LEVERAGED PROCUREMENT AGREEMENT (LPA) BASICS - 1602

Introduction

LPAs are established by DGS/PD as set forth in Public Contract Code (PCC) sections 10290 et seq. and 12101.5, which enable streamlined State purchases by removing repetitive, resource intensive, costly and time consuming bid processes by departments. State Departments are authorized by these same laws to use LPAs (not create them) while adhering to policy and procedure.

LPAs commonly include “user guides” or “ordering instructions” that are unique to a particular LPA program and/or contract.  These instructions, for the purposes of this chapter will be commonly referred to as “user instructions.”  Buyers, in addition to reading this chapter, should always refer to the user instructions for the specific LPA being utilized.

Buyers must also be aware of the importance of reading this chapter in its entirety as the chapter was created to consolidate like processes throughout the various LPAs into the beginning section of the chapter.

LPA Prices

LPA prices for products and services vary from category to category.  Some LPA prices are listed as maximums and negotiating for lower prices is recommended.  Others are at a fixed price for which negotiation is not allowed.

Because of these variables, buyers are required to confirm that the products, services and prices are included in the contract and that the prices in the department’s order are at or below the contract rates.  This is accomplished by obtaining a complete copy of the LPA before executing any purchase documents.  The contract’s user instructions describe the tasks necessary to solicit offers for the order.

Solicitation Document

Some LPAs require the department to prepare and distribute a Request for Offer (RFO) using an authorized supplier pool. An RFO is a document sent to LPA contractors which contains requirements for a specific transaction and requests a specific response or offer. The individual user instructions will indicate whether additional offers are required.

Establishing LPAs

LPAs are established by the DGS/PD as follows:

If the LPA is:	Established by:
Statewide Contract (SC) Contract number leads with a “1” or “8”. SC numbers that begin with “8” are restricted to CalPIA use only.	Statewide competitive bid for: Specified goods/IT goods Specified period of time Price analyzed Awarded to single supplier or multiple suppliers Some require mandatory use Exempt from requirement to obtain 3 offers Reviewed and verified for EPP compliance. Identify EPP attributes and SABRC categories within FI$CAL for tracking. All certified SB or DVBE purchases made through the SC are reported monthly by the contract holder and are credited to the purchasing department.
State Price (SP) Schedule Contract number leads with “2”	Non-Competitively Bid agreement for: Orders for goods at a fixed price Specified period of time Tend to be proprietary supplies and parts
California Multiple Award Schedule (CMAS) Contract number leads with “3” for IT and “4” for non-IT	Competitively assessed, negotiated or bid: Contractor offers products and/or services and prices from an existing competitively assessed, cost compared, multiple award contract. Primarily based on Federal General Services Administration multiple award schedule-based California terms and conditions are incorporated into the contract
Master Agreements (MA) Contract number leads with “5”	Statewide competitively bid (generally) with award to all responsive bidders: Products Services Rental of equipment May include EPP certifications.
Cooperative Agreements (CA) Contract number leads with “7”	Multi-state cooperative purchasing agreements for: Products Services Rental of equipment

Where to find LPA Information?

To access LPA information please click here: Cal eProcure website

Why Do Departments Need a Copy of the LPA Contract?

Departments must obtain a copy of the LPA to be used in order to:

• Validate the contractor is authorized to sell specific products and/or services.
• Determine warranties, guarantees, maintenance provisions, product return policies, bond requirements, travel costs, etc.
• Determine if products and services are available on the LPA.
• Determine which products and/or services are specifically excluded.
• Determine if prices quoted are at or below LPA rates.
• Determine if additional approvals, forms, filings, etc. are required.
• Substantiate the contractor is CA certified as a SB or a DVBE (if applicable).
• Substantiate the contractor has a valid contractor’s license (if applicable).
• Substantiate the contractor has a valid seller’s permit (if applicable).

What LPAs Offer

LPAs offer goods and services that have been competitively assessed, negotiated or bid, and are structured to comply with California procurement codes, policies, and guidelines, providing for maximum contractual protection.

Architectural, engineering, and environmental services, legal services, and public work activities are not available on LPAs.

What is Required to Use LPAs

In order to use LPA contracts, departments must:

• Obtain a complete copy of the LPA contract to be used
• Read through the specific LPA contract and corresponding user instructions to understand the parameters for using a particular LPA.  The user instructions include limitations and/or restrictions (if any), the contracting process, requirements, how to secure pricing, and how to ultimately execute the proper purchase document to complete a transaction.

Departments must have purchasing authority to use LPAs for goods and services.

Applicable Codes, Policies and Procedures

The use of LPAs does not exempt adherence to all applicable laws, regulations, codes, and policies relative to State contracting and procurement requirements.  This includes but is not limited to: conducting and executing all applicable planning activities, pre-procurement approvals, Government Code, Section 19130 civil service considerations, contract approvals, prompt payment requirements and receiving activities as established by this manual.

