CONTRACT MANUAL for Professional and Consultant Services
Contracts, Intra-agency Agreements, and Inter-agency Agreements
Contract Manual Acronyms and Abbreviations
AASIS
|
Arkansas Administrative Statewide Information
System
|
ABA
|
Arkansas Building Authority
|
A.C.A.
|
Arkansas Code Annotated
|
ACO
|
Administrative Compliance Officer
|
AP
|
Accounts Payable, Office of Finance and Administration,
Department of Human Services
|
AR
|
Accounts Receivable, Office of Finance and
Administration, Department of Human Services
|
BAA
|
Business Associate Agreement
|
CAP
|
Contracting Automation Platform
|
CAS
|
Contract Archival System
|
CB
|
Competitive Bid
|
CMU
|
Contract Management/Comprehensive Annual Financial
Report Unit, Office of Finance and Administration, Department of Human
Services
|
CPO
|
Certified Procurement Official
|
CPU
|
Commodities Purchasing Unit, Contract Support Section,
Office of Finance and Administration, Department of Human Services
|
CSB
|
Competitive Sealed Bid
|
CSP
|
Competitive Sealed Proposal
|
CSS
|
Contract Support Section, Office of Finance and
Administration, Department of Human Services
|
CSU
|
Central Support Unit, Contract Support Section, Office
of Finance and Administration, Department of Human Services
|
DAAS
|
Division of Aging and Adult Services, Department of
Human Services
|
DBH
|
Division of Behavioral Health, Department of Human
Services
|
DCCECE
|
Division of Child Care and Early Childhood Education,
Department of Human Services
|
DCFS
|
Division of Children and Family Services, Department of
Human Services
|
DCO
|
Division of County Operations, Department of Human
Services
|
DDS
|
Division of Developmental Disabilities Services,
Department of Human Services
|
DFA
|
Department of Finance and Administration
|
DHS
|
Department of Human Services
|
DMS
|
Division of Medical Services, Department of Human
Services
|
DOV
|
Division of Volunteerism, Department of Human
Services
|
DSB
|
Division of Services for the Blind, Department of Human
Services
|
DYS
|
Division of Youth Services, Department of Human
Services ,
|
EEO
|
Equal Employment Opportunity
|
EO
|
Executive Order
|
FY
|
Fiscal Year
|
GSA
|
General Service Administration, United States
Government
|
HIPAA
|
Health Insurance Portability and Accountability
Act
|
IG
|
Intergovernmental
|
IRS
|
Internal Revenue Service, United States
Government
|
MOA
|
Methods of Administration
|
OCC
|
Office of Chief Counsel, Department of Human
Services
|
OFA
|
Office of Finance and Administration, Department of
Human Services
|
OQA
|
Office of Quality Assurance, Department of Human
Services
|
OSP
|
Office of State Procurement, Department of Finance and
Administration
|
OST
|
Office of Systems and Technology, Department of Human
Services
|
PASOS
|
Provider Audit Sign-off Sheet
|
PCS
|
Professional and Consultant Services
A
|
PEER
|
Performance Evaluation and Expenditure
Review
|
PHI
|
Protected Healthcare Information
|
PO
|
Purchase Order
|
RFP
|
Request for Proposal
|
RFQ
|
Request for Qualifications
|
RMU
|
Records Management Unit, Contract Support Section,
Office of Finance and Administration, Department of Human Services
'
|
SSBG
|
Social Services Block Grant
|
TIN
|
Taxpayer Identification Number
|
CHAPTER ONE
INTRODUCTION
To carry out some aspects of its mission, the Arkansas
Department of Human Services (DHS) uses a statewide network of contracted
service providers.
The purpose of this Contract Manual (hereinafter referred to as
"Manual") is to provide a common frame of reference for the development of
Professional and Consultant Services (PCS) contracts, ‹ intra-agency
agreements (i.e., agreements between two or more divisions within DHS), and
interagency agreements (i.e., agreements between a DHS division and another
state agency). This Manual is based on federal and state directives and agency
policy as well as best practices which have been standardized for use by DHS
program divisions/offices (hereinafter referred to as divisions).
The essential elements of each agreement are based on
mutually binding obligations between the two parties: the service provider and
the applicable DHS division, using funds appropriated to carry out the program
responsibilities of that division.
The Office of Chief Counsel (OCC) provides legal advisory
concerning procurement methods, service performance provisions, and any unique
terms and conditions or other proposed deviations from standard practices
described in this Manual.
The Office of Finance and Administration (OFA) provides
administrative direction to facilitate the successful completion of agreements
so that they meet requirements for coordination through the Office of State
Procurement (OSP), Department of Finance and Administration (DFA) and review by
the Arkansas state legislature, if necessary. OFA also provides financial
advisory and technical assistance through a network of divisional Chief Fiscal
Officers to assure compliance
!i with the Financial Management Guide
and the Accounting and Budgetary Procedures Law.
The Contract Support Section (CSS) of OFA provides this Manual
as an element of technical assistance. Please direct all suggestions for
corrections, additions and/or updates to:
Contract Support Section/Slot W345
P.O. Box 1437
Little Rock, AR 72203
Telephone: (501)682-6293
* DHS requires fair and equal opportunity in employment and
service delivery regardless of race, color, religion, sex, age, national
origin, political beliefs, or disability that impair one or more major life
activities as defined in the Americans with Disabilities Act. DHS requires
non-discrimination and equal opportunity in compliance with all applicable
federal laws, regulations, executive orders, and civil rights rules and
regulations.
Contractors are required to comply with the promulgated Methods
of Administration (MOA) for recipients of federal financial assistance as
directed by the United States Department of Health and Human Services.
CHAPTER TWO
CONTRACTING FORMATS
I.
Definition (from Rules and
Regulations Implementing Governor's Executive Order [EO] 98-04 and Act 34 of
1999)
"Contract shall mean any agreement entered into by and between
a state agency and an individual or entity pursuant to which the agency agrees
to purchase or lease tangible1 personal property,
real property, or services, or any agreement for the disposal of commodities
and services. Contract includes, but is not limited to, awards and notices of
award; contracts of a fixed price, cost, or incentive type; contracts providing
for the issuance of job or task orders, leases, lease purchase agreements,
letter contracts,, purchase orders (PO's), and professional or consultant
services contracts. Contract also I! includes supplemental agreements with
respect to any of these categories."
II.
Contracting Formats for
Services
A purchase of services contract is a legally binding agreement,
enforceable by law, i between DHS and a provider of services. A provider of
services may be a private entity (i.e., an individual, partnership, or
corporation) or a public entity (i.e., a governmental agency or entity). The
agreement contains mutually binding obligations and a description of the
services to be provided with payment contingent on delivery of services. The
common contracting formats for services include:
A.
PCS Contracts
1. PCS contracts are governed by Arkansas
Procurement Law and applicable statutes (as found in the Arkansas Code
Annotated [A.C.A.]) and regulations, including but not limited to the
following:
a.
|
A.C.A. §
19-11-101
etseq.
|
General Provisions
|
b.
|
A.C.A. §
19-11-201
etseq.
|
Procurement Law
|
c.
|
A.C.A. §
19-11-701
etseq.
|
Ethics in Public Contracting
|
d.
|
A.C.A. §
19-11-801
etseq.
|
Procurement of Professional Services ,
|
e.
|
A.C.A. §
19-11-1001
etseq.
|
Professional and Consultant Services
:i
|
f.
|
A.C.A. §
15-4-301
etseq.
|
Minority Procurement
|
g-
|
A.C.A. §
19-11-251
|
Alternate Format
|
2.
Professional Services contracts are for the purchase of services
which are ( professional in nature and generally require
that the provider have some type i of specialized training or
license/certification (e.g., medical services, social work, counseling, etc.).
A.C.A. §
19-11-203(14),
as amended in 2003, exempts certain professional services from
compliance with the procurement law.
3.
Consultant Services contracts
are utilized when the service to be rendered is primarily the giving of advice
by the contractor on a particular problem facing the agency.
4.
PCS Contract Formats
a. PCS contracts for which the total
compensation exceeds $25,000
per vendor, per cost center, per service shall be executed on
the Professional/Consultant Services Contract form (Form
OSP-1) and are commonly referred to as "standard PCS
contracts."
EXCEPTION:
In accordance
with the rules and regulations promulgated under ACA §
19-11-251, inter-agency
agreements for professional or consultant services may be executed on an
alternate
format from the standard Form OSP-1, inter-agency
agreements being defined as those between a DHS division and another state
agency. The alternate format designed for this purpose is the DHS-9198
(and the DHS-9198A for amendments). Use of this alternate
format requires the prior approval of the OSP Director.
b. PCS contracts for which the total
compensation does NOT exceed
$25,000 per vendor, per cost center, per service may be
executed on the PO format, in which case they are referred to as
"stand-alone PO's." A division may, however, execute a PCS
contract that does not exceed $25,000 in compensation per vendor, per cost
center, per service as a "standard PCS contract" if preferred.
''
5. Routine PCS contracts are addressed in
Chapter Ten of this Manual. PCS inter-agency agreements executed
on the alternate format are addressed in Chapter Twelve of this
Manual.
B.
Intra-agency Agreements
1.
Intra-agency agreements are used when one DHS division purchases services from
another DHS division.
2.
Intra-agency Agreements are addressed in Chapter Eleven of this
Manual.
C.
technical Services Contracts
1.
Contracts for technical services are governed by the Arkansas Procurement Law
and applicable statutes and regulations, including but not limited to the ;
following:
a.
|
A.C.A. §
19-11-101
etseq.
|
General Provisions
|
b.
|
A.C.A. §
19-11-201
etseq.
|
Procurement Law
|
c.
|
A.C.A. §
19-11-301
etseq
|
Bidding - State Industry Priority Goods
|
d.
|
A.C.A. §
19-11-601
etseq
|
Federal Government Surplus Property
Sl
|
e.
|
A.C.A. §
19-11-701
etseq.
|
Ethics in Public Contracting
|
f.
|
A.C.A. §
15-4-301
etseq.
|
Minority Procurement
|
g-
|
A.C.A. §
19-11-901
etseq
|
Purchases of Workshop Made Products and
Services
|
h.
|
A.C.A. §
15-4-301
etseq
|
Minority Procurement
|
DHS Administrative Procedures Manual, Chapters 601
through 609, also governs contracts for technical
services.
2. "Technical
services" are described by
A.C.A. §
19-11-203(34)
as:
a. Work accomplished by skilled
individuals involving time, labor, and a degree of expertise, in which
performance is evaluated based upon the quality of the work and the results
produced;
b. Work performed to meet
a demand, including, but not limited to, work of a recurring nature that does
not necessarily require special skills or extensive training; or c. The
furnishing of labor, time, or effort by a contractor or vendor, not involving
the delivery of any specific end product other than reports that are incidental
to the required performance.
3. Examples of services that are typically
considered technical in nature include drug screening, criminal background
checks, elevator service, janitorial service, pest control service, translator
service, nursing, occupational therapy, physical therapy, speech therapy,
housekeeping, training, and office machine maintenance.
4. When in doubt if a particular service
should be considered technical or professional, divisions should consult with
Commodities Purchasing Unit (CPU).
5. Technical services are not within the
scope of this Manual. For assistance on the development of technical services
contracts, divisions should consult with " CPU.
D.
Interlocal Agreements
1. Interlocal Agreements are authorized under
A.C.A. §
25-20-104.
2. The purpose of Interlocal Agreements is to
facilitate cooperation and sharing of resources at the local level between
state agencies.
3. For information
regarding Interlocal Agreements, divisions should consult with CSS prior to
development.
4. Interlocal
Agreements are for highly specific situations and the details on their
development are not within the scope of this Manual.
III.
Other
Agreement Types
A.
Medicaid
Provider Agreements
1. Medicaid
Provider Agreements establish an individual or entity as a Medicaid provider
and are specific to each service being provided. Contractors may have multiple
contracts if they provide more than one of the approximately forty available
services.
2. Medicaid Provider
Agreements are managed by the Division of Medical Services (DMS) and are
governed by Medicaid regulations and rates.
3. Medicaid Provider Agreements are not
within the scope of this Manual.
B.
Sub-grants
1. Sub-grants are written agreements to
provide money or property to eligible recipients under specific federal or
state legislation authorizing such assistance.
2. The sub-grant award process shall comply
with the Accounting and Budgetary Procedures laws of Arkansas.
3. In accordance with A.C.A. §
19-4-2201
and 2202,
the Legislative Review Subcommittee and the Legislative Council must
review non-exempt discretionary sub-grants prior to implementation.
4. Some of the factors to consider when
determining if a particular situation warrants a sub-grant or a contract
include the following:
a. Sub-grants are for
ASSISTANCE while contracts are for ACQUIRING (PURCHASING) SOMETHING.
b. Sub-grants are often considered to be an
award of resource assistance to fulfill the SUB-GRANTEE'S mission, while
contracts are often put in place to fulfill DHS' mission.
c. If performance based standards are needed,
with the extra degree of specificity regarding what is to be done and remedies
for failure to perform, a contract is probably more appropriate than a
sub-grant.
d. Just because the
funding comes TO DHS as a grant does NOT necessarily mean DHS should put it out
to the vendor as a sub-grant.
5. Sub-grants are not within the scope of
this Manual.
NOTE:
If there is doubt as to whether a sub-grant or a contract is
the more appropriate agreement format, divisions should consult with
CSS.
C.
Construction Contracts
1. Construction
contracts are developed and approved in accordance with [GREATER THAN]
Arkansas Building Authority (ABA) regulations.
2. For details on construction contracts,
divisions should consult with Central Support Unit (CSU).
3. Construction contracts are not within the
scope of this Manual.
CHAPTER THREE
DISCLOSURE
I.
Policy
A. In accordance with
Executive Order
(EO) 98-04, Sections 2.C. and 3.A., any non-exempt
contract
which exceeds $25,000 total (i.e., compensation plus reimbursable
expenses) requires the contractor to complete the
Contract and Grant
Disclosure and Certification Form, Form PCS-D.
NOTE: Contracts with another government entity
such as a state agency, public education institution [ex., state university,
public school, etc.], federal government entity, or body of a local government
are exempt from disclosure requirements.
