Demolition/Abatement Constracts (Folders 1-2)

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Chapter 4: Methods of Selection http://w~ww.fta.dot.gov/fta/library/adminBPPman/sect 40.htm that the price to be paid is fair and reasonable. 3. Micro-purchases are exempt from the Buy America requirements.5 4. Micro-purchases should be equitably distributed among qualifi~d suppliers in the local area and purchases should not be split to avoid the requirements for competition above the $2,500 micro-purchase threshold. 5. The requirements of the Davis-Bacon Act apply to construction contracts between $2,000 and $2, 500.6 6. Minimal documentation is required: (a) a determination that the price is fair and reasonable and (b) how this determination was derived. DEFINITION Micro-purchasing - A method of procuring goods and services under $2,500. A micropurchase does not require obtaining competitive quotations if you determine that the price to be paid is fair and reasonable. DISCUSSION If permitted by state and local requirements, purchases under S2,S00 no tonger require more than one price to satisfy Federal requirements, as tong as you determine that the price paid is fair and reasonable. You can include a"fair and reasonabte price" determination in your forms used for micro-purchases. Rotating through a tist of the suppliers is one method to equitably distribute the micro-purchases among qualified suppliers. Best Practices A threshold question you must get an answer to is whether or not your state law allows you to implement a micro-purchase method of procurement that does not require "futl and open competition." If you have the legal authority under your state law to implement a micro-purchase program, you must comply with the procedural requirements stated as items 1, 2, 4, & 5 under the Requirements portion of this section. Once you are satisfied that you can legally have a micro-purchase program under your state's laws, you need to develop a procedure or regulation that addresses the F'TA requirements and provides practical guidance to your organization Limits and Procedures - How will you guide the use of micru-purchase procedures? In accordance with the general requirement to have procurement procedures and a contract administration system (includin~ written selection procedures),~ larger agencies often maintain formal written procedures that address the circumstances under which micro-purchase procetiures should be used. Although these circumstances shall not include purchases greater than $2,500, you may wish to set your limit lower depending on state law and your ovm experience with the cost-effect~veness of price competition using small purchase procedures. If you can efficiently ascertain the lowest cost supplier, you may not always wish to use micro-purchase procedures. This method of procurement is intended to be used as creatively as po§sible and to minimize the paperwork that is inherent in other procurement practices. In establish~g golicies relating to micro-purchases at the grantee level, you must always be mixtc~ful t~fthe "equitably distribute° 4 of45 01/10/97 13:0920