InsIde ThIs Issue From the Desk of the President ..............................2VAGP/CAPA Reverse Trade Show Recap ..................3Specing a Pizza & Other Procurement Misadventures ...4Committee Reports .................................................5Confidentiality and Conflict of Interest ............................7Upcoming 2012 Educational Offerings .......................8Hospital i ty .............................................................10

Promoting Compliance ..............................................10NIGP Region 4 Updates ......................................11NIGP Business Council .........................................12Going to Seattle? ...............................................13Members in Mot ion! .........................................13W h e r e i s i t ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14Purchasing Unknowns: Time & Materials Contracts ....15Spring Conference Photo Review .........................17

Published for Members of the Virginia Association of Governmental Purchasing, Inc.

June 2012

& News Views

Congratulations to VAGP Award WinnersThe Honors and Awards Committee reviews the accomplishments of VAGP, agencies, members or any person who has provided outstanding service to VAGP, or any VAGP members who have distinguished themselves in the areas of purchasing or materials management, involvement in Association activities, and promotion of professional development, not only for themselves but also for others.

At the 2012 VAGP Spring Conference held in Williamsburg, several of our Association’s prestigious awards were presented. Congratulations to each of you! (For more award information, please go to www.vagp.org/awards/.)

(above) Mr. Frederick Marks, CPPO, VCO, received the Retired Lifetime Membership Award from 2012 VAGP President, Kelly Okken, CPPB, VCO, VCCO.

(above) Mrs. Linda Wade, CPPB, received the Purchasing Manager of the Year Award from 2012 VAGP President, Kelly Okken, CPPB, VCO, VCCO.

(left) Mr. Paul Proto, CPPO, VCO, with his wife Faye, received the T. Gordon Sandridge Lifetime Achievement Award and Retired Lifetime Membership Award from 2012 VAGP President, Kelly Okken, CPPB, VCO, VCCO.

Congratulations

Page 2 - June 2012

Virginia Association of Governmental Purchasing, Inc.

BoArd of direCtors

Officers

PresidentKelly okken, CPPB, VCo, VCCo

President-ElectBill Lindsey, CPPo, C.P.M.

treasurerJan Giffin, CPPO, CPPB, VCO

Secretarystephanie suter, CPPB

first Past PresidentLinda Wade, CPPB

Second Past PresidentJennifer Luchard, CPPB, VCO

first At–Large MemberGreg Scearce, VCO

Second At–Large MemberGinger Gordon, CPPB

Committee Chairpersons

ConferenceAmy Holschuh, VCO

diversityMarvis W. Marshall, CPPB

EducationCindy davis smith, CPPB

MembershipMichelle Glass, VCO

Professional developmentChristopher Cheney, CPPB

Public RelationsLeeAnne Beatty smith, VCA

TechnologyJimmy MacKenzie, VCO

LegislativeJ. Kevin Beardsley CPPB, CPPo

Executive DirectorCrystal Anderson

News & Views

editorLeeAnne Beatty smith, VCA

Layout, design & AdvertisingKim Breeding

News & Views is published quarterly and was designed and created for the members of the Virginia Association of Governmental Purchasing, Inc. (VAGP), by Organization Management Group, Inc. Views and advertising expressed in this newsletter are not necessarily those of, or endorsed by, VAGP. Send correspondence to 638 Independence Parkway, Suite 100, Chesapeake VA 23320; (757) 609-3696; info@VAGP.org. Subscriptions are included in the annual dues paid by members. Advertising rates and policies may be obtained by calling (757) 609-3696.

Copyright 2012. All rights reserved.

from the desk of the PresidentBy Kelly Okken, CPPB, VCO, VCCO

Wow, it’s hard to believe that we are almost halfway through this year. I have enjoyed the past few months as your President and I am so proud of the members of this Association and your many

accomplishments. I am also very excited about what the future holds and I hope that you are, too! Your Board is working very hard to plan a successful 2013. Yes, you heard me correctly…2013. There are many tough decisions that need to be made for 2013. Although VAGP is financially sound, we cannot relax. We have to continue to work at planning successful events and spending carefully. This way we can ensure that VAGP will remain financially sound for years to come. Your Board is always looking for ways to keep costs low and benefits high. If you have any suggestions, I would be glad to listen.

Also, just to put a little “bird in your ear”, there are several upcoming scholarship and award opportunities. The submissions for the scholarship and awards are due by August 14, 2012. I know that this is a few months away, but please be sure that you take a look at these opportunities…we want to award every scholarship and award this year. The scholarships and awards available are:

• J.BradOakleyScholarship– This scholarship recognizes a member who has served in a non-supervisory, non-management buyer or materials management related position.

• T.GordonSandridgeLifetimeAchievementAward – This award is VAGP’s most prestigious award. It is presented to an individual who possesses high ethical and moral standards and is recognition of outstanding lifetime contributions and/or service to public procurement.

• DistinguishedServiceAward – This award recognizes a member or members displaying such distinguished service to the organization.

