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HomeMy Public PortalAboutPurchasing and Sales PolicyCOUNCIL Page 1 of 15 POLICY Effective Date: August 27, 2012 Amended: January 22, 2018 April 25, 2022 Section: Finance Title: Purchasing and Sales Policy POLICY STATEMENT Amended A pril 25, 2022 This document defines the general purchasing and tendering policies for the Town of Oliver in compliance with MUSH (municipalities, universities, schools and hospitals) sector thresholds, the Community Charter, Local Government Act and other relevant legislation. City staff involved in the procurement of goods and/or services on behalf of the City must comply with the guidelines set out in this policy. 1.0 PURPOSE The purpose of this policy is to identify the principles guiding the procurement of goods, services and construction of assets required by the Town of Oliver (Town) in the performance of the duties and responsibilities assigned to it. In achieving the maximum economy, efficiency and effectiveness in the performance of this function, the Town has endorsed certain fundamental principles which are applicable to all Departments. 2.0 PURCHASING PRINCIPLES 2.1 Procure the necessary quality and quantity of goods and services in an efficient, timely, cost-effective manner, while maintaining the controls necessary for a public institution. 2.2 Encourage an open and transparent process for the acquisition and disposal of goods and services. 2.3 Ensure the maximum value is obtained regarding acquisition of products and services by determining the full cost over the lifetime of the product or service. 2.4 Procure goods and services giving due consideration to the Town’s commitment to encourage the use of environmentally friendly products and services as well as local suppliers. 2.5 Ensure that the guidelines set out in the Code of Conduct as identified in this policy are adhered to. 2.6 Ensure the maximum value is gained when disposing of surplus goods and that they are sold in a transparent and publicly acceptable manner. 2.7 Ensure compliance with Town policies and bylaws, the Community Charter and all other Provincial and National laws and regulations that apply to the procurement of goods, services and construction. 2.8 Ensure that purchasing policies and practices support the direction of the Town and are in compliance with policy established by Council. Purchasing and Sales Policy Page 2 of 15 3.0 RESPONSIBILITIES 3.1 Town Council shall approve any amendments to this policy. Amended A pril 25, 2022 3.2 The CAO will support the implementation of this policy and recommend any amendments. The CAO will ensure compliance with this policy. 3.3 The Department of Finance will administer the Purchasing and Sales Policy to ensure that goods and services are acquired and disposed of in accordance with this policy. 3.4 The Town operates on a decentralized purchasing model. It is the responsibility of department managers to ensure their department’s purchasing practices are in conformance with the Town’s purchasing policy and procedures. All invoices and purchase orders must be approved by department managers or, within established spending limits, by their designate. The Chief Financial Officer must be advised, in writing, of the departmental designate along with a sample signature. 3.5 Department Managers are responsible for ensuring budgeted funds are available in duly authorized accounts before making commitments for goods and services. 4.0 PROHIBITIONS 4.1 Include: 4.1.1 Purchase by the Town of goods and services for personal use by or on behalf of any member of the Town Council, appointed officers, employees or their immediate families. 4.1.2 Purchase by the Town of goods and services from any member of its Council, appointed officers, employees or their immediate families or from any other source that would result in a conflict of interest unless the purchase is disclosed and participation discontinued in accordance with the Community Charter. Amended January 22, 2018 4.1.3 The purchase of any Town goods by a member of its Council, appointed officers, employees or their immediate families, unless it is goods the Town is selling for profit or is available to the general public. 4.2 Exclude: 4.2.1 Purchases through the Employee/Council Electronic Device Purchase Program. 