B. In accordance with EO-98-04, Section
2.F.(1), any non-exempt sub-contract which exceeds $25,000
total requires the sub-contractor to complete the Form
PCS-D.
C. In accordance with
EO 98-04, Section 2.A., disclosure is required of any of the
following, whether current or former ("former" is defined as within two years
of entering into a contract):
1. Arkansas
General Assembly member
2.
Constitutional officer "
3. State
Board or Commission member
4. State
employee
5. The immediate family
member of 1. through 4. above,
NOTE: In accordance with EO-98-04, Section
1.O.,
immediate family member is defined as spouse, children of that
individual or his or her spouse, brother, sister, parent of the individual or
his or her spouse.
6. Any
entity in which any person designated in 1. through 4. above:
a. holds any position of control, or
b. holds any ownership interest of
10% or greater
II.
Procedures
A.
Information for Contractor:
In accordance with EO 98-04, Section 3.A., the
contract developer shall inform , each potential contractor who desires to
enter into a contract that is not exempt from I the disclosure requirements
that disclosure is a condition of the contract and that the agency cannot enter
into any such contract for which disclosure is not made.
B.
Required Language in Contracts and
Subcontracts:
1. In accordance with
EO 98-04, Section 5.C., the following language shall be included
in the terms of
every contract with any individual or entity, for
which the total consideration is greater than $25,000, for services funded
through a contract:
"Failure to make any disclosure required by Governor's
Executive Order 98-04, or any violation of any rule, regulation, or policy
adopted pursuant to that Order, shall be a material breach of the terms of this
contract. Any contractor, whether individual or entity,
who fails to make the required disclosure or who violates
any rule, regulation, or policy shall be subject to all legal remedies
available to the agency."
NOTE:
* This language is contained in the Form OSP-1,
which is used for standard PCS contracts.
* For applicable stand-alone PO's, this language shall be added
in › the text of the PO or as an attachment.
2. In accordance with
EO 98-04, Section
2.F.(3), any agreement between the contractor and a subcontractor for
which the total consideration is greater than , $25,000 shall contain the
following language:
"Failure to make any disclosure required by Governor's
Executive Order 98-04, or any violation of any rule, regulation or policy
adopted pursuant to that Order, shall be a material breach of the terms of this
subcontract. The party who fails to make the required disclosure or who
violates the rule, regulation, or policy shall be subject to all legal remedies
available to the contractor."
NOTE: Contract developer shall advise the
contractor of this requirement.
C.
Subcontractors:
1. The Form PCS-D for
sub-contractors shall include a statement containing the dollar amount of the
subcontract.
2. According to DFA
interpretation, Therapeutic Foster Care parents are , considered as
subcontractors for the purpose of disclosure.
3. If Form(s) PCS-D for
subcontract(s) are required but are not submitted with the contract, they shall
be submitted to DFA within ten days of subcontract ' execution, in accordance
with EO 98-04, Section 2.F.(3).
D.
Amendments:
1. All amendments to non-exempt contracts
greater than $25,000 total require disclosure on the contractor.
2. All amendments to non-exempt contracts
greater than $25,000 total require j; disclosure on all
subcontractors receiving over $25,000 total who are affected by the
amendment.
E.
Contract Developer's Responsibility:
During the development phase of the contract, the contract
developer shall determine
1. That the
Form(s) PCS-D has/have been completed, signed, and included in the
contract, where required, AND
2.
a.
That the contract is not prohibited or subject to approval,
OR
b. If subject to
approval, that the required approval has been obtained.
F.
Restrictions and
Approvals (in accordance with EO 98-04, Section 4.):
1.
PROFESSIONAL OR CONSULTANT SERVICES
CONTRACTS BETWEEN AGENCIES AND STATE EMPLOYEES PROHIBITED:
Except as otherwise permitted by law, agencies are prohibited
from entering into, extending, amending, or renewing professional or consultant
services contracts with state employees who are paid from extra help or regular
salaries. None of the exceptions contained in Section 4 C allow agencies to
enter into otherwise prohibited professional or consultant services contracts
with state employees.
2.
PROFESSIONAL OR CONSULTANT SERVICES CONTRACTS BETWEEN AGENCIES AND
CONSTITUTIONAL OFFICERS SUBJECT TO PRIOR APPROVAL:
Constitutional officers, including members of the General
Assembly, or their spouses may enter into professional or consultant services
contracts with agencies only upon the prior approval of the Joint Budget
Committee during legislative sessions, or the Legislative Council between
sessions, and the Governor.
3.
CONTRACTS SUBJECT TO COMPETITIVE
SEALED BID OR REQUEST
FOR PROPOSAL:
An agency may enter into, extend, or renew a contract, lease,
or grant with a * constitutional officer, including members of the General
Assembly, the spouse of a constitutional officer, or an entity in which the
officer- or spouse holds an ownership interest greater than ten percent (10%)
if (i) the contract is the result of competitive sealed bidding or a request
for proposal, and (ii) such officer played no role, directly or indirectly, in
the administrative determination of specifications for the bid or request for
proposal, in the administrative evaluation or consideration of bid or request
for proposal, or in the administrative decision to '-accept
the bid or request for proposal.
An agency may enter into, extend, amend, or renew a contract,
lease, or purchase agreement with a board or commission member, state employee,
the immediate family member of any of these, or any entity in which any of
these persons has an ownership interest of 10% or greater if the contract is
the result of competitive sealed bidding or a request for proposal.
!i
4.
CONTRACTS AND GRANTS GREATER THAN
$25,000 AND NOT SUBJECT
TO COMPETITIVE SEALED BIDDING OR REQUEST FOR PROPOSAL
REQUIRE APPROVAL:
An agency must obtain approval in order to enter into, extend,
amend, or renew a contract, lease, or purchase agreement not subject to
competitive sealed bidding or a request for proposal, as follows.
If the total consideration for the contract is greater than
$25,000 the approval of the Chief Fiscal Officer of the State is required if
the potential contractor or lessee is one of the following:
a. a state employee or the employee's
immediate family member;
b. a board
or commission member or the member's immediate family member, or
c. any entity in which a state employee or
board or commission member, or an immediate family member of any of these:
* * holds any position of control, or
* holds any ownership interest of 10% or greater.
y
If the total consideration for the contract is greater than
$25,000 and the potential contractor, lessee, or grantee is a constitutional
officer, including a member of the General Assembly, the spouse of a
constitutional officer, or a corporation, limited liability company,
partnership, or any other legal entity of which a constitutional officer or the
officer's spouse has an ownership interest of at least ten percent (10%), the
contract, lease, or grant must receive the prior approval of the Joint Budget
Committee during legislative sessions, or the Legislative Council between
sessions, and the Governor.
5.
SUBCONTRACTS:
A constitutional officer including members of the General
Assembly, the spouse of a constitutional officer, or a corporation, limited
liability company, ; partnership, or any other legal entity of which a
constitutional officer or the officer's spouse has an ownership interest of at
least ten percent (10%) may not receive any sub-grant, subcontract, or
assignment of lease from a state agency unless:
a. the constitutional officer, spouse, or
legal entity is disclosed as a sub- [GREATER THAN] grantee or subcontractor in
the competitive bid or request for proposal; or
b. for contracts not requiring competitive
bidding or a request for proposal, prior approval is obtained from the Joint
Budget Committee during legislative sessions, or the Legislative Council
between sessions, and the Governor.
6
APPROVAL PROCEDURE:
The following procedures shall apply to all contracts for which
the prior approval of the Joint Budget Committee during legislative session, or
the Legislative Council between sessions, and the Governor is required. The
Office of State Procurement shall submit the request for approval of the
;; contract to the Chief Fiscal Officer and to the
appropriate legislative body. The Chief Fiscal Officer, on behalf of the
Governor, will notify the agency in writing whether the contract is approved or
disapproved. The legislative body will notify the agency whether the contract
is approved or disapproved. The agency may proceed with the contract upon
receipt of the approval of both the Chief Fiscal Officer on behalf of the
Governor and the appropriate legislative
! body.
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to view image
III.
Quarterly Report
A. In accordance with
EO 98-04, Section
8, all state agencies are required to submit a quarterly report to OSP
itemizing the disclosures that were identified during the ' calendar quarter
for all transactions covered by EO 98-04. Those disclosures required to be
reported include:
1. Sub-grants, contracts, or
leases awarded to a Constitutional Officer or his/her spouse,
including members of the General Assembly, or to an entity in which a
Constitutional Officer or spouse holds 10% ownership interest, IF the
sub-grant, contract, or lease WAS procured
competitively; and
2.
Contracts, leases, or purchase agreements awarded to state employees,
board or commission members or their immediate family members, or to
legal entities in which the individual holds 10% ownership interest, IF
the contract, lease, or purchase agreement WAS NOT
procured -competitively
B. For PCS contracts, janitorial contracts,
and equipment leases, CSS captures the ! data necessary for the
report.
C. For sub-grants and other
purchase agreements, the administering divisions must ; submit the reportable
disclosure data to CSS for inclusion in the report. The division should submit
the information to CSS Program Coordinator no later than the
5
th
working day following the last day of each calendar quarter.
[GREATER THAN]
i- !
i
'F [GREATER THAN]
CHAPTER FOUR
PROCUREMENT
I.
POLICY
This policy applies to all PCS contracts, whether the contract
is executed as a standard PCS contract or as a stand-alone PO.
* Procurement is governed by Arkansas Code at A.C.A.
§
19-11-204, §
19-11-229 through 234, §
19-11-301 through 319, and
§
19-11-801 through
806
* Procurement is also governed by the Arkansas
Procurement Law and Regulations,
which can be found at
http://www.arkansas.gov/dfa/procurement/pro
laws.html.
"Small Procurements", defined as those purchases not exceeding
$5,000 per vendor, per fiscal year, per service, may be purchased without a
competitive procurement process. Competition should, however, be used to the
maximum extent possible. ,
Purchases exceeding $5,000 per vendor, per fiscal year, per
service must be competitively procured unless OSP approves a Sole Source
selection or unless the purchase is otherwise exempt as defined in A.C.A.
§
19-11-203.
Refer to the DHS Procurement Manual for Professional and
Consultant Services for greater detail on the procurement of PCS
services.
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to view image
NOTE:
* It is DHS policy to use open and competitive public
procurement methods to promote cost effectiveness and fairness of opportunity
among all prospective providers of service.
* Open, competitive procurement practices should also be
applied to the greatest extent practicable in contract offers to other state
agencies if there is more than one state agency which might have the capability
to perform the required service(s).
II.
PROCEDURES
A.
Service source selection activities
in each division must be carried out by qualified procurement officials.
Therefore, all Issuing Officers shall be credentialed by CSS as Certified
Procurement Officials (CPO's) before exercising their procurement
activities.
B. Once the
division identifies the need for contracted professional or consultant
services, they should set an allocation (funding amount) and select the
appropriate procurement method from the following methods identified in
Arkansas Code:
1. Small Procurement;
2. Competitive Bid (CB)
3. Competitive Sealed Bid (CSB);
4. CSP, also known as RFP;
5. Request for Qualifications
(RFQ);
6. Sole Source;
7. ABA criteria;
8. Intergovernmental (IG); or
9. Emergency
C. For PCS contracts that are to be
competitively procured by the RFQ method, the . FIRST STEP for the
division is to request, and be granted, approval from the Director of OSP to
use the RFQ method. This approval should be obtained prior to starting work on
the procurement. *
D. For PCS
contracts that are to be competitively procured by the
CSB, CSP,
or
RFQ method (and after receiving OSP's approval, in the
case of an
RFQ), the division shall forward their completed
procurement documents to OCC in accordance with ,, the
"Professional/Consultant Services Contract Critical Process Dates"
to allow OCC sufficient time for review, response, and approval. The
elements generally required include:
1
Procurement proposals prior to public release;
2.
Financial terms, if they
depart from DHS-standard options of fixed rate, final negotiated rate, actual
cost, or scheduled reimbursement; and
3.
Terms and Conditions, if they
depart from the standard, OCC-approved
Terms and Conditions.
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E. Initial standard PCS contracts shall not
extend past the end of the applicable period of legislative appropriation.
However, up to six years' worth of extension options can -be exercised if the
following conditions are met:
1. The OSP
Director approves the extension options prior to the procurement (in : case of
RFQ only);
2. The original
competitive procurement explicitly stipulates the extension ‹
options;
3. The original contract
explicitly stipulates the extension options; AND
4. Service performance under the existing
contract has been satisfactory.
Initial contracts can be extended for a total time period not
to exceed seven years.
The state standard is for the initial contract and each
successive extension period to not exceed one year (i.e., the initial contract
should normally not exceed one year and the contract should be amended to
extend for no more than one year at a time). If circumstances warrant deviation
from the state standard, divisions should consult with CSS.
F. A NEW procurement requires a
NEW contract (i.e., an existing contract cannot be ___ amended to incorporate
the terms of a NEW procurement.)
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G.
Procurement Methods
NOTE: The A.C.A. reference is provided for each
procurement method for more detail on the specific requirements. The
information below only highlights the key areas; it does NOT represent a
comprehensive repeat of ALL the requirements found in the A.C.A. and relevant
Regulations. .
The following procurement options are allowable for PCS
contracts. (A.C.A. §
19-11-203 [14] lists those
commodities and services that are exempt from the I procurement
requirements):
1.
Small Procurement
a. Refer to A.C.A. §19-11 -204
and §19-11 -231.
b.
Small Procurements are
defined as those purchases that do not exceed $5,000
total (i.e., compensation plus reimbursable expenses)
' per vendor, per fiscal year, per service. ,,"
c. Procurement requirements shall not be
artificially divided so as to constitute a Small
Procurement.
d. Competitive
procurement is not required for Small Procurements but is STRONGLY
encouraged.
e. A contract that does
not exceed $5,000 per vendor, per fiscal year, per service should normally be
executed as a stand-alone PO.
2.
