No. 40565 (Amendment): Rule R33-9. Cancellations, Rejections, and Debarment

(Amendment)

DAR File No.: 40565
Filed: 06/30/2016 02:06:24 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of the rule is to address the cancellations, rejections, and debarment within the procurement process.

Summary of the rule or change:

Section R33-9-103 was amended to clarify that a solicitation may be cancelled before award but after opening all bids or offers when the procurement unit determines in writing that an infraction of code, rule, or policy has occurred or that there is other good cause including inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation. Additionally, Section R33-9-105 was deleted.

State statutory or constitutional authorization for this rule:

• Title 63G, Chapter 6a

Anticipated cost or savings to:

the state budget:

Any anticipated costs or savings to the state budget, based on the changes to this rule, cannot be measured. The changes to the rule address the cancellation of an award if it is determined that there was an infraction of code, rule, or policy that has occurred or that there is other good cause including inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation. It is impossible to determine, prior to the incident, what reasons for a cancellation would occur. Therefore, there are no anticipated costs or savings to the state budget.

local governments:

Any anticipated costs or savings to local government, based on the changes to this rule, cannot be measured. The changes to the rule address the cancellation of an award if it is determined that there was an infraction of code, rule, or policy that has occurred or that there is other good cause including inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation. It is impossible to determine, prior to the incident, what reasons for a cancellation would occur. Therefore, there are no anticipated costs or savings to local government.

small businesses:

Any anticipated costs or savings to small businesses, based on the changes to this rule, cannot be measured. The changes to the rule address the cancellation of an award if it is determined that there was an infraction of code, rule, or policy that has occurred or that there is other good cause including inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation. It is impossible to determine, prior to the incident, what reasons for a cancellation would occur. Therefore, there are no anticipated costs or savings to small businesses.

persons other than small businesses, businesses, or local governmental entities:

Any anticipated costs or savings to persons other than small businesses, businesses, or local government entities, based on the changes to this rule, cannot be measured. The changes to the rule address the cancellation of an award if it is determined that there was an infraction of code, rule, or policy that has occurred or that there is other good cause including inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation. It is impossible to determine, prior to the incident, what reasons for a cancellation would occur. Therefore, there are no anticipated costs or savings to the local government.

Compliance costs for affected persons:

There are no anticipated compliance costs for affected persons. The changes to the rule address simply address the cancellation of an award if it is determined that there was an infraction of code, rule, or policy that has occurred or that there is other good cause including inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation.

Comments by the department head on the fiscal impact the rule may have on businesses:

The changes to the rule address the cancellation of an award if it is determined that there was an infraction of code, rule, or policy that has occurred or that there is other good cause including inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation. As it is impossible to determine, prior to the incident, what reasons for a cancellation would occur, and fiscal impacts cannot be measured. Therefore, there are no anticipated fiscal impacts that the rule may have on businesses.

Kimberly Hood, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Administrative Services
Purchasing and General Services
Room 3150 STATE OFFICE BLDG
450 N STATE ST
SALT LAKE CITY, UT 84114-1201

Direct questions regarding this rule to:

• Alan Bachman at the above address, by phone at 801-538-3105, by FAX at 801-538-3313, or by Internet E-mail at [e-mail]
• Kent Beers at the above address, by phone at 801-538-3143, by FAX at 801-538-3882, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

08/15/2016

This rule may become effective on:

08/22/2016

Authorized by:

Jared Gardner, Chair, Procurement Policy Board

RULE TEXT

R33. Administrative Services, Purchasing and General Services.

R33-9. Cancellations, Rejections, and Debarment.

R33-9-101. General Provisions.

(1) An Invitation for Bids, a Request for Proposals, or other solicitation may be canceled prior to the deadline for receipt of bids, proposals, or other submissions, when it is in the best interests of the procurement unit as determined by the procurement unit. In the event a solicitation is cancelled, the reasons for cancellation shall be made part of the procurement file and shall be available for public inspection and the procurement unit shall:

(a) re-solicit new bids or proposals using the same or revised specifications; or,

(b) withdraw the requisition for the procurement item(s).