5.0 CODE OF CONDUCT 5.1 Those employees who have been delegated authority to commit Town funds and those employees responsible for corporate assets will abide by the Code of Conduct as it applies to their duties performed for the Town. 5.2 Employees of the Town will not use their authority or office for personal gain and will seek to uphold and enhance the standing and image of the Town. Page 3 of 15 Purchasing and Sales Policy 6.0 INSURANCE 6.1 To assist in protecting the Town against losses, all contractors providing services to the Town are required to obtain and maintain insurance for a specified amount and duration indicated during the procurement process. Insurance must be obtained from an insurance company duly registered, licensed and approved to conduct insurance business in the Province of British Columbia and be no lower than $2,000,000 (two million dollars). Contractors must also indicate whether they carry Worker’s Compensation Board coverage. 7.0 WORKER'S COMPENSATION 7.1 Contractors shall be deemed to be the Principal Contractors within the meaning of the Worker's Compensation Council ("WCB") Industrial Health and Safety Regulations for the Province of British Columbia and must comply with WCB Health & Safety Regulations and all other WCB regulations that apply to the works. 8.0 RIGHT TO REJECT BID DUE TO LITIGATION OR NON-COMPLIANCE WITH ZONING BYLAWS 8.1 Without limiting the foregoing, the Town may, in its absolute discretion, reject any tender or proposal submitted by a proponent if: 8.1.1 the Tenderer or any officer or director of the Tenderer is or has been engaged either directly or indirectly through another corporation in a legal action against the Town or its elected or appointed officers or employees in relation to: (i) any other contract for works or services; or (ii) any matter arising from the Town’s exercise of its powers, duties or functions under the Community Charter or another enactment, within five years of the date of the invitation to tender; or 8.1.2 the use of any real property owned or occupied by the Tenderer, located in the Town of Oliver and used by the Tenderer in connection with the performance of the Contract, including use as an office, as storage or as a works yard, is not a permitted use of that property as established by the Town’s Zoning Bylaw or any covenant in favour of the Town, unless such use constitutes a legal non-conforming use. Page 4 of 15 Purchasing and Sales Policy 9.0 PURCHASING AUTHORITY AND APPROVAL LIMITS 9.1 Only those persons delegated authority are authorized to commit the Town for materials, equipment, supplies and services as authorized by the annual budget. Amended April 25, 2022 9.2 The CAO, Departmental Managers and/or their delegate are given authority to execute purchase orders for materials, equipment, supplies and services in accordance with the following criteria: 9.2.1 Items and/or services are included in the annual budget. Items and/or services that are supplemental to the budget but do not create a budget deficit for the department. Any transfer of funds between accounts within a specific function must be approved as a budget amendment by Council in the form of a resolution. 9.2.2 Accepted supplier is the lowest qualified bidder meeting requirements and/or specifications, or in the case of an RFP, the recommended proposal receives the highest criteria score, as set out in Schedule A of this policy. 9.3 Council approval is required for all purchases which exceed the budgeted amount of the department. Council approval is also required for those tenders where the accepted supplier is not the lowest qualified bidder meeting specifications or requirements. 9.4 Authority Limits for Town Staff: Amended April 25, 2022 Purchases Authority Council (Formal Resolution) over $100,000 Chief Administrative Officer or designate (countersignature of CFO & Department Head up to $100,000 Chief Financial Officer (“CFO”) (countersignature of Department Head required) up to $75,000 Managers/Department Head designate (countersignature of up to $75,000 Other staff (with approval of the supervisor) up to $5,000 9.5 Purchases Exempt From Purchase Orders 9.5.1 Costs related to court actions or damage claims 9.5.2 Subscriptions, publications, dues and fees 9.5.3 Utility accounts 9.5.4 Insurance premiums 9.5.5 Salaries, wages and benefits 9.5.6 Grant in aid payments 9.5.7 Clerical purchases under $100, Manager’s approval on invoice is sufficient (public works department must always use purchase orders) 9.5.8 Travel expenses, which require submission of expense form 9.5.9 Requests for additions to the list of exempt purchases must be forwarded to the Chief Financial Officer for approval Page 5 of 15 Purchasing and Sales Policy 10.0 PURCHASING PROTOCOL – Quotes, Tenders, RFPs, and Change Orders Amended A pril 25, 2022 10.1 Where goods and services to be purchased are contained in a