Competitive Bid
(CB)
a. Refer to
A.C.A. §
19-11-234.
b. At a minimum, contracts exceeding $5,000
total but not exceeding
;i $25,000 total per vendor, per
fiscal year, per service must be procured
\
by the CB method (or the more formal CSB or CSP method, if
desired) unless OSP approves an alternate procurement method.
c. The CB method of procurement requires
obtaining bids by:
(1.) Direct mail;
(2.) Telephone;
(3.) Written form; and/or
(4.) Electronic media
Note: Written requests and written responses are
far preferable to verbal requests and responses.
d. Sufficient solicitation should be
conducted to elicit three bids. If three bids are not received, the division
must document that at least three firms were contacted OR explain why three
were not contacted. Only firms that could logically provide the service to be
procured should be contacted.
e.
The CB request should specify in detail the project objectives, results
expected, contract extension options, if applicable, and desired \
; qualifications.
f.
R7:
19-11-234
and
ACA
§
19-11-708(a),(b),(c)
require that the following
f Ethics
language be included in
ALL
competitive procurements over -$5,000:
Ethics
It shall be a breach of ethical standards for a person to be
retained, or to retain a person, to solicit or secure a state contract upon an
agreement or understanding for I
a commission, percentage, brokerage, or contingent fee, except
for retention of bona fide employees of bona fide established commercial
selling agencies maintained by the contractor for the purpose of securing
business.
g. The contract
shall be awarded to the qualified bidder responding with ; the lowest bid.
3.
Competitive Sealed Bid (CSB)
a. Refer to A.C.A. §
19-11-229.
b. At a minimum, contracts exceeding $25,000
total per vendor, per fiscal ; year, per service must be procured by the more
formal CSB method. Contracts exceeding $25,000 total per vendor, per fiscal
year, per service may, however, be competitively procured by the CSP method, or
by the RFQ method with OSP approval.
c. CSB procurement requires
public solicitation and
public opening of responses.
d.
Act 157 of 2007 requires that
the following
Illegal Immigrant language be included in all
competitive procurements over $25,000:
CERTIFICATION PRIOR TO AWARD
Pursuance to Act 157 of 2007, all respondents must certify
prior to award of the contract that they do not employ or contract with any
illegal immigrants in their contract with the State. Respondents shall certify
online at: http://www.arkansas.gov/dfa/procurement/pro
ind ex.html.
e.
Act 2157 of 2005 requires that the following
Equal
Employment
Opportunity language be included in all CSB
procurements.
Equal Employment Opportunity Policy
In compliance with Act 2157 of 2005,
for all contracts exceeding $25,000, the Office of State Procurement
(OSP) is required to have a copy of the vendor's Equal Employment Opportunity
(EEO) Policy prior to issuing a contract award to the vendor. The vendor may
submit its EEO policy as a hard copy accompanying vendor's response to this
solicitation or in electronic format to DHS at the following e-mail address:
(the DHS contact's e-mail address inserted here.) DHS will
submit the successful respondent's EEO policy to OSP and OSP will maintain a
,file of all vendor EEO policies received. The submission by the successful
respondent is a one-time requirement but vendors are responsible for providing
updates or changes to their respective policies as necessary. Vendors that do
not have an established EEO policy will not be prohibited from receiving a
contract award, but are required to submit a written statement attesting that
they do not have an EEO policy. n
f.
R7:
19-11-234
and ACA
§
19-11-708(a),(b),(c)
require that the Ethics language be included in all competitive
procurements over $5,000. See specific language under CB above.
g. Divisions shall post the notice on the DHS
website for seven working days. In addition, staff is strongly encouraged to
publish a notice in a newspaper having statewide circulation. Divisions may
also post on their division website a link to the DHS website in order to
promote full awareness of the competitive procurement opportunity to all
potential service providers.
[LESS THAN] NOTE: The division shall post the
notice not fewer than five calendar days nor more than thirty calendar days
preceding the date for the opening of bids, in accordance with A.C.A.
§
19-11-229(d)(1).
h. The CSB statutes and
regulations are much more detailed than those for non-sealed CB and far more
numerous than space here permits Referral to the A.C.A. is
critical
4.
Competitive Sealed Proposal (CSP), also known as Request for
Proposals (RFP)
a.
Referto A.C.A. §
19-11-230.
b. The CSP method of procurement is often
more appropriate for PCS contracts because it allows for factors in addition to
cost to be x considered in the evaluation of responses.
c. If the division wants the option to extend
the contract into successive years, it shall state such in the CSP.
d. If the division wants the option to award
multiple contracts from the CSP under consideration, it should make that
request to the OSP Director, in the following manner:
(1.) Division Director shall prepare an
electronic memo to OSP
Director requesting the option to award multiple contracts from
the identified CSP and stating the reason(s) why multiple awards might be
necessary.
(2.) Division
shall route the electronic memo to CSS Program
Administrator who will forward the request to OSP.
(3.) CSS Program Administrator
shall forward OSP's response to the division.
e. The CSP method is appropriate when the
evaluation involves the relative abilities of respondents to perform, including
the degree of '* technical or professional experience, and
price is not the only consideration.
f. Divisions shall post the notice on the DHS
website for seven working ' days. In addition, staff is strongly encouraged to
publish a notice in a newspaper having statewide circulation. Divisions may
also post on their division website a link to the DHS website in order to
promote full , awareness of the competitive procurement opportunity to all
potential service providers.
NOTE: The division shall post the notice not fewer
than five calendar days nor more than thirty calendar days preceding the date
for the opening of proposals, in accordance with A.C.A. §
19-11-230(c).
g. The division should evaluate proposals by
an OSP-trained evaluation committee consisting of three or more qualified
members in accordance with the requirements set forth in the CSP.
h. The division shall review and evaluate all
proposals that met the established minimum requirements and award the contract
to the respondent that provides the most effective solution for the price
quoted.
i. The division should be
prepared to address, in the legislative review ' process, their criteria for
selection of contractor(s), particularly if the contract(s) was/were awarded to
respondent(s) who did not provide the lowest cost proposal.
j.
Act 1814 of 2003 requires
that ALL CSP's contain language that encourages minority participation. The
following language shall be
s included in ALL CSP's:
MINORITY BUSINESS POLICY:
'* Minority participation is encouraged in this and all other
procurements by state agencies. "Minority" is ›
defined by Arkansas Code Annotated §
1-2-503 as "black or African
American, Hispanic American, American Indian or Native American, Asian, and
Pacific Islander." The Division of Minority Business Enterprise of the
Department of Economic Development conducts a certification process for
minority businesses. Bidders unable to include minority-owned businesses as
subcontractors "may " explain the circumstances preventing minority
inclusion."
k.
Act 157
of 2007 requires that the Illegal Immigrant language be
included in all competitive procurements over $25,000. See the specific
language under CSB above.
I.
Act 2157 of 2005 requires that the
Equal Employment
Opportunity |
language be included in all competitive procurements. See the
specific language under CSB above.
m.
R7:
19-11-234
and ACA
§
19-11-708(a),b),(c)
require that the Ethics language be included in all
competitive procurements over $5,000. See , the specific language under CB
above.
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n. The CSP statutes and regulations are much
more detailed than space here permits. Referral to the A.C.A. is
critical.
5.
Request for Qualifications (RFQ) i|
a. Refer to A.C.A. §
19-11-802.
b. This procurement option is", in the
absence of sole source justification, the procurement method recommended when
contracting for , architectural, engineering, land surveying and legal
services.
c. This option may also
be used, to a limited extent, with prior approval from OSP, for other services
when it is determined to be the most suitable method of contracting. Divisions
should consult with CSS before considering this option.
d. The RFQ method is typically limited to
those situations where there is a clearly defined set of qualifications to be
met and cost is not an evaluation factor for selection.
e. Utilization of the RFQ method must be
prior approved by OSP, except for architecture, engineer, land surveying, and
legal services, as indicated above.
f.
Act 2157 of 2005 requires
that the
Equal Employment Opportunity
language be included in all competitive procurements. See the
specific language under CB above.
g.
R7:
19-11-234
and ACA
§
19-11-708(a),(b),(c)
require that the Ethics language be included in all
competitive procurements over $5,000. See the specific language under CB
above.
h.
Act 1814 of 2003
requires that the Minority Business language be included in
all RFP's and RFQ's. See the specific language under CSP above.
i.
Act 157 of 2007 requires that
the Illegal Immigrant language be i included in all competitive
procurements over $25,000. See the specific language under CSB above.
j. Divisions shall post the notice on the DHS
website for seven working days. In addition, staff is strongly encouraged to
publish a notice in a newspaper having statewide circulation. Divisions may
also post on their division website a link to the DHS website in order to
promote full awareness of the competitive procurement opportunity to all
potential service providers.
NOTE: The division shall post the notice not fewer
than five calendar days nor more than thirty calendar days preceding the date
for the opening of responses, in accordance with A.C.A. §
19-11-802.
k. Architect and engineer contracts for
construction projects are NOT indicated as RFQ on the Form OSP-1
as these contracts are subject to ABA criteria and should, therefore,
reflect "ABA Criteria" as the procurement option.
6.
Sole
Source
a. Refer to
A.C.A. §19-11 -232.
b.
The sole source method shall be used
only as a last resort, and only when other procurement
methods are clearly not applicable.
Exceptions can be requested only if based on statutory
requirements or ; profound programmatic imperatives. The division should expect
detailed questioning in the legislative review process for all sole source
proposals.
c. Sole Source
PCS contracts can be executed under the following circumstances:
(1.)
Sole Source, Exempt by Law
This refers to a contract with a specific provider which
results from a mandate by the court system or from state or federal law.
(2)
Sole Source, Intent to
Award
Divisions may contract by "sole source, intent to award" under
the following conditions:
* They advertise, in a newspaper of statewide circulation
AND on the DHS or the OSP website, their intent to conduct.a
competitive procurement and receive no indication from any vendor expressing
interest in providing the service(s); and
* The advertisement contains the following language: "It is the
intent of the State to award this contract as a sole source should the State
not receive a responsive and responsible response to the solicitation."
(3.)
Sole Source,
Justification Approved by OSP
Except for those contracts that are "Sole Source, Exempt by
Law" or "Sole Source, Intent to Award" and those contracts that are for
performing artists and lecturers, hew sole source contracts require a written
narrative justification, which must be approved in advance by OSP. The written
justification will also be provided to legislators for consideration and
discussion during review by sub-committees and the Legislative Council.
(EXCEPTION: OSP's prior approval is not required for Sole
, Source contracts with state agencies.) [GREATER THAN]
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The procedures for the division to request sole source approval
are as follows:
(a.) Division Director
shall prepare an
electronic memorandum from division
Director on division letterhead to Director of i OSP addressing the following
seven questions: i
(1.) Why is this service
needed?
(2.) What method(s) were
used to determine that a lack of responsible/responsive competition exists for
this service?
(3.) How was it
determined that this provider possesses exclusive capabilities?
(4.) Why is this service unique?
(5.) Are there patent or proprietary rights
that make the required service unavailable from other sources?
(6.) What would the agency do if the
provider/service were no longer available?
(7.) What, if any, program considerations
make the use of a Sole Source critical to the successful completion of the
agency's task?
NOTE:
* If the division wants to have the option to amend the
contract to extend for a multi-year period, the division must also include in
the request an indication of the number of extension options the contract will
have. Even with the OSP Director's approval to reserve this option, division
must re-justify the sole source situation to the OSP Director ! by submitting
answers to the above seven I questions again, and must receive
his/her approval, before exercising the options to amend to extend.
The maximum length of time that a Sole Source contract can
continue without full, formal re-approval by OSP is seven years.
* If known, the division should include the anticipated
effective dates and maximum liability of the initial contract.
(b.) All seven questions
must be addressed in the memorandum, even if the proper response
is "not , applicable." [LESS THAN]
(c.) The memorandum shall be prepared as a
Word® format document suitable for electronic transmission.
(d) The memorandum shall be FROM the division
director TO the Director, Office of State Procurement.
(e.) Division shall submit the memorandum as
an attachment via e-mail to CSS Program Administrator for
coordination/approval.
(f.) CSS
Program Administrator shall coordinate approval with OSP.
(g.) CSS Program Administrator shall forward
DFA's approval or disapproval to the requesting division via e-mail.
(h.) In its submittal of the applicable
contract authorization to , CSS, the division shall include a copy of the
requesting memorandum as well as a copy of DFA's approval message.
7.
Arkansas Building Authority (ABA)
a. Refer to
Architectural Section 6-100
of State Building Services Standards and Criteria - Professional Selection
Procedures for
\ State Agencies.
b. The guidelines and procedures established
by the ABA shall be used in selecting architects, land surveyors, and engineers
for state construction projects.
8.
Intergovernmental
(IG)
a. Refer to
A.C.A. §
19-11-203(14) and
A.G.A. §
19-11-251.
b.
IG contracts are those
involving agreements with governmental agencies (both Arkansas's agencies and
other states' agencies).
c.
IG contracts are not required to be competitively procured. A
contract with a governmental agency is considered an IG contract
even though the contractor may have been selected by a competitive
procurement.
d.
IG
contracts with
Arkansas state agencies with a
total dollar value (compensation plus reimbursement) that exceeds $25,000 are
reviewed by the Performance Evaluation and Expenditure Review (PEER) ;
subcommittee prior to the execution date of the contract.
IG
contracts
; with
other than Arkansas
state agencies, with a total dollar value that exceeds $25,000,
are reviewed by the Legislative Review subcommittee prior to the execution date
of the contract.
EXCEPTION:
Those
contracts with Arkansas state agencies which are executed on the alternate
format in accordance with A.C.A. §
19-11-251
do not require
review by the PEER committee. See Chapter Twelve for Interagency
Agreements.
e.
IG
contracts do not require EO 98-04 disclosure
forms.
f. Although IG
contracts do not require competitive procurement, program agencies
should be able to justify, if the question arises, the selection of \
a particular agency if there is more than one governmental agency that
might have the capability to perform the required service(s).
9.
Emergency
a. Refer to A.C.A. §
19-11-233.
b.
Emergency procurements may
only be requested by the agency Chief
! Fiscal Officer or equivalent or
Director, Division Director or Deputy Director. This option is to be used VERY
SPARINGLY.
c. The Emergency
procurement process allows a contract to be implemented prior to review
by the full Legislative Council. (Unless critical, Emergency
procurements should be made using some form of competitive bid
process.)
