Nutrition and Wellness Programs
This page is designed to provide school food authorities (SFAs) with information regarding the proper procedures to be used in the procurement of contracts for foods and goods (not meal services contracts) in the School-Based Child Nutrition Programs. Numerous references and resources are also provided.
The Code of Federal Regulations (CFR)
- Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments
- Governmentwide Debarment and Suspension (Nonprocurement) and Governmentwide Requirements for Drug-Free Workplace (Grants)
- New Restrictions on Lobbying
- Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations
For further information, refer to the following questions and answers.
General Procurement Requirements
All procurement transactions must be conducted in a manner that provides maximum open and free competition. Procurement procedures must ensure they do not foster noncompetitive practices between firms, do not create organizational conflicts of interest, and do not restrict or eliminate competition. Procurement must not place unreasonable requirements on firms, require unnecessary experience, or establish unrealistic bonding requirements. Cost plus a percentage of purchase is not an allowable system. There must be descriptions of all products purchased and identical instructions provided to all potential vendors.
Formal standards of conduct should govern the performance of officers, employees, and agents in the award and administration of contracts. These standards should provide that officers, employees, or agents should not solicit nor accept gratuities, favors, or anything of monetary value from contractors, potential contractors, or parties of sub-agreements.
Competitive Sealed Bid Requirements
Federal regulations require SFAs receiving federal assistance to competitively purchase food, supplies, equipment and services. When the aggregate amount to be purchased is in excess of $150,000, a formal procurement process must be conducted.
NOTE: For public schools only, the Illinois School Code states that all purchases, except perishable food and beverages in excess of $25,000 (or a lower amount as required by district board policy), must be competitively bid and awarded to the lowest responsible bidder. The $25,000 level refers to aggregate purchases on an annual basis.
The chart below details when formal competitive bidding must be conducted.
TYPES OF ITEMS
ANNUAL AMOUNT OF PURCHASES
|Milk or fresh dairy products||In excess of $150,000|
|Fresh bread||In excess of $150,000|
|Fresh produce||In excess of $150,000|
|General groceries||In excess of $150,000|
|Vended meals||In excess of $150,000|
|Supplies||In excess of $25,000|
|Equipment||In excess of $25,000|
The $150,000 amount is determined by examining the manner in which food has been purchased in the past. If using vendors that supply only one particular type of product, such as bread, milk, or meat, the competitive bid process must be implemented when the annual amount of purchases is in excess of $150,000 per type of product.
When multiple vendors, such as full-line vendors, supply various items such as canned, frozen, and dry goods, the total annual purchase amount for all the vendors must be added together. If this amount is in excess of $150,000 annually, the food must be competitively bid. However, if supplies, equipment, or any non-perishable food/beverage items are purchased from the full-line vendor in addition to the food/beverage items, the $25,000 threshold becomes applicable. In other words, if paper goods and/or cleaning supplies are purchased from the same vendor that supplies canned, frozen, and/or dry goods, a formal competitive sealed bid must be used if the total annual amount for all foods and items purchased is over $25,000 (instead of $150,000).
Competitive Sealed Bid Procedures
The following procurement procedures must be implemented to ensure compliance with federal and state regulations and statutes. The SFA should also seek the advice of their legal counsel regarding local regulations and policies.
- The invitation for bid, including the specifications and attachments, must define the items or services needed in order for the bidders to properly respond.
- Bids must be solicited from an adequate number of known suppliers. Bid documents must be distributed (mailed, faxed, or delivered) to a minimum of three prospective bidders.
- The procurement must be publicly advertised in at least one public notice at least ten (10) days before the bid open date in a newspaper of general circulation.
- Sealed bids are accepted.
- Bids are opened at a public bid opening and the bid contents are announced.
- The contract must be awarded to the responsible and responsive bidder whose bid, conforming to all the material terms, specifications, and conditions of the invitation for bid, is lowest in price.
- Documentation of the entire process is maintained.
Informal Bid Procedures
If the purchases do not exceed $150,000 (or $25,000) as described above, informal bid procedures may be used. The following steps should be part of the informal bid process:
- Develop a written purchase description of the services/items being solicited;
- Solicit quotes/bids from three or more potential vendors based on the purchase description; document vendor names along with the date and method of contact—be sure to maintain free and open competition;
- Record all quotes/bids received and any notification received from vendors declining to bid;
- Evaluate the quotes for conformance to the purchase description;
- Award the purchase/contract (record the justification for the award); and
- Maintain all documents on file for potential audit purposes.
Federal regulations require procurements to be conducted in a manner that allows for free and open competition. Therefore, a school food authority (SFA) cannot impose geographic restrictions on potential bidders, with one exception. Geographic preference may only be applied to the procurement of unprocessed agricultural products which are locally grown and locally raised, and that have not been cooked, seasoned, canned, or combined with any other products. De minimis handling and preparation are allowable in order to present an agricultural product to an SFA in a useable form as long as the product retains its inherent character. Handling and preservation techniques that are permissible include: cooling; refrigerating; freezing; washing; packaging (such as putting eggs in a carton); vacuum packing and bagging (such as placing vegetables in a bag); drying/dehydration; applying high water pressure or “cold pasteurization”; butchering livestock, fish and poultry; pasteurizing milk; and adjusting the size through size reduction made by peeling, chopping, cutting, slicing, dicing, grinding, and shucking.
While a geographic preference may be used to encourage the purchase of locally grown and locally raised products by enabling SFAs to grant an advantage to local growers, this provision does not eliminate the requirement for procurements to be conducted in a manner that allows for free and open competition as noted previously. In addition, while SFAs are permitted to apply a geographic preference for the procurement of locally grown and locally raised unprocessed agricultural products, SFAs are not required to do so. The SFA has the discretion to determine whether and how a geographic preference meets its needs, but must keep in mind that for all procurements, whether formal or informal, bids/quotes must be obtained from a minimum of three prospective vendors.
