Introduction to Cooperative Purchasing and HGACBuy The H-GAC Cooperative Purchasing Program

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Introductionto Cooperative Purchasingand
HGACBuyThe H-GAC Cooperative Purchasing
Program
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What is Cooperative Purchasing?

• Consortium or Group Buying pooling the purchasing
  needs to achieve better value through
• Lower prices
• Increased response
• Efficient use of time resources
• Effective application of expertise

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Models of Cooperative Purchasing

• 3-Types
• Collaborative Model
• Third-Party Model
• Hybrid Models

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Collaborative Model

• Multiple entities join together
• Use of joint bids
• Lead agencies take turns bidding
• Use of standardized specifications
• Commodity procurement more common
• Better done locally or regionally

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Third-Party Model

• One entity bids term contracts
• All other entities purchase off the contracts
• The third-party may not be a user
• Flexibility through multiple configurations
• Less input from end user agencies
• Third-party may charge fee for operations

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Hybrid Models

• Combines aspects of Collaborative Third-party
  models
• Use of host entity
• Use of shared responsibilities through lead
  agencies
• Piggy-backing is less formal

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Model Comparison

• Collaborative Model
• Administrative work shared
• No fees
• Specific purchase
• Local/regional based
• More member control
• Third-party Model

• Host program handles administration
• Typically charges fees
• Blanket/term contracts
• Not locally tied
• Less control over procurement process

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Analyzing a Cooperative Purchasing Program

• Decisions must be made on which cooperative
  contract to utilize
• Procurement process
• Fees
• Structure of program
• Flexibility

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WHAT IS H-GAC?

• The Houston-Galveston Area Council is a Council
  of Governments and a Political Sub-division of
  the state of Texas.
• H-GAC began with an Interlocal Agreement between
  13 Gulf Coast Counties primarily to supply
  planning services to their region.
• The agency operates under the direction of a
  Board of Directors made up of 36 elected
  officials.

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What is the H-GAC Cooperative Purchasing Program?

• Thirty three years ago, the Board of Directors
  decided that purchasing services were needed to
  help the region to keep pace with the regional
  growth surge that was outpacing the local
  governments capabilities.
• In 1971, the Texas legislature passes the
  Interlocal Cooperation Act to promote activities
  among local governments across Texas
• In 2001, legislation was passed to amend the
  act to allow for nationwide participation in
  the program.

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Texas Interlocal Cooperation Act

• Government Code, Chapter 791
• Increase the efficiency and effectiveness of
  local governments by authorizing them to
  contract, to the greatest possible extent, with
  one another and with agencies of the state.
  Amended September 1, 2001 to include states other
  than Texas.

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What is required to participate inthe H-GAC
Cooperative Purchasing Program?

• Execution of Interlocal contract by local
  government officials

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Advantages to Buying through the H-GAC
Cooperative Purchasing Program (HGACBuy)

• Time Savings
• Volume purchasing Discounts
• 3-Way Partnership between you, the end user, the
  Vendor and H-GAC
• Dealing directly with purchasing professionals
  with more than 200 combined years of expertise.
• Expedited procurement process.
• Knowledge that all HGACBuy contracts have been
  awarded based upon a thorough competitive
  bid/proposal process.

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Current HGACBuy Contracts

• Ambulances Fire Apparatus
• Chem/Bio Detectors, Robots, Rescue, Safety
  Equipment
• Earth Moving Construction Equip
• Vehicles, Trucks, Fleet Equip
• Tractors, Mowers, Sewer Cleaning, Street
  Maintenance Equip
• Video Conferencing

• Radio Communications Interoperability Equip
• 9-1-1 Systems Recording Equip
• Refuse Collection Equip/Containers, Sewer
  Inspection Systems
• School Transit Buses
• Street Sweepers Equipment Trailers
• Video Surveillance Traffic Signal Systems
• Cell Phone Mobile Satellite Communications

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Current Service Contracts

• Lease Purchase Financing
• Foodservice Delivery
• Consulting
• Environmental Consulting
• Community Planning
• Homeland Security Consulting Training
• Insurance Consulting
• Marketing Public Relations
• Electricity Aggregation

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HGACBuy Cooperative Purchasing Program Update

• Over 1,600 End Users
• Over 250 Contractors
• 37 Major Product Categories
• 216 million in Products Services 2005
• Activity in Texas 23 other States

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Order Activity 2005
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The Bid Process