CHAPTER FIVE
PROVIDER EXCLUSION RULE
I.
Policy
It is the policy of DHS to conduct business only with
responsible participants/contractors. Participants will be excluded from
participation in DHS programs, if necessary, to protect public funds, the
integrity of publicly funded programs, and public confidence in those
programs.
II.
DHS Exclusion List
A. The DHS Excluded Provider list
is a listing of recipients or contractors determined by DHS to be
excluded from doing business with DHS.
B. Upon receipt of notification that an
entity has been added to the DHS Excluded Provider list, CSS shall
initiate action to terminate all existing contracts with that entity.
C. Staff should refer to DHS
Administrative Policy 1088 and A.C.A. §
19-11-245
for specifics
relative to exclusion.
III.
List of Parties
Excluded from Federal Procurement and Non-procurement
Programs
A. The General
Service Administration (GSA) maintains the List of Parties Excluded from
Federal Procurement and Non-procurement Programs.
B. This is a listing of firms and individuals
that have been suspended, debarred, or otherwise excluded by the federal
government from participating in federal programs.
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C. This listing is available on the Internet,
the address for which can be obtained from CSS.
D. Search of the list is executed by name of
the firm or individual in question.
IV.
List of All Vendors
Suspended/Debarred by State of Arkansas
A. This is the list of all vendors
suspended/debarred by the State of Arkansas.
B. OSP maintains this listing.
V.
Procedure When
Developing PCS Contracts
Divisions should consult the DHS Excluded Provider list,
the GSA list, and the State of
Arkansas list during the procurement process
AND prior to the developing and awarding of any
contracts.
CHAPTER
SIX
PROVIDER AUDIT REQUIREMENT
II.
Procedures
A. Upon receipt of a provider's independent
audit report, OQA Audit reviews the report for any findings and
recommendations.
B. If there are
findings and recommendations, OQA Audit ensures that there is a Corrective
Action Plan and, if necessary, comments on the Corrective Action Plan.
.
C. OQA Audit forwards the
findings and recommendations, the Corrective Action Plan, and any comments to
the program division and to CSS administrative staff. CSS administration shall
distribute copies of the findings and recommendations to the appropriate
Administrative Compliance Officers (ACO's) to use in their compliance reviews.
1. Upon receipt of the above information from
OQA Audit, the division shall determine the course of action to be
taken.
2. If the division
determines that recoupment from the provider or additional payment to the
provider is indicated the following action shall be taken.
a. If the contract is no longer in effect,
the division shall forward its determination to OFA/Accounts Receivable (AR)
for recoupment or to OFA/Accounts Payable (AP) for payment, with copies
forwarded to CSS and OQA Audit.
b.
If the contract is still in effect, the division shall forward its
determination to CSS for payment adjustment, with copies forwarded to OQA
Audit.
3. If the
division determines that no recoupment or additional payment is required, the
division shall forward that information to CSS with a copy to OQA
Audit.
D. For every
contract that is NOT with an Arkansas State agency or an Arkansas Public
\ School, contract developer shall verify that the
contractor's audit status is current.
1. Each
such contract should have on file in DHS Share an electronic Provider
Audit Sign-off Sheet (PASOS) on which OQA Audit has indicated that the
contractor's audit status is "current."
2. If there is no indication in DHS Share
that the contractor's audit is current, developer shall submit to OQA Audit a
PASOS requesting verification of audit status. Developer should
review the returned PASOS to determine contractor's audit
status.
3. If the status is
"current", developer shall proceed with development action.
4. If the status is "not current", developer
should contact contractor to determine if audit has been submitted, to
determine when it will be submitted, or to otherwise resolve the delinquency.
a. Contractors desiring to do so may file an
extension request with OQA. If OQA grants the request, OQA will change the
status to "current" thru the extension date.
b. When the contractor has submitted his/her
audit or has been granted an extension, OQA will send an e-mail notification to
the developer that the contractor's status is now "current".
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CHAPTER SEVEN
PERFORMANCE BASED CONTRACTING
I.
Policy
Refer to DHS Policy 1066 "Performance Based Contracting
Policy" and A.C.A 619-11-1010.
These policies are applicable to every PCS contract and PCS
contract amendment to which DHS is a party except as listed below:
A. PCS contracts for Architectural and
Engineering services that are awarded using ABA criteria; or
B. PCS contracts for
$10,000
total (i.e., compensation plus reimbursable expenses) or less
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Unless otherwise exempt, PCS contracts exceeding $10,000
total must have performance based standards, regardless of whether they are
executed as standard PCS contracts or as stand-alone
PO's.
II.
Procedures
A. The division
shall prepare proposed performance-based standards for each PCS contract except
for exclusions listed previously.
B. The division preparing performance based
standards shall submit the proposed standards and Scope of Work to CSS
electronically for review and approval of the proposed standards.
C. CSS shall review the proposed performance
based standards. CSS shall submit ' any questions regarding enforceability,
adequacy of the scope of work description, or compliance with laws,
regulations, and rules to OCC for a legal opinion. CSS shall indicate their
approval electronically.
D.
Form DHS-1366-A illustrates the required format for performance based
standards. The performance based standards included in the contract are
required to specify the following:
1. Program
deliverables (also known as goals or benchmark objectives) ,
2. Performance Indicators
3. Acceptable performance levels
4. Remedies for unacceptable
performance
E. There is
no need for legal review by CSS if the contracting division certifies the '
following:
1. The contract is identical to an
existing contract that has received CSS or OCC approval except as to contractor
and
2. The existing approved performance terms
are satisfactory and have accomplished the outcomes desired.
Performance Based Contracting Certification, Form
DHS-1366, can be used for this certification.
F.
Inclusion of Performance
Based Standards in PCS Contracts
1
Standard PCS Contracts
a.
Performance based standards shall be made legal attachments in standard PCS
contracts.
b. CSS approval and
division certification shall be included with the contract but not made legal
attachments.
2
Stand-alone PO's for Professional and Consultant Services
a. For each and every PCS contract that is
executed as a stand-alone PO, and for which performance based standards are
required, division shall attach the Contractor Certification Concerning
Performance, Forms DHS-9353 or DHS-9354, to which shall be
attached a copy of the performance based standards.
b. The Form DHS-9353 or
DHS-9354 shall be retained in the Division files.
III.
Performance Evaluation
A. During the
term of the contract, the division shall complete sufficient performance
evaluation(s) to determine if the contractor's performance is satisfactory or
unsatisfactory. /
Legislators, in Legislative Review and PEER Committee
meetings, often ask division staff about the divisions' method(s) of monitoring
performance and the overall success of the program.
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B.
Justification for the division's ultimate determination should be retained in
the division files for a minimum of five years from the expiration date of the
contract.
IV.
Contract Amendments
A. When contract
amendments require changes to the performance based standards, the division
shall submit the revised performance based standards electronically to
;i CSS for review and approval.
B. When contract amendments do NOT require
changes to the performance based standards, the division shall certify that:
1. The amendment changes only quantity,
price, or duration, and
2. The existing approved performance terms
have previously been approved by CSS, are satisfactory, and have accomplished
the outcomes desired.
Form DHS-1366 can be used for this
certification.
NOTE:
Neither CSS approval nor division certification is required for
amendments that terminate a contract.
C. If an amendment changes some but not all
of the performance based standards in a PCS contract, CSS approval shall be
obtained for those that are changing and the division shall certify for those
that are not changing.
i
CHAPTER EIGHT
MATCHING FUNDS
I.
Policy
A. Matching requirements are based on federal
or state legislation or DHS policy decisions. If required by the terms of the
contract, the contractor may certify that specific amounts of money, property,
or services are available to match funds. See Financial Guidelines for
Purchased Services, Section 3700 for more information.
B. Certain funding sources (e.g., Social
Services Block Grant [SSBG]) have specific requirements regarding the source(s)
of match that are available for utilization. See Social Services Block
Grant Program Manual, Section 5100 for more information.
II.
Procedures
A. For all agreements that require matching
funds, the terms (including associated percentages of state, local, or
certified levels of participation) should be specified in the agreement.
(NOTE: A section for the required match information is included in
the standard, OCC-approved Terms and Conditions.)
B. When specified limits are exceeded or
match rate changes, an amendment to the agreement should be executed.
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CHAPTER NINE
RATE INCREASE APPROVAL
I.
Policy
A.C.A.
§
20-76-212
and §
20-77-110
govern rate
increases to DHS contractors.
II.
Requirements
A. In many situations, it is prohibited to
increase the contractor's reimbursement rate without first obtaining the
approval of the Governor of Arkansas and the Chief Fiscal Officer,
DFA.
B. New contracts are not
subject to this requirement.
C.
Some fixed rates that function as ceiling rates can allow for increases in
payments that do not constitute a rate increase above the ceiling
rate.
D. Administrative contracts
or other PCS contracts entered into by the Medicaid program with individuals or
corporations not as providers of medical service do not come within the scope
of this regulation. These contracts already have a review process established
which includes DFA and the legislature.
E. When a Medicaid rate increase is approved
for a service that is in a PCS contract, DHS can pay the increased rate without
having to request a rate increase through the Governor
IF and only
if the contract contains the following language:
(Listing of services) are Medicaid
reimbursable services and the reimbursement rate will be equal to the Medicaid
rate in effect at any given time."
F. In those cases where the Governor's
approval is required, the implementation of rate || increase will not be
approved prior to the date of his/her signature on the ‹
Reimbursement Rate Increase Approval Form, Form DHS-1951.
III.
Procedures
A. To request an increase
in the reimbursement rate(s) for service(s), the division shall complete
Form DHS-1951 and submit it to CSS Assistant Director along with
justification and supporting documentation. The Form DHS-1951
requires an original signature by the division Director. One form should
be completed for each contractor.
B. CSS Assistant Director or designee shall
process the request and forward through DHS Chief Fiscal Officer to DHS
Director.
C. Upon his approval, DHS
Director shall route the request and the justification to the Governor's Office
for approval. If he does not approve, DHS Director shall return the request to
CSS Assistant Director.
D. Upon his
approval, the Governor will return the signed request to CSS Assistant
Director. CSS Assistant Director or designee shall notify the requesting
division and ACO of the Governor's approval or disapproval.
For rate increase requests that relate solely to Medicaid and
that are strictly under the auspices of DMS, the request originates within DMS
for coordination through OFA and the DHS Director's Office to DFA, Office of
Budget and on to the Governor. These requests do NOT flow through CSS. All
other rate increase requests SHOULD flow throuah CSS as outlined above.
CHAPTER TEN
PROFESSIONAL ANDCONSULTANT SERVICES
CONTRACTS
I.
Policy
See A.C.A. § 19-11-200et seq., §
19-11-700et seq., and § 19-11-1000et seq.
II.
PCS Contracting
Requirements
A. PCS Contracting
Formats
1.
Standard PCS
Contracts
a. All PCS contracts that
exceed
$25,000 in compensation per vendor, per cost
center, per service shall be executed on the
Form OSP-1. (All PCS
contracts executed on the
Form OSP-1 are referred to in this
Manual as
"standard PCS contracts.")
EXCEPTION:
In accordance
with the rules and regulations promulgated under AC A §
19-11-251, interagency
agreements for professional or consultant services may be executed on an
alternate format from the standard Form OSP-1, inter-agency
agreements being defined as those between a DHS division and another state
agency. The alternate format designed for this purpose is the DHS-9198
(and the DHS-9198A for amendments). Use of this alternate
format requires the prior approval of the OSP Director.
b. Standard PCS contracts that exceed
$25,000 in compensation per vendor, per cost center,
per service are required by Procurement Law to be submitted to DFA for review
and approval. DHS has opted, however, to submit ALL standard PCS contracts to
DFA for review and approval.
c.
Standard PCS contracts that exceed
$25,000 total (i.e.,
compensation plus reimbursable expenses) per vendor, per cost
center, per service must also be reviewed by the Legislative Council (or Joint
Budget Committee when legislature is in session).
(1.) Those contracts with Arkansas state
agencies must be presented to the
PEER Subcommittee prior to
approval by DFA and prior to the execution date of such contract.
EXCEPTION:
In accordance
with the rules and regulations promulgated under AC A §
19-11-251, interagency
agreements for professional or consultant services executed on the alternate
format do NOT require review by the PEER Subcommittee or
Legislative Council.
(2.)
Those contracts with state agencies other than Arkansas state agencies must
be:presented to the Review Subcommittee
prior to approval of DFA and prior to the execution date of such
contract.
(3.) The Legislative
Council or the Joint Budget Committee may elect to review or exempt any
contract or group of contracts.
2.
Stand-alone PCS PO's
a. PCS contracts that DO NOT exceed $25,000
in compensation per vendor, per cost center, per service may be executed on the
PO format and are referred to in this Manual as
"stand-alone PO's".
Agencies j, shall not, however, split known quantities into smaller
($25,000 and below) amounts to avoid a standard contract.
A division may execute a PCS contract that does not exceed
$25,000 in compensation per vendor, per cost center, per service as a standard
PCS contract, if preferred.
b. Stand-alone PO's require neither DFA
review and approval nor * legislative review unless they exceed $25,000 total
(compensation plus reimbursable). However,
multiple PO's to the same
contractor in the same fiscal year from the same cost center MUST be
reported
to OSP to assist OSP in determining whether an
agency is issuing multiple PO's in an attempt to circumvent the requirement of
establishing a standard PCS contract. (See A.C.A. §
19-11-1012 )
;
c. The services shall not ' be rendered prior
to the issuance and acceptance of the stand-alone PO.
d. In the event that services not exceeding
$5,000 per vendor, per cost center, per service are rendered prior to the
issuance of a PO being in effect, Division Director shall prepare a request to
the DHS CFO for approval of a post-delivery PO. The request shall address the
following:
* The reason the services were provided without benefit of a PO
* being in place;
* The amount of the charges that were incurred without a PO
being in place;
* Request for ratification of charges incurred in violation of
procurement law.