• LeadingLightAward – This award recognizes an agency for their outstanding contributions, achievements, and new initiatives that benefit their agency and/or other procurement professionals. The program also promotes sharing of innovative ideas and best practices within the procurement profession and VAGP’s membership.

• Lifetime&Retired LifetimeMembership – VAGP has two categories of life membership. Individuals may be recommended for life membership for continuous and significant long-time service to VAGP. Life members will no longer be required to pay dues to the Association.

• Volunteerof theYear – This award recognizes a member or members displaying substantial volunteerism to the organization. This award recognizes those who go “above and beyond” the call of duty.

• VAGPManager-LevelScholarship - This scholarship recognizes a member who has served as a manager in a purchasing or related materials management capacity.

Be sure to check out VAGP’s website for more details and an award/scholarship application form. I look forward to seeing your name in the pile of applications!

Always be sure to keep your eye on the website, emails and social media for updates. We have a busy few months ahead and you will want to stay engaged. We have highlighted several of the events throughout this newsletter. If you don’t see something, but need information, please feel free to contact me or any of your Board members. We are here to help you!

As always, I will leave you with an inspirational quote: “Every accomplishment starts with the decision to try.” I hope that you will accomplish much from your many efforts! Until next time…

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Virginia Association of Governmental Purchasing, Inc.

By LeeAnne Beatty Smith, VCAPublic Relations Committee Chair

VAGP and CAPA once again partnered to bring you the Reverse Trade Show, which was held on May 23 at the Holiday Inn Koger in Richmond, VA. This event had

48 exhibitors representing various state agencies, school systems, localities, municipalities and universities along with

220 visiting vendors! VAGP and CAPA would like to say “thank you” to our event sponsors: Lifecycle Construction Services, Daly Computers, and US Communities, as well as everyone else who helped to make the Reverse Trade Show 2012 a huge success!

VAGP/CAPA reverse trade show

see More eVent

Photos on VAGP’s

fACeBooK PAGe!

Page 4 - June 2012

Virginia Association of Governmental Purchasing, Inc.

By Jeff Moyer, CPPBPublic Relations Committee Member

In looking back over it, maybe I had gotten a little bit lazy or complacent and assumed that my vendors ALWAYS knew what I was talking about and that there

was no need to share details. All I had to do was send out an email or place a phone call and handle it like ordering a pizza: the vendors would reel off the list of toppings and I tell them which ones I want or don’t want such as easy on the sausage, no pepperoni or anchovies, heavy on the mushrooms and cheese, or in this case I tell the vendor I’m interested in this and that, thank you for your time, and send me a quote. I recently did this same process when ordering some water materials, the result of which turned out about like the last time I tried to make gravy at home: it just did not work. I had forgotten the fact that terminology changes and evolves and the sales staff turns over with new people who are unfamiliar with me, our organization, and how we do things. All of which, when stirred together, can be a perfect recipe for mistakes and headaches. Lesson learned that day was always provide adequate information to your vendors, and if you’re unclear on what your end user has described to you, go back and ask for clarification. It will save time and aggravation later. Remember Bill Lindsey’s pipe spec at the spring conference? (Ask him about it, if not!) It can and does happen.

This started me thinking about some of the things I have seen or experienced over the years. Prior to my position with Harrisonburg, I worked in the parts department for a local farm machinery dealer. One day my boss got an order for 250 steel ball bearings. The order was placed with the supplier and delivered to our dealership a few days later. A day or so later another 250 arrived, and another 250, and another, soon to be followed by a phone call from the supplier asking if we “really wanted 250,000 of those things?” Someone had transposed a decimal point or a zero somewhere along the way. Lesson learned: pay attention to those small details.

Shortly before I left that position for my current one, I answered the phone one day and the caller identified himself as Mr. So-

and-So of thus-and-such division of the Pentagon. I thought it was one of my pals being cute and almost asked how George and Barbara (Bush) were doing but didn’t, thankfully, as it really was the Pentagon. They had a fleet of lawn tractors

and needed parts for them and they liked to patronize small businesses, which led them to us. They called with an order for a huge variety of wear and maintenance parts, which I assembled and shipped. Lesson learned: always be professional, things aren’t always what they seem.

When I began this position with the City of Harrisonburg, we handled dynamite, blasting caps, and detonation cord for construction applications. This was in the days when terrorism as we know it today was just starting, about the time of the first World Trade Center attack. One day a city police captain came to my office accompanied by a serious looking fellow in a suit and tie who later turned out to be an ATF agent. The ATF agent asked to see my explosive’s storage site and my records. Both men spoke little to me and were very, very serious. It took no time for my imagination to run wild, wondering what I had done, hadn’t done, or had done wrong and how soon they would be coming to get me. Most importantly—would I be out in time for bow season? Trying to lighten the mood a bit, I told the ATF agent that “I had nothing to do with the World Trade Center.”

He looked at me with icy regard and said, “Mr. Moyer, you might be closer than you think.” I never heard anything more about it much to my relief. Lesson learned; think before you speak, again always be professional, and most importantly, ATF agents have little to no sense of humor.

