CSU 101 Procurement
Buying for the CSU
Presented by:
Matthew Roberts, C.P.M., CPP, MBA
Director of Contracts, Procurement & Risk Management
Cal Poly State University
3/10/09
Who are you, CSU?
• CSU is the State of California acting in a higher
education capacity
• The CSU acts through its Trustees of the
California State University
• The CSU is created and defined by Statute
• CSU is a single legal entity with 24 campuses
• Consultative governance structure
An Overview of CSU:
Authority
• History lesson
– Pre 1960’s (Dept of Education & State Colleges)
– Post 1960 (Donohoe Higher Education Act = CSU)
– Statement of General Principles in the
Delegation of Authority and Responsibility
• Trustees on 8/4/61 (via Standing Orders)
SOURCE, FLOW, AND SCOPE OF STATE GOVERNMENT AUTHORITY AND REGULATIONS
(Exclusive of case law, local governments, and Federal law)
September 2005
ARTICLE IV
THE CONSTITUTION OF CALIFORNIA
Selected constitutional
articles and sections that
affect CSU:
DONOHOE ACT OF 1960
CREATES
THE CSU BOARD OF TRUSTEES
AND CAL STATE SYSTEM OF CAMPUSES
(EDUCATION CODE)
Article III: State of California
Article IV: Legislative
Article V: Executive
Article VII: Public Officers and
Employees
Article XII: Public Utilities
Article XIII: Taxation
Article XIV: Labor Relations
Article XVI: Public Finance
Article XX, §3, §20, §23
Article XXI: Architectural and
Engineering Services
CALIFORNIA CODE OF
REGULATIONS
TITLE 5. Education
Division 5. Board of Trustees of the
California State University
Chapter 1. California State University
ACTIONS OF THE BOARD
RESOLUTIONS AND
ORDERS
Budget Act
Business and Professions Code
Code of Civil Procedure
Corporations Code
Elections Code
Fish and Game Code
Government Code
Health and Safety Code
Labor Code
Penal Code
Public Contract Code
Public Utilities Code
Streets and Highway Code
Vehicle Code
Welfare and Institutions Code
Civil Code
Commercial Code
Education Code
Evidence Code
Financial Code
Food and Agricultural Code
Harbors and Navigation Code
Insurance Code
Military and Veterans Code
Probate Code
Public Resources Code
Revenue and Taxation Code
Unemployment Insurance Code
Water Code
CHANCELLOR
OF THE CSU
EXECUTIVE ORDERS,
DELEGATIONS OF
AUTHORITY, AND
POLICIES
State laws that govern CSU
operations:
STATUTES AND
APPROPRIATIONS OF FUNDS
THE CALIFORNIA LEGISLATURE
STATE SENATE AND STATE ASSEMBLY
CAMPUS
PRESIDENT
RESOLUTIONS AND
RULES
Subchapter
Subchapter
Subchapter
Subchapter
Subchapter
Subchapter
Subchapter
Subchapter
Subchapter
1.
2.
3.
4.
5.
6.
7.
8.
9.
Definitions
Educational Program
Admission Requirements
Student Affairs
Administration
Auxiliary Organizations
Employees
Environmental Quality
Contracts and Purchases
CSU Procurement Spend
• CSU combined FY 07-08 spend was:
Over $1.3 Billion
($1,318,946,079)
CSU Spend by Type
• Goods / Commodities
»$190 million
• Services & Consultants
»$317 million
• Info Tech Resources (ITR goods & services)
»$155 million
• Public Works & Professional Services
»$657 million
Total CSU Spend -
Goods Non-IT
Services Non-IT
Construction
IT
Total
%
FY 07/08
1A
2A
3A
4A
1A - 4A
Total
Chancellor's Ofc.
