Florida Certified Contract Manager - DMS · Contracts/Grants ... The purpose of the Florida Certified Contract Manager course is to provide you ... The final assessment will consist

Florida Certified Contract Manager

Participant Guide for Contract and Grant Managers

Last Updated 2/12/18

1

Table of Contents Course Overview ............................................................................................................................. 4

Contracts/Grants ......................................................................................................................... 4

Sign-In Sheets .............................................................................................................................. 4

Participant Guide ........................................................................................................................ 4

Reference Material ..................................................................................................................... 4

Introductions ................................................................................................................................... 5

Introduction to DMS ................................................................................................................... 6

Introduction to DFS ..................................................................................................................... 7

Course Structure ......................................................................................................................... 9

Final Assessment ....................................................................................................................... 10

Online ModuleS review ................................................................................................................. 11

Ethics for Public Procurement Professionals ............................................................................ 11

Stage 1: Need Identification Process ........................................................................................ 16

Stage 2: Pre-Solicitation Process ............................................................................................... 18

Stage 3: Solicitation Preparation Process ................................................................................. 21

Stage 4: Solicitation Process ..................................................................................................... 24

Stage 5: Response Evaluation Process ...................................................................................... 26

Stage 6: Contract Award Process .............................................................................................. 29

Building the Contract ................................................................................................................ 31

Cost Analysis ............................................................................................................................. 31

Worksheet 1: Cost Analysis Worksheet .................................................................................... 39

Building the Contract ................................................................................................................ 48

Scope of Work ....................................................................................................................... 49

Deliverables ........................................................................................................................... 54

Financial Consequences ........................................................................................................ 62

Stage 7: Contract Management Process ....................................................................................... 64

Module 1 – Preparation ................................................................................................................ 65

Roles, Responsibilities, and the Contract File ........................................................................... 65

Contract Administrator and Contract Manager ................................................................... 66

Contract Handover ................................................................................................................ 68

Worksheet 2: Contract Management File Checklist ................................................................. 72


2

Introduction to FACTS (Florida Accountability Contract Tracking System) .......................... 80

Provider Onboarding ................................................................................................................. 82

Communication ..................................................................................................................... 82

Module 2 – Monitoring ................................................................................................................. 87

Monitor Provider Performance ................................................................................................ 88

Monitoring Activities................................................................................................................. 90

Risk Assessment .................................................................................................................... 98

Monitoring Plan .................................................................................................................... 99

Monitoring Tool .................................................................................................................. 101

Monitoring Sampling .......................................................................................................... 102

Documentation ................................................................................................................... 103

Reporting Results ................................................................................................................ 104

Delays .................................................................................................................................. 105

Conflict Resolution .............................................................................................................. 108

Corrective Action Plan ........................................................................................................ 110

Module 3 – Deliverables, Payments, and Enforcing Terms & Conditions .................................. 112

Deliverables, Payments, and Enforcing Terms & Conditions ................................................. 112

Receive Deliverables and Provide Written Certification ........................................................ 113

Process Invoices ...................................................................................................................... 114

Invoice Activity .................................................................................................................... 117

Worksheet 3: Sample Invoice Worksheet .............................................................................. 119

DFS Invoice Audits ................................................................................................................... 120

DFS Pre-Audit ...................................................................................................................... 120

Enforce Terms and Conditions ................................................................................................ 123

Financial Consequences ...................................................................................................... 123

Liquidated Damages............................................................................................................ 123

Settlement Agreements ...................................................................................................... 124

Module 4 – Changes and Closeout ............................................................................................. 126

Changes to the Contract ......................................................................................................... 126

Amendments ....................................................................................................................... 127

Renewals ............................................................................................................................. 128

Extensions ........................................................................................................................... 130

Assignments ........................................................................................................................ 131


3

Termination ......................................................................................................................... 132

Contract Closeout ................................................................................................................... 134

Collect and Resolve Programmatic Details ......................................................................... 135

Reconcile all Fiscal Information .......................................................................................... 136

Legal References ..................................................................................................................... 138

Resources ................................................................................................................................ 139

Sources .................................................................................................................................... 140


Course Overview 4

COURSE OVERVIEW

The purpose of the Florida Certified Contract Manager course is to provide you with the knowledge, skills, and abilities necessary to be effective contract or grant managers.

At the end of this course, you will have the foundational knowledge necessary to be an effective contract or grant manager. The information presented in this course is meant to demonstrate best practices and, for the most part, will stay at a high level so it can apply to any state employee. Each agency may have unique processes and procedures that their contract or grant managers should follow. Therefore, you are encouraged to complete any agency-specific training and are responsible for knowing and following the specific policies and procedures of your agency.

Contracts/Grants

There are a lot of similarities between contract and grant management. Most of the information we discuss here applies to both contracts and grants. When there is specific information just for grants, it will be noted.

Sign-In Sheets

You must sign the sign-in sheet at the beginning of each day and after returning from lunch.

Participant Guide

Everyone should have completed the initial online assessment, online modules, and printed their participant guide.

Reference Material

You should have a numbered binder called Reference Material. This binder contains handouts you will use throughout the course. These binders will be reused each class, so please do not write in the binder or remove pages. At the end of the session, give this binder back to the instructor. The material contained in this binder is located on DMS’ website: https://www.dms.myflorida.com/business_operations/state_purchasing/public_procurement_professional_development/florida_certified_contract_manager. If you’d like to print any of these resources for use after class, you can download them there.

https://www.dms.myflorida.com/business_operations/state_purchasing/public_procurement_professional_development/florida_certified_contract_manager



Introductions 5

INTRODUCTIONS

You will play an icebreaker game called Person Bingo. The game works just like regular bingo except it uses personality traits/experiences instead of numbers. The purpose of the game is to get to know each other.

1. You’ll be given a bingo card. Please, use a dry erase marker to fill in the card. 2. You’ll have 15 minutes to mingle. Find people who match one trait on your bingo card.

When you find a match, put the person’s name in the corresponding square. 3. Once you’ve introduced yourself and found a match, move on to someone else.

You are not allowed to:

• Use one person to fill in several boxes (unless you’ve mingled with everyone and still don’t have a bingo)

• Use yourself to fill in any boxes The first person to fill five boxes across, down, or diagonally yells BINGO and the game is over.


Introductions 6

Introduction to DMS

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Welcome to the Department of Management Services’ (DMS) Florida Certified Contract Manager Professional Development course. Here at DMS “We serve those who serve Florida.” We provide many services to help state agencies meet their responsibilities, such as:

• Fleet Management

• Human Resource Management

• People First

• Real Estate Development and Management

• Retirement

• State Group Insurance

• Telecommunications

• State Purchasing

• Private Prison Monitoring State Purchasing assists state agencies with meeting important responsibilities related to sound stewardship of public funds. Responsible management of public funds begins with fair, open, and competitive procurement practices. The Division of State Purchasing delivers services that result in true value for state agencies purchases. Good stewardship doesn’t end with procurement; it also requires skillful contract and grant management. The Florida Legislature recognizes the importance of contract and grant management. The 2012-2013 Legislature provided, and Governor Rick Scott approved, authorization for DMS to revise the professional development process for contract and grant managers. The Department


Introductions 7

of Management Services, along with the Chief Financial Officer, are responsible for jointly teaching the courses for a contract or grant manager to become certified. In fact, each contract or grant manager who is responsible for contracts or grant in excess of $100,000 annually must become certified. To meet this statutory obligation, the Department of Management Services has revised not only the Florida Certified Contract Manager professional development program but all of the programs under its purview. This program is designed to provide you with the knowledge and skills you need to meet your responsibilities as a Florida contract or grant manager.

