INTRODUCTION Procurement activity starts after thorough planning.

It is assumed that technical designs/plans, detailed estimates, program of works and procurement packages are approved. DEFINITION OF TERMS:

What is procurement? Procurement is a process of:

acquiring/purchasing goods, supplies, materials, equipment and renting equipment; contracting the entire or portion of the works to contractor.

What do we procure in KALAHI-CIDSS? GOODS -These include supplies, materials and purchase of equipment, trucking and hauling. Examples: construction materials, seedlings/seeds (for prevention of erosion), hand tools and including office supplies for use by the BSPMC in its operations. WORKS refers to civil/infrastructure and all types of physical works such as construction, improvement, upgrading, roads and bridges, irrigation, flood control and drainage, water supply, electrification facilities, buildings, fabrication of equipment and structural parts, Natural Resources Management (NRM) activities, solid waste management system and physical works that require labor. CONSULTING SERVICES refers to services provided by external technical service providers or professional expertise that are beyond the capacity of the project/LGU staff to undertake such as but not limited to: feasibility studies; design; construction supervision; services for capability building types of sub-project; and, special studies. PRINCIPLES OF PROCUREMENT FE-E T- A Fairness/Fair-dealing competitive by extending equal opportunity to enable private contracting parties who are eligible and qualified to participate in public bidding. Suppliers/contractors should be treated fairly and without unfair discrimination, including protection of commercial confidentiality where required. The Community should not impose unnecessary burdens or constraints on suppliers or potential suppliers. PRINCIPLE

Effectiveness - it should be simple and applicable to the community. The service provider/s should meet the commercial regulatory and socio-economic goals of the community in a balanced manner appropriate to the procurement requirement. The processes should be carried out as cost effective as possible. Economy - The BSPMC shall use the Lowest Calculated and Responsive Bid/Quotation and the most advantageous to the BSPMC as criteria for selection of service providers. T ransparency

Transactions during procurement process and implementation must be transparent. There should be openness and clarity on procurement policy and its delivery. All transactions must be known by the public.

A ccountability the BSPMC and any official, directly or indirectly involved in the procurement process as well as in the implementation of procurement contracts and the private parties that deal with BSPMCs, when warranted by circumstances, investigated and held liable for their actions relative thereto.

PROCUREMENT POLICIES Procurement for the sub-project shall be the responsibility of the community through the Barangay Sub-Project Management Committee (BSPMC). A Procurement Team composed of at least three community volunteers elected by the barangay assembly shall assist the BSPMC. Transparency should be practiced in all stages of the procurement process, from the public announcement of invitation to quote or to bid, awarding of contracts, contract implementation to payment to suppliers, contractors and local workers. This shall be achieved through conduct of barangay assemblies and posting of notices and reports in the KALAHI-CIDSS: KKB billboards or bulletin boards within the barangay. The BSPMC shall use the Lowest Calculated and Responsive Bid/Quotation as the criterion for selection of suppliers and contractors. This criterion shall be publicly announced to the community and to all interested parties. The Project prescribes the procurement methods and procedures to be used. These are contained in the manual and should be followed strictly by participating communities. Section 4 of Government Procurement Reform Act, R.A. 9184 provides that any treaty or international or executive agreement affecting the subject matter of this Act to which the Government of the Philippines is a signatory shall be observed. Following this State policy, the Loan Agreement for KALAHI-CIDSS project, Ln. No. 7147PH, provides that for community projects, the procurement method should follow community participation method.

Thus, the procurement procedures provided for in the Community Procurement Manual, as acceptable to the Bank, shall be followed. Violations of the prescribed procurement policies, methods and procedures shall hold the participating communities liable for sanctions. Procurement made not in accordance with these guidelines shall be disallowed. Grant funds used shall be returned to the Project. Depending on the degree of violation, the sanctions can range from disallowance, suspension of further fund releases, withdrawal of the sub-project, or in the case of anomalous transactions, civil and/or criminal cases against the persons responsible. The Community-Based Procurement Manual shall be the basis of the government auditors, the World Bank, and other bodies exercising oversight functions in determining the legality, propriety and regularity of the communitys procurement activities. The World Bank Guidelines and the Loan Agreement take precedence over Local Guidelines, in case of conflict.

Relevant provisions of RA 9184 and its Implementing Rules and Regulations (IRR) and its amendments shall apply whenever the Community-Based Procurement Manual is silent as regards certain procurement process and procedures

PROCUREMENT ORGANIZATION & FUNCTIONS OF THE PROCUREMENT TEAM The Barangay Assembly members elect at least three members of the Procurement Team (PT) and Bids ansd Awards Committee (BAC) during the Second Barangay Assembly meeting for KALAHICIDSS: KKB Project. The Procurement Team shall be in charge of activities required to acquire all the supplies, materials, equipment, labor from suppliers and contractors.

The BAC shall, among others, determine the eligibility of prospective bidders, receive and open bids, conduct the evaluation of bids, undertake post-qualification proceedings, and recommend the award of contract.

SPECIFIC FUNCTIONS OF THE PROCUREMENT TEAM Prepares procurement documents Act as Canvassers Prepare and finalize Planned Community Procurement Packaging (PCPP) & Community Employment Record Sheet (CERS) with the assistance of DAC Assists in the presentation of PCPP and CERS during Barangay Assembly Receives and records bids/quotations Act as Secretariat to the Bids and Awards Committee Assists in updating the status of Actual Community Procurement Packaging (ACPP)

Functions of BAC The BAC shall be responsible for ensuring that the BSPMC abides by the standards set forth in the Community-Based Procurement Manual. The BSPMC Chairperson is the representative of the owner community. In effect, it represents the head of the procuring entity and approves contract with the Chairman being authorized to sign it. The BAC is a mere creation of the BSPMC. Responsibility therefore cannot be delegated to the BAC.

Composition of the BAC Barangay Treasurer Head-Project Preparation Team One member to be elected by BSPMC Executive Committee (Brgy. Officials are disqualified)

Note: The BSPMC Executive Committee is composed of the BSPMC chairperson and heads of teams under the BSPMC

The BAC members shall elect the chairperson of the Bids and Awards Committee (BAC). The BSPMC Chairperson as approving authority on all transactions is disqualified to be a member of BAC. The Barangay Treasurer is also disqualified to head the BAC. The LGU COA Auditor, Barangay Captain, Area Coordinator, Deputy Engineer and the Barangay Audit and Inventory Committee Head shall be invited to sit as non-voting members. Other interested parties are also encouraged to observe the BAC proceedings. A Technical Working Group (TWG) shall be formed with the assistance of the Area Coordinating Team. The TWG shall assist the BAC in bid evaluation.