To shamelessly paraphrase Forest Gump, “procurement is like a box of chocolates, you never know what you’re going to get,” but that’s what makes our profession interesting and challenging. I’d very much like to hear your horror stories. Post some of your interesting procurement encounters on the VAGP Facebook page…maybe we can console each other.

Specing a Pizza and Other Procurement Misadventures

I had gotten a

little bit lazy or

complacent and

assumed that my

vendors ALWAYS

knew what I was

talking about...

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Virginia Association of Governmental Purchasing, Inc.

ConferenCe AdVisory CoMMitteeBy Amy Holschuh, VCOConference Advisory Committee Chair

Your Conference Advisory Committee would like to extend a big THANK YOU to everyone who attended the Spring Conference in Williamsburg. You made this event a huge success! We sold out both the member registration and the vendor expo and all together VAGP raised $2,153 in cash plus $140 in supplies for the Disabled American Veterans. Like VAGP on Facebook to see pictures from the event.

Now that the conference is complete, we have been focused on planning the next two events of the year. We partnered with fellow NIGP chapter Capital Area Purchasing Association (CAPA) on May 23 for the 3rd Reverse Trade Show. This was a valuable event that provided an organized networking opportunity to suppliers and procurement professionals. The annual Reverse Trade Show is free to public bodies and is a positive way to achieve outreach goals. Keep an eye out for pictures from this event on Facebook as well.

Mark your calendars and plan to attend the Fall Symposium October 4-5 at the Sheraton in Roanoke. We are planning a day and a half full of educational sessions that will help you achieve your professional goals with a little fun mixed in too! Additional information will be posted on the events page of the VAGP website and emailed to members. Save these dates and we hope to see you at the next VAGP event!

eduCAtion CoMMitteeBy Cindy Davis Smith, CPPBEducation Committee Chair

Last August, I had the opportunity to attend a leadership session lead by Michael Staver of the Staver Group (www.thestavergroup.com) at the NIGP Forum. Just recently Michael Staver asked the question, “When was the last time that you did something for the first time?” This question really resonated with me, because like many of you, I am driven by routines. I have my first cup of coffee while I review my emails, I

like to go to lunch around 11:30am each day, and I definitely can’t wear white after Labor Day. I asked myself, “where is there room in my routine to try something new?”

I have discovered that there’s plenty of room as long as I start with the first small step. So, I challenge you to do the same. Start by taking one of the many classes that VAGP is offering this year (see a list on the next page, or check the website at www.vagp.org/education). If the class that you would like to take isn’t available in your area, then let me know via email (cindy.smith3@fcps.edu). The Education Committee strives to meet the needs of the membership and would welcome your feedback and suggestions.

CoMMittee rePorts

Facebook-http://www.facebook.com/VAGPofNIGPStay connected with your VAGP friends!

Twitter-http://twitter.com/VAGPofNIGPGet updates delivered in 140 characters or less!

LinkedIn-http://www.linkedin.com/e/n6js4j-gjohm1kw-13/vgh/3771217/eml-grp-sub/Name VAGP as an important part of your professional online presence!

(continued on page 6...)

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Virginia Association of Governmental Purchasing, Inc.

ProfessionAL deVeLoPMent (Prod) CoMMitteeBy Christopher Cheney, CPPBProD Committee Vice Chair

uPCoMinG LoW-fee seMinArsThe list below features some of our Low-Fee Seminars that are coming up soon; for more educational opportunities, see the full listing on page 8 of this newsletter, or visit www.vagp.org/education.

Seminar Dates LocationVirginia Public Procurement Act Jul. 16 LWPublic Purchasing Basics Jul. 17 DMVPublic Purchasing Basics Jul. 20 COSPublic Purchasing Basics Aug. 3 COCCompetitive Sealed Bidding vs. Competitive Negotiation Aug. 10 CVUnderstanding the PPI/CPI Sep. 7 COMHow to Award to the Best Vendor Sep. 14 COSVirginia Public Procurement Act Sep. 17 HQ

Areyouinterestedinacoursethatyoucannotfindontheschedule? The Professional Development Committee works to offer affordable educational opportunities for procurement professionals. Please let any of the committee members know if you and your entity are if you are interested in hosting a seminar or attending a professional development seminar not listed on the schedule. We hope to hear from you soon!

Pro d CoMMittee MeMBers

Christopher Cheney, CPPB (Chair) - 703-324-3279 - christopher.cheney@fairfaxcounty.gov

Vernice Grooms, VCO (Vice Chair) - 434-970-3860 - groomsv@charlottesville.org

Ivy Crawford, VCA - 757-514-4015 - icrawford@city.suffolk.va.us

Maureen Daniels, CPPO CPPB VCO - 804-786-0266 - maureen.daniels@dgs.virginia.gov

Lynn Enders, VCO - 804-367-0268 - lynn.enders@dmv.virginia.gov

diVersity CoMMitteeBy Marvis W. Marshall, CPPBDiversity Committee Chair

suPPLier diVersity ProGrAM Vs. strAteGy - WhiCh do you WAnt for your orGAnizAtion?Are you creating or managing a supplier diversity program or implementing a strategy for inclusion of diverse suppliers in your organization? No, it’s not the same! “Supplier diversity” is not only about “programs,” but is more about an all-encompassing strategic approach through a comprehensive alignment of organizational processes and protocols to support sustainable behavior change related to

engaging diverse suppliers.