Introduction to DFS

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Section 17.03(1), Florida Statutes requires that the CFO of this State, using generally accepted auditing procedures for testing or sampling, shall examine, audit, and settle all accounts, claims, and demands against this state. Section 17.29, Florida Statutes gives the CFO authority to prescribe any rule he/she considers necessary to fulfill his/her constitutional and statutory duties, which include but are not limited to procedures or policies related to the processing of payments from any applicable appropriation. These duties are delegated to the Bureau of Auditing within the Division of Accounting and Auditing. The primary responsibility of the Bureau of Auditing is to assist the CFO in performing his/her constitutional and statutory duties as the state’s chief fiscal officer. This is accomplished by providing reasonable assurance to the taxpayers of Florida, through effective and efficient pre-audit and post-audit of disbursements and other financial transactions, that disbursement


Introductions 8

transactions represent valid obligations of the State, and funds are disbursed from the State Treasury in accordance with applicable laws, rules, and administrative policies.

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The information provided applies to all agreement types.


Introductions 9

Course Structure

This course is scheduled for 2 days. Below is the tentative agenda for the course. The instructor(s) reserve(s) the right to deviate from this schedule as needed.

Day 1 Topic(s)/Event

• Introductions o Course overview and icebreaker activity o Review of online modules

LUNCH

• Cost Analysis and Building the Contract

• Module 1 – Preparation o Roles, responsibilities, and the contract file o Conducting provider onboarding

Day 2 Topic(s)/Event

• Module 2 – Monitoring o Developing a monitoring plan and monitoring provider performance

• Module 3 – Deliverables, Payments, and Enforcing Terms & Conditions o Receiving deliverables, processing invoices, and applying financial consequences

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• Module 3 (cont.)

• Module 4 – Changes and Closeout o Managing changes to contracts/grants and conducting closeout activities

• Final Assessment Preparation

• Course Evaluation

• Final Assessment


Introductions 10

Final Assessment

There will be a graded final assessment at the end of day 2. You will be required to pass the assessment with a grade of at least 80% in order to receive credit for this course. The final assessment will consist of multiple choice questions. It will include questions related to the objectives and corresponding topics covered in the online modules and material that will be covered in the classroom over the next two days. Your instructor will grade the final assessments before you leave. If you do not pass you will be allowed to review your notes and take the final assessment again before you leave. If you do not pass after the second attempt, you will have to register for the instructor-led portion of this course again and re-attend. You should know that priority for seating will be given to those who have not yet attended this class. You should not have trouble passing the final assessment as long as you pay attention during the class and participate in activities.


Online Modules Review 11

ONLINE MODULES REVIEW

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Ethics for Public Procurement Professionals

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This module presents procurement-related issues concerning:

• prohibited actions or conduct,

• requirements specific to non-competitive procurement, and

• whether appearances matter.



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Stage 1: Need Identification Process

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The goal of Stage One is to identify the specific need for a commodity or service and develop a plan to address that need. This stage includes:

• need identification,

• budget identification, and

• purchasing strategy.

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Stage 2: Pre-Solicitation Process

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The goal of Stage Two is to develop the background information needed for a successful competitive solicitation and to decide which of the competitive solicitation methods is the most appropriate.

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Stage 3: Solicitation Preparation Process

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The goal of Stage Three is to prepare and review a competitive solicitation before it is released to the vendor community. This stage includes:

• planning, drafting, and reviewing the solicitation,

• preparing the solicitation documents for posting, and

• selecting the evaluation or negotiation teams.

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Stage 4: Solicitation Process

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The goal of Stage Four is to release and manage a competitive solicitation. This stage includes:

• posting the solicitation document,

• responding to vendor questions, and

• managing addenda to the solicitation document.

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Stage 5: Response Evaluation Process

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This stage includes:

• opening, reviewing, and evaluating responses to a competitive solicitation,

• negotiating with respondents, if appropriate, and

• making an award recommendation.

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Stage 6: Contract Award Process

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This stage includes:

• posting the agency decision,

• drafting and reviewing the contract, and

• executing the final contract.

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Building the Contract

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Included in this stage are:

• how and when to conduct a cost analysis

• developing the contract

• developing the Scope of Work

• developing the deliverables

• developing the financial consequences

Cost Analysis

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There are times when an award will not involve a competitive process. In these cases, a cost analysis is required to ensure that the state will only be paying for allowable, reasonable, and necessary, and allocable costs related to the success of a program. When conducting a cost analysis, you are reviewing and evaluating each individual cost element on a proposed budget submitted by the provider. It is the agency’s responsibility to document and support each decision made. Section 216.3475 of the Florida Statutes mandates this review for all non-competitively procured agreements. This would include any single source procurement, exceptional purchases, and or line-item appropriations to a specific entity.

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CFO Memo No. 02 (2012-2013) discusses an agency’s evaluation of each cost element to determine if costs are allowable, reasonable, necessary, and allocable and provides the cost analysis form that must be used to record the conclusions made. A cost element is an individual budget item. The statutes specifically mandate a cost analysis whenever services are non-competitively procured. Agreements with recipients/sub-recipients would also need a cost analysis performed since funds can only be expended for allowable cost elements. Cost reimbursement agreements would also need a cost analysis performed since reimbursements can only be made for allowable cost elements.



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The first criteria you will evaluate is whether a cost element is allowable. You must determine:

• if funds can be used in the manner proposed in the budget for your program; and

• if there is legal authority that allows the cost element.

Attorney General Opinion #78-101 requires expressed or implied legal authority to expend funds.

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Authority to expend funds may be provided in Statute or captured in the General Appropriations Act. An agency must be able to identify where that expressed or implied legal authority is given and must maintain that reference in the contract management file.



An agency cannot delegate to a provider something the agency does not have authority to do themselves. For example, an agency could not enter into an agreement for a provider to have a party honoring employees unless the agency has the authority to have a party to honor employees. Here are some places where you can look to determine if you have the legal authority to expend funds on certain costs. The Reference Guide for State Expenditures, which has the authority of administrative rule, will many times provide useful information when determining if a cost element is allowable. Cost elements to carry out a state program can be evaluated to determine if they are allowed by accessing the Catalog of State Financial Assistance located on DFS’s website, https://apps.fldfs.com/fsaa/. Likewise, cost elements to carry out a federal program can be evaluated through the Catalog of Federal Domestic Assistance and OMB Circulars. Please be aware that OMB circulars A-110, A-133, A-87, A-122 and A-21 were replaced with the super circular effective December 26, 2014.

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After we have determined that a cost element is allowable, we must determine if it is reasonable and necessary. When making this determination we must ask ourselves:

• Is this cost element necessary for the success of the program?

• Are there less expensive alternatives that would meet the need?

• Would a prudent person or business pay the same price for similar services? You may need to conduct a market analysis to determine the going rate. You will want to maintain documentation to support the methodology and rationale for your decisions.

https://apps.fldfs.com/fsaa/



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Finally, you will review the allocation for each cost element to ensure the state pays only for the portion of the cost element that is being used for the program. How cost elements are allocated will vary depending on the agreement. Some allocations may be determined by calculating the percentage of the total space used for the program while others may be determined by calculating the percentage of the time used for the program. In any case, you will want to maintain supporting documentation that establishes the basis for the percentage allocated to the program, such as a leasing agreement that establishes the square footage of the building used for the program or a report from a copier tracking system to support the program’s usage of a copy machine. Here is an example of an accountant’s salary charged to a program under a cost reimbursement agreement…



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Salary is allocated when an employee’s time is spent on multiple programs. The accountant’s position description requires him or her to perform accounting services for two programs. The provider would determine how much of the accountant’s salary would be allocated to each program by the use of a project timesheet. A project time sheet accounts for work performed by an employee on each program by including details such as the number of hours worked each day for each program along with a description of the work performed. The percentage of salary allocated to a program would be determined by adding up the number of hours the accountant worked on that program and dividing the sum by the total number of hours the accountant worked. Project time sheets should be signed by the employee and a supervisor who has direct knowledge of the time worked by the employee. When evaluating a project timesheet, be sure to check the dates of the signatures to ensure they were not signed before the work was to be completed. Remember, when writing your agreement to include documentation requirements, such as project timesheets to support time worked on the program.