ROLES OF THE TWG attend procurement training workshop provide technical assistance to BAC during evaluation of quotation and bids assist procurement team in drafting contract Composition of the TWG Area Coordinator or Deputy Area Coordinator Municipal Engineer/Municipal Agricultural Officer/CENRO/MENRO (depends on the type of contract) Supervising Sub-Project Engineer / Leadperson / Foreman (if municipal engineer is not available) Roving Bookkeeper (Financial Analyst) Volunteer professionals in the community (if any)

ROLES OF THE AREA COORDINATING TEAM (ACT) Area Coordinator provide action regarding red flag of abnormalities issue clearance to direct contracting for goods

Deputy Area Coordinator assist in the preparation of CPP conduct training on procurement to volunteers provide technical assistance during bid evaluation attend bid opening provide action regarding red flag of abnormalities as per instruction of AC.

Community Facilitator attend procurement training workshop monitor red flag of abnormalities using CF Procurement Monitoring Form conduct contract review by ensuring completeness of documents using checklist

Roving Bookkeeper/Financial Analyst Maintain copies of procurement documents at ACTs. PROCUREMENT PACKAGE is a group of similar goods that can be purchased from one supplier or work items that can be performed or implemented by a single contractor. Case 1: Hardware materials such as Cement, reinforcing steel bars, tie wires, common wire nails and other hardware materials must be grouped as one package. Aggregates such as sand, gravel and boulders must be separate package. In areas where all the required materials can be taken from one supplier or if all suppliers in the locality can supply all the materials needed, package the hardware materials and aggregates as one. Case 2: For common Work items such as Item 100 (Clearing and Grubbing), Item 102 (Excavation), Item 105 (Sub-grade Preparation), Item 200 (Aggregate Sub-Base Course), Item 201 (Aggregate Base Course), Item 311 (Portland Cement Concrete Pavement), Item 405 (Reinforcing Steelbars), Item 500 (Reinforced Co, 504, 505 and other items that are part of the contract, packaging can be done in two ways. First, define the items that can be undertaken by community force account and have it packaged as separate package then for items that requires heavy equipment, such items must be packaged separately. Second, if the community has no capacity to undertake any of the items of works as the contract calls for mechanized equipment and specialized skills, all the items must be packaged into one and undertake it by contract. The procurement packages should consider the implementation schedule and the releases of Grant Funds by tranche and Local counterpart. The work items should be packaged into one. Procurement Team must observe the approved threshold for the procurement.

Sample Workshop 1 : Prepare an appropriate package of the following materials PARTICULARS Selected Filling Materials Aggregate Base Coarse Sand Boulders Portland Cement 16 mm dia. RSB x 6M 10 mm dia. RSB x 6M 2"x3"x10' Coco Lumber 1/4" thick Ord. Plywood 3 inches CWN POSSIBLE PACKAGING: PACAKGE 1: Selected Filling Materials Aggregate Base Coarse Sand Boulders PACKAGE 2: Portland Cement 16 mm dia. RSB x 6M 10 mm dia. RSB x 6M 1/4" thick Ord. Plywood 3 inches CWN Package 3: 2"x3"x10' Coco Lumber 500 Bd. Ft. 100 110 150 12 15 Bags Pcs Pcs Pcs kilos 50 40 30 20 Cu.M. Cu.M. Cu.M. Cu.M. QUANITITY 50 40 30 20 100 110 150 500 12 15 UNIT Cu.M. Cu.M. Cu.M. Cu.M. Bags Pcs Pcs Bd. Ft. Pcs kilos

Note: In cases of areas where suppliers can supply all the listed materials, these groups
of materials can be packaged as one, otherwise this will be considered as splitting once package into several and serve into same suppliers. Sample Workshop 2: Prepare an appropriate packaging of the following items of works Item 105 Item 200 Item 201 Item 311 Item 500 Item 505 Sub-grade Preparation Aggregate Sub-Base Aggregate Base Coarse 300 Linear Meter Item 311 (PCCP) RCPC (0.61M dia.) Grouted Riprap

Possible Packaging: 1. Option 1 is to package all the items as one if all thee items of works will be undertaken by contract thus, there will be only one package. 2. Option 2: Item 105 PACKAGE 1: Shopping/Bidding Item 200 Item 201 Sub-grade Preparation Aggregate Sub-Base Aggregate Base Coarse

PACKAGE 2: CFA PACKAGE 3: CFA PACKAGE 4: CFA

Item 311 Item 500 Item 505

300 Linear Meter (PCCP) RCPC (0.61M dia.) Grouted Riprap

Notes: 1. This is a combined method of procurement. Items 105, 200 and 201 are mechanized, so it will be undertaken by contract. Items 311, 500 and 505 were separated because it can be undertaken by CFA and 1 or 2 Pakyaw group can undertake it. 2. Breaking of packages in this particular case using combined method of procurement is not considered SPLITTING since the purpose of undertaking the sub-project by contract and force account was based on the capacity of the community to implement it. Moreover, majority of the community can participate in the implementation and procurement process.

The project does not allow splitting of goods and items of works. However, for selected goods, which are in extreme cases, considering the peculiarity of the areas covered by the project, appropriate packing must be done. Hereunder is the definition of the term and sample cases for clearer understanding.