(Committee Reports, continued from page 5...)

(continued on page 7...)

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Virginia Association of Governmental Purchasing, Inc.

(Committee Reports, continued from page 6...)

Supplier diversity is successful when it is incorporated into the business planning process of the organization and clearly communicated, both internally and externally.

New times call for new approaches. It’s necessary to make strategic use of supplier relationships to reach supplier diversity goals. Creative solutions for supplier diversity strategy will come from our joint efforts. Please join the Diversity Committee in compiling the Supplier Diversity Tool Kit.

CreAtinG/MAnAGinG A ProGrAM

• Program is a plan under which action may be taken toward a goal.

• NOT measuring current performance on all appropriate metrics. For example, the focus is on dollar spent with diverse suppliers rather than participation from diverse suppliers.

• NOT aware of current performance vs. “world class.” Not aware of what a “world class” program entails.

• DO NOT have organizational goals for improvement on all appropriate metrics.

CreAtinG/MAnAGinG A strAteGy

• Strategy is an adaptation that serves an important function in achieving evolutionary success.

• Measuring most or all appropriate metrics with focus on total incorporation of diverse suppliers in the procurement processes.

• Benchmark current performance vs. “world class.” Use the National Minority Supplier Development Council (NMSDC) Best Practices in Minority Supplier Development Guidelines or similar documents to develop a “world class” program.

• DO have organizational goals for improvement (as part of the strategy development process).

By Greg Scearce, VCOFirst At-Large Member

When conducting a procurement, most agencies and localities should have Confidentiality and Conflict of Interest statements that

are to be signed by evaluation teams, subject matter experts and even managers. One of the roles of the procurement officer is to explain what is being signed and agreed to. Each member involved in the procurement needs to understand that by signing these types of statements there are certain things that cannot be discussed outside of the ongoing procurement.

It may be necessary to speak with participating suppliers about other matters during an ongoing procurement. While this should be avoided if possible, it is ok as long as the conversation does not include any details surrounding the current procurement. Also, having lunch with suppliers can be looked as favoritism especially if another supplier sees you with that supplier. Members also need to

divulge any interest that they have in companies that may be competing for the good or service that will be awarded.

The purpose of the procurement process is to preserve the integrity of the process and demonstrate objectivity and neutrality. This can prevent protests, the procurement being canceled or even worse, ending up in front of a judge explaining yourself.

Each procurement should have a Single Point of Contact (SPOC) as well. Team members should be instructed at the beginning of the process that if they are contacted by suppliers during any phase of the procurement that the supplier is to contact the SPOC.

Every procurement has its challenges but if all of the team members understand their roles

during the procurement, then the outcome will be a solution that will benefit all.

Confidentiality and Conflict of Interest

Page 8 - June 2012

Virginia Association of Governmental Purchasing, Inc.

Upcoming 2012 Educational Offerings

niGP seMinArs

NIGP seminars are taught by NIGP approved instructors and can assist those aspiring to achieve their CPPB and/or CPPO certifications. These are the standard training courses for entry-level to experienced purchasing professionals. Please visit www.VAGP.org for a list of all 2012 courses offered.

seMinAr titLe dAtes LoCAtion

Contracting for Public Sector Services Jun. 13-14 WWRC

Risk Management Jun. 21-22 FCPS

CPPO Prep Class Aug. 21-22 VSPC

CPPB Prep Class Aug. 23-24 VSPC

Developing & Managing RFPs in the Public Sector Sep. 19-21 VSPC

Contract Administration Sep. 26-28 FCPS

Contracting for Construction Services Oct. 2-3 Chesterfield

Effective Management of Construction Contracts Nov. 2 FCPS

Strategic Procurement Planning Nov. 14-16 Richmond

Introduction to Public Procurement Nov. 28-30 COM

LoW-fee seMinArs

Low-fee seminars are designed to offer VAGP members continuing education through courses designed to meet their particular needs. These courses are taught by instructors familiar with both the subject and Virginia Procurement Law. These courses can provide CPPO, CPPB and VCO recertification points (earn one point for a full day—eight hours of instruction time). Please visit www.VAGP.org for a list of all 2012 courses offered.

seMinAr titLe dAtes LoCAtion

Virginia Public Procurement Act Jul. 16 LW

Public Purchasing Basics Jul. 17 DMV

Public Purchasing Basics Jul. 20 COS

Public Purchasing Basics Aug. 3 COC

Competitive Sealed Bidding vs. Competitive Negotiation Aug. 10 CV

Understanding the PPI/CPI Sep. 7 COM

How to Award to the Best Vendor Sep. 14 COS

Virginia Public Procurement Act Sep. 17 HQ

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Virginia Association of Governmental Purchasing, Inc.

