items for resale for which customers have expressed a preference, and/or promotional items procured under accepted retail merchandising practices, may be purchased without adherence to requirements for minimum notice and number of bids. Appropriate documentation shall be maintained which supports the action taken.

Special Purchase Categories

Purchases for Libraries

  • Purchases of books, electronic or hard copy are capital expenditures and can be made without formal bids or quotations.
  • Purchases of electronic journals, subscriptions, and databases for libraries shall be procured through the Institution’s procurement or contract office in instances when a competitive process can be used or when Fiscal Review Committee is required.
  • In addition, any required electronic or written agreements to license journals, subscriptions, or databases shall be routed through the Institution’s procurement or contracts office for review and approval prior to use.
  • Appropriate documentation must be maintained for purchases to support Sole Source Purchase.
  • Library purchases for electronic media may be subject to Accessibility Standards.

Grant Purchases

Purchases utilizing grant funding shall comply with the conditions of the grant and applicable state and federal guidelines.

State grant purchases for goods or services shall not be made from vendors on the State of Tennessee Debarred Vendors List.

Federal grant purchases for goods or services shall not be made from vendors on the List of Parties Excluded from Federal Procurement and Non-Procurement Programs, available at http://www.sam.gov .

Utility Contracts

Institutions shall purchase or contract for all telephone, electric light, gas, power, postal and other services for which a rate for the use thereof has been established by a public authority in such manner as the Institution deems to be in the best interest of the State of Tennessee.

Each such purchase or contract shall be made on a competitive basis, whenever possible unless it has been determined that such purchase is single source. If such purchase has been determined to be single source, the purchase shall then be made pursuant to the section above related to Non-Competitive Negotiation.

Gifts

Gifts do not require a procurement process subject to this Guideline. See TBR Policy 4:01:04:00 Solicitation and Acceptance of Gifts.

Outsourcing

Institutions are encouraged to determine whether some services can be delivered more economically by the private rather than the public sector. The following process is hereby permitted and encouraged:

  1. The state's cost of the service may be ascertained and kept confidential as part of the evaluation process. This cost must be finally determined and provided to the Chancellor, President, or Director, as appropriate, in a sealed envelope prior to bid/proposal due date.
  2. The service may be the subject of an RFQ/RFP, as appropriate, which approximately describes the services provided by the Institution.
  3. The RFQ/RFP may require that if the proposer’s/bidder’s price exceeds the state’s confidential cost, the proposal/bid may be rejected.