current budget approved by Council, the general practice to be followed shall be: Estimated Purchase Value Actions Required Below $10,000 May be done without quotations. Every effort should be made to obtain the best value for the goods and services. From $10,000 to $30,000 Requires informal written quotations preferably solicited from at least three suppliers / sources From $30,000 to $75,000 Requires solicitation of formal written quotations from a minimum of three suppliers Over $75,000 Requires formal procurement process to be undertaken (i.e. Request for Proposals or Invitation to Amended A pril 25, 2022 10.1.1 Expenditures below $10,000 may be done without quotations. Every effort should be made to obtain the best value for goods and services. : Amended A pril 25, 2022 10.1.2 Expenditures from $10,000 to $$30,000: (i) Attempt to obtain at least three (3) written offers from suppliers; and (ii) Department Managers shall issue a purchase order to the successful supplier and, if applicable, require the supplier to enter into a written agreement with the Town. Amended A pril 25, 2022 10.1.3 Expenditures over $30,000 but not exceeding $75,000: (i) Best effort to obtain at least three (3) written offers from suppliers which must be documented; and (ii) In the event that fewer than three (3) suppliers respond by deadline, that the Department Manager has the authority to proceed with award of contract; and (iii) The applicable Department Manager shall make a recommendation for the CAO’s approval; and (iv) If approved by the CAO, the Department Manager shall issue a purchase order to the successful supplier and, if applicable, require the supplier to enter into a written agreement with the Town. Amended A pril 25, 2022 10.1.4 Expenditures over $75,000: (i) Invite and accept only sealed tenders or RFPs from potential suppliers and:  Publicly receive and open all tenders and initial the tenders when they are opened; or,  Initial the RFPs upon opening (Proposals are not subject to public openings); (ii) The Department Manager shall make a recommendation for the CAO consideration, who in turn will forward the recommendation to Council for consideration and approval; and, (iii) If approved by Council, the Department Manager shall issue a purchase order to the successful supplier and, if applicable, require the supplier to enter into a written agreement with the Town. Page 6 of 15 Purchasing and Sales Policy 10.2 A written agreement between a supplier and the Town is required under this section in the following circumstances: 10.2.1 if requested by the supplier; 10.2.2 for contracts that exceed a value of $50,000 10.2.3 if a RFP and subsequent successful proposal do not contain sufficient elements, such as specifications, conditions, warranties, or indemnities, to constitute a satisfactory contract for either party; 10.2.4 if there is already a contract between the Town and the supplier, but there are changes to that contract for the particular expenditure. 11.0 PURCHASING PROTOCOL – HIRING PROFESSIONALS 11.1 This section shall apply when purchasing professional or technical consulting services related to the following general types of disciplines: 11.1.1 Engineering and land use planning services 11.1.2 Architectural services 11.1.3 Law and Negotiating services 11.1.4 Computer services 11.1.5 Financial services 11.1.6 Management services 11.2 For the services noted in Subsection 11.1 of this policy, the primary consideration shall be technical proficiency of the firm or individual providing the service. Close consideration shall be given to the supplier’s record of service with the Town and with other municipalities. 11.3 The following protocol will govern the hiring of professional consultants for Non-Recurring projects or specialized work (e.g. building design, canal rehabilitation, contaminated site clean-up, etc.): Amended A pril 25, 2022 11.3.1 Competent consultants will be invited to submit proposals to the Town. These submissions shall follow section 13.0 of this Purchasing and Sales Policy. The CAO shall determine whether these invitations are sent only to selected firms or are advertised to the general public. This decision shall be based on the degree of expertise required for the particular project. 11.3.2 Selection of successful proponents shall be based on a wide range of factors including relevant experience, completeness of the proposal, proven reliability of the proponent, projected completion dates as well as overall price. The primary selection tool will not be price; it will be value. 