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Participant Guide Worksheet: 1 Cost Analysis Worksheet

Review the handout and worksheet. Read the scenario together as a class to get an understanding of the agreement. In this example you did not go through a competitive procurement process so you have to conduct a cost analysis on each cost element. Document your findings on the allocation chart located in your worksheet. Determine if each cost element is allowable, reasonable, necessary, and allocable. Determine if more information is needed before a decision can be made. List what documentation you will obtain to support your decisions.

Reference Material (“Green Binder”)

Handout 1 – CFO Memo No. 02 (2012-2013) Page 1



WORKSHEET 1: COST ANALYSIS WORKSHEET

SCENARIO

Background

Homelessness remains a prevalent problem, with a steady, if not growing, percentage of the

population being classified as ‘homeless’ or ‘near-homeless’ (HUD Homeless Definitions).

Research has shown that participation in targeted transition services substantially increases the

rates of homeless individuals obtaining, and retaining, stable and reliable employment.

Facts

The State of Florida has decided to enter into a one year agreement with Homefront

Shelter, Inc. to provide homeless transition services to eligible homeless individuals in Leon

County, Florida. Services will be provided to a minimum of 40 unduplicated individuals

each month.

Required Tasks

1. Make services available at provider’s location

2. Provide counseling services to eligible homeless individuals

3. Provide life skills coaching to eligible homeless individuals

4. Provide Personal Hygiene products (Attachment A) as needed

Successful participants shall complete one (1), 15-minute case management session every other

week and one two (2) hour life skills session every other week with Life Skills Coordinator(s) for

a one month period, during the program year.

Location/Service Dates &Times

Counseling and Life Skills Training will be conducted at the provider’s location in Leon County,

Florida, Monday-Friday, between the hours of 9am—5pm, excluding state holidays.

Funding

The total contract amount is $104,500, subject to the availability of funds.



Attachment A

Approved Personal Hygiene Product List

➢ Soap

➢ Shampoo

➢ Cream Rinse

➢ Hair products, other

➢ Contact lens supplies

➢ Razors (new blades)

➢ Shaving cream

➢ Toothpaste

➢ Toothbrush

➢ Dental floss

➢ Mouth wash

➢ Mints

➢ Mirror, hand

➢ Wet Wipes

➢ Lint brush

➢ Hair brush

➢ Hair comb

➢ Hair pins

➢ Hair dryer

➢ Nail clippers

➢ Nail file

➢ Cotton swabs

➢ Shower shoes

➢ Tweezers

➢ Tissues

➢ Toilet Paper

➢ Feminine Napkins / Products (if applicable)

➢ Diapers (if applicable)

➢ Deodorant

➢ Laundry bag

➢ Shower cap

➢ Seal tight container or shower tote for personal hygiene products



Cost Analysis

Homefront Shelter, Inc. Budget Counselor $20,000 (Salary and benefits) Life Skills Coaches (2) $30,000 (Salary and benefits) Rent and Utilities $23,916 Operational Costs & Supplies $6,000 Education Services & Supplies $12,500 Miscellaneous $12,084 $104,500



Cost Elements 1. Counselor $20,000

❖ Works 5 hours per week on this project. ❖ $20,000 / 260 hrs. = $76.92 per hour salary and benefits.

(Allowable? Necessary? Reasonable? Allocable?)

2. Life Skills Coaches (2) $30,000

❖ Works 2 hours a day on this project. ❖ $15,000 / 520 hrs. = $28.85 per hour salary and benefits, each


3. Rent and Utilities $23,916

❖ Two-hour daily use (5 days a week) of facilities ❖ $23,916 / 12 months @ $1,993.00 per month


4. Operational Cost & Supplies $6,000

❖ Personal Grooming Aides (ex: soap, head lice shampoo, haircuts, shoes, and clothing for clients)

❖ Cleaning Expenses for Facility (ex: detergent, paper towels, linens, pillows, and other traditional household items)




5. Education Services & Supplies $12,500

Supply costs for training clients (including, but not limited to, paper, pens, pencils, printer cartridges, copier toner, shredder, scanner, T-shirts with provider’s logo, laptop computer(s), etc.)


6. Miscellaneous $12,084

Review the items that make up this category.

❖ Travel $2,100

❖ Cellular Telephone: $3,234

$3,234 / 12 months = $269.50 per month

❖ Gift Cards $1,500

❖ Ergonomic Chair (2) $2,750

❖ Dinner Banquet $2,500




Line Item Budget Category Amount % Allocated to

this Agreement

Allowable Reasonable Necessary

Case Management Counselor $20,000 25%

Life Skills Coordinator (2) $30,000 25%

Rent and Utilities $23,916 50%

Operational Costs $6,000 100%

Educational Services and

Supplies:

Toner/Ink $750 100%

Scanner $1,000 100%

Color Printer (2) $1,000 100%

Office Supplies $750 50%

T-shirts with logo $1,500 50%

MacBook Pro (2) $5,500 100%

Other $2,000 100%

Miscellaneous:

Travel $2,100 100%

Cell Phone Service $3,234 100%

Gift Cards $1,500 100%

Ergonomic Chair (2) $2,750 100%

Banquet $2,500 100%

Total $104,500

CERTIFICATION

I certify that the cost for each line item budget category has been evaluated and determined to be

allowable, reasonable, and necessary as required by Section 216.3475, Florida Statutes.

Documentation is on file evidencing the methodology used and the conclusions reached.

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Name Title

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Signature Date



COST ANALYSIS INSTRUCTIONS FOR NON-COMPETITIVELY PROCURED

AGREEMENTS IN EXCESS OF CATEGORY II

1. Agencies must complete a cost analysis worksheet for the original contract and any

amendment that affects the amount of compensation and/or the level of services

provided.

2. Each separate line item must be evaluated to determine whether the cost is allowable,

reasonable and necessary. Each miscellaneous cost must be specifically identified.

3. To be allocated to a program, a cost must be related to the services provided. If the cost

benefits more than one program, a determination must be made that the cost is distributed

in a reasonable and consistent manner across all benefiting programs.

4. To be allowable, a cost must be allowable pursuant to state and federal expenditure laws,

rules and regulations and authorized by the agreement between the state and the provider.

5. To be reasonable, a cost must be evaluated to determine that the amount does not exceed

what a prudent person would incur given the specific circumstances.

6. To be necessary, a cost must be essential to the successful completion of the program.

7. Indirect costs/overhead should be evaluated to determine that the rate is reasonable.

8. Agencies must retain documentation in agency files to support the conclusions reached as

shown on the Cost Analysis for Non-Competitively Procured Agreements in Excess of

Category II form.



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Above are some examples of expenditures that should raise a red flag when reviewing a provider’s budget. These expenditures are typically not allowed, unless there is specific statutory authority for your program to expend funds in this manner. As cash-equivalent instruments, gift cards would require proper internal controls if allowable by statute.

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These items are usually for personal convenience and would therefore not be allowable. The Agency would need to ask for the intended use of these items. For example, in the case of a residential program, a microwave and refrigerator could be allowable.