Standard Purchase Document

Buyers must read the user instructions provided for the individual LPA to determine the appropriate purchase document to be utilized.

LPA Contract Provisions

Departments may add requirements but not delete any LPA terms and conditions without prior written approval from DGS/PD.

Mixing LPAs

Offers cannot be mixed using different types of LPAs to execute a single order.  LPA categories (CMAS, MA, SC, and SLP) cannot be combined to obtain offers to select a supplier.

Example:

An IT consultant is needed.  The department has LPA IT purchasing authority for CMAS and Master Agreements (MA).  Offers cannot be obtained from both CMAS contractors and the Masters contractors to meet the department’s need and the requirement to obtain offers.

SB and DVBE Consideration

When placing orders against LPAs, offers must be considered from certified SB and/or certified DVBE, when available.  The certified prime must perform a commercially useful function in the resulting purchase document.  Most LPA processes provide departments with a means to claim contracting dollars toward SB or DVBE participation goals.

SB and DVBE Sub-Contracting Participation Tracking

Subcontracting dollars towards departmental SB or DVBE participation goals may be claimed whenever an LPA contractor subcontracts a commercially useful function to a certified SB or DVBE business.  The LPA contractor will provide the ordering department with the name and address of the certified SB or certified DVBE business used and the dollar amount that may be applied towards the SB or DVBE participation goal. The buyer must enter the information in the FI$Cal system or procurement file for tracking purposes.

SB and DVBE Verification

Inquiries through the Office of Small Business and DVBE Services (OSDS) database are to be performed to verify SB and DVBE certification status of all LPA contractors prior to issuing the order.   The certification data (SB and DVBE reference number, status, term, business type, etc.) provided from an inquiry, when applicable, must be maintained within the procurement file.

Click here to access the OSDS webpage.

Specifications and EPP consideration

When placing orders against LPAs all offers considered must meet the performance and environmental administrative and specifications requirements, including certifications, in the resulting purchase document.  The LPA contractor must provide the ordering department information that validates EPP and SABRC compliance. When EPP and SABRC criteria are to be considered for LPA tracking purposes, the purchasing department must submit the information to DGS Procurement Division for the information to be entered into the FI$CAL system.

CAL-Card Usage

Individual LPA contracts will provide direction as to whether or not the contract allows for credit card payments.  Payment may be made for goods and services with a CAL-Card, as long as the contractor accepts a VISA card.  CAL-Card is a payment mechanism, not a procurement approach.  Consequently, an LPA order must be executed on a purchase document regardless of dollar amount when using CAL-Card for payments.

Disputes

If a supplier dispute occurs, the department shall first attempt to resolve complaints or disputes informally.  If the dispute cannot be resolved by the department, the dispute may be elevated to the DGS/PD contract administrator as identified in the individual LPA contract or to the DGS/PD Dispute Resolution Unit.

Categories and Dollar Thresholds

Refer to the Purchasing Authority section for more information on categories and dollar thresholds.

Exemptions from Dollar Thresholds

Exemptions to the dollar threshold for LPAs may be considered if a department meets the necessary requirements. Refer to the Purchasing Authority section for information on how to request an exemption to the dollar threshold on a transactional basis.

Contractor Evaluations

Pursuant to Public Contract Code, Sections 10367 and 10369, each contractor providing consultant services of $5,000 or more shall be advised in writing on the standard contract that the performance will be evaluated.

• One Contract/Contractor Evaluation, form STD 4, must be prepared within 60 days of the completion of the contract. The form shall be uploaded into FI$Cal and kept as part of the procurement file.
• The agency shall document the performance of the contractor in doing the work or in delivering the services for which the contract was awarded.
• The evaluations shall remain on file by the agency for a period of 36 months. If the contractor did not satisfactorily perform the work or service specified in the contract, the agency conducting the evaluation shall place one copy of the evaluation form in a separate agency contract file and send one copy of the form to DGS/OLS within five working days of the completion of the evaluation. (SCM Volume 1, section 3.02.5)
• On filing an unsatisfactory evaluation with DGS/OLS, the state agency shall notify and send a copy of the evaluation to the contractor within 15 days. The contractor shall have 30 days to prepare a statement defending his or her performance under the contract and to send it to the agency and the department. The contractor's statement shall be filed with the evaluation in the agency's separate contract file and in DGS/OLS's files.

The evaluations and contractor responses on file with the agencies and DGS/OLS are not public records; they should be maintained in a separate file.

Administrative Fees

LPA Administrative Fees, if applicable, are identified within the DGS State Price Book and/or described within the LPA user instructions.

Click here to access the DGS State Price Book.

Protest Language

Since a Request for Offer (RFO) for MA, CMAS and CA 1122 are not considered competitive solicitations, departments must not include protest language.