11.4 The following protocol will govern the hiring of professional consultants for ongoing professional services where continuity of knowledge is deemed imperative: Amended April 25, 2022 11.4.1 Competent consultants will be invited to submit proposals to the Town. These submissions shall follow section 13.0 of this Purchasing and Sales Policy. The CAO shall determine whether these invitations are sent only to selected firms or are advertised to the general public. This decision shall be based on the degree of expertise required for the particular project. 11.4.2 Selection of successful proponents shall be based on a wide range of Page 7 of 15 Purchasing and Sales Policy factors including relevant experience, completeness of the proposal, proven reliability of the proponent, projected completion dates, overall price as well as ongoing availability for service. The primary selection tool will not be price; it will be value. Amended A pril 25, 2022 11.4.3 Changes which require a new consultant to re-learn the operation of utility systems or the legal history of the Town will be avoided where possible. In effect, the Town’s relationship with some professional consultants providing ongoing services shall parallel the relationships established with staff professionals in larger municipal corporations. The role of these consulting professionals will be similar to the roles set out for city engineers, city solicitors, etc. in larger municipalities. Every five years Department Manager’s should compare Town consultant rates with rates charged to similar size municipalities, for like services, to ensure rates charged to the Town are competitive. Amended A pril 25, 2022 11.4.4 Department Manager’s should annually review the overall quality of services being provided to ensure a level of competitiveness still exists and in rare occasions, if necessary, with the approval of the CAO, re-tender the services. 12.0 GENERAL TENDERING GUIDELINES 12.1 Department Managers are responsible for the preparation of the tender instructions, conditions, specifications, and pricing formula. 12.2 Notwithstanding 12.1, Department Managers may delegate preparation of tender packages to consultants subject to budget availability. 12.3 Procedures for receiving and opening tenders shall conform to the following: 12.3.1 Tenders enclosed in sealed envelopes will be received at the tender address until tender closing time; 12.3.2 All tenders will be recorded as to the date and time received at the front counter who will file the tender in the vault until tenders are opened; 12.3.3 Two staff members should proceed with the tender opening at precisely the designated time on the closing day; 12.3.4 Tender envelopes should be opened and each tender shall be checked to ensure that it is signed and valid. 12.3.5 Individual tenders should be read to the interested public. No special order exists in which to read tenders. 12.3.6 Where only one tender is received, the Town reserves the right to not make the amount of the tender public at the tender opening. The amount of the tender will be made public if a contract is awarded. 13.0 GENERAL RFP GUIDELINES 13.1 The applicable department is responsible to prepare the necessary RFP documents. If Department Managers deem it appropriate, RFP processes can be preceded by a Request for Expression of Interest (RFEI) to gauge interest and prequalification, whereupon only a limited number of proponents are invited to submit proposals. Page 8 of 15 Purchasing and Sales Policy 13.2 The RFP should define the nature of the goods and/or services to be provided, how they are expected to be used and/or problems they are expected to address. 13.3 If mandatory requirements are necessary, they should be kept to a minimum and must be carefully worded so as not to eliminate a vendor with an otherwise good proposal. 13.4 RFP’s must be prepared in a manner that avoids creation of a “Contract A” that would restrict the Town in making its selection of a successful proponent. Such a structure will typically result in the proponent retaining the right to withdraw their proposal without penalty. 13.5 The criteria to be used in the evaluation of proposals are outlined in Schedule A attached to this policy. 13.6 Potential proponents should be allowed sufficient time to prepare a good response. 13.7 The applicable department should receive all proposals for evaluation. Proposals should be treated as confidential documents. 13.8 Requests for Proposals (RFP;s) shall be reviewed by an Evaluation Team which shall consist of at least two staff members. 