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Agreements awarded non-competitively require a cost analysis by statute (§ 216.3475, Florida Statutes). Recommended: Grant agreements with recipients of state financial assistance may generally require the Agency to perform a cost analysis as a preventative measure and to establish fiscal expectations. The funds in these agreements can only be expended on allowable costs applicable to the program. Cost reimbursement agreements will benefit from an analysis each time an invoice is submitted. Only allowable expenses can be reimbursed. CFO Memo No. 03 (2014-2015)



Building the Contract

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The agreement is the written document that establishes the relationship between you and the provider. This document usually contains:

• Terms and Conditions,

• Standard Audit Language,

• Availability of Records,

• Timing and nature of Reports,

• Sub-contracting or sub-granting,

• Payment Terms, and

• Disposition of Property. Sections 287.058 and 215.971, F.S. require that all contractual service agreements include:

• Scope of Work,

• Deliverables, and

• Financial Consequences section.



Scope of Work

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The Scope of Work will establish in detail all work the Provider is required to do. When writing your scope, always clearly state all tasks the provider is to perform. Include enough detail so that there is no ambiguity. A clear and detailed scope of work sets clear expectations for both the provider and the Agency, reducing the likelihood of misunderstandings. It also provides a clear understanding of what is to be done when managing and/or monitoring a provider’s performance under the agreement. When the Scope of Work includes technical terms, consider including a section in the agreement that would define those terms and provide further clarity.

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Above are some examples of vague terms that do not have definitive characteristics.



Spell out any specific activities you want to see performed.

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Take a look at one task pulled from an actual agreement. What do you think about this scope of work?

• Does it provide enough information so that the provider and the contract manager know what is expected?

• Does it answer the “who, how, what, where, and when” questions we discussed previously?

• Does it answer “how much, how many, and how often”?

• Does it require the provider to maintain documentation that would be used to evidence the completion of the tasks?

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The Scope of Work does more than just establish the work required to be completed. It also sets qualitative and quantitative standards so the provider understands the manner in which the tasks are to be completed. Qualitative standards answer the “who, how, when, and where” questions about the work. The quantitative standards (when applicable) answer questions related to “how much, how many, or how often”. Who

• Who is going to do it? Who is eligible to receive services?

• Identifies staffing levels, qualifications, responsibilities, and documentation requirements.

How

• How are all activities to be executed?

• Any specific order

• Follow any specific guideline

• Identifies how tasks are to be performed. When

• When is it to be completed?

• Identifies due dates Where

• Where will the work be done?

• What is the area the provider is responsible for? (Example: Feeding elderly people in the Big Bend Area)

• Where do services have to be delivered? (Example: furniture to be delivered at the loading dock or required to be installed in the offices of the fourth floor?) Include specific address.

How Much/Many

• Define minimum/maximum quantity of service to be delivered by the provider. (Example: A nursing facility must have a minimum of 30 beds available for use by the program)

How Often

• Define how often certain services are to be completed. (Example: Lawn must be cut every two weeks.)



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The work the provider completes must be evidenced with applicable documentation. Since you are not going to be watching the provider while they do their work, you will require them to create and keep documentation that would evidence the completion of tasks as established in the Scope of Work. This documentation can be required to accompany an invoice or it may simply be required to be kept by the provider and submitted to the Agency when requested for an audit or other monitoring activities. Examples of documentation include (as applicable): case management notes, call logs, surveys, pre- and post-tests, or intake forms.

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A poorly written scope of work may result in:

• Tasks that were intended to be performed may not be performed.

• The provider may perform unnecessary tasks.

• Inability to monitor effectively. The task in our Scope of Work now has more detail. Does this help answer some of your previous questions? We now know that:

• “Mentoring services” will be provided to 300 eligible students per month.

• The provider will supply 100 mentors to in Leon County to provide 2 hours of mentoring each week to the current enrolled students.

Is this better? Do you still have some questions?

1. What happens if the number of eligible students is below 300 for any given month? What if the provider has less than 100 mentors?

2. Can a student have failing grades and still be qualified? 3. What documentation should be required/maintained?



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Review the scope of work example your group was given. On your large post it note, rewrite the scope to include:

• Applicable qualitative standards (who, how, when, where)

• Applicable quantitative standards

• Required documentation to be maintained

Deliverables

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Basically, deliverables are the units of service or tasks directly related to the Scope of Work, that must be satisfactorily performed (Performance Criteria) by the provider. The satisfactory completion of these units of service or tasks is supported by documentation, reviewed and accepted in writing by the Contract Manager before payment is made.



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Above are some examples of measureable units of service that could be used, depending on the type of deliverable.

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Deliverables should be clearly defined and directly relate to the tasks outlined in the Scope of Work. Each deliverable should identify the required performance criteria that must be performed in order to receive payment.

Example: One month of case management services (unit of service) for a minimum of 50 clients (minimum level). So the performance criteria is one month of case management services for a minimum of 50 clients.



Hopefully you did a good job in our Scope of Work identifying the documentation requirements because this is where it will come into play. The documentation accompanying deliverables should demonstrate that the provider met the performance criteria and provide reasonable assurance that the services were performed in accordance with the agreement. Does the documentation tell us what we need to know in order to pay the provider? How much is the provider going to be compensated for each deliverable? If the deliverable is going to trigger the payment it is important to identify the amount of compensation. Is a due date necessary to evaluate the successful completion of each deliverable? If so, the agreement should contain timelines for the completion and submission of deliverables. To sum it up, deliverables should:

• Be related to the Scope of Work,

• identify the tasks the provider is supposed to perform along with the documentation (identified in the SOW) to support the performance,

• identify the amount of compensation, and

• provide a timeline for the completion and submission of deliverables. If you’re having trouble developing your deliverables, take a look at your Scope of Work and ensure it contains the appropriate details. Your deliverables should not provide details that are absent in your Scope of Work.

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Some facts to keep in mind when thinking about deliverables:

1. Deliverables are not always tangible in the sense that the provider gives you something



that you can touch or feel. We may be paying for a month’s worth of counseling services or one hour of legal services not something tangible like a widget. It is important to remember that no matter if the deliverable is tangible or not there should still be supporting documentation to validate the completion of the specified deliverable.

2. Reports typically are not deliverables. They are a means of attesting to what was accomplished during the service period. Remember we are paying for the actual work, not for a report. With that said, there may be instances where the report actually is what we are paying for. For example, a research project or feasibility study.

3. The performance expectation should correspond with the payment schedule. We have to make sure there is a connection between the services being performed and the payment schedules. If services are required to be performed on a quarterly basis you would not expect to be making monthly payments.

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Once again, here is the Scope of Work developed for the provider. From here, you want to develop deliverables stating what the provider must perform in order for payment to be made. Remember you want your deliverables to:

• Be related to the scope of work. That ensures that tasks stated in the scope have to be completed for payment to be made.

• Identify the specific tasks/services that must be completed and minimum performance levels to evaluate their successful completion.

• Identify the documentation to evidence that minimum performance criteria was met.

• Identity the amount to compensation.

• State the timeline for successful completion.



Following are some examples of deliverables written from this Scope of Work. For each example, ask yourself the following questions about how the deliverable is written:

• Is it related to the scope of work? Does it ensure that tasks stated in the scope have to be completed for payment to be made?

• Does it identify the specific tasks/services that must be completed and minimum performance levels to evaluate their successful completion?

• Does it identify the documentation to evidence that minimum performance criteria was met?

• Does it identity the amount of compensation?

• Does it state the timeline for successful completion?

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Above is an example of improved deliverable language. Remember that deliverables are to be tied to the scope of work.

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The provider completed task D, so they expect payment for the work that was performed but how are you going to compensate the provider? At this point you may find yourself in a settlement agreement.



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A simple way to help avoid this situation and a potential settlement agreement would be to assign a monetary value to each task. By assigning a monetary value you know how much each task is worth, and can pay the provider accordingly. So if the provider did not complete task E for whatever reason, you can pay the provider for the work that was actually performed/completed and move on. Basically, if a provider does not perform in accordance with the agreement, you want to have the flexibility to compensate the provider for the actual work that was performed and avoid a possible settlement agreement. Keep in mind that assigning a monetary value to each task is just one way of compensating the provider for the actual work performed and you will get into more details in the next topic, Financial Consequences.