Page 10 - June 2012

Virginia Association of Governmental Purchasing, Inc.

By Ginger Gordon, CPPBVAGP Second At-Large Member

As a VAGP Member and serving on the VAGP Board as Second At-Large Member I can’t express enough how honored I am to be part of this Organization. Our VAGP

Board of Directors and Members are amazing! During the 2012 Spring Conference I was asked to handle the hospitality suite. The hospitality suite is where people come to meet, socialize, network, and relax after conference classes. At the 2012 Spring Conference we had two companies that sponsored the hospitality suite: The Whitlock Group and Daly Computers. I would like to send a special thank you to both companies for their contributions toward making the 2012 Spring Conference such a success. Both companies donated gifts for a hospitality suite door prize. The winners of the door prizes were Michael Bacile, Chesterfield County, who won a nice backpack donated by The Whitlock Group, and Jeffrey S. Moyer, City of Harrisonburg, who won an electronic notebook from Daly Computers. CONGRATULATIONS to you both! It was a pleasure socializing and networking with everyone including new members and long-time colleagues.

Finally, as mentioned at the 2012 Spring Conference Business Meeting, VAGP is always looking for new, exciting, dynamic, and energetic members to join the VAGP Board. An excellent way to do that is by joining the Mentor-Protégé Program. If you are interested in this program, please go to www.vagp.org/education/mentor.html or feel free to contact me at ggordon@ci.manassas.va.us.

hospitality

By Jan Giffin, CPPO, CPPB, VCOVAGP Treasurer

What do you think of when you see or hear the words “documentation”, “compliance”, or “written determination”? In the purchasing profession these are

terms we hear and work with on a regular basis. These words imply that an action or set of actions has taken place. Some people might see these as a requirement of policy or procedure. Others might use these as tools to get organized.

Look at these words as tools or an incentive to maintain complete documentation for your procurement records.

Maintain a chronology of events. Maintain records of who said what or who did what. Track project milestones or contract administration. Track performance and payment data. By keeping complete and organized records you can routinely review your procurement records to verify that all steps have been completed.

However you look at it, the goal should be compliance all the way around. So get to work: Document, Document, Document!

Promoting Compliance

(above) Mike Bacile, Mentor, with his Protégé, Michelle Glass, in the hospitality suite.

(below) Jeff Moyer receiving his door prize!

Page 11 - June 2012

Virginia Association of Governmental Purchasing, Inc.

By Kathy S. Elgin, CPPO, CPPBNIGP Director, Region 4

The NIGP Board of Directors met in Seattle, WA, for the 2012 Spring Board meeting. What an interesting city. Hopefully you know that this is the site of

the 2012 NIGP Forum. If you have the opportunity to attend the Forum, just DO IT! I promise you won’t be disappointed!

The business of the Institute began on April 18, 2012 with a networking session with the NIGP Business Council. Look for a separate article in this issue of News & Views that highlights that meeting. The meetings continued through April 20, 2012, culminating with the official Board meeting where we voted on some very significant issues.

Below are just a few of the highlights of the meetings.

AdoPted the fy13 BudGet

Goals 1. Alignment of resources w Boards Strategic Plan 2. Net income of $100K 3. No growth in revenues 4. Revenue cost centers at net surplus 5. 2$ COLA

Issues 1. Consultancy Program 2. Building HVAC/Future development plans in Herndon.

Fees Change in membership structure – marketed to members 7/1/11 $30 increase in Forum registrations fees effective for 2012 Reduction to webinar fees for members; increase for non-members

TotalBudget: $5,044,578

eLeCted the next 3rd VPDeWight Dopslauf

reneWed Ceo ContrACt Rick Grimm, CEO, has served NIGP as its fifth CEO since 1998. The Board voted unanimously for the Executive Committee to continue work on a multi-year contract extension.

utiLized VArious ProGrAM AssessMent tooL The Institute is utilizing several different program assessment tools to evaluate the effectiveness and

efficiencies of various NIGP offerings. The Consultancy Program was the first to be evaluated. It was clear that we should not continue with the program in its current structure. A task force is being assigned by President Creed and 1st Vice President Bobbi Matthews to evaluate the options and to bring forward several different business models.

The next program sector slated for evaluation is the Face to Face Educational Programs which include: Chapter Hosted Seminars, Contract Training, Co-Sponsored and National Seminars.

uPdAted strAteGiC initiAtiVes

e-Learning More classes continue to be rolled out; all have been full; new e-tools approved in budget should improve the e-learning experience

GuidingPrinciples The 1st 10 Standards of practice are officially complete. See the FINAL PRACTICES at http://principlesandpractices.posterous.com/ Twenty more expected by June 30, 2012. Be part of the collaborative process – sign up to be on the review and comment team.

CiPs/niGP PArtnershiP On August 18, 2011, the announcement that the Chartered Institute of Purchases and Supply (CIPS) and NIGP had joined into a partnership to develop their work for the public sector procurement and the public good. The partnership has already had a tremendous effect on the number of organizations worldwide that have accepted, understand and are supporting the Values and Guiding Principles and Standards of Practice initiative. Over 106 Countries flags have been counted as viewing these documents.