Splitting is the act of dividing or breaking up of contracts into smaller quantities and amounts, or dividing contract implementation into sub-contracts but it can be undertaken/procured as one contract to circumvent or subvert the procurement method.
Case 1: If the goods to be acquired can be procured in the Municipality and the method requires Local Bidding since it is within the threshold of bidding but the contract package were divided into several packages to evade NOL requirement from the NPMT or the World Bank then there is Splitting of Package/Contracts. Case 2: In cases of perishable goods like cement that are intended for different items of works and the sub-project requires bulk purchase but it is not realistic to deliver in the barangay considering that there is no available storage and in most cases sub-project locations are located in far flung areas, the community can break the packaging for cement into several package depending on the condition of the area to avoid spoilage. Likewise, for fuel and oil, if the conditions of the contract agreement do not apply to the condition of the area, several packages can be made for fuel and oil. Splitting under the KALAHI-CIDSS procurement guidelines depends upon the purpose for which the contract is divided. If the purpose for the division of the contract/packages into artificial phases or subcontracts is to circumvent or evade the mandatory requirements as per Loan Agreement, the BSPMC shall be responsible for such is guilty of contract splitting thus, sanctions shall be imposed as per section 3.6 of the Procurement Policies. The service provider involved in the preparation must ensure proper packaging to avoid such sanctions.

SAMPLE CASES OF SPLITTING:

1. In Brgy: Popoo, Calrlos P. Garcia, Bohol: The sub-project is Improvement of Farm to

Market Road Package 1 : 300 Linear Meter Item 311 (PCCP) ABC : PhP. 941,219.78 Contract Amount : PhP. 940,219.78 Package 2: Item 105 Sub-grade Preparation Item 200 Aggregate Sub-Base Item 201 Aggregate Base Coarse Item 300 Surfacing Item 500 (1)- RCPC, )0.60M dia. Item 505 Grouted Riprap ABC : PhP. 501,434.02 Contract Amount : PhP. 501,434.

Total Amount of Contracts= PhP1,442,653.80. > than 1.25M

Findings: All the items of works can be packaged and can be undertaken by 1 contractor. The preparer broke the packages into 2 to circumvent request for Central Offices No Objection. Local shopping was used as method instead of Local Bidding. Take note that adding the 2 ABC, the amount of contracts will fall under Local Bidding

2. In Brgy. Villa Milagrosa, Carlos P. Garcia, Bohol: The Sub-project is Construction of

School Building Package 1: Item I Site Clearing Item II Earthworks Item III Concrete Works Item IV Masonry works Item IX Doors and Windows Item XII Soil Poisoning ABC = PhP. 1,166,139.00Contract Contract Cost = 1,165,549.00 Item V Carpentry Works Item VI Roofing Works Item VII Plumbing & Fixtures Item X - Electrical Works Item XI Painting ABC 691,554.41 Contract Cost = PhP. 687,428.41 Total Amount of Contracts= PhP. 1,857693.41 > than 1.25M Findings: All the items of works can be packaged and can be undertaken by 1 contractor. The preparer broke the packages into 2 to circumvent request for Central Offices No Objection. Local shopping was used as method instead of Local Bidding. Take note that adding the 2 ABC, the amount of contracts will fall under Local Bidding

Package 2:

Brgy. Lanjagan, Ajuy, Iloilo Package 1 2 3 4 Items Item 104 Filling Materials Item 201- Aggregate Base Course Sand, RCPC, Boulders Amount (pesos) 351,383.40 266,062.50 56,750.00 Date of Canvass 8/23/05 8/23/05 8/23/05 8/23/05

Portland Cement, Plywood, lumber, CWN, 41,811.10 paint, paint thinner, paint brush & tinting color

Findings: Packages 1, 2 & 3 can be packaged as one since they can be supplied by one supplier. Obviously, instead of packaging the 4 packages into 2 packages only, it was broken into 4 packages to evade BIDDING. Worst, it was canvassed in the same date and the same suppliers!

PROCUREMENT METHODS
For Goods: Local Shopping Local Bidding Direct Contracting For Works: Local Shopping for works Direct Contracting Local Bidding Community Force Account What is Community Force Account? Community Force Account refers to the community itself executing the work. This mode is appropriate when the community has the resources and capacity to perform the works. Portion of the work items maybe contracted if the community does not have capability and resources to undertake the work items.

FAQ: What does capacity means under KALAHI-CIDSS? Answer: Capacity means the community has the ability to manage the implementation of the subproject by hiring the services of skilled worker in the area, technical staff is available in the Community or they are willing to engage the services of a service provider who will supervise the project implementation.
Resources include assets (local materials, available equipment, etc.) in the community and resources they can mobilize from the LGUs and other donors.

PROCUREMENT THRESHOLD: Expenditure Category 1. GOODS Conditions Goods are available locally and there are several suppliers. Contract is valued at less than US$7,500 or around P375,000.001 1 US$ = P50.00 Goods Same condition as above except that value of the contract is US$7,500 and above or more than P375,000.00 Small amount of purchase required and only one local supplier available. Cheaper to purchase because of reduced transportation cost. Contract value does not exceed US$2,500 or about P125,000.00 Conditions 1.2 Bidding Local Simplified bidding process as described in Item 9.4.1 of the manual. Recommended Methods 1.1 Local Shopping Description Community solicits at least three separate price canvass from suppliers. Among the factors to be considered in choosing the potential suppliers are quality, availability, reliability and hauling costs.

Goods

1.3 Direct Contracting

Lone local supplier can be chosen without any shopping for goods, provided cost are in line with local market rates as shown in the Regional Project Management Team Unit Cost Database. The ACT should have a copy of this database. Certification from the DAC is required prior to contracting. Description Written quotations from at least three qualified licensed local contractors shall be obtained.

Expenditure Category 2. WORKS

Recommended Methods

Small works amounting to 1.1 Shopping for Work not more than US$25,000 or P1.25M Several local licensed contractors are available. Rental of equipment and manufacturing works are under this method. Only one local licensed 2.2. Direct contractor is available and Contracting the value of contract is not more than $5,000 or P250,000 This method is also applicable for the Direct Contracting of Labor only (Pakyaw). Several local licensed contractors are available but contract price exceeds $25,000, or P1.25 M. 2.3. Local Bidding for Works

Lone local contractor can be chosen without any shopping for works, provided within approved Program of Works (POW). Clearance from RPMT is required prior to contracting.

Works

Works

Simplified open bidding procedure shall be followed as described in the communitybased procurement manual.

