Procurement Methods

Generally, Title 49 CFR part 18.36(d) permits four types of procurement methods:

  1. Competitive Sealed Bids - This method is generally the preferred method for development and equipment projects utilizing federal AIP funds. It requires the preparation of complete and reasonable specifications that detail the desired work items, services, or equipment. The invitation for bids must be publicly advertised and bids solicited from an adequate number of potential bidders. All bids are to be publicly opened at a time and place prescribed in the invitation for bids. The award of contract will be based on the lowest responsive and responsible bidder. This procurement action assumes a firm fixed price contract agreement.
  2. Competitive Proposal - This method is generally used when procurement by competitive sealed bids is neither reasonable nor feasible. Projects that include significant variables and options that would prohibit the preparation of complete and concise specifications would be candidates for competitive proposals. Competitive proposals shall be publicly advertised. The solicitation shall contain all evaluation factors and their relative importance in the evaluation. Proposals must be solicited from an adequate number of qualified sources. The award is to be made to the responsible firm whose proposal is most advantageous with price and other factors considered.

    The procurement of professional services represents a unique form of competitive proposals. In conformance with the Brooks Act, procurement of professional services requires a qualifications-based selection. The qualifications of competing firms are evaluated based on prescribed criteria. Selection is based solely on a firm's qualifications with cost not being a factor.
  3. Small Purchase - This procedure is available for procurements that fall under the simplified acquisition threshold, presently set at $100,000. Application of the small purchase method should not be construed as an option to waive fair and open competition. Under small purchase procurement, price quotations must be obtained from an adequate number of qualified sources. Grantees are encouraged to adequately document all solicitations. The use of small purchase procedures for procurement of professional engineering services is not appropriate unless the expected contract threshold is less than $25,000.
  4. Procurement by Noncompetitive Proposals - As a rule, procurement actions are to be conducted in a manner that assures fair and open competition. It is possible, however, under certain circumstances that procurement under a competitive basis may not be feasible. Title 49 CFR part 18.36 allows for noncompetitive procurement actions if certain conditions exist. These include--
    • The required item is available from a single source.
    • A public exigency or emergency requires urgent procurement action.
    • After solicitation from a number of sources, competition is determined to be inadequate.
    • The FAA authorizes noncompetitive negotiations.
    Grantees must seek prior approval from FAA in order to utilize noncompetitive procurement methods for development or equipment procurements. Without prior approval, Grantees may use noncompetitive procurement methods for acquisition of professional services that do not exceed $10,000. This is typically used to prepare independent estimates, conduct legal sufficiency reviews, or perform audit services.

Procurement Competition

In accordance with Title 49 CFR part 18.36(c), all procurement transactions are to be conducted in a manner providing full and open competition. Grantees are to avoid practices that limit or restrict competition. Restrictive practices that shall be avoided include but are not limited to--

  • Incorporating unreasonable requirements
  • Requiring unnecessary experience and bonding
  • Unnecessarily use of "brand name" specifications
  • Incorporating regional preferences
  • Use of arbitrary actions in the procurement process

Description of Work or Services

The solicitation must incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured. The description shall not incorporate features that unduly restrict competition. The description should include a statement of the qualitative characteristics of the material, product, or service to be procured. All requirements that the offeror must fulfill and all other factors to be used in the evaluation of bids shall be clearly identified in solicitation. If providing a clear and accurate description of the technical requirements is impractical, a "brand name or equal" description may be incorporated. The basis for acceptance, however, will be the salient characteristics of the named brand.

Small and Minority Firms and Women's Business Enterprises

Grantees must implement affirmative steps to assure that minority firms and women's business enterprises are afforded an opportunity to participate in the project. Affirmative steps that should be considered are identified in Title 49 CFR part 18.36(e).

Cost and Price Analysis

Grantees must perform an analysis of cost or price for all procurement actions, including contract modifications. The method and degree of analysis will be dependent upon the size and complexity of the procurement action. Typically, independent estimates are to be prepared prior to receiving bids or proposals. Such estimates should be signed and dated by the preparer and retained in the Grantees records.

The Grantee is the responsible party for assuring that a fair and reasonable cost is obtained for the desired material, equipment, or service. Any review by FAA shall not be construed as a waiver of the Grantee's responsibility to make the determination of fair and reasonable cost.