Once you have verified that your procurement meets the criteria for a sole source justification (see below) you need to complete the Sole Source Justification and Price Analysis Form and attach the completed form to your requisition in Reqless. Download the Sole Source Justification and Price Analysis Form
Under the CAS Procurement Procedures, every procurement of an item over USD$10,000 that is awarded without competition must have a sole source justification and a price analysis documented in the file. This means that when you submit a requisition for an item costing more than USD $5,000 and specify that the item/service must be procured from a specific vendor (a sole source requisition) you need to provide: (1) a written sole source justification that complies with the CAS Procurement Procedures, and (2) a price analysis that complies with the CAS Procurement Procedures.
CAS requires a written sole source justification and price analysis because of Federal requirements. The Federal government requires that procurements made using federal funds must have competition: “All procurement transactions shall be conducted in a manner to provide, to the maximum extent practicable, open and free competition.” (2 CFR 215.43). The Federal government also requires price or cost analysis for every procurement: “Some form of cost or price analysis shall be made and documented in the procurement files in connection with every procurement action.” (2 CFR 215.45). CAS must document adequate reasons for not having competition for sole source procurements and CAS must document the reasonableness of the price for sole source procurements.
Before you start work on a sole source requisition you should review Section 2.1(d) of the CAS Procurement Procedures to make sure that it is appropriate to procure the item on a sole source basis:
“(d) Sole source procurements. Procurements for which bids are otherwise required under these procedures may be awarded on a sole-source basis (i.e. without competition) only when there is adequate justification documented in the procurement file showing that a competitive procurement is not practical or in the best interests of AURA. The following are examples of Sole Source Justifications from section VI.D.7 of the AURA Procurement Policies:
The vendor is the only known source of acceptable supplies or services as determined by documented research.
No other type of supplies or services will suffice or are compatible with AURA needs.
No other source can provide supplies or services within the requested time.
Vendor possesses unique prior experience, expertise, capabilities, professional stature, or key personnel.
The sponsor of the original grant or contract requests a specific subcontractor, in writing.
In the case of a follow-on contract for continued development or production.”
If you have examined a number of products and selected one product that best meets AURA’s needs, it is not a sole source procurement and you should not use this form. Instead, you should create a .pdf of the products and sources you reviewed and the reason you selected the vendor you did, and attach it to the requisition in Reqless. The sole source form is meant for situations where there is only one vendor or product that can possibly meet our needs, not for situations where one product is the best for our needs.
Because the Federal government requires competition “to the maximum extent practicable,” your sole source justification must present a convincing case, supported by evidence, for procuring the item without competition. For example, just stating that the vendor is the only source of the item would not be adequate. Instead, you should explain how you know for a fact that the vendor is the only source for the item, e.g. you searched extensively on the internet and were not able to find any other vendors for the item.
For catalog items (i.e. off the shelf items that available on a website or catalog ) you can use one of the following methods:
You may document that the price is the published price for the item (published in a catalog or on a website) and not a price quoted just to AURA. To use this method, please attach a screenshot of the web page showing the item’s price or a scan of a catalog page showing the item’s price.
You may document that the price is close to the price we paid for an earlier purchase of the same or very similar item. To use this method, attach a scan of a previous PO (or screenshot of the PO from Casnet) for the same item. If the price of the item isn’t identical, please explain below why the difference in price is reasonable.
You may document that similar items from other vendors cost about the same as the sole source item by attaching three different quotes. If the comparison items differ significantly, explain how they are different and how that should influence the price.
For custom made items, you should obtain a detailed breakdown from the vendor of how the price was determined, showing hours and rates for each labor category, a detailed bill of materials with the price for each item, and the overhead and profit rates applied to those costs. Then analyze the reasonableness of each of those elements of the price.
For work that is charged by the hour, document how the vendor’s hourly rates compare to the hourly rates charged by other vendors for the same or very similar services.