CONTRACT REVIEW, CLEARANCE and APPROVAL

Types of Contract GOODS

BSPMC Chairperson Individual Contract less than P500,000

RPMO Single Contract above 500T but not more than P1M and not to exceed P2.5M. Aggregate of Contract w/ the same supplier w/ aggregate of P1M w/in the Municipality

NPMO Individual Contract above P1M but not more that P2.5M

World Bank Single Contract above P2.50M and above

Direct Contracting

Contract with the same supplier with aggregate of P500,000 <P2.50 M more than P1.25M but below P2.5M

Contract with the same supplier with aggregate of P2.50 M & above

WORKS

Individua l Contract less than P500,000

Individual under Contract P 500,000.00 and above but below P2.5M All Contracts under Direct Contracting regardless of the amount

Individual Contract

P2.50M and above

Contract w/ the same contractor with aggregate of P2.50M & above w/in the Municipality

SUGGESTED PROCEDURES IN TAKING MINUTES OF MEETING

1. Heading: Location (name of Province, Municipality and Barangay) 2. Title of Meeting: e.g. Minutes of Opening of Bids, etc.. 3. Venue/Location 4. Date 5. Time 6. Participants (can be written in separate sheet) 7. Proceedings (started with prayer, opening remarks, etc..) Note: For minutes of opening and evaluation, matrix should be presented showing the name of the contractor, amount of bid, form of bid and remarks. 8. Observation/s, Agreements/Disagreements/Queries, etc.. 9. Closing activities, next steps/activities 10. Adjournment (indicate the time ended) 11. Prepared by PT, Brgy Secretary, approved by the BSPMC Chair Note: The minutes is better appreciated if it is handwritten.

DETAILED PROCEDURES FOR LOCAL BIDDING

1. Conduct pre-procurement conference. A. Discussion The BAC and PT will discuss the items of works for procurement using the Planned Community Procurement Packaging (format is found in the manual) B. Preparation The Procurement Team will prepare the following forms: a. Invitation to Bid b. Instruction to Bidders c. Bidding data d. Conditions of the Contract e. Contract Agreement f. Engineering Drawings/Plans g. Technical Specifications h. Form of bid i. Form of Bid security (Bank Guarantee) j. Form of Performance Security (Bank Guarantee) C. Review and signing Review & signing of the Invitation to Bid Prepares minutes Keep all documents 2. Publication and Posting of Invitation to Bid Publish in any regional newspaper (minimum of 7 Calendar Days maximum of 14 CD) Posts ITB in the Provincial / Municipal / Barangay Hall Billboards, KALAHI or Bulletin Billboard, offices of MIAC, PIAC, NGO offices and Personal serving to at least 3 suppliers

FAQ: When must the bidding documents available to eligible bidders? Answer: Prospective bidders must be allowed to acquire or purchase the bidding documents as soon as it is officially released ( first day of publication until the last day of submission)
3. Issuance of Bid Documents Issues bid documents to interested bidder upon presentation of Acknowledgement Receipt issued by the Barangay Treasurer as payment for the cost of reproduction (amount to be set by the Brgy treasurer) FAQ: How much must eligible bidders pay for the bidding documents? Answer: The BAC must consider the recovery component in determining the price which interested contractors would have to pay for the bidding documents ensure that the same would not have an effect of discouraging competition The cost recovery component may include the following: I. Direct Cost a. Development costs, incurred in developing the original content of the documents, designs, plans and specifications; b. Reproduction cost, labor, supplies and equipment rental costs; c. Communication costs, which include mail, fax, plus costs of advertisement, meetings, other costs incurred for the dissemination of information about the bidding. II. Indirect Cost - overhead, administrative costs such as honoraria to the BSPMC involved.

Note: It is encouraged that participation of as many bidders as possible to create competition. It should consider charging a lower price for the bidding documents, keeping in mind that this price should be sufficient to recover the above-enumerated costs.
CONTENTS OF BID DOCUMENTS TO BE ISSUED TO THE BIDDERS:

a. b. c. d. e. f. g. h. i. j. k.

Invitation to Bid for works Instruction to Bidders Bidding data Conditions of the Contract Contract Agreement Engineering Drawings/Plans Technical Specifications Form of bid Form of Bank Guarantee for Advance payment Form of Bid security (Bank Guarantee) Form of Performance Security (Bank Guarantee)

FAQ: What are the Forms of Bid security Answer: Form, amount and validity period; only the following are acceptable: Cash, Certified Check, cashiers check, managers check, bank draft or irrevocable letter of credit - 1.0% of bid price Bank Guarantee 1.50% of bid price 4. Pre-bid Conference Required for all contracts under local bidding for works. To be done at least 7 days before the deadline of submission of quotation. The purpose of pre-bidding conference is to discuss the details of the contract and clarify documents. Pre-bid conference must be conducted at the Barangay level Records minutes of the conference The minutes shall be issued to all bidders 5 days before the bid opening.

FAQ: Who are the participants during the pre-bid conference? Answer: The BAC; Procurement Team; TWG members; BSPMC Execom; The Eligible Bidders; Observers, community members, NGOs, others..
FAQ: How is the Pre-bid conference conducted? Answer: 1. The BAC shall discuss, among other things, the Technical and Financial components of the contract to be bid, including the explanation of the different documents to be submitted; 2. The BAC Chairperson shall also the requirements in the ITB, then replies to the bidders queries about the requirements, specifications ad other conditions of the project, the bid evaluation of all bidders and post qualification evaluation of the lowest calculated bidder. Emphasis should be given to the WARRANTY requirement of the project and the different offenses and penalties to be imposed by the project; 3. The minutes, by the Procurement Team, and its availability to all participants not later than 3 calendar days

Q: What if the bidder did not attend the pre-bid conference? Answer: Attendance in the pre-bid conference of the bidder is not compulsory and should not be a ground for disqualification.
FAQ: What happens if there is a need for clarification or interpretation on the Bidding Documents after the Pre-Bid Conference had been held? Answer: Requests for clarification/s on any part of the bidding documents or for an interpretation may be made by eligible bidders provided these are in writing and are submitted to the BAC at least 3 days before the deadline for the submission and receipt of bids. In this case, the BAC shall issue an immediate

