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FAQ: Request For Proposals
FAQ: Request For Proposals (RFPs) by Ramona Huckstep
The answers to these FAQs are intended for discussion purposes and to provide the reader with useful ideas and general guidance on the topics and issues covered. This article does not constitute legal advice and information provided may require consultation with applicable professionals to appropriately apply to specific circumstances.
Introduction
Issuing a Request for Proposal (RFP) can help a local government agency find new vendors, compare products, and find the best solution for their problem. It does not have to be a cumbersome process. RFP’s are a mutually beneficial process. For the municipalities, they create an atmosphere of competition where hopeful candidates can put their best feet forward to win attractive opportunities. RFPs tell invited bidders, “Our door is open, come and make your best case.” For vendors, RFP’s are a chance to look at clients and their project descriptions before any contracts are signed. Knowing in advance what the details of a project are and what the approximate cost will be will assist the municipality in planning and being prepared for the work that is coming. Additionally, setting expectations from the beginning will help the project run more smoothly.
What is an RFP?
When a municipality needs an outside service provider or consultant, the RFP is a way to communicate that need. A RFP is a document that a local government creates to outline the requirements for a specific project. They use the RFP process to solicit bids from qualified vendors and identify which vendor might be the best-qualified and least expensive to complete the project. Issuing a RFP allows governments to compare various products and vendors. RFPs can be especially helpful when a government agency needs an integrated solution involving components from various suppliers.
Why do municipalities create RFPs?
The purpose is to provide specialized service providers with a specific detailed description of a project and request that they submit a proposal addressing the manner in which the project would be completed and the cost. From the responses, the local government selects the consultant based on the cost and responsiveness to the RFP. For local government agencies, RFPs help ensure transparency and shows the public they are accountable for project goals and vendor choices. Writing the RFP also forces organizations to create benchmarks they can use later to measure a project’s success. RFPs also help government agencies make more informed buying decisions by allowing them to compare many different bids. Rather than seeing only one solution, RFPs can show many different ways of approaching a problem. This can highlight solutions that are more comprehensive and sustainable. What Should You Include in the RFP?
Although each RFP will vary according to the needs and goals of a project, most include the same categories of information: • The brief history of the municipality; • A detailed description of the project, including the reason it was created and the results desired; • Specific requirements about preferred materials, tools, systems and/or products; • The proposed budget; • The project deadline, along with clearly defined milestones and dates; • Questions you would like the respondents to answer or additional details you would like them to provide; • The submission deadline, contact information, and guidelines to submit proposals. • Another item to consider is asking to see the product (screenshots or demo videos), if appropriate.
• Contractor/vendor history and qualifications. This should include general information about the bidder’s company, principals, and history, including state and date of incorporation. • Liability and safety information. This can include safetytraining programs for employees, disclosure of any local, state or federal violations, and proof of insurance. • Financial capacity should be noted. Items such as audited financial information current within the past 12 months should be included, such as a balance sheet, statement of operations, and bonding capacity. • Licenses and certifications are also good information to gather from vendors. This could consist of trade categories and information regarding the state and local licenses and license numbers held by the applicant. If there are specialized certifications or licenses that are needed to complete the project, they can be included in the bid information. • References that the municipality can contact. It is helpful if the vendor can supply contact information for other organizations where they have completed satisfactory work.
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1. Determine needs: When writing the RFP, you are essentially writing a “help wanted” ad. You should be able to communicate things about the project such as skills needed, objectives for the project, and the timeline for completion. Clearly communicating your needs will help narrow RFP applicants down to the most qualified. In this first step it is important to know your budget and address the “needs vs. wants” of the stakeholders, including the city officials and the residents of the municipality. 2. Write the RFP: Like a resume, the RFP has a format. They may change from one author to the next, but it is wise to follow a common formula, so vendors know what to expect from the document. There are many templates online that can help you correctly piece together your RFP. 3. Distribute the RFP: Distributing your RFPs is a fine art.
You want to send enough to get a decent response but not become overwhelmed with proposals. When coming up with a list of recipients, consider the realities where either not enough or too many organizations respond. 4. Evaluate Responses: This process is time-consuming but important. Your team of councilmembers or stakeholders should go through every response carefully to determine the best candidates. This step may include department heads, line staff and elected officials. 5. Make a Decision: This process will include your elected officials and may also include municipal staff who will sit down and look at all options and information presented and decide which vendor can best deliver on expectations. Final thoughts
Make sure to check your local ordinances and policies before writing the RFP and make sure your municipality is following those rules and guidelines as well as state and federal regulations. Do not forget to use resources around you when writing an RFP such as the Missouri Municipal League, your local regional planning commission and your municipal neighbors. You can even ask other municipalities from around the state about sample RFPs through the MML listservs for the finance officers and the city managers; and through the city clerk message board. Also note, the Missouri Municipal League has partnered with the Associated General Contractors of Missouri to provide free distribution of RFPs that are related to building and infrastructure, to their more than 200 members across the state who are general contractors and specialty contractors.
“Don’t try to reinvent the wheel. The things you are doing, no matter how seemingly unique, has been done before. Take advantage of, and perhaps expand upon, your predecessors work.”
— Paul Heacock (2003)
Ramona Huckstep is a policy and membership associate with the Missouri Municipa League. Contact her at Rhuckstep@mocities.com or (573) 635-9134.
When is a bid required by state statute?
According to a Missouri Municipal League Fact Sheet on competitive bids requirements there are numerous instances when the state requires a competitive bid: 1) Insurance; 2) Special assessments; 3) Grants; 4) City officials selling or providing services to the city, 5) Construction management services; 6) Industrial development: projects with general obligation bonds; 7) City library (cities over 10,000) by election; 8) waterworks erection/purchase of revenue bonds; 9) Banks. (For more information on this topic, reference the Competitive Bid Requirements Fact Sheet by MML).
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What is the difference between the RFP and the RFQ?
A Request for Proposal (RFP) is needed when a project is sufficiently complex, requires a great deal of technical information, solicits hard data for analysis and comparison, and thereby warrants a formal proposal from a supplier. They are best used when you really need to compare responses and vendors objectively. A Request for Qualifications (RFQ) is needed when soliciting architectural, engineering and land-surveying services that requires a qualifications-based selection process according to Missouri Revised Statute Chapter 8.285-8.291.
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