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Public Tender Act


P-1.10 - WHAT REQUIRES OR DOES NOT REQUIRE A PUBLIC TENDER

P-1.10.1 - WHAT REQUIRES OR DOES NOT REQUIRE A PUBLIC TENDER

Essentially all orders of goods and/or services and public works contracts greater than $10,000 in value (before taxes, freight, etc.) and in the case of "Public Work" where the total estimated cost is greater than $20,000 (before taxes, freight, etc.) require a public tender to be placed. Purchase orders cannot be broken down into more than one order in order to get each order value less than $10,000. A tender means a call for tender by electronic advertisement, as per Regulation 3(1)(a) of the Public Tender Act.

The Public Tender Act does outline several exceptions related to the definition of "services." Services do not include legal, engineering, architectural, accounting, land surveying, banking, telecommunications or insurance services or other services that provide the opinion of a professional.

All other exemptions are found in clauses 3 and 4 of the Act and, if taken advantage of, are to be reported to the Government Purchasing Agency. This procedure is outlined in sub-sections 10 and 11 of this section.


The University requires that the following sources of funds are to comply with the Public Tender Act:

  1. Operating fund accounts (Fund 1).
  2. Ancillary Enterprise funds (Fund 3).
  3. Research and special purpose accounts (Fund 2, 4, 5, 6 and 7) where the source of funding is from the Newfoundland Provincial Government.
  4. Plant fund accounts (Fund 9).
Memorial University of Newfoundland must retain the freedom to exempt some researchers from the public tendering process when sole sourcing can be justified. Exemptions are permitted and considered on a case-by-case basis. The appropriate exemption form for sole sourcing for research grant purchases (Purchases from Research Grants) is available in Appendix A. This form may only be used when no Provincial Government money is utilized in the research project. The form will follow the following processing and approval procedures: The "Purchases From Research Grants" form is to be fully completed and signed off by the Grantee and his/her Dean or Department Head; the form is then forwarded to the Vice-President (Research) for his approval prior to issuance of the purchase order for the goods/services. This is required in order to ensure the Vice-President (Research) has approved not going to tender before the award is made; use of this exemption cannot be granted after the award has been made; a copy of the form will be sent back to the grantee to attach to the purchase requisition or procurement card reconciliation as appropriate.

If further clarification of the applicability of the Public Tender Act/Public Tender Regulations is required, contact the Tendering Clerk, Department of Financial and Administrative Services for assistance.

Copies of the Public Tender Act and Regulations can be obtained from the Tendering Clerk, Department of Financial and Administrative Services.

P-1.10.2 - DEPARTMENT OF FINANCIAL AND ADMINISTRATIVE SERVICES FUNCTION

The Director of Financial and Administrative Services is responsible to ensure that the University is in compliance with the Public Tender Act (1984), with related regulations.

This responsibility includes:

  1. Reporting to the President on a monthly basis all exceptions and awards made under the Act.
  2. Ensuring that all University departments are consistent in the application of the Act to the purchasing function for which they have responsibility.
  3. Providing approvals as may be delegated to the Director of Financial and Administrative Services by the President and the Board of Regents in accordance with section 7 and Regulation 6 of the Public Tender Act.
  4. Providing any type of assistance required by departments in order that they may efficiently and effectively comply with the Act. This includes provision of services related to development of tender specifications, advertising, tender opening, tender evaluation and subsequent recommendations, and interpretation of the various sections of the Act.
To ensure the smooth operation of these guidelines, it is recommended that all purchases greater than $10,000 (before taxes) be coordinated with the Department of Financial and Administrative Services Tendering Clerk to ensure consistency throughout the University.

For those departments going to tender, the Department of Financial and Administrative Services will supply a locked tender box in which bidders may place their bids.