Financial Consequences

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The third requirement for all agreements is financial consequences. Financial consequences give direction for payment when work is not completed as the agreements requires. Without financial consequences we could find ourselves in a settlement agreement. What would we do if we determined that a provider taught the full 100 hours of training required in a monthly deliverable period; however, the provider was using instructors that did not meet the full minimum qualifications for instructing as defined in the agreement? A financial consequence that stated how much payment would be reduced for not having a certified teacher would help resolve the issue and the agency could pay the provider for the services actually received. Financial consequences state what the agency MUST do, not MAY do in the event of non-performance or non-compliance by the provider. Decide if the following meet the criteria to be considered a financial consequence:

• The Department may reduce payment by $200 for each client the provider fails to serve below the 100 minimum each month.

• The Department will terminate the contract upon unsuccessful completion of work.

• Cost reimbursement invoice will be reduced by 2% for each meal not served by noon.

• At the Department’s discretion payment will be reduced by $200 for every student below the minimum class size of 50.

• The provider will be paid $25,000 monthly for cleaning a minimum of 700 rooms each month. Payment will be reduced by $15 for each room below the minimum.



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Use the revised Scope of Work from the previous exercise, as a team, to:

1. Write one deliverable that:

• is related to the Scope of Work

• identifies all task and services that are to be completed

• identifies minimum performance criteria

• identifies required documentation

• identifies compensation

• identifies timeline for submission

2. Write one financial consequence that:

• is tied to the deliverable performance

• states what the agency MUST do to adjust payment for non-performance

• identifies the methodology for adjusting payment for non-performance


Stage 7: Contract Management Process 64

STAGE 7: CONTRACT MANAGEMENT PROCESS

The goals of Stage Seven are to ensure the provider performs according to the terms of the contract/grant and that both parties properly perform their responsibilities. Remember that when we use the term provider we’re referring to both contractors and recipients/sub-recipients. As a contract/grant manager, you may or may not have been involved in the stages leading up to this point. If you weren’t, it is vital that you thoroughly review your contract file and discuss lessons learned with those involved in the procurement process. The effectiveness of contract management is heavily affected by the thoroughness of these previous stages and the documentation of those activities. In order to effectively administer and enforce the terms of a contract, you must have a clear understanding of the actions that took place during the procurement project that created the contract. The contract management process is not linear. You will have several activities that you must perform and, at times, activities may overlap. Many of the activities will also be ongoing and recurring. It’s important to recognize that each agency may do things a little differently. Your agency will have procedures to follow and certain documentation requirements. It’s your responsibility to know and follow your agency’s procedures. This training will demonstrate legal requirements and best practices and will stay at a high level so it can apply to any state employee.


Module 1 – Preparation 65

MODULE 1 – PREPARATION

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Roles, Responsibilities, and the Contract File

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By the end of this section, you’ll be able to:

• Compare and contrast the roles of the contract administrator and contract/grant manager during Stage 7.

• Identify documents to be maintained in the contract file.



The contract management process begins when the agency has posted its Intent to Award and has an executed contract or grant in hand. The executed contract or grant is transferred to the contract administrator or grant manager.

Contract Administrator and Contract Manager Once a contract or grant is properly executed by the appropriate parties, the agency must designate one employee to be a contract administrator and one employee to be a contract manager. At the agency’s discretion, these roles and responsibilities may be assigned to the same or different employees. § 215.971, F.S. only references duties for a grant manager, there is no mention of a grant administrator. Therefore, grant managers are responsible for all duties listed below. Grant managers are also responsible for cost reconciliation and preparing a final reconciliation report.

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Roles and responsibilities may vary from agency to agency. For example, we all know there are certain requirements and timeframes for posting documents to FACTS. In some agencies, posting these documents is the responsibility of the contract administrator while in other agencies it is the responsibility of the contract manager. In addition to understanding what is required of you as a contract manager according to Florida Statute, it is your responsibility to also be aware of what your agency requires of you. The contract administrator is a resource you can rely on for advice and guidance while performing your contract manager duties.



Contract Handover *From this point forward, the term “contract manager” refers to both contract and grant managers.

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The contract administrator takes possession of all documents and materials that must be retained in the contract file. This could happen through a formal contract handover meeting or it may be a simple administrative transfer from your agency’s purchasing department to the contract administrator. Each agency may have a different procedure. The procurement file, which was created during Stages 1 - 6, should be filed in this new contract file in a logical and neat manner.



Contract File Creation and Maintenance

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Once the contract administrator has the procurement file, the master contract file will need to be created. The contract file includes the information contained in the procurement file as well as all relevant information related to the contract/grant from the time of award to closeout.

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The contract administrator is responsible for maintaining the contract file and financial information (§ 287.057(15), Florida Statutes). However, in many agencies, both the contract administrator and the contract manager will maintain a contract file.



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The contract file must contain:

• Formal contract documents o original contract/grant, o amendments, o renewals, o bonds, and o insurance.

• Day-to-day management documents o performance documentation, o correspondence, o payment documentation, o contract monitoring, o deliverables, o subcontractor approvals, etc.).

The contract file must contain any documentation required in the contract. In your agency, these documents may be filed in many separate places (contract administrator, contract manager, procurement office) or all in one location. Your agency will provide guidance on the policies and procedures you should follow for maintaining the contract file.



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See Participant Guide Worksheet 2: Contract Management File Checklist

Contract/Grant File Contents The contract file is the complete history of the contract. The file should be organized so that the activities conducted during the contract management process can be reconstructed and understood by someone who is not familiar with the contract. All contract files are subject to audit by the Chief Financial Officer (§ 287.136, Florida Statutes). The Contract Management File Checklist that follows is a great starting point for any contract or grant you manage. You can modify this checklist for your contracts/grants and add any agency-specific items.



WORKSHEET 2: CONTRACT MANAGEMENT FILE CHECKLIST

Click here for an Excel version of this checklist.

CRITERIA PROTOCOL Y N N/A COMMENTS

Activity Record & Correspondence

Contract Review Checklist

Contract review checklist verifies that the contract is current, accurate, and

complete.

Date:

Correspondence

Evidence of correspondence regarding contract issues which may include

emails, letters, telephone contact log, file notes, etc.

Date:

Documentation of written assignment of contract management

duties

Senior Management must assign, in writing, the contract management

responsibilities to a trained contract manager. Ch. 287.057(14), F.S.

Date:

Documentation of Approval/Disapproval

of subcontracting

A subcontract will be considered approved if subcontracting is allowed in

Attachment I of the contract and prior written approval was provided by letter,

memo, or email.

Date:

Documentation of contract termination/ cancellation, including

contract closeout activities

Documents pertaining to termination or cancellation of a contract.

Date:

Financial/Payment Records

Budget Authorization E.g. Appropriations Act proviso, budget

agendas, Chart 8 Date:

Evidence of Cost/ Price Analysis

Budget, Unit rate tool, Capacity Report, Approved Cost Allocation Plan for CBC,

Cost Analysis for Non-Competitively Procured Agreements in Excess of

Category II form (for new contracts executed on or after 7/1/10) or its DFS-

approved equivalent form.

Date:

Copy of Business Case

For an outsourcing contract exceeding $10 million within a single fiscal year, an

agency must complete a business case. Ch. 287.0571(4), F.S.