13.9 Each Evaluation Team member shall complete the RFP Evaluation Form for each proposal as outlined in the attached Schedule A. 13.10 Upon completion of Step 2 of Schedule A, the Evaluation Team shall determine, by consensus, the score for each proposal and shall forward these scores to Council for its consideration to select the successful proponent. 14.0 TENDERS/RFPs THAT EXCEED THE BUDGET 14.1 Where a tender or RFP exceeds its budget, the applicable Department Manager must take one of the following actions: 14.1.1 Recommend rejection of all Tenders or Proposals and re-tender; or Amended A pril 25, 2022 14.1.2 With the CAO, jointly recommend that Council approve a transfer of extra funding from other line items included in a budget approved by Council or from reserves in order to accept the tender or proposal. 15.0 BONDING REQUIREMENTS 15.1 Contractors shall provide the specified surety bonds or certified cheques or irrevocable letter of credit to the Town of Oliver. 15.2 A Bid Bond is to accompany Tenders and RFP’s. Page 9 of 15 Purchasing and Sales Policy 15.3 Performance and/or Labour and Material Bond is to be delivered to the Town within ten (10) days of the date of notice on contract award. 15.4 The following chart outlines contract types as well as preferred Bond types: Amended A pril 25, 2022 Contract Type Bid Bond or Cash Equivalent Performance Bond Labour & Material Payment Bond Construction, maintenance, or service contracts under $100,000 Nil Nil Nil Construction contracts for structural or miscellaneous work over $100,000 & up to $250,000 10% Nil Nil Construction contracts over $250,000 10% 50% Surety Bond 50% Construction contracts for other than standard structural work including underground work; or unusual or high risk work on all types of contracts 10% 50% 50% Maintenance or service contracts over $75,000 per year. If contract is for more than one year, bid bond is based on first 12 months cost 10% At discretion of CAO and/or Department Manager At discretion of CAO and/or Department Manager Amended A pril 25, 2022 15.5 The above table is a guideline only. Depending on the anticipated risk of non- performance bonding requirements may be increased, decreased or eliminated at the discretion of the Department Manager or CAO. 16.0 SINGLE-SOURCE PURCHASES 16.1 A Department Manager may make purchases without inviting offers from suppliers if: 16.1.1 there exists only a single supplier from whom the purchase can be made; 16.1.2 the circumstances in which the purchase is required are extraordinary; or, 16.1.3 the circumstances in which the purchase is required involve an emergency, which refers to an unexpected event that requires prompt action. 16.2 A purchase made under Subsection 16.1.1 and 16.1.2 requires the approval of: Amended A pril 25, 2022 16.2.1 the CAO for purchases not exceeding $100,000; or, 16.2.2 the Town Council for purchases exceeding $100,000. Amended A pril 25, 2022 16.3 The CAO or designate is authorized to proceed with any purchase made under Subsection 16.1.3 without soliciting proposals or tenders. Page 10 of 15 Purchasing and Sales Policy 17 IDENTICAL TENDER OR QUOTATION PRICES 17.2 Where the total price of two or more tenders or quotations are the same, awards shall be made first to firms located in the Town of Oliver, second to firms located in British Columbia, and third to firms located in Canada. 18.0 PREFERENCE FOR LOCAL SUPPLIERS 18.1 The intent of this policy is to ensure the Town receives the best value possible on goods and services it procures. The Town supports local merchants by encouraging the use of local suppliers and by purchasing locally, where all things are equal. 18.2 The following priorities will be given where all things are equal, (i.e. after giving due consideration to determining overall BEST Value): 18.2.1 Firstly - Locally 18.2.2 Secondly - Within the Province 18.2.3 Thirdly - Within Canada 18.2.4 Fourthly - Outside Canada 18.3 For the purpose of this policy, “local” shall mean in the order of preference as listed below: 18.3.1 An in-town business with a local business license; or, 18.3.2 An Area “C” business with a local business license. 18.4 No percentage differences or dollar references will be given to purchasing locally as that would represent a direct grant to local suppliers; however, full consideration will be given to potential future costs or savings that may be experienced by using a local supplier. 19.0 CONFIDENTIALITY 19.1 A total bid price is public information. However, it is considered unethical as well as damaging to the Town’s position to allow unit price information from one vendor to pass to another vendor. 