P-1.10.3 PREPARING A TENDER NOTICE

All tender notices must be routed through the Department of Financial and Administrative Services unless alternate arrangements have been made.
Procedures for preparing tender notice:
  1. Obtain tender number, opening time and date from the Tendering Clerk at Financial and Administrative Services, the Vice President's Office at Grenfell Campus, the purchasing office at the Faculty of Medicine, the Tendering Section at Facilities Management or the purchasing section at the Marine Institute. Tenders normally close a minimum of fifteen(15) calendar days after they are posted.
  2. Tender Notice should include: (Refer Appendix A-1)
    1. Tender Number
    2. Tender Name
    3. Time and Date for closing (be sure to include time zone; NDST or NST after time)
    4. Details to bidders where to obtain tender packages (Service Providers)
    5. Indicate address where tenders are to be delivered
    6. Indicate room number and building where opening to take place
  3. All tender notices will be advertised electronically with a Service Provider (Bids, Pods, and Merx). Departments will be required to forward all tender documents electronically to the Tendering Clerk at the Department of Financial and Administrative Services, Grenfell Campus, Marine Institute and Department of Facilities Management.
Instructions to Departments

When preparing tender packages for submission to the Tendering Clerk, ensure that each package contains:
  1. Tender Notice.
  2. Specifications. Ensure that all specifications are included in package.
  3. Include any amendments to the general terms and conditions for tendering that may be unique to the end-user department.
  4. Forward all documents to the Tendering Clerk in electronic format such as WordPerfect, Word, Microsoft Word, Lotus, etc., as an e-mail with an attachment.
  5. The deadline for the electronic transfer to the Tendering Clerk is two (2) working days prior to the date the department wishes to have it appear on the Service Providers Website..
  6. Upon receipt of the Notice, Specifications and Amendments, all necessary changes will be made and converted to PDF files. The Tender Bid Form (Appendix A-2), the General Terms and Conditions for Tendering, the Notice, the Specifications and any Amendments to the General Terms and Conditions for Tendering will be attached and the complete package will be forwarded to the Service Providers within the required time frame.

P-1.10.4 - PREPARING TENDER SPECIFICATIONS

There are five basic steps to preparing a tender. They are:

  1. Development of an accurate set of specifications for the bidders to review and reply to. Inadequate specifications will cause problems for the bidders in developing accurate bids and may result in the acquisition of goods and/or services that do not meet the standards desired by the requisitioner.
    When developing the tender specifications ensure that the following points are considered:
  • Document the minimum warranty requirements you will accept.
  • Ensure that your specifications adequately express the quality of the product you expect to purchase. For example, specifying just a LCD panel monitor for a computer system may not be adequate if you expect a contrast ratio of 600:1 w/digital interface or better and you are quoted 350:1 w/analog which is not acceptable. Specify exactly what your minimum requirements are.
  • Specify a delivery date.
  • Where required you are permitted to reference a "brand" name of an acceptable product. However, the words "or approved equivalent" are also required.
  1. Contact the Tendering Clerk at the Department of Financial and Administrative Services to arrange for the review of specifications.
  2. The tender opening. (See P-1.10.6)
  3. Tender evaluation. (See P-1.10.7)
  4. Notification of award to bidders.

P-1.10.5 - GUIDELINES FOR REJECTION/ACCEPTANCE OF TENDERS

Tenders will be rejected during the evaluation process when key elements of the bids have not been included, such as:

  • Tenders are not submitted on the "Invitation to Tender" form.
  • Tender is not properly identified.
  • "Invitation to Tender" form is not signed.
  • FOB terms are not as requested.
  • Appropriate specifications and or catalogue information of an equivalent product are not provided.
  • Faxed bids are not received in its entirety prior to the tender closing time.
Tender bids not meeting the documentation requirement will be rejected promptly by the Department of Financial and Administrative Services.

P-1.10.6 - TENDER OPENING

Tender Opening
  1. All tender openings must be attended by at least two Memorial University representatives. One from the tendering department and one from the Department of Financial and Administrative Services.
  2. The tender attendance sheet must be signed by all present. (Appendix A-3)
  3. Tenders will be opened individually and the following information disclosed:
    1. Name and address of bidder
    2. Item(s) being bid on
    3. Unit price(s)
  4. Each tender along with above information will be duly recorded by the departmental representative.
  5. Each tender will be signed and dated by both MUN representatives.
  6. After all tenders have been opened, recorded and signed, the attendees will be asked if they have any questions as to the manner in which the tenders have been opened.