• Products/services researched
• Draft specification issued
• Solicitation advertised
• Pre-bid conference held
• Final specification issued
• Bids publicly opened
• Bids evaluated, award recommendations made
• H-GAC Board of Directors makes awards
• Contracts issued

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The Procurement Process

• Discuss product/service with contractor
• Contractor issues detailed price quote
• Make purchase order out to contractor
• Send copy of PO to H-GAC
• Contractor delivers and invoices
• Pay contractor (including administrative fee)

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Procurement Flexibility

• Most contracts are bid with base line items and
  correlating options
• The options submitted with the bid are evaluated
  and considered published options
• For additional flexibility, options may be added
  to an order that were not included in the bid
  unpublished options
• Change Order rules are applied to unpublished
  options limiting their use to 25 of an order

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Administrative Fees

• The program is pay as you go
• Cost of operations is covered by an
  administrative fee issued on each order
• Administrative fees are either a flat amount per
  unit, or a percentage of the overall order

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The HGACBuy Bid Process

• Meets the standards that end user would normally
  utilize
• Supporting documentation
• Approval through governing body
• End user is substituting the bid process they
  would normally perform for the process now
  undertaken by the H-GAC Cooperative Program

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Usage Fees

• Are fees actually charged?
• Who pays for the fees?
• End User
• Vendor
• How much is the fee?
• Customer service
• Ease of use

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Program Structure

• History experience of the cooperative program
• Staff size expertise
• Where do the contracts come from?
• Knowledge of the products
• Contract administration
• Problem resolution

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HGACBuy Offers Flexibility

• End User has the ability to purchase item as
  needed which include the base items options
  under contract
• Customization
• 3-Way Partnership between End User, Vendor and
• H-GAC

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Delivering Value

• Cooperative contracts are only of use if they
  deliver value
• Value to the End User
• Value to the Contractor
• Stay in the loop
• Communicate frequently
• Three-way partnership must be fostered

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www.HGACBuy.org

• Web site contains pricing contact information
• Future functionality may include
• Online quotes
• Product comparisons
• Order status
• Contract information

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Law Enforcement, General Purpose Vehicles, and
Buses

• Staff Cars
• Light Trucks
• Police Cars
• Vans
• School Buses

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EMS and Fire Apparatus

• Ambulances (Types I,II,II)
• Pumper and Tanker Fire Apparatus
• Aerials Ladder Platforms
• Rescue, Haz-Mat, Command Centers
• Brush/Wildland Fire Apparatus

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Medium and Heavy Duty Trucks,and Specialized
Bodies

• Medium Duty Chassis
• Heavy Duty Chassis
• Refuse Collection Bodies
• Sewer Cleaners
• Van Bodies
• Dump Bodies, Aerial Lifts, Cement Mixers,
• Wreckers, Water Trucks

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Communications and Emergency Equipment, and
Supplies

• Radios, Base Stations Communication Systems
• Defibrillators
• SCBAs
• 9-1-1 Systems
• Wireless Communications Services
• Chem/Bio Detectors EOD Robots

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Public Works and Heavy Equipment

• Earth Moving Equipment
• Tractors Mowers
• Traffic Signals Controls
• Street Maintenance Equipment
• Street Sweepers
• Equipment Trailers Refuse Containers

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Security and Electronic Equipment

• Security Video Access Control Equipment
• Traffic Signals Controls
• Auxiliary Power Generators
• Sewer Video Inspection Systems

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Consulting Contracts

• Insurance Consulting
• Environmental Consulting
• Homeland Security Consulting Training
• Community Planning

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Service Contracts

• Lease Purchase Financing
• Electricity Aggregation
• Reverse Auction Services
• Food Products Equipment
• Marketing and Communications
• Public Relations
• Video Conferencing

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HGACBuy is a proud member
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HGACBuy

• The H-GAC Cooperative Purchasing Program
  (HGACBuy) recognizes purchasing as a universal
  profession and has adopted the H-GAC Code of
  Ethics as stated in the H-GAC Procurement Policy,
  revised edition dated January 1, 2006
• As a member in good standing of the National
  Institute of Government Purchasing, (NIGP)
  HGACBuy recognizes that the NIGP sets the
  universal standards for government procurement
  and therefore, HGACBuy and its employees are
  committed to the NIGP Code of Ethics and its
  principals
• Our goal is to provide to all of its members,
  quality products and services, by reputable
  vendors, through cost effective, ethical, moral
  and prudent procurement standards

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Questions
Contact HGACBuy Program Staff Phone
800-926-0234 Fax [phone] Experience
the Smart Purchasing Solution Log on to
www.HGACBuy.org