response by issuing a supplemental/bid bulletin, to be made available to all those who have properly secured the bidding documents at least 3 calendar days before the deadline for the submission of bids. The BSPMC may, at its own initiative, issue supplemental/bid bulletins for purposes of clarifying or modifying any provision of the bidding documents at least not later than 3 days before the submission and receipt of bids. Any modification to the bidding documents must be identified as an AMMENDMENT. FAQ: What happens if there is a need for clarification or interpretation on the Bidding Documents after the Pre-Bid Conference had been held? Answer: continuation A supplemental /bid bulletin must contain a brief but comprehensive and accurate summary of the issue/s that it wishes to address. If it was an eligible bidder that raised the issue addressed by the Bid bulletin, then it ought to contain a summary of that bidders requests for clarification and/or interpretation, without denying the eligible bidder. Bidders who have submitted bids before a supplemental/bid bulletin is issued have to be informed in writing and allowed to modify or withdraw their respective bids FAQ: Who are involved in the Issuance of the Supplemental/Bid Bulletin? Answer: The BAC, PT, TWG and Eligible Bidders METHODOLOGY: How is a Supplemental/Bid Bulletin issued? If Supplemental/Bid Bulletin is being issued If the Supplemental/Bid Bulletin is issued by the upon the initiative of the BAC BAC in response to a request for clarification submitted by an eligible bidder 1. 2. 3. The PT and/or the TWG drafts the supplemental/bid bulletin for approval by the BAC; The BAC approves the supplemental/bid bulletin and the BAC Chairperson signs it; The PT sends copies of the supplemental/bid bulletin all all prospective bidders who have properly secured or purchased the bidding documents, within the period prescribed; The PT posts the supplemental /bid bulletin in conspicuous places. 1. The eligible bidder submits to the BAC, through the PT, a written request for clarification, within the period prescribed period; 2. The BAC directs the PT and/or TWG to study the request for clarification; 3. The TWG, BAC, and PT perform steps undertaken in the issuance of the supplemental/bid bulletin issued at the initiative of the BAC.

4.

5. Conduct of Group Site visit FAQ: What if the bidder did not conduct site visit? Answer: The conduct of site visit is compulsory. This will enable the bidder to make good offer of bid price. BSPMC Chair to issue Certificate of Site Inspection 6. Preparation, submission and opening of bids Prepare and submit sealed bid within 7 days 7. Receives sealed envelope in the Barangay Hall. If submitted in the Barangay Hall before the deadline stipulated in the ITQ, the PT members will record receipt in the logbook with the following information: a. Date & time of receipt; b. Name of supplier/contractor; and, c. Name of works procured and name of PT member who received the sealed envelope The sealed bids and logbook will be placed at BSPMC office inside the filing cabinet

FAQ: What if the bidder submitted late bid? Answer: Late bid is automatically rejected and returned to the bidder BID OPENING AND EXAMINATION 8. Invite Municipal Engineer, DAC, COA, representative, concerned TWG member, RIE/DRIE to witness the bid opening 9. Prepares the Barangay Hall for Public opening of bids 10. Brings the logbook and sealed bid envelopes and place inside the bid box at the Brgy. Hall. 11. Preparation, submission and opening of quotation Convene at the Barangay Hall for the opening of bids The BAC to declare quorum before the opening of bids Open the padlock of the box and open one by one the sealed envelopes and read aloud in public the name of supplier and the total amount of prices. BAC to initial the invitation to bid PT to prepare minutes of opening of bids

What are the grounds for disqualification? Answer: Late Bids and No Bid Security attached to the bid. FAQ: Are the bidders allowed to witness the opening of bids? Answer: YES.
FAQ: HOW TO CONDUCT BID OPENING The opening of bids should take place immediately after the deadline for submission in the presence of bidders representatives who wish to attend. The following should be addressed: 1. A suitable accessible room, specified in the bidding documents, must be reserved for the opening of bids. 2. All bidders representatives present at the opening should sign a register of attendance. 3. The envelopes received should be grouped into the following categories: bids received prior to the submission deadline; modifications received prior to the deadline; withdrawals received prior to the deadline; Bid/s modifications and withdrawals received after the deadline. 4. Bids, modifications and withdrawals received after the deadline must not be opened. The envelopes of all late submissions must be returned unopened to the respective bidders. 5. Withdrawal notices received prior to the deadline should be opened next and read out and recorded. Bids which are the subject of a withdrawal notice must not be opened and must be returned unopened to the respective bidders. 6. All bids and modifications received prior to the deadline must be opened next. 7. For each bid opened the items on the checklist should be checked and read out aloud. The bidders names, bid withdrawal or modification, bid price, discounts, the presence or absence of the requisite bid security and such other details as the Employer, at its discretion, may consider appropriate, should be announced and recorded at the opening. It is important for all discounts and alternatives to be read out. Bid prices, discounts and alternatives which are not read out at bid openings should not be considered in the subsequent evaluation. 8. No bid shall be rejected or an opinion/judgment voiced as to its responsiveness at the bid opening, except for late bids. 10. The Procurement Team (Secretariat) must prepare minutes of the bid opening.

11. Immediately after the opening of bids, all bids which were opened must be stored safely and confidentially and be made available only to those directly involved in the evaluation process. 12. The bidding documents will have specified how the above should be carried out. It is important that the relevant provisions in the instructions to bidders be applied in a consistent manner for each of the above. HOW TO PRELIMINARY EXAMINATION 1. Each bid will be examined to determine if it: is accompanied by the required bid security; is complete and generally in order (if not, any omission must be noted); is substantially responsive to the bidding documents (if not, any deviations, omissions or variations must be noted); is free of computational errors (any such errors must be noted); and requires any clarifications (any such clarification must be noted). requires any clarifications (any such clarification must be noted).

2. The bidding documents will have specified how the above should be carried out. It is important that the relevant provisions in the instructions to bidders be applied in a consistent manner for each of the above. 3. The BAC must decide which deviations (including omissions and variations) or reservations identified at this point are material and therefore the relevant bids should be declared as not substantially responsive. If a bid is not substantially responsive, it should be rejected and cannot be made responsive by correction or withdrawal of the nonconforming deviation or reservation. 4. The bidding documents will have specified how the above should be carried out. It is important that the relevant provisions in the instructions to bidders be applied in a consistent manner for each of the above. 5. The evaluation committee must decide which deviations (including omissions and variations) or reservations identified at this point are material and therefore the relevant bids should be declared as not substantially responsive. If a bid is not substantially responsive, it should be rejected and cannot be made responsive by correction or withdrawal of the nonconforming deviation or reservation. 6. At the end of this stage, the committee should be agreed on: those bids which are substantially non-responsive and should not be considered further; and any clarification which should be requested from bidders. 7. The outcome of the examination should be summarized. FAQs:

Q: Who are involved in the Receipt and opening of bids?