P-1.10.7 - Tender Evaluation

Tender Evaluation

  1. Ensure that each bidder has signed the tender bid form.
  2. Completeness of bids. Ensure that the tender form and any other required documents are included with bid.
  3. Ensure that for any faxed bids, the original documents are received within three (3) working days after the tender has closed.
  4. Evaluate each tender to ensure that the bidders are in compliance with all specifications.
  5. Complete a technical evaluation.
  6. Complete tender evaluation form. This will show all bids received, whether they are acceptable or not acceptable and the preferred bidder. (Appendix A-4)
  7. Document reasons for disqualification of any bid.
  8. Notify unsuccessful and disqualified bidders. (Appendix A-5)
  9. Forward original bids, tender evaluation form, copy of all documents outlining reasons for disqualification, copies of notices sent to unsuccessful bidders and a copy of the resulting purchase order(s) to the Tendering Clerk at the Department of Financial and Administrative Services.

P-1.10.8 - Form B: Contract Award Without Tender Invitation

a. "Form B" (Appendix A-6) is required to be completed pursuant to section 10 of the Public Tender Act (1984), The form is designed to summarize those contracts awarded without tender as allowed by sections 3 and 4 of the Act. Briefly, these sections are:

b. In cases of a pressing emergency injurious to public interest.

c. Only one available source.

TIMING OF AWARD

The Department of Financial and Administrative Services will be responsible for gathering all "Form Bs" and submitting them to the President for review and signatures.

This form is to be fully completed and forwarded to the Department of Financial and Administrative Services prior to the issuance of the purchase order. This is required in order to ensure the President has approved not going to tender before the award is made.

It should be noted that, in order to use exemption clause 3 (2) (e) (Sole Source), the Director of Financial and Administrative Services will be responsible for providing prior exemption. It is important, therefore, that arrangements for approval be made in advance if you anticipate using this clause. Use of this exemption cannot be granted after the award has been made.

COMPLETION OF FORM B

Section 1 - This area will indicate the University department making the award.

Section 2 - This section will briefly describe the nature of the services or supplies purchased. The purchase order number is also required.

Section 3 - This section will contain the complete mailing address of the contractor, supplier or lessor to whom the award was made.

Section 4 - The full value of the contract, including all taxes and freight are to be shown here, along with the date of award (date purchase order issued). Awards for a public work should include all applicable taxes.

Section 5 - Check the appropriate section of the Public Tender Act for which this purchase is exempt. The relevant section of the Act is attached to this instruction for your assistance.

Section 6 - Clearly outline why the tender was not invited. This explanation will have to undergo the scrutiny of the Auditor General's Office, Government Purchasing Agency and the general public, so accuracy is critical.

Section 7 - Not applicable at this time.

Section 8 - In all cases, the appropriate Dean, Director or Department Head is required to sign the form prior to it being forwarded to the Department of Financial and Administrative Services for review and recommendation to the President/Vice-President for approval.

P-1.10.9 - EXTRACTS FROM PUBLIC TENDER ACT (1984) RELATED TO COMPLETION OF THE REPORT: CONTRACT AWARD WITHOUT TENDER INVITATION FORM B

Section 3

  1. Where a public work is to be executed under the direction of a government funded body or goods or services are to be acquired by a government funded body, the government funded body shall invite or cause to be invited tenders for the execution or acquisition.

Notwithstanding subsection (1), the government funded body is not required to invite tenders:

b. Where the estimated cost of the work or acquisition is equal to or less than twenty-five thousand dollars, and it appears to the head of the government funded body that in view of the nature of the work or acquisition it is not advisable to invite tenders.

d. In the case of a pressing emergency where the delay resulting from inviting tenders would be injurious to the public interest; or

e. Where there is only one available source of acquisition or work.