- USDA Fact Sheet on Geographic Preference
- USDA Procurement Geographic Preference Questions and Answers
School food authorities are required to adhere to the Buy American provisions found in federal regulations (7 CFR Part 250.23). Actions an SFA should take to comply with these requirements are as follows:
- Include a Buy American clause in all food product procurement documents (product specifications, bid solicitations, purchase orders, etc.);
- Monitor contractor performance;
- Require suppliers to certify the origin of the product;
- Examine product packaging for identification of the country of origin; and
- Ask the supplier for specific information about the percentage of U.S. content in the food product.
For further information, view questions and answers.
Contract Certification Forms
- Bid-Rigging Certification
- Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary Exclusion—Lower Tier Covered Transactions (if contract is over $25,000)
- Certificate Regarding Lobbying—Contracts, Grants, Loans and Cooperative Agreement (if contract is over $100,000)
- Disclosure of Lobbying Activities (if contract is over $100,000 and if applicable)
Any action which diminishes open and free competition seriously undermines the integrity of the procurement process and may subject an SFA to bid protests. SFAs are responsible for properly responding to protests and concerns raised by potential contractors. Pursuant to §3016.36(b) (12), SFAs must have protest procedures in place to handle and resolve disputes relating to their procurements and must in all instances disclose information regarding a protest to the Illinois State Board of Education Nutrition Programs Division.
When purchasing fresh fruits and vegetables or other allowable items, you may use your current vendor as long as proper procurement methods were already followed AND the items being purchased were included in the procurement specifications. This includes terms by which a “new” item may be purchased. If the item being purchased was NOT included in the original procurement specifications, terms were not included for “new” item purchases*, and the purchase will not total more than $100,000, informal purchase procedures must be followed and quotes MUST be obtained from a minimum of three prospective vendors (which may include your current vendor). If the purchase will exceed $100,000 annually, you must use formal competitive procurement methods. Refer to the School-Based Child Nutrition Programs Administrative Handbook for details on determining the proper method of procurement.
*Since you cannot always foresee every single item that you may need during the course of a year or predict new items that may come on the market, you may include a method for handling new and other products in your original procurement specifications. For example, you may choose to use “vendor’s cost + fee/case”: $0.00–$10.00 + $1.00, $10.01–$20.00 + $2.00, and so forth. It is recommended that you research the marketplace to determine the best method for handling these types of purchases in your area.
Please contact ISBE staff at 800-545-7892 with any questions regarding procurement for the FFVP.
If schools have chosen to use the Department of Defense (DoD) Fresh Fruit and Vegetable Program, ISBE has conducted procurement for them. Schools using DoD can order using the FFAVORS system, but will need to set-up an account. Contact DoD FFAVORS representative, Jane Boyles at 215-737-5573 or firstname.lastname@example.org.
References and Resources
Plus: A Reference Guide for Foods and Ingredients
USDA Team Nutrition reference guide on foods and ingredients to assist purchasers in developing food specifications consistent with nutritional goals and knowledge. Provides information to help program operators make informed decisions when purchasing products for use in school lunch and breakfast programs. (Published 1996, National Food Service Management Institute)
Plus Food Safety Supplement
Provides information on how to apply food safety to the food purchasing process. Discusses onsite visits to distributors, food recalls, safety language, food dating, manufacturer HACCP qualification standards, manufacturer audit survey, and estimated storage life of products. (Published 2003, National Food Service Management Institute)
Purchasing for Child Nutrition Programs
105-minute satellite teleconference video addresses cooperative purchasing. Includes forming a cooperative purchasing system, managing purchasing cooperatives, and maintaining communications. (Published 1999, National Food Service Management Institute)
- Equipment Purchasing and Facility Design for School Nutrition Programs
This manual provides information, background, and processes for designing, renovating, and equipping school nutrition facilities.
- Equipping School Kitchens to Prepare Healthful Meals
Examines production equipment issues and provides equipment guidelines for the type and amount of food preparation necessary for producing menus planned in accordance with the Dietary Guidelines for Americans. (Published 1996, National Food Service Management Institute)
- Excluded Parties List
Use this site to search for parties or companies that are debarred or suspended from conducting business.
Choice: A Purchasing Systems Manual for School Food Service,
A resource to guide child nutrition professionals in their procurement procedures. This edition provides procurement information and integrates food safety information to assist the purchaser in establishing procedures to assure the receipt of a safe product as specified. (Revised 2002, National Food Service Management Institute)
Buying Guide For Child Nutrition Programs
This is a link to the USDA website where the document can be downloaded. The handbook provides information to help serve meals that meet USDA requirements for any of the Child Nutrition Programs and assist food service personnel and purchasing agents in the purchase of the proper amount of food. (Published March 2002, U.S. Department of Agriculture Food and Nutrition Service)
Education and Training
90-minute satellite teleconference video provides basic information about the purchasing process and the importance of training. A key message is the importance of administrative decision-making based on assessment of individual program and training needs. Expert panelists identified the steps of the procurement process for Child Nutrition Programs, described successful methods used in procurement training, compared similarities and differences of training needs, and more. (Published 2004, National Food Service Management Institute)
Decisions for Cost Effective Implementation of the Dietary
Guidelines for Americans
Addresses how achievement of the Dietary Guidelines for Americans places special considerations on the purchasing process. Resources developed to help you become a more skillful purchaser also are mentioned. (Published 1995, National Food Service Management Institute)
- USDA Guide to Procuring Local Foods for Child Nutrition Programs
- USDA Policy Memo (SP 02-2010) Procurement Questions - October 9, 2009