In the event that services exceeding $5,000 per vendor, per
cost center, per service are rendered prior to the issuance of a PO being in
s effect, Division Director shall
prepare a request to the OSP Director for ratification of charges that were
incurred, in accordance with A.C.A. §
19-11-247. The request
shall address the following:
* The reason the services were provided without benefit of a PO
being in place;
* The amount of the charges that were incurred without a PO
being in place;
* Confirmation, if applicable, that neither the vendor nor the
agency acted fraudulently or in bad faith;
* The steps taken by the division to prevent such an occurrence
in the future;
* Request for ratification of charges incurred in violation of
procurement law.
B.
Timeframes
1. All standard PCS contract proposals should
be negotiated, developed, and submitted to CSS in sufficient time to allow for
a thorough compliance review by CSS, approval and signature by the division,
and approval and signature by the contractor. This review, approval, and
signature is required prior to the routing of the proposal to DFA, if
applicable, and prior to the effective date of the contract action.
2. For specific deadlines for the submission
of authorizations to CSS and signed contracts to DFA, refer to the
Professional/Consultant Services Contract ; Critical Process Dates
that is available from CSS. Cooperation in meeting \
the published deadlines will avoid possible delays in service and
Suspension ‹ of the Rules.
3.
Contracts requiring legislative review that are submitted to DFA after the due
date must be accompanied by a
Suspension of the Rules letter from
the DHS Director (see sample letter in Appendix). This letter should contain
the following:
a. Contractor's name
b. Request for suspension of the
rules
c. Explanation for failure to
submit the contract under regular procedures
d. Description of the service(s) being
purchased
e. Consequences if the
request is not granted
C. General requirements for all PCS contracts
include, but are not limited to, the
I following:
1. DHS standard is that initial contracts
shall not extend past the end of the fiscal year. Requests for initial
contracts to extend past the end of the fiscal year will be considered by CSS
on a case by case basis. In any case, the initial term of a PCS contract shall
not extend past the end of the applicable period of legislative
appropriation.
2. PCS contracts may
be amended to extend for a total period of no more than seven years.
3. PCS contracts with
individuals and sole
proprietorships are prohibited unless | approved by
OCC and are, in any case, strongly discouraged. (A sole i proprietor is one who
owns all of the assets of the business and is solely ll liable for all the
debts of the business.)
4. In many
situations, it is prohibited to increase the contractor's reimbursement rate
without first obtaining the approval of the Governor of Arkansas and the Chief
Fiscal Officer, DFA.
Note: New contracts are not subject to this
requirement. Also, some fixed rates that function as ceiling rates for services
can allow for increases in payments that do not constitute a rate increase
above the ceiling rate. (See Chapter Nine of this
Manual.)
5. For all
contracts that were competitively procured and that exceed $25,000, . the
contractor must submit (or have on file with CSS) a copy of its Equal ;
Employment Opportunity (EEO) policy. Contractors that d*o not have an
!i
established EEO policy must submit a written statement
attesting that they do not have an EEO policy. This EEO policy, or statement,
shall be made a part of the contract file and shall be submitted to DFA, if
required..
6. Certain PCS
contracts require additional approval beyond the normal procedure.
a. Construction-related contracts require
review by and approval from CSU and ABA.
b. PCS contracts for information systems
technology and services (including the purchase of computer equipment) require
review by and approval memo from the DHS Office of Systems and Technology (OST)
prior to the development of the contract (see DHS Policy 1022 for
details.) Re-approval is required for all amendments to applicable
contracts.
c. Contracts for legal
services to represent DHS require review by and approval from OCC, for
coordination to DHS Director (see DHS Policy 1073).
7. Standard PCS contracts are not
binding, and no payments will be made, until they are approved by both
contracting parties (the contractor and the division Director), as well as by a
representative of DFA when applicable. Standalone PO's are considered effective
and, therefore, binding upon the contractor's acceptance of the
terms.
8. Funding amounts based on
Final Negotiated or Fixed unit rates should be computable to an even number of
units whenever practical. If the contract amount cannot be computed to an even
number of units, the number of full units possible should be indicated, with a
notation made that payment cannot exceed the contract total. Funding amounts
based on budgets should be exact, not rounded. Contract totals that include
more than one funding source should reflect the exact total of the funding
sources, not a rounded amount.
9.
The prior written approval of OCC is required for the contractor to assign the
. contract in whole or in part or any payment arising out of it.
10. Contractors shall insure
non-discrimination and equal opportunity by subcontractors in compliance with
all applicable federal laws, regulations, executive orders and civil rights
rules and regulations.
*
11. For
standard PCS contracts, the contractor's status of "good standing" with the
Arkansas Secretary of State is required. (Exception, this does not apply to
contracts with individuals, contracts with governmental entities, or contracts
with out-of-state vendor who are NOT transacting business IN Arkansas.)
D.
Electronic
Signatures
1. Electronic signature
protocols for DHS contracts are in compliance with federal and derivative state
statutes, including §
19-11-203(29),
§
25-31-104 and -105, and the
Arkansas Uniform Electronic Transactions Act of 2001 codified at §
25-32-101,
et.seq.
2. An
electronic signature is recognized as valid under Arkansas law if there is
evidence of intent by the signatory to be bound by a verified, unique
electronic signature under the sole control of the signatory.
3. The documents are created by CSS as
"portable document files" (PDF files) using Adobe 8.0 or later software. DHS
program personnel will sign electronically using one of two options:
* Use of signature software licensed under an approved
third-party certification authority
* Use of electronic signature capability inherent in Adobe
Reader software ' version 7.0.5 or newer, following verification of
self-certification and signature archiving by CSS
\ /
4. Providers who wish to participate fully in
electronic development of their legal agreements with DHS will sign
electronically using signature capability inherent in Adobe Reader software
version 6.0 or newer after first establishing authorized signatories as valid
and current within the CSS system. Participating providers must complete an
"Electronic Signature Verification" form indicating their
cognizant acceptance of CSS protocols and their desire to use electronic
signature as an affirmative and binding n obligation on contracts
provided.
E.
Ethics in Public Contracting
1. Ethics
in public contracting is addressed in A.C.A. §
19-11-701 through
717.
2. DHS shall conform to
high professional standards and stringent procurement practices to sustain
public trust in their functions. Public employees must discharge their duties
impartially so as to assure fair competitive access to governmental procurement
by responsible contractors. Moreover, they should conduct themselves in such a
manner as to foster public confidence in '' the integrity of the state
procurement process.
F.
Reimbursement Guidelines
The contractor and division should agree upon the method of
reimbursement before a contract is developed. The following methods are
acceptable (see Financial Guidelines for Purchased Services for
greater detail):
1. Fixed Rates
a. Fixed rates are based on a rate schedule
approved by DHS and ; standardized for a particular service or group of
services. Rate * schedules are developed by the division funding the program.
The division should adhere to the DHS criteria for a cost study.
b. The contractor rates should fall within
the range of allowable rates shown on the approved rate schedule. Amendments to
revise rates within this range are completed on a prospective basis from the
effective date of the contract amendment. Fixed rates based on federal approved
rates such as Medicaid may be effective on the date of approval by the federal
agency.
c. All payments are final
and no settlement will be made upon expiration of the contract.
d. Fixed rates are appropriate for services
that can be objectively defined in the procurement and for which risk of
performance is manageable. For example, if the service is measurable by hourly
or daily rates, this method should be used. Fixed rate contracts are ideally
suited for performance-based statements of work, measurable performance
standards, and monitoring reports. When being reimbursed on a fixed rate basis,
contractors tend to be motivated to find improved methods of performance in
order to increase its profits.
2. Final Negotiated Rates
As with fixed rates, final negotiated rates are appropriate for
services that can i be objectively defined in the procurement
and for which risk of performance is manageable. Also, contractors reimbursed
on a final negotiated rate basis tend to find improved methods of performance
to increase their profits.
There are a variety of approved methods to determine an
estimate of reasonable and necessary expenditures per unit of service being
purchased. These include, but are not limited to, the following:
a. A total operational budget allocated to
service component;
b. The published
rates of the contractor for non-contract clients;
c. The established community rate for a
similar service;
d. The previous
year's audit; and e. The contractor's cost study.
3. Actual Cost
a. Actual cost reimbursement is based on a
complete itemized listing of allowable program expenses (i.e., a budget).
b. The total itemized listing
should equal the total DHS funding in the contract.
c. Actual cost reimbursement is appropriate
for services that can only be › defined in general terms or for which the
risk of performance is not reasonably manageable. For actual cost
reimbursement, the division should seriously consider what costs are to be
allowable and what costs are unallowable. This requires reliance on the
division's experience, knowledge, and historical data from similar
contracts.
d. Federal reporting has
demonstrated that converting from actual cost reimbursement to a rate based
reimbursement has significantly reduced contract prices.
4. Scheduled Reimbursement
a. Scheduled reimbursement -
actual cost basis
(1.) Scheduled reimbursement on an actual
cost basis is based on a payment schedule that is included in the contract. The
payment schedule shall be based on an itemized listing of allowable program
expenses (i.e., a budget) that is on file with the division.
(2.) The payment schedule shall include the
total dollar amount, total compensation amount, and total reimbursable
amount.
(3.) The payment schedule
shall indicate that payments are based on actual expenditures incurred and no
advance payments are allowed. Division shall reconcile payments to the
contractor's reported expenditures and make payment adjustments as
necessary.
(4.) The payment
schedule shall indicate the anticipated date and amount of each
payment.
(5.) The payment schedule
shall address invoicing requirements, expenditure reporting and payment
adjustments, as applicable.
(6.) As
with actual cost reimbursement, scheduled reimbursement on an actual cost basis
is appropriate for services that can only be defined in general terms or for
which the risk of performance is not reasonably manageable.
(7.) Again, federally reporting indicates
agencies significantly reduce their contract prices when converting from actual
cost-based reimbursement to a rate based reimbursement.
b. Scheduled reimbursement -
fee
basis
(1.) The payment schedule
shall include a statement identifying the basis for reimbursement.
(2.) The payment schedule should indicate the
anticipated date of payment, amount of each payment, and total applicable
funding.
G.
Payment Limitations
The division may impose payment limitations on certain funding
sources to be able to maintain payment capabilities to all contractors and/or
to levelize payments to contractors throughout the contract period. Payment
cuts to contractors necessitated by payment limitations are restored in
subsequent payments within the contract period.. Common payment limitations
include Monthly Cumulative and Quarterly Cumulative.
1. Monthly Cumulative
Payment to the contractor is limited to 1/11 or 1/12 (to be
determined by the division) of the maximum annual contract liability for each
month of the contract on a cumulative basis (e.g., at the end of the first
month of a 12 month contract, the payment limitation is 1/12 of the contract
liability; at the end of the second month the payment limitation for the two
month period is 2/12 of the maximum liability, etc.)
2. Quarterly Cumulative
Payment to the contractor is limited to one quarter of the
maximum contract liability for each quarter of the contract on a cumulative
basis (e.g., at the end of the first quarter, the payment limitation is 25% of
the contract liability, at the end of the second quarter the payment limitation
for the six month period is 50% of the maximum liability, etc.)
H.
Services
Accepted/Rendered Prior to Date of Contract
1. Professional Services should NOT
be accepted or rendered prior to a contractual agreement being in
effect.
2. In the event that
services are rendered prior to the issuance of a contract being in effect,
refer to Chapter Ten, Section II., A., 2.
III.
Development of Standard PCS
Contracts
A. The DHS standard is that
CSS develops all standard PCS contracts upon receipt of authorizations from the
DHS divisions requesting such contracts.
NOTE:
CAP
is the electronic
system through which contracts are authorized, developed, reviewed, approved,
and signed.
* The division requesting contract development shall submit ALL
authorizations to CSS in electronic format.
* CSS shall develop and review contracts electronically.
* Division Director or designee shall review contracts and
indicate approval of such electronically.
i!
* ACO shall print contracts for manual signature by the
contractors, or shall submit the contracts to contractors for electronic
signature, following electronic review and approval by division Director or
designee.
B. The following
procedures apply to development actions executed by CSS (for development
actions executed by the division, proceed to C. below).
1. Division shall include the following in
its authorization:
a. Completed
Contract Authorization/Input Form, Form DHS-9190
(
(1.) Most
contracts must be entered into Arkansas Administrative Statewide Information
System (AASIS) as an outline agreement.
(a) If
the contract the contract is to be paid in AASIS through a PO and the division
is doing its own AASIS entry, the division shall create the outline agreement
in AASIS and enter the outline agreement number on the Form DHS-9190
as the contract number.
(b.)
If the contract is to be paid in AASIS through a PO and CSS is doing the
division's AASIS entry, the division shall leave blank the contract number
field on the Form DHS-9190.
(2.) Some Medicaid-related contracts are paid
through a third party and are NOT entered into AASIS as outline agreements, in
which case the division shall leave the contract number field blank. CSS shall
enter a unique, division-specific, ten-digit contract number on the
Form
DHS-9190 upon receipt of the authorization. The contract number shall be
in the following format:
* '3-digit agency number (710)
* 2-digit division identifier (as identified in Form
DHS-9190 instructions, e.g., DM, etc.)
* 2-digit state fiscal year identifier (e.g., SFY05 would be
"05")
* 3-digit sequential numerical identifier starting with 001
(3.) Division shall
clearly identify the geographical service coverage area in the space provided
on the DHS-9190. Division shall identify the area in terms of
actual counties served or geographical portion of the state (ex., northwest
quadrant, etc.) '' as opposed to division-specific areas (ex., DCFS Area V,
etc.) If the contract covers services for the entire state, division shall
identify "statewide" as the service coverage area.
b. CSS- or OCC-approved performance based
standards and evidence of i approval or division
certification;
c. A copy of the
contractor's EEO policy (or approved alternate statement), if the contract were
competitively procured and exceeds $25,000;
d. Any other legal attachments, including
required financial information;
e.
Any additional information necessary concerning billing, forms the contractor
is required to use, procurement documentation, etc.
2. Upon receipt of the authorization,
assigned CSS individual(s) shall review the ' authorization, consult with the
contractor, complete the contract proposal, and review the completed proposal
for technical compliance and completeness.
NOTE: For contracts exceeding $25,000, that are
with a non-State agency, contract developer shall verify that contractor has a
current certification on the | OSP website that he/she does not employ or
sub-contract with any illegal immigrants. "Current" is defined as within 3
months prior to the date contract developer checks the website.