 

R33-9-102. Re-solicitation.

(1) In the event there is no initial response to an initial solicitation, the chief procurement officer or head of a procurement unit with independent procurement authority may:

(a) contact the known supplier community to determine why there were no responses to the solicitation;

(b) research the potential vendor community; and,

(c) based upon the information in (a) and (b) require the conducting procurement unit to modify the solicitation documents.

(2) If the conducting procurement unit has modified the solicitation documents and after the re-issuance of a solicitation, there is still no competition or there is insufficient competition, the chief procurement officer or head of a procurement unit with independent procurement authority, shall:

(a) require the conducting procurement unit to further modify the procurement documents; or,

(b) cancel the requisition for the procurement item(s).

 

R33-9-103. Cancellation Before Award.

(1) When it is determined before award but after opening that the specifications, scope of work or other requirements contained in the solicitation documents were not met by any bidder or offeror the solicitation shall be cancelled.

(2) A [Solicitations]solicitation may be cancelled before award but after opening all bids or offers when the procurement unit determines in writing that an infraction of code, rule, or policy has occurred or that there is other good cause including:

(a) inadequate, erroneous, or ambiguous specifications or requirements were cited in the solicitation;

(b) the specifications in the solicitation have been or must be revised;

(c) the procurement item(s) being solicited are no longer required;

(d) the solicitation did not provide for consideration of all factors of cost to the procurement unit, such as cost of transportation, warranties, service and maintenance;

(e) bids or offers received indicate that the needs of the procurement unit can be satisfied by a less expensive procurement item differing from that in the solicitation;

(f) except as provided in Section 63G-6a-607, all otherwise acceptable bids or offers received are at unreasonable prices, or only one bid or offer is received and the chief procurement officer or head of a procurement unit with independent procurement authority cannot determine the reasonableness of the bid price or cost proposal;

(g) the responses to the solicitation were not independently arrived at in open competition, were collusive, or were submitted in bad faith; or,

(h) no responsive bid or offer has been received from a responsible bidder or offer;

 

R33-9-104. Alternative to Cancellation.

In the event administrative difficulties are encountered before award but after the deadline for submissions that may delay award beyond the bidders' or offerors' acceptance periods, the bidders or offerors should be requested, before expiration of their bids or offers, to extend in writing the acceptance period (with consent of sureties, if any) in order to avoid the need for cancellation.

 

[ R33-9-105. Continuation of Need.

If the solicitation has been cancelled for the reasons specified in Rule R33-9-103(1)(f), (g), or (h) and the chief procurement officer or head of a procurement unit with independent procurement authority has made the written determination in Rule R33-9-103(1) and the conducting procurement unit has an existing contract, the division or a procurement unit with independent procurement authority may permit an extension of the existing contract under Section 63G-6a-802(7).]

 

R33-9-201. Rejections and Debarments.

An issuing procurement unit may reject any or all bids, offers or other submissions, in whole or in part, as may be specified in the solicitation, when it is in the best interest of the procurement unit. In the event of a rejection of any or all bids, offers or other submissions, in whole or in part, the reasons for rejection shall be made part of the procurement file and shall be available for public inspection.

 

R33-9-202. Conformity to Solicitation Requirements.

(1)(a) Any bid or offer that fails to conform to the essential requirements of the solicitation shall be rejected.

(b) Any bid or offer that does not conform to the applicable specifications shall be rejected unless the solicitation authorized the submission of alternate bids or offers and the procurement item(s) offered as alternates meet the requirements specified in the solicitation.

(c) Any bid or offer that fails to conform to the delivery schedule or permissible alternates stated in the solicitation shall be rejected.