 

Section 4

 

1. Where a government funded body requires space and intends to lease the space, the government funded body shall in the prescribed manner invite tenders for the leasing of the space required unless:

b. The estimated rental value of the space is equal to or less than thirty thousand dollars, and it appears to the head of the government funded body, in view of the nature of the lease, that it is not advisable to invite tenders.

5. A renewal of a lease for leased space in accordance with the original terms of the lease and a lease for an extension of the area of leased space in accordance with the original terms of the lease are not subject to this section but such lease and renewals of leases are subject to the approval of the Lieutenant-Governor in Council and to section 10.

Section 10

Where a public work is executed or goods or services are acquired or space is leased by a government funded body and a tender is not required to be invited by reason of paragraph (b), (d) or (e) of subsection (2) of section 3, or paragraph (b) of subsection (1) of section 4 or subsection (5) of section 4, the head of the government funded body shall inform the Minister of Transportation and Works of the public work or goods or services or lease and the Minister of Transportation and Works shall table a report indicating the public works so executed or the goods or services so acquired or the space so leased and the reasons why the tender was not invited, in the House of Assembly,

  1. if the House of Assembly is then in session within 30 days of the awarding of the tenders; or
  2. if the House of Assembly is not then in session within 30 days from the opening of the next session.
Regulation 8
Where a head of a government funded body is required to inform the Minister of Transportation and Works pursuant to subsection (3) of section 8 of the Act or under section 10 of the Act, the head of the government funded body shall provide, within 30 days of the awarding of the contract or the execution of public work or the acquisition of goods or services or the space leased, to the Minister the information required in the form prescribed by the Minister or further information as the Minister may request.

P-1.10.10 - COMMON QUESTIONS AND ANSWERS REGARDING PUBLIC TENDER ACT

  1. Are we required to tender for all purchases greater than $10,000 (before taxes) in value?
    Yes.
  2. Under what circumstances can we apply for exemption under the Public Tender Act?
    All exemptions are outlined in section 3 and 4 of the Act.
  3. How can I apply for exemption under the Act?
    All that is required is to complete Form B with your purchase details and forward it to the Department of Financial and Administrative Services prior to making the award. The form will be reviewed and returned to you as promptly as possible. Once you have received the approval of your Form B from the Department of Financial and Administrative Services, the purchase order may be issued.
  4. If I have an order greater than $10,000 in value, but it includes items, each with a value less than, $10,000 do I still have to go to tender?
    Yes. Some departments may be inclined to split the order to avoid the Act. This is not permitted as it goes against the intention of the Act.
  5. Can we invite suppliers to bid on a tender rather than relying on the public advertisement?
    Yes. In order to ensure all suppliers are aware of the tender and to ensure that the University gets the maximum number of bids, you should contact potential suppliers.
  6. If we ask for bids on specific items, do we have to actually make the purchase or can we refuse all or a portion of the tender?
    The specifications should indicate that the University will not be obligated to accept all or any of the bids offered.
  7. Should the HST (Harmonized Sales Tax) be taken into consideration when determining whether or not a tender should be invited?
    No. However, freight, currency exchange and any other additional purchase costs must be taken into consideration when determining whether or not a tender is to be invited.
  8. What should be done if a department requests that a tender be cancelled after bids are called?
    A written explanation should be sent immediately to the Director of Financial and Administrative Services (along with all bids received).
  9. With reference to Question #8, the tender includes goods that are both over and under $10,000. What happens if the request to cancel is for the goods over $10,000 and the remaining goods are less than $10,000 in value?

    If the remaining goods are less than $10,000, there will be no need to call a tender, but the companies that originally bid on the tender should be contacted for new quotations.
  10. Is a Fax copy acceptable as a tender bid?
    Yes. Facsimile copies of Tender Bids will be accepted as legal documents. Bidders should also be aware that Fax tenders are not guaranteed as being confidential.

APPENDIX A

 

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