Date:

Copy of Provider's Approved Budget

Submitted as part of contract negotiations

Date:

http://www.dms.myflorida.com/content/download/127549/791685/Contract_Management_File_Checklist.xlsx




Recipient/Subrecipient vs. Vendor

Determination

Florida Single Audit Act and/or Federal Recipient/Sub-recipient vs. Vendor Determination Checklists must be

completed, signed, and dated if applicable to the project. Ch. 215.97, F.S.

Date:

Post Award Notices and Transmittal Letter

The Contract Manager must furnish within ninety days of contract execution

and funding changes.

Date:

Payment Activity Ledgers

Payment History

Schedule of contract payments and total amount disbursed; Payment tracking

system, ledger, spreadsheet with running payment balance (aka invoice

tracking sheet), etc.

Date:

Documentation of periodic reconciliation of contract payments

Quarterly reconciling of the contract payment records with the state’s official

accounting records; reconciliation of actual expenses versus invoiced

expenses.

Date:

Copies of Invoices and Supporting Documentation

Invoices with proof of date stamp

Copies of invoices with proof of date stamps. Section 215.422(1), F.S.

Date:

Documentation performed by Contract Manager - inspection

and approval of contract deliverables

The Department has five working days to inspect and approve the goods and

services upon submission of any invoice unless the contract specifies otherwise.

Section 215.422(1), F.S.

Date:

Provider's justification of need for advances

Documentation supporting the decision to provide advanced funding. A) detail

documentation justifying cash need such as certified settlements or analysis; B)

Documentation that any interest earned by the provider on an advance is

returned to the Department or applied against the obligation of the contract.

Date:

Contract Documents

Original signed contract (and amendments)

Contract File must contain the original signed and dated contract, amendments,

renewals, and provisions.

Date:




OPB/EOG approval for actions over $1 million

Executive Office of the Governor Memo #12-019 -OPB contract review for

contract changes of $1 million or more including competitive solicitations,

renewals and amendments. Began Sept 11, 2011- Submitted to EOG submission

-check agency procedure to proceed.

Date:

Contract Review Form - Routing of Contract or

Amendments

Signed by Legal, Budget, and Contract Administration 287.057(18), F.S.

Date:

Notice of Non Compliance (PUR 1010)

When services are initiated prior to the execution of a contract and there is no valid emergency, certification as to the specific circumstances leading to the

failure to have the contract signed prior to rendering of services must be filed

within 30 days and included in the contract file.

Date:

Certification Regarding Debarment and

Suspension Form

Form signed and dated for all contracts containing $25,000 or more in Federal

funds.

Date:

Certification Regarding Lobbying Form

Form signed and dated for all contracts containing Federal funding in excess of

$100,000.

Date:

FFATA Certification of Executive

Compensation Reporting

Requirements

Copy of completed for qualifying contracts (executed or amended on or after 10/1/10 with $25,000 or more in

Federal funds. Isn't applicable for ARRA-funded contracts).

Date:

Vendor Certification Regarding Scrutinized

Companies Lists

Copy of completed CF 1110 for qualifying contracts of $1 million or more. Ch. 215.473 and 287.135, F.S.

Date:

Documentation of Legislative approval of

renewal contract in excess of $10 million

for the outsourcing of a service or activity

Written report documenting satisfactory contract performance must be

submitted for approval. Documentation of legislative approval must be included

in the contract file.

Date:

Written delegation of authority including a

sample signature

If the Contract Manager identified in the executed contract is unable to provide

written certification of contractual services, a delegation of authority must

be provided in writing.

Date:




Proof of Insurance Copy of current provider insurance Date:

Civil Rights Compliance Checklist

Signed and dated questionnaire if provider has 15 or more employees if

federal funds are being used. Title VI of the Civil Rights Act of 1964

Date:

Attestation of No Conflict

(PUR 7662)

Individuals required by Ch. 287.057(19), F.S. to attest that they are independent of and have no conflict of interest in an

entity evaluated and selected as part of a procurement accomplished without

competition must sign this form.

Date:

Vendor Transaction Fee Report (PUR 3776)

Unless exempt by Rule 60A-1.031, vendors shall report all fee-eligible business activity on a monthly basis

using Form PUR 3776.

Date:

Notice of Transaction Fee Exemption

(PUR 3778)

Agencies should complete PUR 3778 when requesting a transaction fee

exemption under Rule 60A-1.031(4) Florida Administrative Code (F.A.C) in

advance of procurement.

Date:

Vendor Identification Number (VENDOR ID)

verified by contract manager through

FACTS

Date:

Proof of Provider's Bonding or Letters of

Credit

Date:

Property Inventory from provider

Date:

Monitoring/Performance Management Oversight Activities

Documentation of Monitoring Planning

Meeting

Copy of Contract Review Matrix or equivalent documentation of the

planning process.

Date:

Monitoring and corrective action documentation

Copy of monitoring report, if performed, and documentation of corrective action,

when applicable.

Date:




Documentation of mandatory monthly

meeting with contractor

The file contains evidence (such as a chronological activity record) indicating

direct monthly contact with the contractor's representative.

Ch. 402.7305(3)(e), F.S.

Date:

Documentation of site visit

For contracts involving the provision of direct client services, at a minimum, an

annual visit to the physical location where the services are delivered

documenting direct conversations with clients receiving the services and the

staff responsible for delivering the services. Ch. 402.7305(3)(d), F.S.

Date:

Coordinated Contract Services (monitoring)

Copy of letter sent to provider, requesting comprehensive list of their health and human services contracts.

Ch. 287.0575, F.S.

Date:

Verification of vendor license to do business in the State of Florida

Copy of business license or applicable documentation from Sunbiz.org

(recommended)

Date:

Contract Management documentation of

Contract default or breach

In the event of a contract default or breach, the contract file must include documentation such as guidance from

legal, relevant correspondence, etc.

Date:

State College or University Contracting

RFI documentation

Proof that the RFI was issued to all applicable State Colleges and

Universities to determine if more than one possesses the required special skill,

knowledge, and capability.

Date:

Non-Competitive Selection

Documentation

When selecting a non-competitive procedure, provide justification as to

whether the required special capability, skill, or knowledge is unique to the

college or university selected for contract award.

Date:

Competitive selection documentation

Date:

Documentation of restrictions waived by

the Department's secretary

The secretary of the Department may waive, in writing, some of the

restrictions in Ch. 402.7305(2)(a), F.S. This documentation must be included in

the contract file.

Date:




Reports

List of all required reports & due dates

The Contract File must include performance/outcome data. Proof of

timely submission of any required reports.

Date:

Emergency Preparedness Plan

Copy of plan maintained by contract manager and evidence of region/circuit

acceptance. Required for Service Contracts.

Date:

Emergency Procurement

Notice of Emergency Purchase

(PUR 7800)

Agencies may make emergency purchases pursuant to Ch. 287.057(3)(a), F.S.

Date:

Notice of Non Compliance (PUR 1010)

When services are initiated prior to the execution of a contract and there is no valid emergency, certification as to the specific circumstances leading to the

failure to have the contract signed prior to rendering of services must be filed

within 30 days and included in the contract file.

Date:

Procurement Documents

Approval of selected procurement process

Approval of selected procurement process

Date:

Copy of Business Case Date:

Justification for the procurement method

used

Justification in writing for why a certain method of procurement was used

Date:

Proof of legal advertising

All agency decisions or intended decisions shall be electronically posted on the VBS. All competitive solicitations

issued by agencies shall be electronically posted on the VBS for at least 10 calendar

days prior to the date for receipt of responses, unless the Department or

other agency determines in writing that a shorter period of time is necessary to

avoid harming the interests of the state. Rule 60A-1.021

Date:




Solicitation documents

Documentation for the method of procurement used.

Date:

Correspondence received regarding

the solicitation

Documentation of all relevant correspondence received and responded

to regarding the solicitation.

