GUIDELINES +

SOLE SOURCE PURCHASE JUSTIFICATION

 Definition: Sole source procurement is one in which only one supplier can provide the commodity, technology and /or perform the services required.

Every order, not on State Contract, that cannot be competitively bid, and is over $2500, must be documented as a sole source.  The explanation must be maintained in the Procurement file.

The explanation must have three components:

l. Why is the item/service unique?

2. How do you know that there is only one source for this item/service?

3. The basis upon which the price/cost was determined to be fair and reasonable.

GUIDELINES FOR SUBSTANTIATING SOLE SOURCE

l. Why is the item/service unique?

  • A description of the feature(s) that make the item/service unique and why you need this uniqueness.
  • Compatibility with, or component of, an existing item; provide enough detail to demonstrate that compatibility is necessary.
  • Original manufacturer/supplier, i.e. software, license.
  • Supplier holds a service contract and must supply parts to accomplish a contract.
  • Emergency order and no other supplier available at the time.
  • Proprietary purchase, no other supplier available.

2. How do you know that there is only one source for this item/service?

  • Advertise in the Contract Reporter and receive only one response (over $50,000).
  • Requested quotations and no one else responded.
  • Google search.
  • Proprietary purchase, no other supplier available.
  • Phone calls to competitors.

3. Price Justification

  • Comparison to product catalog.
  • Comparison to similar product/service.
  • Published price lists.
  • Prices quoted are less than or equal to, that quoted to other governmental agencies.
  • Records of previously bid items that were similar.
  • Proven industry standard.

Documentation should be on departmental letterhead, signed and sent to Procurement Services with the requisition.