PuBLiC ProCureMent MAturity frAMeWorK This framework will be a core foundational element toward the advancement of the procurement profession. It will identify the specific skill sets that a person needs to be successful at various levels in procurement. The 1st paper on this initiative that defines common procurement language has been published and was presented at the International Purchasing and Supply Education and Research Association (IPSERA) Conference by Guy Callender, Catherine Pardoe and Trevor Nongwa.

niGP region 4 update

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Virginia Association of Governmental Purchasing, Inc.

By Kathy S. Elgin, CPPO, CPPBNIGP Director, Region 4

niGP Business CounCiLThe Mission of the Business Council is to: “Serve the NIGP membership and purchasing profession through the

sharing of resources and expertise in support of NIGP’s educational, research and advocacy mission.”

The NIGP Business Council is the coming together of private sector corporations in support of the public procurement profession to provide this professional community a resource for market intelligence and business’ best practice. Through interactive participation with the NIGP Board and membership, public procurement professionals gain access to a substantially expanded base of information. With this market intelligence as a reference, purchasing officials can anticipate and better prepare for the market conditions that will impact their agencies and their communities. Current corporate members on the NIGP Business Council are: Canon Business Solutions, GovDeals, Graybar, Office Depot, Periscope Holdings, The Toro Company and U.S. Communities.1

I have to admit that when this council was first created, I did not see a need, nor could I envision any value. However, over the last eighteen to twenty-four months, I have grown to realize and truly appreciate the tremendous value of this council. At the April 2012 Board Meeting, we spent three plus hours with the Business Council discussing the latest global trends and various “hot” procurement topics. Following are some of the highlights.

GLoBAL trends/MAndAtesDid you know that the EPA tier 4 standards are a requirement by 2014? I didn’t even know there was a new requirement. What is Tier-4? Tier-4 refers to a generation of federal air emissions standards established by the U.S. Environmental Protection Agency (EPA) that apply to new diesel engines used in off-road equipment. Essentially it requires manufacturers to reduce the levels of particulate matter and oxides of nitrogen (NOx) to a level that is 50-96 percent lower than existing generation of diesel engines. It is important to note that Tier-4 emissions requirements apply to new products only and do not apply retroactively to any existing machines or equipment.2

What do you know about the new light bulb standards that went into effect on January 1, 2012? What about the bulbs being discontinued by 2014? The Graybar representative

tweaked my interest enough for me do a little more research. I would encourage you to visit the Consumer Federation of America’s website and view the tip sheet under Energy under the Consumer Information page: www.consumerfed.org. You will find great information for your homes and your agencies.

We heard from the Cannon Representative, that copier prices are expected to increase 2-5% globally within the next year. The representative from Caterpillar indicated that primarily due to the Tier 4 mandate, heavy equipment prices are expected to increase 5-12%. From the revenue side, GovDeals has seen and predicts continued upswings in the sale of government property. Volume and prices of surplus property are both on the rise. Several of the representatives indicated that there seems to be a surge of governments moving beyond using pcard and using EFT. Most of the Council Members reported that approval of procurements seems to be requiring a higher level of authority. The Office Depot representative talked about the trend they are seeing of governments outsourcing their traditional print shops.

hot toPiCsCooperativeProcurementOrganizations. The NIGP Board brought up many of the same topics that have plastered our list serves lately such as, “Is XYZ Cooperative usable by my agency?” “Was the contract awarded after competitive principles or is it simply a negotiated pricing list?” “Is XYZ Cooperative a “public body?”, “Who is the lead agency?” “If a supplier is on multiple cooperative contracts, how can I determine which is best?”

The Business Council offered a bit of advice. As the leading authority in public procurement, NIGP should issue the standard on how cooperatives should be set up. NIGP should document the standard procedures that a buyer should follow to evaluate the cooperative organization and the resulting contracts. In the end, all agreed that cooperative contracts are another tool in our tool box. Nothing takes the place of our due diligence.

LocalPreferences.This was another interesting discussion. While the NIGP position on preferences continues to be that it is opposed to all types of preference laws and practices and views it as an impediment to cost effective procurement of goods, services and construction in a free enterprise system, discussion ensued on the need to be able to quantify the effect of having or not having local preferences. For example, “How does an increase of product or service cost compare to the economic gain of

NIGP Business Council

Page 13 - June 2012

Virginia Association of Governmental Purchasing, Inc.

By Stephanie Suter, CPPBVAGP Secretary

If you are planning to attend the 2012 NIGP Forum in Seattle, why not take the opportunity to volunteer? NIGP has placed a call for volunteers to serve on

the Quality Control Team (QCT), and it would be great to have Virginia attendees help out! There are many different ways you can assist, and they are willing to accommodate your schedule.