NOTE: The following
instructions for standard PCS contracts pertain to those executed ,, on the
Form OSP-1. For those executed on the alternate format, see
Chapter Eleven. i
Click
here to view image
C.
The complete standard PCS contract
shall include the following items:
1. FormOSP-1;
a.
It is ABSOLUTELY CRITICAL
* that the funding tally to the penny,
* that the funding percentages are accurate,
and
* that the procurement methodology is correctly
indicated!!!
Failure to have 100% accuracy in any of these three
crucial areas will result in the legislative review staff rejecting the
contract!!
b. The
contract name should be the complete, legal name of
the contractor as opposed to the "doing business as" name. For incorporated
entities, the legal name is found on the contractor's incorporation papers and
on the Arkansas Secretary of State website (for Arkansas incorporated
entities). The contract address should be t the address of the
legal headquarters, as opposed to the "remit to" address.
2.
All attachments referenced on Form
OSP-1;
All attachments should be numbered in sequential and consistent
form.
3.
Form PCS-D
(for applicable contracts over $25,000);
a. All disclosures requiring pre-approval by
DFA should be resolved prior to completion of the contract.
b. The Form PCS-D shall not be
made a legal attachment.
4.
Performance Based Standards
(Required for applicable PCS contracts over $10,000);
a. Performance based standards require
approval of CSS or OCC according to DHS Policy 1066. This approval
should be in the form of electronic mail submission.
b. For amendments or contracts using
previously approved performance based standards, the division shall provide
certification of performance based standards, in accordance with DHS
Policy 1066. If the division certifies for performance based standards
previously approved by CSS or OCC (prior to the development of this contract),
a copy of CSS' or OCC's approval shall also be included.
c. Performance based standards shall be made
a legal attachment. Approval and division certification should be included in
supporting documents.
5.
Terms and Conditions, Forms DHS-9193 and DHS-9194;
a. This document contains the legal and
financial terms of the contract.
Form DHS-9193 is for contracts
with a non-state agency;
Form DHS-9194 is for contracts with a
state agency.
NOTE: The state agency version (Form
DHS-9194) is applicable to contracts with other states' agencies (ex.,
OK, TX, MS, etc.), not just Arkansas's state agencies.
b. The Form DHS-9193 or
Form DHS-9194 shall be the current version provided by CSS (as
will be evidenced by the release date at the bottom of each page of the form).
Referral to and/or consultation with OCC is required if an alternate version is
to be utilized.
c. This document
shall be made a legal attachment.
6.
Budget/Rate Information;
a. For contracts reimbursed on an
Actual Cost basis
(1.) The
contract shall include a statement to the effect that reimbursement is based on
an itemized listing of expenses that
! is on file with the division
OR shall include an itemized listing of allowable
expenses (i.e., a budget).
(2.) The
statement or itemized listing shall indicate the total liability, total
compensation amount, and total reimbursable amount.
(3.) For an actual cost contract that
includes subcontractor expenses:
(a.) If the
division requests that the itemized listing of expenses (i.e., budget) be
included in the contract, the sub-contractor's budgets shall be included in the
contract, ' as well. If the subcontractor is reimbursed on an
actual j cost basis, the costs shall be identified as compensation " and
reimbursable expenses.
(b.) If the
itemized listing of expenses is on file with the division as opposed to in the
contract, the sub-contractor's budget shall be on file with the division, as
well. If the subcontractor is reimbursed on an actual cost basis, their
expenses shall be split between compensation and reimbursable
expenses.
(4.) Indirect
Costs should normally be split between compensation and reimbursable expenses
by the same percentages by which the Direct Costs are split between
compensation and reimbursable expenses.
(5.) If the contract identifies purchased
services to DHS clients, (i.e. indicates or refers to service[s] by service
name and service code on the
Form DHS-9190) the itemized listing
should include:
(a.) service name(s),
and
(b.) service unit
definition(s).
(6.) The
statement or itemized listing of expenses shall be indicated on the Form
OSP-1 or made a legal attachment.
b. For contracts reimbursed on a
Fixed
or
Final Negotiated Rate basis
(1.) The rate schedule shall be indicated on
the Form OSP-1 or made a legal attachment to the
contract.
(2.) The rate schedule
shall indicate the basis for the rate(s).
(3.) If the contract identifies purchased
services to DHS clients, (i.e. indicates or refers to service[s] by service
name and service code on the
Form DHS-9190) the rate schedule
should include:
(a.) service
name(s);
(b.) service unit
definition(s); and
(c.) unit
rate(s).
(4.) The
division shall maintain budgets or other supporting documentation pertaining to
the establishment of the Fixed or f
Final Negotiated Rates.
(5.) Subcontractor costs should normally be
considered as compensation for Fixed or Final Negotiated rate contracts.
Note: If the division has a specific request and
justification for including program-specific budgets and/or a full-disclosure
budget as a part of the contract, they may be added as legal attachments. CSS
will review the program-specific budgets, but not the full-disclosure
budgets.
c. For
contracts reimbursed on a
Scheduled Reimbursement basis
(1.) The schedule shall include a statement
indicating the basis for the scheduled reimbursement (actual cost or fee
basis).
(2.) For scheduled
reimbursement on an
actual cost basis, the payment
schedule shall include:
(a.) The anticipated
date and amount of each payment;
(b.) A statement indicating that the payment
schedule is based on a budget that is on file with the division;
(c.) The total dollar amount, total
compensation amount, and total reimbursable amount;
(d.) A statement to the effect that payments
are based on actual expenditures incurred and no advance payments are
allowed;
(e.) Invoicing
requirements, expenditure reporting and i payment adjustments, as applicable.
NOTE: The division shall reconcile payments to the contractor's
reported expenditures and make payment adjustments as necessary.
(3.) For scheduled
reimbursement on a
fee basis, the payment schedule
shall include:
(a.) The anticipated date and
amount of each payment and the total funding;
(b.) A statement identifying the basis for
reimbursement.
d. The method of reimbursement shall be
correctly identified on the Form DHS-9193 or Form
DHS-9194
7.
Illegal Immigrant Certification:
a. ACO shall make a screenprint verifying
that the contractor has recently certified on the OSP website that he/she does
not employ or subcontract with any illegal immigrants.
b. ACO shall label the certification with the
contract number but shall not make it a legal attachment to the contract.
D. Other
elements may be required to complete the standard PCS contract. They include,
but are not limited to:
1.
Sole Source
Documentation;
Sole Source PCS contracts, except for those for performing
artists and lecturers, must be justified.
a. For "Sole Source by law,"
reference the mandating legislation or the ! court order number on page
1 of Form OSP-1.
b.
For "Sole Source by Intent to Award", include a copy of the
advertisement and the dates the advertisement ran.
c. For "Sole Source by Justification
Approved by OSP," include a copy of the division's justification and of
OSP's approval.
d. The Sole Source
documentation shall not be made legal attachments. s
2.
Prior Approval for RFQ
Selection;
a. Prior approval from DFA
is required for RFQ procurements (except for contracts for architect, engineer,
land surveying, or legal services.)
b. This approval shall not be made a legal
attachment.
3.
EEO
Policy;
a. Contracts that were
competitively procured and that exceed $25,000 must include a copy of the
contractor's EEO policy, or a statement from the contractor attesting that they
do not have an EEO policy.
b. This
information shall not be made a legal attachment.
4.
Certification Regarding
Lobbying;
a. Anytime a PCS contract
total reaches or exceeds $100,000 in federal funds, the Form DHS-9350
must be made a legal attachment.
b. The $100,000 threshold pertains to ALL of
the federal funding in the specific contract at hand, as opposed to all the
federal funding received by the contractor from all sources. The $100,000
pertains to the contract TOTAL, not the amount per fiscal
year.
c. In lieu of the contractor
signing the Form DHS-9350, developer shall , enter "see
signature and date on form_______" in the signature field on the
Form DHS-9350.
d.
Certification shall be made a legal attachment to the contract.
5.
Funding
Availability;
a.
A Funding
Availability statement should be added to any contract that has funding
within the contract with effective dates (beginning and/or ending dates) that
differ from that of the overall contract.
b. The Form DHS-9196, Funding
Availability, or any similar format that clearly states the necessary
information, may be used for this purpose.
c. The Form DHS-9196 (or
alternate format for the same purpose) shall be made a legal attachment to the
contract.
6.
Matching Terms;
a. Specification
of matching terms is required when funds included in the contract have a
required match from state and/or local funds. (If the standard Terms and
Conditions are utilized, no additional documentation regarding matching
arrangements is required.)
b. This
specification shall be made a legal attachment.
7.
Reimbursement Rate Increase
Approval, Form DHS-1951;
a. Rate
increase approvals are not effective until the date of signature by the
Governor of Arkansas on the Form DHS-1951.
b. An approved Form DHS-1951 is
required for rate increases for services. Note exceptions in Chapter Nine
of this Manual.
c. The
Form DHS-1951 shall not be made a legal attachment.
8
Independent Contractor
Checklist, Form DHS-9356;
a. If the
contractor is an individual or sole proprietor, the division shall complete the
Independent Contractor Checklist, Form DHS-9356,
and shall obtain OCC's approval to contract with an individual
or sole proprietor.
b. The
purpose of this documentation is to assess and confirm the status of the
individual or sole proprietor as an independent contractor rather than a DHS
employee.
c. The Form
DHS-9356 and OCC approval shall not be made legal attachments.
9.
Waivers of Policy;
a. The requesting division Director or
designee should obtain approvals for waivers of any DHS promulgated policy from
the DHS Chief Fiscal Officer or designee.
b. Waiver approvals shall not be made legal
attachments.
10.
Secretary of State Standing;
a.
For standard PCS contracts, the contractor's status of "good standing" with the
Arkansas Secretary of State is required. (Exception: this does not apply to
contracts with individuals, contracts with governmental entities, or contracts
with out-of-state vendors who are NOT transacting business IN
Arkansas.)
b. Evidence of this
standing shall not be made a legal attachment.
11.
Suspension of the Rules Letter
(see sample letter in Appendix);
a.
This letter is required for all contracts requiring legislative review that are
submitted to DFA after the date due to DFA.
b. This letter shall not be made a legal
attachment.
12.
Business Associate Agreement (BAA), Form DHS-4001;
a. A BAA, when required, must be the latest
version and must be signed by the contractor to demonstrate its compliance with
the Health Insurance Portability and Accountability Act (HIPAA). The BAA shall
not be made a legal attachment to the standard PCS contract.
b. BAA's are required for ALL new standard
PCS contracts with the following divisions:
(1.) Division of Developmental Disabilities
Services (DDS);
(2.) Division of
Behavioral Health (DBH);
(3.)
Division of Youth Services (DYS);
(4.) DMS; and
(5.) OCC, IF OCC is
contracting for the services of counsel or an expert witness to represent one
of the above divisions.
c. BAA's are NOT required for new standard
PCS contracts with the following divisions:
(1.) Division of Aging and Adult Services
(DAAS);
(2.) Division of Childcare
and Early Childhood Education (DCCECE);
(3.) Division of Children and Family Services
(DCFS);
(4.) Division of County
Operations (DCO);
(5.) Division of
Services for the Blind (DSB);
(6.)
Division of Volunteerism (DOV);
(7.) Director's Office;
(8.) OFA; and
(9.) OCC, except in the circumstances noted
above
13.
Tobacco Settlement Funds
a. In
accordance with Act 1586 of 2003, and Act 2310 of 2005, PCS contracts funded by
Tobacco Settlement funds shall include a legal attachment staging:
"The Division of______________is not obligated to continue the
funding this contract paid from the proceeds of the Tobacco Settlement in the
event that
Tobacco Settlement funds are not sufficient to finance the
contract. State funds will not be used to replace Tobacco Settlement funds when
such funds expire unless appropriated by the General Assembly and authorized by
the Governor."
b. For
standard PCS contracts, the source of funding shall be clearly identified on
the
Form OSP-1 and the funding shall be categorized as "Other".
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IV.
Signing and Routing of Standard
PCS Contracts
A. The division shall
secure electronic approval of the division Director or designee on the contract
proposal.
B. CSS ACO shall secure
the signature of the contractor on the contract proposal.
C. ACO shall route the contract to DFA
electronically, if applicable.
EXCEPTION:
In accordance
with ACA §
19-11-251, inter-agency
agreements for professional or consultant services executed on the alternate
format do NOT require review by DFA.
V.
Legislative Review and DFA Approval
of Standard PCS Contracts
A. Following
their review of the standard PCS contract, DFA will forward those contracts
that are over $25,000 for legislative review at the next regularly scheduled
Review or PEER subcommittee meeting.
1. Review
Subcommittee usually meets the first Wednesday of each month.
2. PEER Subcommittee usually meets the first
Thursday of each month.
B. It is very important for the division to
have knowledgeable representatives in attendance at the committee meeting to
answer programmatic and budgetary questions about the specific contracts on the
agenda as well as more general questions concerning the entire program. Typical
questions that can be anticipated include:
1.
What was the procurement method?
2.
If the procurement were Sole Source, why was a competitive method not utilized?
-
3. If the procurement were
competitive, how many responses were received and how did the other responses
compare to that of the selected entity (including, at times, the relative
comparison of cost proposals)?
4.
What are the services being provided and how will contractor performance be
monitored?
5. Where are the
services provided?
6. What source
of funding is being utilized and what are the future plans for this
program?
7. If an out-of-state
contractor were selected, what steps were made to find a qualified in-state
vendor?
C. Upon
completion of their review, the Review and PEER Subcommittees will send their
recommendations to the Legislative Council for consideration.
D. Legislative Council, which usually meets
the third Friday of each month, reviews the contract and provides OSP a report
on their review and their findings as to the propriety of the
contract.
E. Following receipt of
the Legislative Council's report, DFA will approve or deny the PCS contract.
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VI.
Entry of Standard PCS Contracts
into AASIS
A. For a standard PCS
contract
over $25.000:
1. Upon approval of the contract by DFA,
division shall approve the outline agreement, if necessary.
2. CSS shall coordinate OSP's approval of the
outline agreement.
3. Contract
Management/Comprehensive Annual Financial Report Unit (CMU) or the division
shall create the PO, if necessary.
