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Source Food, Supplies and Services

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Sourcing food, supplies and services is also known as procurement: the multi-step process used to obtain goods or services. Review the resources below to source food, supplies or services for your program.


Methods of Procurement

The appropriate procurement method to use depends on the dollar amount of the expected purchase. Sponsors should evaluate what goods or services are needed and for how long, and determine which procurement method to use based on the estimated dollar value of the purchase. All procurement must be conducted in a manner that maximizes free and open competition.

Process for procurement:

  • Evaluate menus to determine what food products will be needed throughout the school year, and an estimate of how much of each product will be ordered.
  • Using that information, estimate the total cost of food products for the school year and make a decision on what procurement method to use to purchase them.
  • For frequent purchases made to the same vendor (example: your prime vendor for food), estimate the total dollar value of the whole school year, not each individual purchase. This is because the contract length is typically the school year, not week to week.
  • Other purchases that are a one-time purchase or a specific duration (example, three months) may be evaluated differently.

View common Procurement Terms

Micro-Purchases (<$10,000 per transaction)

A micro-purchase is defined as a purchase where the aggregate dollar value does not exceed $10,000 (per purchase). To meet the requirement for competition, purchases should be distributed equally among qualified suppliers with reasonable prices (to the extent practicable). Purchase prices of goods must be reasonable based on research, experience, purchase history, or other information; and this documentation should be kept on file.

Sponsors can self-certify a micro-purchase threshold of up to $50,000. If your district or organization chooses to update your micro-purchase threshold, make sure your procurement policies are also updated to maintain compliance.

This self-certification must be completed annually, and include:

  • A justification
  • Clear indication of the new threshold
  • Supporting documentation of any of the following:
    • A qualification as a low-risk auditee, in accordance with the criteria in 2 CFR 200.520
    • An annual internal institutional risk assessment to identify, mitigate, and manage financial risks

Small/Informal Purchases ($10,000 - $250,000 OR the most restrictive threshold)

The federal small purchase threshold is $250,000. However, your district/LEA/organization may have a more restrictive threshold. If so, the most restrictive threshold must be followed. However, there may NOT be a different small purchase threshold for federal vs. non-federal purchases, and the sponsor must follow one consistent procurement policy.

For purchases that do not exceed the small purchase threshold, price or rate quotations may be used.

  • Quotes may be verbal or written, but must be documented
  • Public notice is not required
  • Award the contract (purchase) to the lowest price from a responsible bidder who submits a responsive bid
  • Documented quotes and receipts

Download the Small Purchase Checklist

Informal Purchasing Log

Small purchase checklist

If your district or organization updates its micro-purchase threshold, the lowest value of the small purchase threshold should be replaced with the amount your district has self-certified for micro-purchases.

Formal Procurement (>$250,000 OR most restrictive threshold)

A cost or price analysis must always be conducted prior to soliciting goods or services where the value exceeds the small purchase threshold.

Formal solicitations must include certain language, including:

Procurement Resources:

Source Food: Formal Procurement Checklist

Procurement by Noncompetitive Proposals

Noncompetitive procurement may only be used when one or more of the following circumstances apply:

  • The item is available only from a single source
  • The public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation
  • The CDE Office of School Nutrition expressly authorizes noncompetitive proposals in response to a written request from the SFA
  • After solicitation of a number of sources, the competition is determined inadequate

Review the Noncompetitive Procurement Guidelines

View Noncompetitive Procurement Guidelines

noncompetitive procurement


Policy & Standards of Conduct

Procurement Policy

The sponsor must maintain written policies and procedures that reflect applicable federal, state, and local regulations.

These policies should include:

  • The procurement methods to be used
  • A requirement that costs incurred must be necessary and cost-effective
  • A requirement that procurement avoids the acquisition of unnecessary or duplicative items
  • All procurement transactions must provide full and open competition
  • A requirement that the sponsor must maintain records sufficient to detail the history of procurement
  • Procedures for evaluation of proposals, including procedures for the use of the market basket cost analysis method if applicable
  • A requirement to conduct a cost or price analysis for all formal bids and/or contract modifications
  • Steps that the sponsor will take to assure that small, minority, and women's business enterprises and labor surplus firms are used when possible.

Standards of Conduct

The sponsor must maintain written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award, and administration of contracts. The written standards of conduct may be included in the written procurement policy or may be maintained in a separate policy.

These standards must:

  • Prohibit soliciting or accepting gratuities, favors, or anything of monetary value from contractors or parties of subcontracts
  • Include disciplinary actions for violations of the policy

Capital Equipment Purchases & Approval Procedures

Capital Equipment is defined by federal regulations as tangible personal property (including information technology systems), having a useful life of more than one year, and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the SFA/LEA for financial statement purposes, or $5,000.00. Click here for more information on Equipment Grants.

These procedures become relevant for School Food Authorities that plan to purchase Capital Equipment using Food Service (Fund 21) funds.

Capital Equipment Approval Procedures:

Step 1

Complete the Equipment Purchase Approval Tree to determine if the equipment purchase is allowable and if the equipment is on the Prior Approved List.

Step 2

If the equipment is allowable and on the prior approved list, keep the Approval Tree for your records. The SFA may purchase the equipment and does not need further approval.

Step 3

If the equipment is allowable but it is not on the Prior Approved List, Complete the Capital Equipment Approval Form for CDE approval.


Buy American Provision

The William F. Goodling Child Nutrition Reauthorization Act of 1998 requires school food authorities to purchase, to the maximum extent practicable, domestic commodity or product.

Domestic commodity or product is defined as an agricultural commodity that is produced in the United States and a food product that is processed in the United States using substantial agricultural commodities that are produced in the United States.

Exceptions

Limited exceptions to the Buy American Provision allow for the purchase of products not meeting the “domestic” standard.

Before using an exception, alternatives must be considered:

  1. Are there other domestic sources for this product?
  2. Is there a domestic product that could be easily substituted, if the non-domestic product is less expensive?
  3. Am I soliciting bids for this product at the best time of year? If I contracted earlier or later in the season, would prices and/or availability change?

Exceptions to the Buy American Provision should be used as a last resort; however, an alternative or exception may be approved upon request.

Exceptions include:

  1. The product is not produced or manufactured in the U.S in sufficient and reasonable available quantities of a satisfactory quality; or
  2. Competitive bids reveal the costs of a U.S. product are significantly higher than the non-domestic product.

To be considered for the alternative or exception, the request must be submitted in writing to a designated official, in advance of delivery.

Requests should include:

  • Alternative substitute (s) that are domestic and meet the required specifications:
    • Price of the domestic food alternative substitute (s); and
    • Availability of the domestic alternative substitute (s) in relation to the quantity ordered.
  • Reason for exception: limited/lack of availability or price (include price):
    • Price of the domestic food product; and
    • Price of the non-domestic product that meets the required specification of the domestic product.

Review the resources below for additional information on Buy American Provision exceptions.


Procurement Resources

Identify Your Program Point of Contact