Answer: BAC, TWG (MIAC, ACT members, RIE/DRIE), members; and Observers (COA, NGOs, Religious groups). PT, Eligible bidders, community

Q: What if only one bidder submits a bid envelope?

Answer: The BAC will conduct bid evaluation. If the lone bidder passed in the bid evaluation, he will be subjected to post qualification. If he passed in the post qualification, he will be declared as the Lowest Calculated and Responsive Bidder. If the bidder failed in the bid evaluation, failure of bidding will be declared and re-bidding will be conducted. FAQ: What if no eligible bidder submits a bid? Answer: If no eligible bidder submits a bid, the BAC should declare the bidding a failure. In such a case, the BAC shall issue a Resolution declaring a failure of bidding. The BAC then reviews the terms and conditions stated in the ITB. If warranted, it changes any of the terms

and conditions, including the quantities or specifications, provided that the ABC is left unchanged. It must, thereafter, conduct re-bidding, in the process formulating a new ITB and posting and publishing this as required. If the original estimate is found to be inadequate on reassessment to meet the objective of the project, it is may be necessary to reduce the scope of the project (or adjust the ABC should there be a second failure of bidding). FAQ: What if no eligible bidder submits a bid? Answer: Should a second failure of bidding occur and the BSPMC finds that there is a need to evaluate the responsiveness of the ABC, and so decides to revise the ABC accordingly, the BSPMC should conduct another public bidding with re-advertisement and/or posting. Alternatively, the BSPMC may enter into negotiated procurement with a legally, technically, and financially capable contractor. It the BSPMC resorts to negotiated procurement,, the terms, conditions, and specifications of the project as well as the ABC must be maintained 12. Prepares Abstract of Bids a. Name of Contract and its location b. Time, date and place of bid opening c. Names of bidders and their bids d. Bid security 13. Bid Examination using the pass/fail criteria. (see matrix in manual plus the memo issued dated May 10, 2006) Bid security must conform with the requirements Contractors license Income tax return with Financial Audited Statement List of similar projects undertaken for the past two years List of equipment owned/leased with proof of ownership/lease agreement List of technical Personnel Site Visit Certificate If examination is not completed in one day, keep all the documents in a lock filing cabinet in the Barangay Hall. BID SECURITY: Bid securities must be deposited in the community account. Bid Security of the winning bidder will be returned only after posting the performance security Bid securities of the non winning bidders will be returned only after the winning bidder has signed the contract with the BSPMC. 14. Evaluate the quotation and choose the contractor who offers the lowest calculated and responsive quotation In the Evaluation: Evaluate if quotation is responsive, i.e. Applied corrections on prices Pass/Fail criteria Ranking of bids Prepares minutes of evaluation of bids FAQs: Q: What is a Responsive Bid? Answer: Responsive Bid is a bid that has passed both Pass/Fail criteria and in the Post Qualification. Q: What if bid is not responsive? Answer: Declare the bidder disqualified. Do not include disqualified bidder in the ranking. Q: Who are the participants in Bid Evaluation? Answer: The BAC, PT, TWG and observers.

Bid Evaluation Methodology: 1. After the preliminary examination of bids, the BAC, through the TWG, shall immediately conduct a detailed evaluation of all bids rated passed, using the pass/fail criteria with considerations to the following: a. The bid must be complete. Bids not addressing or providing all of the required items in the bidding documents including, where applicable, bill of quantities, shall be disqualified. If no price is indicated in some items of works, but specifying a 0 (zero) for the said item would mean that it is being offered to the BSPMC for free. b. Check minor arithmetical corrections to consider computational errors, omissions and discounts. Bid Evaluation Methodology: 1. After the preliminary examination of bids, the BAC, through the TWG, shall immediately conduct a detailed evaluation of all bids rated passed, using the pass/fail criteria with considerations to the following: c. Bids shall be evaluated on an equal footing to ensure fair and competitive evaluation. Bids shall be inclusive of taxes. d. In case of discrepancies between:

i. Bid prices in figures and in words, the latter shall prevail; ii. Total prices and unit prices, the latter shall prevail; and, iii. Unit cost in the detailed estimate and unit cost in the bill of quantities, the latter shall prevail.
2. Based on the detailed evaluation of bids, those that comply with the above-mentioned requirements shall be ranked in the ascending order of their total calculated bid prices, as evaluated and corrected for computational errors, discounts and other modifications, to identify the LCRB. Total corrected bid price which exceed the ABC shall be disqualified. 3. Prepare the Abstract of Bids. All members of the BAC should sign the abstract of bids.

1. The DAC, with the assistance of the PT, should prepare the Evaluation Report, containing the details of the evaluation conducted.

its bid?

FAQ : What happens if a bidder does not accept the arithmetical corrections done by the BAC on Answer: The BAC must disqualify the bid and forfeit the bid security of the bidder FAQ: Can the BAC declare the lowest calculated and most responsive bidder after the opening and evaluation of bids? Answer: NO! Declaration of the LCRB will be done after the Post-qualification evaluation.

15. Conducts post-qualification of the lowest calculated responsive bidder. Definition: Post-qualification is the process of verifying, validating and ascertaining all the statements made and documents submitted by the bidder with the LCRB, which includes ascertaining the said bidders compliance with the legal, financial and technical requirements of the bid. FA Q: Who conducts Post-qualification evaluation?