19.2 Access to information shall be subject to provisions of the Freedom of Information and Protection of Privacy Act. 20.0 ENVIRONMENTAL PURCHASING In addition to the principles included in section 2, the Town of Oliver supports the use of environmentally sustainable products and practices and expects staff to pursue this objective in the acquisition of goods and services for the Town. This will be accomplished by ensuring that the user departments review and modify existing specifications, and write new specifications, to include environmentally sustainable choices subject to both suitability and costs. Page 11 of 15 Purchasing and Sales Policy 20.1 General Principles 20.1.1 To specify products that do not harm the environment in their manufacture, use or disposal (third party certification such as the “Eco Logo” or “Energy Star” may be used.) 20.1.2 To consider the environmental facts along with price and performance. 20.1.3 To secure comprehensive, accurate and meaningful information about the environmental performance of products or services sufficient to determine environmental preference. 20.2 Procedures 20.2.1 Department staff (or delegate) will review and modify existing specifications and write new specifications to include options for the use of environmentally sound products and processes. 20.2.2 Environmentally preferred products must meet or exceed the same engineered standards for the traditional products with respect to performance, structural integrity, life span and safety. 20.2.3 The Town may be prepared to pay a premium (1% of budgeted cost or $250, whichever is lower) for the environmentally friendly option, within reason, but any significant impact on budgets must be appropriately approved. 20.2.4 Department staff (or delegate) will remain alert to sources of recycled materials, products made from recycled materials and other environmentally beneficial products, bringing such information to the attention of the Department Manager. 21.0 SURPLUS ASSET DISPOSAL 21.1 The Town of Oliver recognizes that assets purchased for its use will eventually become surplus to its needs. These assets are deemed surplus due to:  Obsolescence  Worn out  Too costly to maintain  No longer used Amended April 25, 2022 21.2 All surplus assets estimated to have a monetary value shall be disposed of by the Finance Department upon the CAO’s approval, in the manner which will receive the best possible return to the Town. Except for trade-ins, surplus assets valued in excess of $10,000 shall be referred to Council stating reasons for disposal. Once Council approval is received the Finance Department will dispose of the surplus assets in a manner that will receive the best possible return to the Town. 21.3 All surplus assets shall be sold on an “as is/where is” basis. No warranties or guarantees are to be offered or implied in the sale of the surplus assets. Page 12 of 15 Purchasing and Sales Policy 21.4 It is the responsibility of each Department Manager to notify the Chief Financial Officer, in writing, of surplus assets. Where applicable, the list must contain make, model and serial number. The Chief Financial Officer will provide this information to Council via the council reading file. 21.5 Prior to disposition, a list of surplus assets will be circulated to all Town departments to see if they can be of use in another department. 21.6 When deemed to be in the Town’s best interest, surplus assets will be traded in on replacements. 21.7 Proceeds from the sale of surplus assets will be credited back to the appropriate fund. 21.8 The sale of surplus assets, valued in excess of $200, to members of Council, appointed officers, employees or their immediate families is prohibited unless the assets have also been made available for the general public to purchase through a competitive bidding process. 21.9 The sale of surplus assets valued below $200 will firstly be available to members of Council, appointed officers and employees. The Chief Financial Officer will determine the value of the asset and notify members of Council, appointed officers and employees as to any interests in purchasing the asset. If more than one person expresses interest in purchasing the asset the interested parties will provide the Chief Financial Officer with a closed bid. The highest bidder will be allowed to purchase the asset. If there are no interested parties, the asset will be donated to a local charity. Page 13 of 15 Purchasing and Sales Policy SCHEDULE “A” REQUEST FOR PROPOSALS EVALUATION FORM Proponent’s Name: Project Title: Evaluation Date: Evaluator: Step 1: YES NO Mandatories Proposal received prior to closing