If you saw The Avengers and feel a sudden urge to keep the world from harm, put on your safety vest (NIGP will provide) and serve as a hall monitor, keeping Forum attendees moving in the right direction. If social gatherings and party planning are more your speed, you can volunteer to help set up for meals and social events. Since you will already be attending the educational sessions, why not take a few minutes to help

post signs, introduce speakers, distribute speaker gifts, or check A/V equipment? You still get to go to all of the sessions you prefer, but serving on the QCT gets you involved and

provides another opportunity to meet many colleagues from around the globe.

Whether you want to help a little or help a lot, the QCT has a spot for you. You do have to take a minute to fill out the QCT Volunteer Form, but that is just to make sure they put you where you want to be. If you have specific questions regarding volunteer opportunities during the NIGP Forum,

please contact Faye Jackson, NIGP Events Administrator, at 1-800-367-6447 (x 276) or fjackson@nigp.org. Hope to see many of you at the the 67th NIGP Annual Forum & Products Exposition in Seattle, Washington, August 18–22, 2012!

Going to seattle?

By Mary Pennington, CPPBPublic Relations Committee Member

This summer in our new ongoing series, we meet Lynn Enders, VCA, VCO, Procurement Specialist Senior, DMV, Richmond, VA.

Years in Procurement: 4+Years as a VAGP Member: 4+

Lynn began her career in Procurement in 2008 when she started as a full time Administrative Office Assistant III at Germanna Community College. She was reclassified to Procurement officer I with VCA/VCO certification in which she obtained her VCA in 2008 and her VCO in 2009. Lynn currently works for the Department of Motor Vehicles as a Procurement Specialist Senior in Richmond, VA. She will be sitting for her CPPB Certification in October 2012. She has a BA in Design from American University and AAS in Interior Design from Northern Virginia Community College.

Lynn is responsible for a wide range of procurements for her organization. She handles IT procurement, Facilities Services Contracts, Conferences/Hotel Requirements, Telephone Wiring and Data Cabling, Median and Design Services and

Printing Equipment. Lynn invites any VAGP member who has questions about working with these commodities to contact her at lynn.enders@dmv.virginia.gov.

Lynn has been married for 25 years and has 5 beautiful children and 3 grandchildren and one more on the way. Lynn is a Washington, DC native and grew up in Maryland. She enjoys studying the Bible, playing cards, watching her daughter’s Lacrosse games and cooking comfort foods. If you would like to recommend a VAGP member to appear in the next News & Views publication please contact mpennington@fairfaxwater.org.

Members in Motion!

Lynn enders, VCA, VCo

Page 14 - June 2012

Virginia Association of Governmental Purchasing, Inc.

By Doug Chester, VCOPublic Relations Committee Member

CAn you nAMe this VirGiniA LAndMArK?

This Virginia location is 4,000,000 centuries in the making and is said to be one of the world’s most spectacular natural wonders. It

has drawn many visitors since its discovery in 1878 by five local men whose attention had been attracted by a protruding limestone outcrop and a nearby sinkhole with cool air issuing from it. The men started to dig, and about four hours later a hole was created for the smallest men to enter through, slide down a rope, and explore by candlelight.

It has been featured on hundreds of travel shows, television programs, motion pictures, and news stories. It has also been the location of many weddings due to the uniqueness of the venue. Tours are given daily. Can you guess this Virginia Landmark? Post your guess on VAGP’s Facebook page; the first one to guess correctly wins a VAGP prize!

Send your suggestion for another Virginia landmark to feature in the News & Views to smith2lb@jmu.edu.

Where is it? MAKe A Guess...

Win A Prize!

new or the sustainment of jobs, taxes, etc.?” Do you have a cost benefit analysis? Please share.

Certain types of preferences were more tolerable with the Business Council than others. Tie bids being awarded to the local supplier seemed reasonable. Recycle product preferences seemed fair. However, the reciprocal or matching preferences seemed to cause problems for the business community. Several indicated they would not even consider submitting their bids if a reciprocal or matching preference was in place. Taking away or cutting into an already barebones profit margin was not acceptable.

In summary, I must say that this was one of the most valuable three plus hours I have spent with the Business Council so far. If you have the opportunity to visit with a Business Council representative ask them about what trends they see in the market place or what innovations are heading your way. They are a valuable resource!

1 “NIGP Business Council”, http://www.nigp.org/ (accessed 04-26-2012)2 2011 Associated Equipment Distributors. “Clean Diesel Technology for off-road engines and equipment: tier-r and more”, http;://cedmag.com (accessed 04-26-2012)

Page 15 - June 2012

Virginia Association of Governmental Purchasing, Inc.

By Bill Lindsey, CPPO, C.P.M.VAGP President-Elect

Fresh from my attendance at our March Spring Conference in Williamsburg, I received a call from Fred Marks discussing the possibility of teaming up to conduct

a future class dealing with Time and Materials contracting. Astute as ever, Fred was interested in some of the discussion that occurred in the ‘Hot Topics’ session at the conference concerning time and materials contracting.

As I discussed this further with Fred, I came to the conclusion that our conversation was centering on the ‘unknowns’ of time and materials contracting, which coincidently was where the discussion went in the ‘Hot Topics’ session. Obviously, as purveyors of good purchasing practices, we can never preside over any function that contains unknowns; right?