Answer: Procurement Team with the assistance of TWG FAQ: What does Post Qualification entail? Postqualification involves the BAC verifying, validating and ascertaining that the bidder satisfies the following: 1. LEGAL Requirements. The post-qualification process under this criterion involves the verification, validation and ascertaining of the contractors claim that ii is not included in any government blacklist, as well as all the licenses, permits and other documents it submitted, including the following: a. PCAB License; SEC registration or the DTI name registration; Mayors permit; BIR Certification, which contains the TIN; Authority of the Signatory; and, Affidavit of compliance with the Disclosure Provision. 2. TECHNICAL Requirements. The BAC would have to verify , validate and ascertain the veracity of the documents submitted by a contractor to prove compliance of the infra project it offered with the requirements of the contract and bidding documents. This involves the following: a. Verification of the bidders stated competence and experience, as well as the competence and experience of its key personnel to be assigned to the project, to ensure that these meet the minimum requirements; b. Verification of availability and commitment, and/or inspection and testing, of equipment units to be owned or leased by the bidder, as well as checking the performance of the bidder in its ongoing govt or private contracts, e.g. examine the Construction Schedule, Construction Methods, Equipment Utilization Schedule, List of projects undertaken or ongoing and to be started. c. Verification if any bidders on-going contracts shows: A reported negative slippage of at least 15%; Substandard quality of work as per contract plans and specifications; Unsatisfactory performance of his obligations as per contract terms and conditions, at the time of inspection; or That the minimum required experience of the bidders key personnel were not met; All of which will be grounds for disqualification if found by the BAC to be due to the bidders fault or negligence. d. Ascertain of the sufficiency of the Bid Security as to type, amount, form and wording, and validity period. 3. FINANCIAL Requirements. The BAC ought to verify, validate and ascertain the bid price proposal of the bidder and, whenever applicable, the required bank commitment to provide a credit line to the bidder in the amount specified and over the period stipulated. it also means verifying, validating and ascertaining, the bidders stated net worth and liquid assets, net working capital , the value of all outstanding or unfinished works under ongoing contracts, and the bidders NFCC, as recalculated considering developments in the bidders other projects. This is also done to ensure that the bidder can sustain the operating cash flow of the transaction. The process involves: a. Examination of the Bill of Quantities, Detailed Estimates and Cash Flow; b. Ascertaining of the sufficiency of the Bid Security as to type, amount, form and wording, and validity period; c. Ascertain the NFCC, credit line, or cash deposit; and, d. Examination of the BIR-audited financial statement. FAQ:

Q: What is the timeline for the conduct of Post-qualification? Answer: It is recommended to be completed within 1-3 calendar days.
Methodology : How is Post-qualification conducted?

Steps: 1. The PT/TWG verifies, validates, and ascertains the genuineness, validity and accuracy of the legal, technical and financial documents submitted by the bidder with the LCRB, using criteria earlier mentioned. 2. The PT/TWG inquires about the bidders performance in relation with other contracts/transactions as indicated in its eligibility statement (statement of ongoing, completed or awarded contracts). 3. The report of the PT/TWG should contain, among others, how the activity was undertaken including feedbacks from inquiries conducted; 4. The BAC reviews the Post-qua report; 5. The BAC determines whether the bidder with the LCRB passes the post-qua; 6. If the LCB passes the post-qua, the BAC declares it as LCRB; and, 7. After the BAC determined the LCRB, the PT, with the assistance of the TWG, if necessary, prepares the BAC Resolution declaring the LCRB and the corresponding Notice to the said bidder informing it of its post-qualification.

SUGGESTED FORMAT IN PREPARING THE POST-QUALIFICATION REPORT

I.

INTRODUCTION (optional) State the facts why a post-qualification will be done

II. METHODOLOGY
A. Satisfy the ff: 1. WHO? 2. WHEN? 3. HOW? Courtesy visit to the Contractors office Conduct interview (owner, project manager, personnel/workers) Check authenticity of submitted documents (companys records, financial records, conduct inspection of its premises, construction equipment, tools and facilities) B. Check the ff: Check recently completed projects (for the past 2 years) that are similar to the project to be undertaken if they were completed satisfactorily according to plans, specifications and duration Check with local banks where the contractors account/credit line facilities are maintained to determine if he/she has access to funds to finance the execution of the contract Date and time Duration Who authorized the conduct of post-qua (the BSPMC Chair) Name/s of the contractor/s to be evaluated The team composition (the TWG and volunteers)

III. RESULTS OF INVESTIGATION A. Test of Contractors Qualification Conduct review of awardees general eligibility qualifications based on the Instruction to Bidders B. Test of Contractors Technical & Organizational Capability Check the minimum construction personnel, tools, equipment and required schedule Contractors experience (2 years) in similar project

C. Test of Contractors Financial Capability Check the NFCC (NFCC should be more than Contract Cost) D. Contractors Reputation in the Community Check if the contractor has a good standing/reputation in the community or nearby Municipalities Check with the local courts and local arbitration commission (if there were cases, was he cleared?) FAQs during Post-qualification Q: What happens if a bidder is found to have been included in any government blacklist of contractor? Answer: A blacklisted contractor by any government agency or instrumentality will be disqualified by the BAC from further participating in the bidding process.

Q: What happens if a bidder or its employees is related within the third civil degree of consanguinity to the BSPMC Chairperson or any member of the BSPMC or TWG with direct access to information that may substantially affect the results of the bidding? Answer: Such bidder will be disqualified by the BAC.
FAQs on Post-qualification Q: What happens if a bidder or its employees is related within the third civil degree of consanguinity to the BSPMC Chairperson or any member of the BSPMC or TWG with direct access to information that may substantially affect the results of the bidding? Answer: That is conflict of interest. A Bidder shall not have a conflict of interest. All Bidders found to have a conflict of interest shall be disqualified to participate in the procurement at hand, without prejudice to the imposition of appropriate administrative, civil and criminal sanctions. A Bidder may be considered to have conflicting interests with another Bidder in any of the events described in paragraphs (i) through (iii) below and a general conflict of interest in any of the circumstances set out in paragraphs (iv) through (vi) below: i. A Bidder has controlling shareholders in common with another Bidder; ii. A Bidder receives or has received any direct or indirect subsidy from any other Bidder; iii. A Bidder has the same legal representative as any other Bidder for purposes of this Bid; iv. A Bidder has a relationship directly or through common third parties, that puts them in a position to have access to information about or influence on the Bid of another Bidder, or influence the decisions of the PROCURING ENTITY regarding this bidding process. This will include a firm or an organization who lends, or temporarily seconds, its personnel to firms or organizations which are engaged in consulting services for the preparation related to procurement for or implementation of the project, if the personnel would be involved in any capacity on the same project; v. A Bidder submits more than one Bid in this bidding process; ; or vi. A Bidder who participated as a consultant (service provider) in the preparation of the design or technical specifications of the goods and related services that are the subject of the Bid.