Sub-Consultant list Project Manager identified Project Team identified – Resumes included Reference List Workers Compensation Number provided Sufficient number of proposal copies Step 2: Assigned Points Points Proponent (15-30 points) Qualifications of firm and project team members Experience of firm and project team members References Resources Proposal (30-50 points) Scope Methodology Environmental Performance Scheduling Project Team - Level of Effort Clarity of Proposal Price (20-50 points) Consideration of Price Presented Price = (lowest cost proposal divided by proposal being evaluated) x (% weight) Total Score Proponent + Proposal + Price Scores 100 [Review and add any specific items that should be in the mandatory section or Specific items for the proposal related to the project] Page 14 of 15 Purchasing and Sales Policy Evaluation Team Members shall use the following list of questions to complete the RFP Evaluation Form: Proponent Evaluation – 15 to 30 Points Total (i) Qualifications of Firm and Project Team Members: Are the firm and project team members specialized and qualified in the nature of the project work? (ii) Experience of Firm and Project Team Members: Has the firm completed similar projects during the last three years? Do the assigned project team members have experience with similar projects? (iii) Past Performance: Is the firm’s record of past performance sound? Do reference checks reveal weaknesses? Was abnormal level of monitoring required? Does the firm consistently complete assignments on time and within budget? (iv) Resources: Does the firm have ample resources (e.g. staff, equipment, etc.) to apply to this project? Proposal Evaluation – 30 to 50 Points Total (i) Scope: Do the objectives, scope, work plan, and prediction of results comply with the terms of reference and project objectives? (ii) Methodology: Is the methodology clear and in sufficient detail to cover all necessary aspects? Does the proposal reflect the required understanding of the project? Is each task clearly outlined and in logical sequence? (iii) Environmental Performance What is the environmental burden and unit cost of a product or service, from its design through to production and then final disposal? (iv) Scheduling: Does the proposal indicate that the achievement of objectives will be met according to an acceptable schedule? Are they within the timelines set by the terms of reference (if outlined in the terms of reference)? Are problems or delays accounted for? Is timing realistic for the project? (v) Project Team: Is the level of effort (total hours) adequate, low or high? Are the hours of professionals involved adequate, low or high? Is the proportion of professional vs. technical hours adequate or appropriate? (vi) Clarity of Proposal: Is the proposal clear, concise, and logical? Price Evaluation – 20 to 50 Points Total (i) Total Price Page 15 of 15 Purchasing and Sales Policy APPENDIX 1 Environmental Performance Decision Criteria Basic evaluation criteria for rationalizing the purchase of environmentally sound alternatives: (i) Does the alternative product meet or exceed the minimum required performance specifications? (e.g) durability, safety, structural integrity. (If no, use the conventional product; if yes move to (ii)). (ii) Is the unit pricing of the alternative product equal, or less than, the conventional product? (If yes purchase the alternate product; if no move to (iii)). (iii) What is the total annual cost differential of using the alternate product instead of the conventional? (If the effect on budget is nominal use the alternate product; if the effect on budget is more than nominal go to (iv)). (iv) By using the alternate product are there any offsetting benefits that can be clearly measured and recorded in cost avoidance accruing to the same Business Unit, or to other business Units and, if so, do those benefits equal or exceed the extra acquisition costs? (If yes purchase the alternate product; if no go to (v)). (v) Are there any other benefits that are not measurable in any direct monetary sense but are benefits that we ought to realize for other on-pecuniary reasons?, e.g. “green benefits” such as reduced pollution, air emissions, effluent release, recyclable & disposal issues etc. (If no, purchase the conventional product; if yes define those reasons and report them through established reporting channels to get the increased budget commitment approved. In either case go to (vi). (vi) If acquisition of the alternative product at the higher cost is approved purchase the alternate product; if not purchase the conventional product.