(2) A bid or offer shall be rejected when the bidder or offeror imposes conditions or takes exceptions that would modify requirements or terms and conditions of the solicitation or limit the bidder or offeror's liability to the procurement, since to allow the bidder or offeror to impose such conditions or take exceptions would be prejudicial to other bidders or offerors. For example, bids or offers shall be rejected in which the bidder or offeror:

(a) for commodities, protects against future changes in conditions, such as increased costs, if total possible costs to the procurement unit cannot be determined;

(b) fails to state a price and indicates that price shall be the price in effect at time of delivery or states a price but qualifies it as being subject to price in effect at time of delivery;

(c) when not authorized by the solicitation, conditions or qualifies a bid by stipulating that it is to be considered only if, before date of award, the bidder or offeror receives (or does not receive) an award under a separate solicitation;

(d) requires that the procurement unit is to determine that the bidder or offeror's product meets applicable specifications; or

(e) limits rights of the State under any contract clause.

(3) A bidder or offeror may be requested to delete objectionable conditions from a bid or offer provided doing so is not prejudicial to other bidders or offerors, or the conditions do not go to the substance, as distinguished from the form, of the bid. A condition goes to the substance of a bid or offer where it affects price, quantity, quality, or delivery of the procurement item(s) offered.

 

R33-9-203. Unreasonable or Unbalanced Pricing.

(1)(a) Any bid or offer may be rejected if the chief procurement officer or head of a procurement unit with independent procurement authority determines in writing that it is unreasonable as to price. Unreasonableness of price includes not only the total price of the bid or offer, but the prices for individual line items as well.

(b) Any bid or offer may be rejected if the prices for any line items or subline items are materially unbalanced. Unbalanced pricing may increase performance risk and could result in payment of unreasonably high prices. Unbalanced pricing exists when, despite an acceptable total evaluated price, the price of one or more line items is significantly over or understated as indicated by the application of cost or price analysis techniques. The greatest risks associated with unbalanced pricing occur when:

(i) startup work, mobilization, procurement item sample production or testing are separate line items;

(ii) base quantities and option quantities are separate line items; or

(iii) The evaluated price is the aggregate of estimated quantities to be ordered under separate line items of an indefinite-delivery contract.

(c) All bids or offers with separately priced line items or subline items shall be analyzed to determine if the prices are unbalanced. If cost or price analysis techniques indicate that an offer is unbalanced, the procurement unit shall:

(i) consider the risks to the procurement unit associated with the unbalanced pricing in determining the competitive range and in making the source selection decision; and

(ii) consider whether award of the contract will result in paying unreasonably high prices for contract performance.

(d) A bid or offer may be rejected if the procurement unit and the chief procurement officer or head of a procurement unit with independent procurement authority determine that the lack of balance poses an unacceptable risk to the State.

 

R33-9-204. Rejection for Nonresponsibility or Nonresponsiveness.

(1) Subject to Section 63G-6a-903, the chief procurement officer or head of a procurement unit with independent procurement authority shall reject a bid or offer from a bidder or offeror determined to be nonresponsible. A responsible bidder or offeror is defined in Section 63G-6a-103(42).

(2) In accordance with Section 63G-6a-604(3) the chief procurement officer or head of a procurement unit with independent procurement authority may not accept a bid that is not responsive. Responsiveness is defined in Section 63G-6a-103(43).

(3) When a bid security is required and a bidder fails to furnish the security in accordance with the requirements of the invitation for bids, the bid shall be rejected.

(4) The originals of all rejected bids, offers, or other submissions, and all written findings with respect to such rejections, shall be made part of the procurement file and available for public inspection.

 

R33-9-301. Rejection for Suspension/Debarment.

Bids, offers, or other submissions, received from any person that is suspended, debarred, or otherwise ineligible as of the due date for receipt of bids, proposals, or other submissions shall be rejected.

 

KEY: government purchasing, cancellations, rejections, debarment

Date of Enactment or Last Substantive Amendment: [July 8, 2014]2016

Notice of Continuation: July 8, 2014

Authorizing, and Implemented or Interpreted Law: 63G-6a

 

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