4. CSS shall coordinate OSP's approval of the
PO.
B. For a standard
PCS contract
$25,000 and under:
1. Upon approval of the contract by DFA,
division shall approve the outline agreement, if necessary.
2. CMU or the division shall create the PO,
if necessary.
NOTE: The PO must accurately reflect the standard PCS
contract in every aspect, including the compensation/reimbursable breakout,
contractor name and address, and total funding.
VII.
Distribution of Standard PCS Contracts
A. Upon approval of the contract by OSP, RMU
shall receive the original approved contract from OSP and post it to the DHS
Contract Archival System (CAS).
B.
RMU shall distribute a copy of the signed contract to the contractor.
C. RMU shall notify the division, the CSS
Supervisor, and CMU that the contract is available in CAS.
D. RMU shall maintain the original contract
on file in the Records Room. All requests for contract information from the RMU
Records Room should reference the contract number.
VIII.
Reporting to OSP on Standard PCS
Contracts Exceeding $5,000 but not Exceeding $25,000
A. DHS shall report electronically to OSP, at
least monthly, ALL PCS contracts that were created which exceeded
$5,000 but which did not exceed $25,000.
B. The entity which created the outline
agreement is the entity responsible for submitting the report.
C. Reports are to be made online on the OSP
website. Divisions may consult with CSS for more detail.
IX.
Amendments to Standard PCS
Contracts
A.
Timeframes
Amendments to standard PCS contracts should adhere to the same
timeframes outlined for the development of new contracts.
B.
General Amendment
Requirements
1. Amendments to standard
PCS contracts are required when any element on the
Form OSP-1 or
any of the legal attachments is revised to the extent that it materially
affects the contractor or DHS in any way. The contracting parties '
shall mutually agree upon amendments.
2. Contracts can NOT be amended to add
services that are outside the realm of the procurement for the original
contract (ex., a division CANNOT procure for counseling
services, develop a contract for counseling
services, then add therapy services to
the contract at a later date just because the need arises.)
3. Minor revisions or administrative
corrections that affect only the internal administration of a contract do not
require an amendment; these may be accomplished as "change" actions.
4. Changing a contractor's Taxpayer
Identification Number (TIN) is not normally accomplished as a change or an
amendment. The normal procedure is to terminate the contract with the former
TIN and create a new contract with the new TIN. Variances to this procedure
must be coordinated with CSS and approved by OCC.
For this to be allowable without re-procuring, however, the old
contractor must assign the old contract via a legal document called an
"Assignment". The new contractor shall complete a Form PCS-D, if
required, and an individual authorized by.the contractor shall sign an
affidavit attesting to the following:
* The new contractor will abide by all terms stated in the
underlying procurement document(s) and any response(s) made by the original
contractor.
If the new contractor does not sign the Assignment, the
division shall re-procure.
All Assignments must be approved by OCC.
5. PCS contracts that have expired cannot be
amended.
6. An amendment to extend
a standard PCS contract into another state fiscal year is allowable ONLY if the
following conditions are met:
a.
(ONLY
for contracts procured by RFQ or Sole Source) OSP Director has given
his/her approval for extension(s);
b. The procurement included information
relative to the extension option(s); AND
c. The original contract contains language
supporting the extension option(s) (the extension clause is found in Section 12
of the
Form OSP-1)
NOTE: The extension period added to a contract by
an amendment shall not cross the applicable period of legislative
appropriation. \
7. All amendments to standard PCS contracts
that add money require an amendment to the corresponding PO in AASIS, if
applicable.
8. For every amendment
to applicable PCS contracts over $25,000, a current signed and dated Form
PCS-D shall be submitted for the contractor and all subcontractors
receiving over $25,000 who are affected by this amendment.
9. Amendments to PCS contracts are not
binding until they are approved by the DHS Director or designee and contractor
and approved by DFA, if applicable.
10. The effective date of an amendment to
extend an otherwise expiring contract shall be no later than the
expiration date of the expiring contract.
11. Divisions should initiate all amendments,
except for those necessitated for administrative purposes only and for those
otherwise exempted.
12. For every
amendment, the division should submit an electronic authorization to CSS to
develop the amendment. (In those instances where the division developed their
own PCS contract, they shall also develop the amendments to that contract.)
C.
Development of
Amendments to Standard PCS Contracts
1.
The following procedures apply to amendment development actions executed by CSS
(for amendment development actions executed by the division, proceed to 2.
below).
a. The amendment authorization from
the division is required to include:
(1.)
Completed Form DHS-9190
(2.) Any revised or additional attachments to
the Form OSP-1, if applicable
(3.) Approval/certification of performance
based standards
(a.)
Performance Based
Contracting Certification must be completed by division staff, for
current, unchanged performance based standards (the Form DHS-1366
may be used for certification.)
(b.) CSS or OCC approval is required for new
or revised performance based standards.
b. Upon receipt of the amendment
authorization, assigned CSS individual(s) shall review the authorization,
consult with the contractor, complete the amendment proposal, and review the
completed '
amendment proposal for technical compliance and
completeness.
NOTE:
For amendments that
extend the contract into another fiscal year (IF the contract
amount exceeds $25,000 and /Fthe contract is with a non-State agency) contract
developer shall verify that contractor has a current certification on the OSP
website that he/she does not employ or sub-contract with any illegal
immigrants. "Current" is defined as within 3 months prior to the date contract
developer checks the website.
2. The complete amendment package shall
include, at a minimum, the
Form OSP-1A, Amendment to
Professional/Consultant Services Contract.
NOTE: It is ABSOLUTELY CRITICAL that, if
applicable,
the funding tally to the penny
and
the funding percentages are
accurate !!!
Failure to have 100% accuracy in either of these crucial
areas will result in the legislative review staff rejecting the
amendment!!!
3. Other
elements that may be required to complete the amendment include but are not
limited to the following:
a.
Form
PCS-D
All amendments to non-exempt standard PCS contracts greater
than $25,000 require disclosure on the contractor and on all subcontractors
receiving over $25,000 who are affected by the amendment.
b.
Performance Based Contracting
Certification
This is required from division for current performance based
standards not changed by this amendment. Form DHS-1366 may be used
for this purpose.
Note:
New or revised performance based
standards require current CSS or OCC approval.
c.
New or Revised Attachments
Any new or revised attachments to the Form OSP-1
should be included and referenced appropriately on the Form OSP-1
A.
(1.) An attachment is
considered "new" when it is being added to the contract with this
amendment. A new attachment "stands on its own" and does not replace any
attachment that is already in the contract. A new attachment should be numbered
consecutively in accordance with the existing attachments and should reflect an
effective date commensurate with the effective date of the amendment.
(2.) An attachment is considered a
"revision" when it replaces an attachment that is already in the
contract and covers the entire period of the attachment it is replacing. It
should be assigned the same attachment number as the attachment it replaces and
should reflect an effective date commensurate with the effective date of the
amendment.
(3.) An attachment is
considered an "addendum" to an existing attachment when it is
being added to the contract with this amendment. An addendum is similar to a
"new" attachment in that it does not replace any existing attachment BUT it
closely relates to an existing attachment to which it is made an addendum. An
addendum should be numbered as a subset of the relative attachment (ex.,
Attachment 1a, or Attachment 1, Addendum 1.) An
addendum should reflect an effective date commensurate with the effective date
of the amendment.
d.
Reimbursement Rate Increase Approval, Form DHS-1951
An approved Form DHS-1951 is required if the
amendment increases rates for services. Note exceptions in Chapter Nine
of this Manual.
e.
Suspension of the Rules Letter
This letter is required for all amendments requiring
legislative review that are submitted to DFA after the date due to DFA (see
sample letter in Appendix).
f.
Certification Regarding Lobbying,
Form DHS-9350
This certification is required if the amendment results in
contractor's funding exceeding $100,000 in federal funds in this
contract.
' Certification should be indicated on Form DHS-9350,
unless provided elsewhere in the contract, i.e., on the Form
DHS-9193 or Form DHS-9194.
g.
Illegal Immigrant
Certification
(1.) For amendments that
extend the contract into another state fiscal year, ACO shall make a
screenprint verifying that the contractor has recently certified on the OSP
website that he/she does not employ or sub-contract with any illegal
immigrants.
(2.) ACO shall label
the certification with the contract number but shall not make it a legal
attachment to the contract.
4. Signing and Routing of Amendments to
Standard PCS Contracts
Same as for standard PCS contracts above.
5. Legislative and DFA Review of Amendments
to Standard PCS Contracts
An amendment to a standard PCS contract requires review and
approval by DFA, and review by the Review or PEER Subcommittee if, and only
if:
a. The amendment involves a major
change in the objectives and scope, OR
b. The original contract required review and
the amendment increases the dollar amount, OR
c. The original contract did not require
review but the amendment increases the total to exceed $25,000.
6. Entry of Amendment to Standard
PCS Contracts into AASIS
* Upon approval of the amendment, CMU or division shall revise
the PO accordingly, if necessary. E
7. Distribution of Amendment
a. Upon approval of the contract by DFA, RMU
shall receive the original approved amendment from DFA and post it to CAS.
b. RMU shall distribute a copy of
the signed amendment to the contractor.
c. RMU shall notify the division, the CSS
Supervisor, and CMU that the contract is available on CAS.
d. RMU should maintain the original contract
on file in the Records Room. All requests for contract information from the RMU
Records Room should reference the contract number.
X.
Changes to Standard PCS Contracts
A. Minor revisions or administrative
corrections may be accomplished by a change action. Change actions affect only
the internal administration of a contract and do not materially affect the
contractor or DHS in any way.
B.
Examples of actions that could appropriately be handled as "change" actions
include:
1. A change in funding
codes;
2. A change in address (IF
the AASIS vendor number remains the same);
3. A line item adjustment
a. If deviation from the amount budgeted will
not exceed $500 or 10% of the line item from which funds are being moved,
whichever is greater, no line item adjustment is necessary.
b. A line item adjustment is allowable only
if the total reimbursable and total compensation amounts are
unchanged.
C.
Change actions shall NOT be used for:
1. A
change in total financial amount (either an increment or decrement);
2. A change in reimbursable and/or
compensation amounts;
3. Any change
in the percentage of state/federal funds;
4. A change in the overall rate per unit of
service;
5. A change that adds a
new funding source (fund, fund center, or commitment item)
D. The DHS standard is that CSS develops
change actions for all standard PCS contracts upon receipt of authorizations
from the division requesting such change actions. For those contracts that are
developed by the division, the division shall develop the change action.
NOTE:
CAP
is the electronic
system through which change actions are authorized and developed.
* The division requesting a change action shall submit the
authorization to CSS in electronic format.
* CSS shall process the change action
electronically.
E. For
change actions executed by the division, the division shall submit the
completed change action to RMU electronically.
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XI.
Stand-alone PO's for Professional
and Consultant Services
A.
General requirements for stand-alone PO's for professional and consultant
services
1. Divisions typically
negotiate with the contractor the terms of the stand-alone PO's.
2. Any PCS contract that DOES NOT exceed
$25,000 in compensation may be executed in the stand-alone PO format. A
division may, however, if preferred, execute a PCS contract that does not
exceed $25,000 as a "standard PCS contract".
Agencies shall NOT split known quantities into smaller ($25,000
and below) amounts to avoid a standard contract.
3. Stand-alone PO's normally require neither
DFA review and approval nor legislative review. However, multiple PO's to
the same contractor in the same fiscal year from the same cost center MUST be
reported to OSP to assist OSP in determining whether an ggency is
issuing multiple PO's in an attempt to circumvent the requirement of
establishing a standard PCS contract.
4.
IMPORTANT! Procurement
regulations apply to stand-alone PO's just as they do to standard PCS
contracts, including the requirement for prior approval by OSP for Sole Source
by justification or RFQ.
5.
Performance Based Standards
a.
Performance based standards are required for stand-alone PCS PO's except for
those which are as follows:
(1.) For
Architectural and Engineering services, which are awarded using ABA criteria;
or
(2.) For $10,000 or
less
b.Performance
based standards, when required, shall be added to standalone PO's in the
following manner:
(1.) The division/office
shall complete the Contractor Certification Concerning Performance, (Form
DHS-9353 for a PO with a non-state agency or Form DHS-9354
for a PO with a state agency) and attach a copy of the applicable
Performance Based Standards as Attachment I.
(2.) The division/office shall review the
Contractor Certification Concerning Performance and Performance
Based Standards with the contractor and secure the contractor's signature on
the
Certification.
(a.) One
original certification per contractor, for each set of
performance indicators, per fiscal year is sufficient.
(b.)
Copies shall be
inserted in all subsequent contracts with that
contractor for PO's with the same set of performance indicators executed in
that fiscal year.
(c.) Contractor's
signature certifies that he/she understands the signature is binding for ALL PO
contracts utilizing those performance indicators during that fiscal
year.
(3.) CSS or OCC
approval of performance based standards is required, as it is for standard PCS
contracts.
(4.) The division/office
shall retain the Certification in the division/office files and
give a copy to the contractor for each PO.
6. For those stand-alone PO's for
professional and consultant services funded in whole or in part by SSBG, the
division shall obtain the contractor's signature on the
Certification of
Compliance for Social Services Block Grant (SSBG) Funding, Form DHS-9357
a. One signature per contractor per fiscal
year is sufficient. If a contractor has more than one PO with SSBG funding, a
copy of the signed certification for each subsequent PO is sufficient. Faxed
signatures are acceptable.
b. The
division shall retain the original Form DHS-9357 in their files,
giving a copy to the contractor.
c.
In creating the PO in AASIS, the creator shall add the following text:
"Vendor must adhere to all State and Federal laws and regulations
applicable to Social Services Block Grant funding."
7. Stand-alone PO's for professional and
consultant services require BAA's under the following conditions:
a. Those for the following divisions require
BAA's IF the PO deals with PHI. PO developer shall electronically attach the
BAA.to the PO.
DBHS
DDS
DMS
DYS
* OCC, IF OCC is contracting for the services
of counsel or an expert witness to represent one of the above divisions
b. Those for the following division
do NOT require BAA's:
DAAS
DCCECE
DCFS
DCO
DOV
DSB
* Director's Office OFA
* OCC, except in the circumstances noted above
c. For stand-alone PCS PO's
for the SSBG-funded Child and Adolescent Service System Program (CASSP),
division director signature is not required on the BAA. The division shall
complete the division director portion of the form by entering the division
name, division Director's name and division Director's
title.