2,125,727
4,737,206
8,297,057
30,479,624.00
45,639,614
3.46%
Bakersfield
4,669,390
4,931,215
20,871,551
2,338,904
32,811,060
2.49%
Channel Islands
7,735,672
11,555,259
18,113,638
37,404,569
2.84%
Chico
6,378,336
15,754,456
26,639,115
3,327,481
52,099,388
3.95%
Dominguez Hills
5,692,618
8,470,028
51,019,162
896,535
66,078,343
5.01%
East Bay
6,208,245
10,675,871
86,437,618
3,315,700
106,637,434
8.09%
Fresno
6,563,436
15,728,116
10,384,328
5,036,740
37,712,620
2.86%
Fullerton
8,418,431
31,447,574
55,283,131
17,247,495
112,396,631
8.52%
Humboldt
4,155,654
8,178,083
4,781,834
13,023,386
30,138,957
2.29%
Long Beach
10,411,200
7,372,751
22,660,306
4,955,901
45,400,158
3.44%
Los Angeles
10,471,733
8,257,866
77,594,910
10,451,497
106,776,006
8.10%
Cal Maritime
2,385,404
3,172,254
3,552,699
1,126,389
10,236,746
0.78%
622,041
8,896,817
22,763,369
5,539,445
37,821,672
2.87%
8,860,214
11,518,322
42,979,317
6,331,155
69,689,008
5.28%
13,339,081
14,719,351
23,740,508
3,705,387
55,504,327
4.21%
Sacramento
7,494,310
12,729,508
59,133,190
11,166,987
90,523,995
6.86%
San Bernardino
8,148,228
10,620,223
3,252,520
5,135,388
27,156,359
2.06%
21,525,984
34,925,254
21,452,408
8,901,718
86,805,364
6.58%
6,633,546
17,091,719
21,952,806
3,306,827
48,984,898
3.71%
San Jose
14,870,187
41,244,947
2,909,650
5,096,184
64,120,968
4.86%
San Luis Obispo
19,934,649
10,837,692
6,635,875
7,463,722
44,871,938
3.40%
San Marcos
3,308,967
7,720,923
6,178,134
2,647,001
19,855,025
1.51%
Sonoma
3,735,076
8,847,978
38,969,049
1,491,328
53,043,431
4.02%
Stanislaus
5,896,792
8,345,845
21,347,479
1,647,452
37,237,568
2.82%
189,584,921
317,779,258
656,949,654
154,632,246
1,318,946,079
Monterey Bay
Northridge
Pomona
San Diego
San Francisco
Totals
-
100.00%
Total CSU Spend - FY 06-07
Goods Non-IT
Services Non-IT
Construction
IT
Total
%
1A
2A
3A
4A
1A - 4A
Total
CO
3,903,746
14,990,963
3,807,152
50,361,725
73,063,586
6.03%
Bakersfield
3,551,700
4,657,812
2,508,283
824,483
11,542,278
0.95%
Channel Islands
7,150,326
34,240,040
535,290
2,559,764
44,485,420
3.67%
Chico
5,772,476
19,362,010
41,438,631
2,954,496
69,527,613
5.74%
Dominguez Hills
2,651,192
5,191,591
12,453,522
10,877,097
31,173,402
2.57%
East Bay
2,052,219
4,957,519
24,037,356
2,686,823
33,733,917
2.78%
Fresno
12,252,278
11,219,663
24,024,085
12,350,243
59,846,269
4.94%
Fullerton
11,679,576
12,129,918
52,396,324
6,476,943
82,682,761
6.82%
Humboldt
6,123,007
5,401,633
3,455,744
14,087,427
29,067,811
2.40%
Long Beach
5,916,329
13,861,371
9,257,047
4,423,104
33,457,851
2.76%
Los Angeles
3,836,220
12,273,230
5,093,338
2,862,487
24,065,275
1.99%
Cal Maritime
1,889,174
4,040,811
842,320
595,691
7,367,996
0.61%
Monterey Bay
3,234,266
4,957,477
75,284,182
2,154,405
85,630,330
7.07%
12,732,364
19,375,743
29,383,861
3,498,205
64,990,173
5.36%
7,477,674
9,818,034
24,631,979
2,677,886
44,605,573
3.68%
11,277,866
17,849,705
17,793,354
7,048,736
53,969,661
4.45%
4,686,265
15,379,000
68,640,402
2,887,068
91,592,735
7.56%
24,117,562
58,975,374
31,561,177
2,474,870
117,128,983
9.67%
6,466,096
9,168,747
13,414,852
2,987,587
32,037,282
2.64%
San Jose
13,109,285
15,985,200
6,660,709
10,029,533
45,784,727
3.78%
San Luis Obispo
12,009,070
15,571,223
79,080,946
10,022,950
116,684,189
9.63%
San Marcos
2,613,397
9,252,568
1,113,585
4,542,109
17,521,659
1.45%
Sonoma
1,887,593
25,484,276
3,081,752
921,680
31,375,301
2.59%
Stanislaus
4,635,627
2,830,723
1,871,265
961,933
10,299,548
0.85%
171,025,308
346,974,631
532,367,156
161,267,245
1,211,634,340
100.0%
Northridge
Pomona
Sacramento
San Bernardino
San Diego
San Francisco
Totals
CSU Campus Spend
Top 6 - Procurement Spend (FY 07-08)
1.
2.
3.
4.
5.
6.
