(a) Grantees may use any of four (4) types of procurement, as appropriate for a given procurement situation:

1. (1)

   1. (A) Simplified procurement is an informal method of securing services or supplies by obtaining price quotes from an adequate number of qualified sources.
   2. (B) For the purposes of this part, three (3) price quotes are adequate.
   3. (C) Grantees may use simplified procurement whenever a good or service costs less than the simplified acquisition threshold fixed at 41 U.S.C. § 134;

2. (2)

   1. (A) Procurement by sealed bids is a formal method of securing services or supplies by publicly soliciting bids and awarding the contract to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price.
   2. (B) Grantees should use procurement by sealed bids for procuring construction as long as:

(i) A complete, adequate, and realistic specification or purchase description is available;

1. (ii) Two (2) or more responsible bidders are willing and able to compete effectively for the business; and

   1. (iii) The procurement lends itself to a firm fixed price contract and the selection of the successful bidder can be made principally on the basis of price.

   2. (C) Grantees must comply with the following requirements whenever procuring goods or services by sealed bids:

      1. (i)

(b) (b) The advertisement must appear twice, at a minimum.

1. (c) (c) The first publication of the advertisement begins the thirty-day period.

   1. (d) (d) The second publication of the advertisement must occur one (1) calendar week before the end of the thirty-day period.

(e) (e) If the second publication is delayed for any reason, the public notice period must be extended to one (1) calendar week after the second publication;

1. (ii) Grantees must identify all factors to be used in evaluating submitted proposals, including the importance of price or cost, in the invitation for bids;

   1. (iii) Grantees must publicly open all bids at the time and place specified in the advertisement;

      1. (iv) Grantees must evaluate all submitted bids;
      2. (v)

(b) (b) If all other factors are equally met, the lowest responsive bidder will be selected;

1. (vi) Grantees must also notify, in writing, all unsuccessful bidders; and

   1. (vii) Grantees may reject any or all bids if there is a sound documented reason;

2. (3)

   1. (A) Procurement through competitive negotiation is another formal method of securing services or supplies by publicly soliciting bids.
   2. (B) Grantees may use competitive negotiation for qualifications-based procurement of engineering professional services where the contract is awarded to the most qualified competitors, subject to negotiation of fair and reasonable compensation.
   3. (C) The requirements of subdivisions (a)(2)(C)(i) – (a)(2)(C)(iv), (a)(2)(C)(vi), and (a)(2)(C)(vii) of this section also apply to competitive negotiations.
   4. (D) Grantees may award contracts to the submitted proposal most advantageous to the grantee, considering only the factors specified in the published advertisement.
   5. (E) Grantees may only use this procurement method, where price is not the determining factor, in procurement of engineering professional services.
   6. (F) Competitive negotiation cannot be used to purchase any other types of services or goods; or

3. (4)

   1. (A) Procurement through noncompetitive negotiation is solicitation of a proposal from only one (1) source, or the finding of inadequate competition after soliciting bids from a number of sources.

   2. (B) Grantees may use noncompetitive negotiation only if the award of a contract by simplified procurement, sealed bids, or competitive negotiation is not possible and one (1) of the following circumstances applies:

      1. (i) A published request for proposals results in only one (1) proposal;
      2. (ii) The items or services required are available only from one (1) source;
      3. (iii) Sole-sourcing of the contract has been approved by the Arkansas Natural Resources Commission; or
      4. (iv) A public emergency will not permit a delay beyond the time needed to employ the competitive negotiation method.

(b)

1. (1) Grantees must perform a cost or price analysis in connection with every procurement action, including contract modifications.
2. (2) The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point grantees must make independent estimates before receiving bids or proposals.
3. (3) Grantees must perform a cost analysis when procurement is made through sealed bids and the bidder is required to submit the elements of the estimated cost (a common requirement for professional, consulting, and architectural engineering services contracts).
4. (4) Grantees must always perform a cost analysis when procurement is made through noncompetitive negotiations, unless price reasonableness can be established on the basis of a catalog or market price of a commercial product sold in substantial quantities to the general public or based on prices set by law or regulation.
5. (5) Grantees must perform a price analysis in all other instances to determine the reasonableness of the proposed contract price.