Q: What happens if the bidder with the LC fails Post-qualification? Answer: The BAC shall immediately notify the said bidder in writing stating the grounds for it. The bidder is given 3 days to response if it wishes to be reconsidered. The BAC shall evaluate the request for reconsideration and provide final response in 7 days. Notwithstanding any pending request for reconsideration, the PT (with TWG) shall initiate post-qualification to the second LCB. If the second bidder passes the postqualification, and provided that the request for reconsideration of the first bidder was

denied, the BAC shall declare the second bidder as the bidder with the LCRB. Thus, award will be recommended to the second lowest bidder with the LCRB. If the second bidder, however, fails the post-qualification the procedure for the post-qualification shall be repeated for the bidder with the nest LCB, and so on until the LCRB, is determined for award. 16. Draft the Contract - Drafts Contract (use pro-forma) by the Procurement Team with assistance from DAC 17. Request for NOL: Request NOL from NPMT/World Bank. Attach all supporting documents (photocopies only) ACT and RPMO to review the documents before sending to NPMO for issuance of NOL If found complete, in order and in accordance with KC procurement guidelines, the NPMO issues NOL APPROVAL AND ISSUANCE OF NOTICE OF AWARD 18. Prepares Notice of Award - Approves Notice of award (BSPMC) - Delivers Notice of Award (PT) - Signs Conforme and returns two copies to the Procurement Team (Contractor)

19. POSTING OF PERFORMANCE SECURITY Forms of Performance security: Cash, Certified Check, Cashiers Check, Managers Check Bank Guarantee 5% of Contract Price 10% Contract Price

Note: If security is in the form of cash or check, then it should be deposited in the BSPMC account by the winning bidder and submit to BSPMC the deposit slip with the bank CONTRACT MANAGEMENT CONTRACT SIGNING AND APPROVAL 20. Signs the Contract and returns it to BSPMC ISSUANCE OF NOTICE TO COMMENCE 21. Prepares Notice to commence Signs Notice to commence Delivers Notice to Commence Furnish the LGU COA, RPMO and contractor copy of signed notarized contract MOBILIZATION AND START OF WORKS 22. Contractor mobilizes and starts works 23. Advance Payment

Contractor has the option to claim advance payment equivalent to 15% of the contract price subject to compliance of the following requirement: a. Certification from DAC that equipment and materials are already mobilized on the jobsite. b. Bank guarantee equivalent to the amount requested.

INSPECTION & PROVISION OF TECHNICAL ASSSITANCE DURING CONTRACT IMPLEMENTATION 24. Monitor and Execute the Contract 25. RPMT/ACT/LGU to conduct regular visits to the project sites and provide TA 26. Process Payment on delivered items MRB to review documents MRB to initial duplicate copy of check indicating documents are in order before AC signs the check. Signs the Logbook and Issues Official receipt Filing and Record Keeping Compilation of all documents with subproject implementation procurement and finance document filing checklist on top of the folder. Original copy of the documents compiled and reviewed by the CF will be turn-over to the MRB for reproduction at the ACT or RPMT. Distribution of the copies will be original copy for COA, duplicate copy for Barangay and photo copies for ACT and RPMT. PROCUREMENT RED FLAGS What is Red Flag? A sign of a problem Something that demands attention of detailed sub-project: Over/under estimate compared to local prices Quantity over estimated/under estimated Existing usable materials/items still included in the list of materials to be procured Costing for CFA is based on previous contracts awarded to contractors

A. Preparation

B. Packing/Canvassing: To contract cost is above the procurement mode threshold Canvass form not properly filled-up/signed The same supplier/contractors are invited even there are more qualified bidders in the area Materials were not purchase based on the priority list Some items are not appropriate for the package Brand is specified on the technical specification Technical brand is tailored fit to a particular brand C. Submission of Quotation/Bid, Evaluation and Awarding of Contracts: Quotations/Bids are not sealed prior to opening date Same supplier/contractor is getting majority of the contracts even it has poor performance The winning supplier/contractor is not the lowest bid offered The date in the Quotation/Bid is beyond the deadline of date submission There are erasures on the quotations/bids Signatures are doubtful/falsified Price quotations/bids are too close to each other Hardware of supplier or office of the Contractor does not exist Award was made even if there are only two quotations were received Award was made to supplier/contractor that does not have the capability to deliver/perform the contract Procurement process moving too slow as compared to prescribed time

D. Delivery of Goods/Works:

 Non-delivery/incomplete delivery of goods Sub-standard deliveries or inferior quality of works Materials are not used for the sub-project E. Payment Payment to workers are not on agreed rates Payment made is not equivalent to delivered goods or works accomplished Payment is delayed OTHER FORMS OF RED FLAGS IN LOCAL BIDDING: During Publication: No publication on Regional or Provincial Newspapers. Only posting of ITB was done in the Provincial/Municipal/ Barangay Bulletin board; Invitation/s posted are not conforming to the standard format (copied from formats of other agencies) Standard format not followed Date and time of pre-bid and opening of bid not indicated ITB copy that was posted in the barangay not submitted No certification that such posting was done BSPMC set their own deadline for the procurement of bidding documents instead of following the original schedule as indicated in the Invitation to Bid. During Pre-bidding: Actual pre-bid conference is not the same date as stipulated in the ITB as published or posted. All bidders who purchased the bidding documents were not copy furnished of the minutes of the pre-bid conference. Taking of Minutes: In the minutes of the opening of bids, the deadline of the submission of bids was not captured; Actual deadline of submission of bids not conforming to the dates and time stipulated in the ITB as published and posted. Failed to capture if there are late bidders or none During the scheduled submission and opening: Opening was not done immediately after the deadline of submission Minutes of the opening of bids failed to capture if BAC is in quorum Minutes were prepared by the CFs BAC failed to initial all the bid documents Bidders are not allowed to stay after the bid opening in time for the preliminary examination. During Contract Signing Incomplete entries in the contract agreement During Review of Documents The contracting capacity of the contractor is below contract for bid using the formula: NFCC=(Current Assets-Liabilities (10 ))-Value of ongoing projects & projects to be awarded) Expired Contractors License The amount of bid security not conforming with the requirement The name appearing in the bid security not conforming with the requirement (instead of BSPMC of Brgy. ______, it was Brgy.____) The name appearing in the bid security is inappropriate. Items of work and quantity differs from the Invitation to Bid