Fullerton
Los Angeles
East Bay
Sacramento
San Diego
Northridge
Totals
$112M
$107M
$106M
$91M
$87M
$70M
8.52%
8.52%
8.09%
6.86%
6.58%
5.28%
$533 million 40.4%
CSU Campus Spend
Top 6 - Procurement Spend (FY 06-07)
1.
2.
3.
4.
5.
6.
San Diego
San Luis Obispo
San Bernardino
Monterey Bay
Fullerton
Chancellors Office
Totals
$117M
$116M
$92M
$85M
$83M
$73M
9.7%
9.6%
7.6%
7.1%
6.8%
6.0%
$566 million 46.8%
CSU Campus Spend
(FY 07-08)
• Average Spend
• $54.9 million
• Median Spend
• $45.6 million
• CSU Lowest Annual Spend
• $10.2 million (CMA)
• Single Largest Spend Item
• $ 86 million (Construction at E-Bay)
CSU Campus Spend
(FY 06-07)
• Average Spend
• $50.5 million
• Median Spend
• $44.6 million
• CSU Lowest Annual Spend
• $7.4 million (CMA)
• Single Largest Spend Item
• $ 79 million (Construction – Cal Poly SLO)
What we buy!
• CMA - Spends $1m+ just to “filler up” in port for
the Golden Bear (training ship fuel).
• CI – Buys explosives so they can train the police
bomb sniffing dog Frieda.
• We all buy body armor, weapons, ammo &
pursuit cars.
• We charter aircrafts for teams, boats for biology
students, buses for bands.
• Athletic teams hire hypnotherapist,
chiropractors, psychologists, & physical
therapists.
What we buy!
• Pomona & SLO have classes in Animal Husbandry – use
your imagination on what that entails.
• We buy cadavers for anatomy class.
• The CSU spends over $13 million a year on Office
Supplies via Office Max contract.
We buy everything you need to run 24 small cities
• With over 400,000 students
• ~45,000 Employees
• Running - 24 x 7 x 365
Public vs. Private Purchasing
Public Procurement
• Open & Transparent processes
• Inclusive & Fair process
• Ask & you shall receive information
–California Public Records Act
• Protest of Awards
• Driven by statute and policy
• Low Bid
• Time consuming processes
Public vs. Private Purchasing
Private Procurement
• Private = confidential, proprietary, secret
• Knowledge is a Business Advantage
• If it’s legal it’s OK
• Cut-throat, survival of the fittest, win at all
costs
• Moves very fast, decisions are made
quickly
• Based on profit motive incentive
How we buy Goods & Services
Formal vs. Informal
Formal
– Invitation For Bid
(IFB = lowest price)
– Request For Proposal
(RFP = best value)
– Sole Source
(Only place / person known)
– Established Contracts
(Competitive piggybacks)
– Sealed Bid process
(Opens on - date & time)
Informal
– Informal bid process
• Phone
• Fax
• E-Mail
– Lowest Price
– Low Value Procurement
Processes (LVPP)
•
•
•
•
P-Card
Direct Pay
Campus Contracts
Petty Cash
– Sole Source
CSU Procurement Thresholds
• Goods & Services (non - ITR)
• Formal >$50,000
• Informal <$50,000
• LVPP <$ X,XXX.xx (set by campuses, ranges $1 to 5K)
• ITR Goods & Services
• Formal >$250,000
• Informal <$250,000
• Sole Source (not Sole Brands)
• VP sign off >$100,000
• CO sign off >$250,000
• Public Works
• Major Cap >$400,000
• Minor Cap <$400,000
• JOC’s <$400,000
• LVPW <$5,000
CSU 101 – Procurement,
Buying for the CSU
• On-Line Resources:
– http://www.calstate.edu/CSP/
Contract Services & Procurement Website – lots of resources
– http://www.calstate.edu/CSP/crl/policy/Policy.shtml
CSU Procurement Policy Manual - online
– http://www.calstate.edu/CPDC/
Capital Planning, Development & Construction website – more resources
– http://www.calstate.edu/CPDC/SUAM/
CSU State University Admin. Manual – online
– http://www.calstate.edu/eo/
CSU Executive Orders – online
– http://www.leginfo.ca.gov
Cal. Legislative info such as bills, statutes, etc.
CSU 101 – Procurement,
Buying for the CSU
• Notebook section includes:
– Excerpts from the CSU Professional Buyer
training course, Procurement Law:
•
•
•
•
CSU Legal Structure Overview
Overview of CSU Authority to Contract
CSU General Provisions for Services (explained)
CSU Sovereignty (explained)