Well, maybe not; but if we choose a purchasing technique like time and materials contracting that some may purport to inherently contain a higher degree of risk, it is imperative that we try to mitigate those unknowns or do what purchasing professionals do best. That, of course, is to build the appropriate controls to manage these risks.

As for time and materials contracting, I have heard some of my colleagues comment that such a contracting method invites trouble and they would never use it. I disagree with such statements and find this contracting method to be a good tool in our tool bag. But, that’s under the condition that we use our professional training to accurately describe the appropriate management controls in the contract. First of all, let’s take a look at time and materials contracting. Simply stated, it is generally seen to be a cost contract that includes a fully loaded labor rate that is charged for every hour a worker performs any labor under the contracted services. Although that’s the ‘time’ part of the contract, what about the ‘material’? The material is the full and complete cost of the various items, goods, or ‘stuff’ used and billed by the contractor to accomplish the objective of the work. The trick here is that the cost of the materials must be limited to the actual cost the Contractor paid for the materials. Therefore to summarize what we are doing with a time and materials contract, you are establishing an agreement or a pricing arrangement for work that cannot be defined very well

in advance or for work that may contain unknown needs or conditions. So, you need to recognize that you are going into such agreements with the realization that the ‘unknown’ will occur.

Getting back to my conversation with Fred, he kept peppering me with questions regarding time and materials contracts and I kept coming back to saying the my goal in such a contract was to obviously get the work done, but most important of all, was to control the cost. Fred immediately remarked, “Well, there’s your training class!”

The more that I have thought about it since our conversation, the more that I understand that the ‘unknowns’ of a time and materials contract is precisely the control of cost. What can be done to establish a proper control of time and materials contracts? One of the best methods as it relates to cost is to include some sort of ceiling or maximum dollar figure in your contract that establishes a limit as to how much spending authority is available for the work. But, I think that you can be successful with time and materials contracts by taking more time to better describe what you want done. For example, the last time I used a time and materials contract was when my County was hammered by tornadoes resulting in the loss of one of our middle schools and a tremendous amount of vegetative and structure damage. Believe it or not, I found the demolition services related to the school to be relatively simple because I knew a lot about the school and could describe the services needed. However, the debris pickup over a wide area was a

different story. As anyone would know that has developed debris pickup contracts, the key is in describing the total square or cubic yards of material that could be expected to be collected. Well, when quite a bit of this material has been spun up in trees and distributed over miles, your ability to identify the quantities is pretty tough. But we did find another method by visiting the damaged area with a Contractor and literally pointing to the materials and saying that we wanted that to go away. In addition, we mutually agreed that the work would need to be completed at a maximum cost identified for each work task. We were always very quick to encourage the Contactor to use the time and materials rate to offer us any savings, but we also clearly identified that the reward for this type of behavior would be to receive additional work until the total project funding was exhausted. We coupled this with a very shrewd and seasoned contract administrator for the

Purchasing Unknowns: Time and Materials Contracts

You need to

recognize that you

are going into such

agreements with the

realization that the

‘unknown’ will occur.

(continued on page 16...)

Page 16 - June 2012

Virginia Association of Governmental Purchasing, Inc.

We want your news...and views!This is your Association and your publication—make your voice heard! All VAGP members are encouraged to send articles, press releases and photos. Published articles on purchasing-related topics may help members earn recertification points. For eligibility requirements, please verify directly with the certifying agency.

Submit articles to LeeAnne Beatty Smith at smith2lb@jmu.edu.

2012 PRODuCTION SCHEDuLE 2nd Quarter 3rd Quarter 4th QuarterMaterials Deadline May 7 Aug. 6 Nov. 5Issue Available Jun. 1 Sep. 4 Dec. 1

9 Industry News 9 Best Practices 9 Photos 9 Book Reviews 9 Education Opportunities 9 Event Recaps

9 New Certifications 9 Tips and tricks

County that had managed time and materials contracts in the past which was very beneficial. Not only did the procurement method pay off, but we certainly managed the ‘unknown’.

Undoubtedly, I’m sure there are other stories out there that could paint quite a different picture regarding the unknowns of time and materials contracting. And yes, I shudder to recall a routine maintenance job that I had contracted a number of years ago for ferry boat repairs that unfurled like an onion peel. Looking back, certainly the risk of conducting this work on a time and materials basis could have been managed better, but I simply did not know who to discuss it with because it was so specialized.

This doesn’t have to happen to you because through your networking relationship with VAGP members, you have unfathomable resources and knowledge out there that you can assist you in tackling about any complex procurement challenge. It may sound corny, but through these associations, you have a better chance to turn the ‘unknowns’ into ‘knowns’.

Stay tuned, you may be seeing a Fred and Bill class at a future conference. Please let me know if you have any questions or if I may ever be of assistance to you in the future.

(Purchasing Unknowns, continued from page 15...)

Page 17 - June 2012

Virginia Association of Governmental Purchasing, Inc.

VAGP Spring Conference Photo Review

see More eVent Photos on VAGP’s fACeBooK PAGe!