Date:

Evaluation documents Date:

Planning documents Date:

Notice of Award Documentation of the notice of the

intended contract award. Date:

Copies of protests received and

documentation of their resolution

Date:

Solicitation receipt log Date:

Solicitation tabulation Documentation of pricing and scoring. Date:

Documentation required by small

purchase procedures

Date:

Single Source procurement

documentation

Approval required PUR forms 7776 and 7778.

Date:

Appointment of negotiators

Memorandum identifying those members selected to be a negotiator/Identify the

lead/Approval of members of the negotiating team.

Date:




Conflict of Interest Questionnaire

Forms signed, dated, and completed by all individuals taking part in the selection,

evaluation, and award process. Ch. 287.057, F.S.

Date:

Contract Amendment Format

Format for amendment Date:

Contract Attestation

DMS Memo No. 01 (2013-2014) - Attestation executed prior to execution of

contract ensuring criteria outlined in directive as of October 1, 2013-must

attest that the contract or PO has statement of work, quantifiable and

measurable deliverables, performance measures, financial consequences, terms and conditions that protect the interests

of the state, requirement of law have been met regarding contract,

documentation in the contract file that is sufficient to support the contract, and

that the contract is established by way of a competitive solicitation as identified in

s. 287.057(1), the costs of the contract are the most advantageous to the state or

offer the best value.

Date:



Based on the sample contract language below, what would we expect to find in the contract file?

The Service Provider shall be fully responsible for all work performed under the Contract resulting from this solicitation including but not limited to planning, managing, implementing, operation, supporting, and warranties if applicable, of the MyFloridaMarketPlace system. If the Service Provider needs to subcontract for any services (other than those already outlined in its reply) the Service Provider shall submit a written request to the Department’s Contract Manager. All subcontractors must be approved in writing by the Department’s Contract Manager before the subcontractor is authorized to subcontract. Within 30 days of contract execution, Service Provider will deliver to the Department’s Contract Manager a Performance Bond or Irrevocable Letter of Credit in the amount equal to the lesser of $2 million dollars or the average annual price of the contract (averaged from the initial contract term pricing). Commencing no later than five (5) calendar days after execution of this Contract, the Service Provider shall, at its own expense, secure and maintain the insurance coverage required by law and explicitly required by this Section and shall provide certificates of insurance as proof to the Department, including Commercial General Liability, Worker’s Compensation, Professional Indemnity and Auto Insurance (as applicable).

Introduction to FACTS (Florida Accountability Contract Tracking System)

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DFS is required by Florida Statute to maintain a contract tracking system. This system is available for anyone, including the public, to search and view state agreements (§ 215.985, Florida Statutes).



Florida Statute also requires each state agency to post contract information and redacted electronic copies of contract and procurement documents to FACTS within 30 days of execution (§ 215.985(14)(a), Florida Statutes). While it may not be your responsibility to upload contract files into FACTS, as a contract manager, you should verify that the agreements you’re responsible for are properly uploaded into FACTS by your agency. Otherwise, you may experience a delay in payment processing – DFS will not approve payment for an agreement if it is not in FACTS.

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You can search FACTS here: https://facts.fldfs.com/Search/ContractSearch.aspx

https://facts.fldfs.com/Search/ContractSearch.aspx



Provider Onboarding

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By the end of this section, you’ll be able to describe how to prepare for and conduct a provider onboarding meeting. At this point, you’ve been designated as the contract manager, the contract file has been created, and you’ve created a plan for how to monitor the contract. The next step is to conduct a provider onboarding meeting (also called as a post-award meeting, start-up meeting, etc.).

Communication

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Miscommunication and misinterpretation may happen during the life cycle of a contractual relationship. You and the provider may leave a meeting with two different ideas about what was said. That’s why it’s vital that all communication is explicit, clear, and documented. For example, it’s a good idea to always follow-up phone conversations with an email outlining what was discussed and what action items are to be taken. This will also help ensure that you are maintaining sufficient documentation of your communication with the provider.

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A provider onboarding meeting is a conference of the parties, the provider, and the state agency, responsible for managing the contract/grant. This meeting should be held as soon as possible after a contract/grant is awarded. Provider onboarding is your first opportunity to provide technical assistance and communicate with the provider.

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As the contract manager, you are responsible for establishing the time and place of the meeting, preparing an agenda, and notifying all appropriate parties. The meeting does not have to take place face-to-face. It could be conducted through a conference call, a video conference, etc.

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At the meeting, discuss the following areas:

• Scope of the contract/grant.

• Contract terms and conditions, particularly any special contract provisions.

• Technical and reporting requirements of the contract. Reporting requirements are a means to keep the state agency informed regarding contract status and verify that the provider’s progress coincides with contract requirements.

• Applicable contract administration procedures, including contract monitoring and measurement of progress.

• The rights and obligations of both parties and the provider performance evaluation procedures.

• Potential contract/grant problem areas and their possible solutions.

• Invoicing requirements and payment procedures. This is especially important if payment will be made according to milestones achieved by the provider.

• Liquidated damages (if any) and performance bonds (if any) must be discussed with the provider and conditions for enforcement explained.


Handout 2 – Provider Onboarding Checklist Page 7



• State agency personnel must explain the limits of their authority, and obtain the same information regarding provider personnel.

Reviewing the contractual monitoring requirements with your provider is a best practice for contract managers. Reviewing these requirements during your onboarding conference documents your efforts to inform your provider of their obligations.

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All direction given to a provider must be within the scope of the contract. You may not impose additional requirements upon the provider or make changes that are out of scope of the contract.

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After the provider onboarding meeting, you should prepare a summary for the contract file detailing the items discussed in the meeting and distribute the summary to all participants. The summary should include: the method of delivery of invoices; list of meeting attendees; list of action items, including individual(s) responsible and due dates. This meeting will kick-off the relationship you’ll need to maintain throughout the life of the contract. It’s important to set up a clear understanding of expectations right from the start. Both sides should understand what is expected of them.


Module 2 – Monitoring 87

MODULE 2 – MONITORING

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At this point in the process, you are responsible for maintaining the day-to-day operations of the contract and the contractual relationship. This includes monitoring provider performance, verifying receipt of commodities/contractual services, certifying quality of commodities/services, validating and auditing contract pricing and payment, enforcing terms and conditions, and managing changes to the contract.

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By the end of this section, you’ll be able to describe how to develop a contract monitoring plan, the various types of monitoring activities, and how to address non-compliance.



Monitor Provider Performance

Each time you process an invoice and receive a deliverable, you are monitoring performance. Other requirements such as data submissions, personnel credentials, and match requirements must also be monitored.

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Monitoring is an ongoing process. You’ll conduct various monitoring activities throughout the life of the contract or grant. The purpose of monitoring is to ensure the provider complies and performs in accordance with the agreement terms and conditions. Effective monitoring helps obtain valuable information and documentation towards getting reasonable assurance that providers are:

• in compliance with agreement terms,

• completing deliverables, and

• handling funds appropriately, if applicable.



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In addition monitoring helps ensure program goals are being achieved. You are also responsible for addressing and resolving issues that may arise during the life cycle of the contract. Your goal should be to maintain a positive working relationship that benefits both parties. You should always maintain clear, detailed documentation of provider’s performance.

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Providers have the responsibility to perform under the terms and conditions of the agreement. The state agency has the responsibility of enforcing terms and conditions, and evaluating performance.



A poorly written scope of work makes it difficult to determine what specifics activities the provider should be performing. You would not know if the provider is administering the appropriate scholarship activities. Remember, it is difficult to effectively monitor without a clear scope of work.

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Above there is a much clearer description of the work to be performed. You know what to look for. Our monitoring could be used to verify if the provider was providing the minimum number of hours per week of mentoring services. You could also verify if the services were being provided to eligible students. Based on this scope of work, what could you monitor? What additional details could be added to further improve this scope of work? How could these additional details be monitored?