8. Ethics Language
In accordance with R7:
19-11-234
and ACA
§
19-11-708(a), (b), and
(c), the following language must be
added to all contracts (including stand-alone PO's) over $5,000:
* It shall be a breach of ethical standards for a person to be
retained, or to retain a person, to solicit or secure a state contract upon an
agreement or understanding for a commission, percentage, brokerage, or
contingent fee, except for retention of bona fide employees of bona fide
established commercial selling agencies maintained by the contractor for the
purpose of securing business.
9. Confidentiality of Information Language
The following language must be added to all contracts
(including stand-alone PO's) that deal with confidential information:
* In connection with this contract, the Contractor will receive
certain Confidential Information relating to DHS clients. For purposes of this
contract, any information furnished or made available to the Contractor
relating to DHS clients, the financial condition, results of operation,
business, customers, properties, assets, liabilities or information relating to
recipients and providers including but not limited to protected health
information as defined by the Privacy Rule promulgated pursuant to the Health
Insurance Portability and Accountability Act (HIPAA) of 1996, is collectively
referred to as "Confidential Information". The Contractor shall comply with all
DHS policies governing privacy and security of Confidential Information,
including the contracting division's designation of the Confidential
Information as required by the Arkansas Data and System Security Classification
Standards, and shall implement and maintain reasonable security procedures and
practices appropriate to the nature of the Confidential Information as required
by AC.A. § 4-11-104, the Personal Information Protection Act ("the Act").
In addition, the Contractor shall comply with the Business Associate Agreement
between ‹
the parties, incorporated herein by reference, and shall
disclose any breaches of privacy or security by contacting the Information
Technology Security Officer within one (1) business day of the breach by
notification to the following e-mail address:
dhs-it-security@arkansas.gov.
B.
Development of Stand-alone PO's for
Professional and Consultant Services
1. Upon selection of a contractor through
appropriate procurement means and after direct communication with the
contractor concerning the terms of the agreement reached, the division shall
enter a requisition into AASIS reflecting all of the details that need to be
incorporated into the PO.
2.
Division shall create their own PO in AASIS from the requisition or forward the
requisition in AASIS to CMU for the creation of the PO.
C.
Reporting to DFA on Stand-alone
PO's for Professional and Consultant Services
1. DHS shall report electronically to OSP, at
least monthly, ALL such standalone PO's that were created which
exceeded $5,000 but which did not exceed $25,000.
2. The entity which created the PO is the
entity responsible for submitting the report.
3. Reports are to be made online on the OSP
website. Divisions may consult with CSS for more detail.
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XII.
Compliance Reviews for PCS
Contracts
A.
Definition
Compliance reviews are a means of contract monitoring by CSS of
the following:
1. All PCS contracts
over $5,000 developed by CSS; and
2. Those PCS contracts over $5,000 that
contain SSBG funding which are developed by the division.
;
Compliance reviews are not required for ABA-related PCS
contracts.
B.
Purpose
The purpose of compliance reviews is to monitor contract
activity and assist contractors in achieving and maintaining compliance with
billing and client eligibility requirements of the contract. Compliance reviews
address fiscal, administrative and legal advisories and eligibility/billing
audits.
C.
Policy
For each applicable PCS contract requiring a compliance review,
ACO should make a minimum of one compliance review per contract year. This
pertains to standard PCS contracts as well as stand-alone PCS PO's.
XIII.
Billing for
PCS Contracts
For those PCS contracts developed by CSS, CSS shall:
J
A. Provide instructions on billing, if
necessary;
B. Explain any special
requirements for specific funding sources (ex., SSBG);
C. Supply billing forms or letter bill
format, if necessary
XIV.
Records Retention for PCS Contracts
A. DHS should retain all PCS contract
information for a minimum of five years after the contract ends or is
terminated. Contracts containing HIPAA-related information must be retained for
a minimum of six years. This includes, but is not limited to, the following
information:
1. Original contract, amendments,
and all related documents, correspondence, etc.;
2. Contractor billings;
3. Compliance review reports;
4. Audit reports and findings; and
5. Procurement documentation.
B. In the event any audit,
litigation, or other action is initiated before the end of the five year
period, records should be retained until all issues arising out of the action
are resolved or until the end of the five (or six) year period, whichever is
later.
CHAPTER
ELEVEN
INTRA-AGENCY AGREEMENTS
I.
Policy
A. Intra-agency agreements are used when one
DHS division purchases services from another DHS division.
B. In accordance with ACA §
19-11-203, intra-agency
agreements are exempt from the Arkansas Procurement Law and
Regulations.
C. Intra-agency
agreements require neither DFA nor Legislative review or approval.
D. The initial term of an intra-agency
agreement shall not extend past the end of the applicable period of legislative
appropriation.
E. Intra-agency
agreements may be amended to extend for a total period of no more than seven
(7) years.
F. Intra-agency
agreements MAY or MAY NOT be entered into AASIS as PO's, as determined by
documented collaborative consultation with Assistant Director, Managerial
Accounting, OFA.
1. If the circumstances are
determined to be a
genuine purchase of service,
the agreement shall be entered into AASIS as an Outline
Agreement against which PO's shall be created for payment.
2. If the circumstances are determined to be
administrative flow through from the funding division to the
service division AND if the funding is
NOT 100% State General Revenue, the
agreement shall typically not be entered into AASIS as a PO. Instead, the
service division shall be paid by the funding division by the funds transfer
mechanism. This is normally the most accurate accounting approach to avoid the
confusion of "double-booking" external income to DHS overall as reflected in
AASIS.
3. If the circumstances are
administrative flow through AND if the funding
IS 100% State General Revenue, typically an associated PO must be
created and used to document payments as though the transaction were a purchase
of service. This avoids audit confusion with transactions involving budget line
item redistribution of 100% State General Revenue between program divisions,
which must be approved through PEER Committee as Resource Reallocation
Requests.
II.
Procedures
A. The DHS standard
is that CSS develops all intra-agency agreements upon receipt of authorizations
from the funding division requesting such actions.
B. The authorization from the funding
division is required to include:
1. Completed
Contract Authorization/Input Form, Form DHS-9190;
2. If desired by the funding division,
CSS-approved performance based standards and evidence of CSS or OCC approval or
funding division certification; and
3. If desired by the funding division, any
other legal attachments.
C. Upon receipt of the authorization from the
funding division, assigned CSS individual(s) shall review the authorization,
consult with the service division, complete the agreement proposal, and review
the completed proposal for technical compliance and completeness.
D.
The complete intra-agency agreement
shall include the following items:
1.
Form DHS-9197, Intra-agency Agreement
2. Any legal attachments required by the
funding division
\
CHAPTER TWELVE
INTER-AGENCY AGREEMENTS
I.
Policy
A. In accordance with the rules and
regulations promulgated under ACA §
19-11-251, inter-agency
agreements for professional or consultant services may be executed on
; an alternate format from the standard
Form OSP-1. Inter-agency agreements are defined as those between a
DHS division and another state agency. The alternate format designed for this
purpose is the DHS-9198, Inter-agency Agreement (and the
DHS-9198A for amendments).
B. Use of this alternate format requires the
prior approval of the OSP Director. Interested parties should coordinate those
requests through the CSS Program Administrator.
C. In accordance with ACA §
19-11-203, inter-agency
agreements are exempt from the Arkansas Procurement Law and
Regulations.
D. Inter-agency
agreements developed under this code require neither DFA nor Legislative review
or approval.
E. The initial term of
an inter-agency agreement shall not extend past the end of the applicable
period of legislative appropriation.
F. Inter-agency agreements may be amended to
extend for a total period of no more than seven (7) years.
G. Inter-agency agreements shall be entered
into AASIS as Outline Agreements against which PO's shall be created for
payment.
II.
Procedures
A. The DHS standard is that
CSS develops all inter-agency agreements upon receipt of authorizations from
the funding division requesting such actions.
B. The authorization from the funding
division is required to include:
1. Completed
Contract Authorization/Input Form, Form DHS-9190;
2. If desired by the funding division,
CSS-approved performance based standards and evidence of CSS approval or
funding division certification; and
3. If desired by the funding division, any
other legal attachments.
C. Upon receipt of the authorization from the
funding division, assigned CSS individual(s) shall review the authorization,
consult with the service agency, complete the agreement proposal, and review
the completed proposal for technical compliance and completeness.
D.
The complete inter-agency agreement
shall include the following items:
1.
Form DHS-9198, Inter-agency Agreement
2. Any legal attachments required by the
division.
E. RMU shall
process completed agreements through to digital file and
distribution.
CHAPTER
THIRTEEN
CONTRACT INVOICING
I.
Procedures
A. For those contract payments processed
through CMU, It takes approximately seven to ten working days from the time an
invoice reaches CMU for a warrant to be printed and ready to mail. Before any
invoice is approved for those payments processed through CMU, the following
requirements must be met:
1. CMU should have
access to the legal document for use in monitoring the payment request. All
original signed contracts should be on file in the CSS Records Room and
available in the archival system.
2. Each contractor should have a
Request for Taxpayer Identification Number and Certification form (W-9)
on file with OFA before payment can be processed. W-9 Forms
may be obtained from the Internal Revenue Service office.
3. Providers should comply with the DHS audit
requirements as outlined in
Arkansas Department of Human Services
Audit Guidelines. Copies may be obtained from
Arkansas Department of Human Services Office of Chief Counsel
Audit Section P.O. Box 1437- Slot S270 Little Rock, Arkansas 72203-1437
4. Invoices should be submitted to
the division with which the contractor has a legal agreement unless the
contractor is given other instructions.
5. The division should check all invoices and
indicate their approval with a full, legible signature, date, and the words
"Approved to Pay". These should be routed to CMU as soon as possible for
processing.
B.
Summary of DHS Invoice Procedures
1.
Contractors shall follow the uniform invoicing procedures outlined in "
Administrative Procedures Manual Chapter 305.
‹
2.
The invoice must not contain abbreviations. These are not standardized and may
cause AP staff to return the invoice for explanation.
3. If the invoice is to be paid by direct
deposit, the invoice should include the notation "DIRECT DEPOSIT" in the upper
right hand corner.
4. If the
invoice is to be paid separate and apart from other invoices, the invoice
should include the notation "SEPARATE PAYMENT" in the upper right hand
corner.
5. For contracts reimbursed
on an actual cost basis, the invoice should identify all expenses as
compensation or
reimbursable.
6. CMU staff will correct payment requests
submitted without all of the above information if possible. All verbal changes
agreed to by the program division and the contractor/sub-grantee should be
documented on the invoice. The CMU staff person should indicate "Approved to
Pay," sign and date the request, and forward to AP.
7. Prior to the end of the state's fiscal
year, CMU should submit information to all contract service providers and to
all divisions regarding instructions for end-of-year billings.
II.
Contractor
Expenditure Reports
Contractors may be required by the terms of the contract to
submit periodic expenditure reports. These reports should be submitted as
required or payment requests will be held in a pending status. The format of
the expenditure report should agree with the budget in the contract. Reports
should be mailed to
Arkansas Department of Human Services
Contract Management/Comprehensive Annual Financial Report
Unit
P.O. Box 1437-Slot W205
Little Rock, Arkansas 72203-1437
For contracts reimbursed on a Scheduled Reimbursement - Actual
Cost Basis the division is responsible for reconciling actual expenditures
against the payment schedule and adjusting payments as necessary.
III.
Monitoring for
Contract Compliance
Requests for payment not complying with all terms of the signed
agreement will be held in pending status by division, CMU, or AP until
resolved.
IV.
Recovery of Overpayments
For those contracts for which CMU enters the Goods Receipts in
AASIS, any recognized overpayments should be forwarded to the Accounting
Supervisor, CMU. The Accounting Supervisor will draft collections
correspondence for signature by the Assistant Director, CSS, and route recovery
of funds through AR.
V.
Settlements
All agreements that require settlement should be reconciled as
soon as possible following expiration of the agreement. Each contractor should
be notified in writing of all amounts payable or receivable requirements and
the procedures necessary to accomplish the settlement.
VI.
Internal Revenue Service (IRS)
Levies
All IRS levies will be forwarded to CMU. The CMU Accounting
Supervisor will receive and forward all payments specified to the IRS until
notified that the levy has been satisfied or released.
Appendix
State of Arkansas SECRETARY OF STATE
State Capitol Little Rock, Arkansas'72201-1094
FOREIGN CORPORATIONS TRANSACTING BUSINESS IN
ARKANSAS
A foreign corporation may not transact
business in this state until it obtains a Certificate of Authority from the
Secretary of State.
The following activities, among others, do not constitute
transacting business as stated in A.C.A. §
4-27-1501(B):
1. Maintaining, defending, or settling any
proceeding;
2. Holding meetings of
the board of directors or shareholders, or carrying on other activities
concerning internal corporate affairs;
3. Maintaining bank accounts;
4. Maintaining offices or agencies for the
transfer, exchange, and registration of the corporation's own securities or
maintaining trustees or depositaries with respect to those
securities;
5. Selling through
independent contractors;
6.
Soliciting or obtaining orders, whether by mail or through employees or agents
or otherwise, if the orders require acceptance outside this state before they
become contracts;
7. Creating or
acquiring indebtedness, mortgages, and security interests in real or personal
property;
8. Securing or collecting
debts or enforcing mortgages and security interests in property securing the
debts;
9. Owning, without more,
real or personal property;
10.
Conducting an isolated transaction that is completed within thirty (30) days
and that is not one in the course of repeated transactions of a like
nature;
11. Transacting business in
interstate commerce.
Corporations which fail to obtain a Certificate of Authority
may not maintain a proceeding in any court in this state based on a cause of
action arising from the transaction of business and may be found liable for
civil penalties ranging from $100 to $5,000.
For information regarding the application seeking authorization
to do business in this state please write,
Secretary of State
Corporation Department
Room 058
State Capitol
Little Rock, Arkansas 72201-1094
(501) 682-3409
(DHS Letterhead)
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