Monitoring Activities

Monitoring activities can be categorized into desk monitoring and onsite monitoring. Desk monitoring involves review and verification of data such as reports, surveys, invoices, and communication documents to monitor provider performance. Desk monitoring is an efficient way to monitor and can be performed on a regular basis since as it doesn’t involve traveling to offsite locations. At a minimum, every contract/grant will require desk monitoring. However, desk monitoring can never completely replace onsite monitoring.



Onsite monitoring involves traveling to the provider’s location to review documentation, interview staff and clients, perform onsite observations, etc. While this type of monitoring requires more time and effort than desk monitoring, it is absolutely essential to rounding out your monitoring activities.

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Above are some examples of monitoring activities.

TYPES OF

MONITORING ACTIVITY ACTIONS

Client Surveys Survey clients to determine quality of services delivered. Any complaints should be resolved by the provider as soon as possible. Maintain documentation in the contract file of all complaints and their resolutions.

Invoice Reviews Review submitted invoices to ensure they are in compliance with the contract/grant. Have services been invoiced according to the contract/grant? Have progress reports or other supporting documentation been submitted with the invoice as required?

Onsite Reviews and Observations

Perform an onsite visit to interview provider staff and observe office operations. Interview clients to provide assurance that program goals are being met and proper services are being received. Review onsite documentation, including case records, personnel records, and fiscal records, comparing these documents to contract requirements. Gather documentation to support any findings of non-compliance. Document the results of these monitoring activities in writing. Be sure to keep documentation that was gathered in support of findings.



TYPES OF

MONITORING ACTIVITY ACTIONS

Periodic Contact Regularly communicate with your provider to monitor progress and resolve any issues that may arise. Documentation of all communication should be maintained in the contract manager’s file. This documentation can be especially helpful when resolving disputes.

Provider Reports/Audit Reports

Review reports submitted to you by the provider. Verify that services are being provided in accordance with the agreement. If reports are required for auditing purposes, ensure that they are submitted and reviewed in accordance with the contract requirements.

Did you know that something as informal as a simple phone call can be used for monitoring? After placing a call to the provider, be sure to follow-up with an email to summarize the conversation. Monitoring activities in your agency may be completed by a separate unit or your agency may have a contract with a vendor to provide monitoring of contracts and grants. Each agency is different. What you need to remember is that each contract manager must manage the agreement and has the responsibility to monitor and document performance, review and document deliverables, and provide written certification of the agency’s receipt of goods and services. If additional activities are conducted by others, request a copy of the work papers or report and place in your contract management file. There are two types of monitoring – programmatic and fiscal.

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Programmatic Monitoring determines the provider’s compliance with the contract’s:

• terms and conditions



• requirements for delivery of services

Fiscal Monitoring

• determines if State funds have been accounted for and used appropriately by the service provider

• is applicable to all cost reimbursement contracts and contracts with a recipient or sub recipient relationship

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Programmatic monitoring determines if:

• The provider complied with all terms and conditions of the agreement, laws and rules, such as business qualifications and requirements, staff qualifications, client eligibility, and licensure.

• The provider performed all services and tasks as identified in the scope of work. For example, were activities satisfactorily completed as outlined in the scope of work?

• Deliverables have been provided. Did the provider meet established milestones or phases of completion?



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Above is an example.

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Monitoring activities will assist you in determining if there are any programmatic issues. It may be determined that services were performed before the agreement was executed. In these cases a settlement agreement would be required. The provider may not have sufficient documentation to evidence the work they have completed. Examples of documents that evidence work include intake forms for each client receiving services, pre-tests/post-tests, client surveys, workshop agenda, sign-in sheets, and project timesheets.



The provider may not have sufficient documentation to support the effort toward achieving a deliverable. For example, a provider was required to assist individuals in obtaining their GED by providing educational training. The provider was paid a fixed rate of $1,000 for each individual who successfully obtained their GED, by submitting a copy of the GED to document the services were provided. The provider had submitted copies of valid GED certificates but could not provide any documentation that showed they had actually conducted any training. DFS discovered during an expanded pre-audit that the provider was running an ad in the local newspaper which basically stated, “Congratulations all young men and women in the local area that worked so hard to get your GED, we are proud of you, and to show you how proud of you we are if you provide us a copy of your GED we will gladly pay you $100.” When performing monitoring, if it is determined that ineligible clients are receiving services through the program, steps should be taken to make the provider aware of the deficiency and that funds will need to be returned. Document monitoring activities and findings in your contract management file. This will be beneficial when you are executing a new contract for these services in the future.

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Fiscal monitoring will need to be completed when managing cost reimbursement and/or recipient/sub-recipient agreements. Each expenditure should be directly associated with a programmatic activity. For example, travel can be authorized by the agreement, but if travel was for attendance at a national convention that was not directly related to the project, the expenditure would not be allowable.



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Sources and uses of funding must be identified for each project and accounted for separately. Many entities that provide services on behalf of the State have more than one contract with a State agency. They may have contracts with several agencies.

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Some common issues discovered during fiscal monitoring could include:

1. Insufficient or missing supporting documentation. For example, financial records of itemized invoices/receipts are not maintained or are missing.

2. Expenses for items used for other purposes not related to the agreement – either for personal use or use by another program.

3. Payments made to consultants on a rate schedule that can’t be justified. 4. Related party transactions.



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Monitoring activities will provide greater assurance that deliverables have been provided as required by the agreement. However, resources are not unlimited. There are times when you do not have enough resources (including personnel, time, and money) to do the same amount of monitoring for all your agreements. If this is the case, a State agency must have a designated contract monitoring function. CFO Memo No. 06 (2011-2012) establishes uniform procedures a State agency must include in the designated process.

• Risk Assessment

• Monitoring Plan

• Monitoring Procedures and Criteria

• Evidence to support conclusions reached during its monitoring process

• Corrective Action Plan (if required)

• Follow-up on Corrective Action (if required) The memorandum also mandates the adequacy of documents maintained in the contract file during monitoring. Next, take a look at each of these requirements.



Risk Assessment

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The type and frequency of monitoring activities will depend on the contract’s risk assessment. Agreements that warrant more resources are identified by evaluating and ranking the agreements based on the risk assessment. Each agency will identify the criteria and evaluation method for conducting a risk assessment for their contracts and grants. Here are some examples of risk factors.

• Total amount of the contract may be an indicator that would establish risk. If a contract has a total contract amount in the millions, it may score higher for risk.

• The type of services provided may indicate risk. For example, if the contract is for direct client services, your agency may deem it to be a higher risk contract as opposed to a contract for research services.

• A provider that is new to contracting with the State may score higher for risk than one that your agency has done business with for many years.

• Fiscal requirements of the program may indicate a higher risk factor which dictates an increased frequency of monitoring.



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The agency should maintain documents of all the risk factors, how each agreement was scored based on each risk factor, and the final score. The risk assessment may be completed by a separate group within your agency. If so, request a copy of the assessment for your contract management file.

Monitoring Plan

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Based on the results of the risk assessment, a monitoring plan will be developed to identify the timing, nature, and extent of monitoring activities for each contract. The monitoring plan is a roadmap of the activities that will be performed to ensure that the provider is meeting his/her responsibilities according to the contract. The plan should outline what type of monitoring will take place (programmatic monitoring/fiscal monitoring), what monitoring activities will be most



appropriate, sampling procedures, required documentation, and how and to whom results will be communicated. Monitoring results should be shared in writing with the provider in a timely manner. The contract file should include copies of all monitoring documentation, including letters, meeting notes, and documentation of phone conversations.

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For example, an agency may decide that all low risk agreements will undergo a review of monthly invoices, a review of monthly progress reports, and an annual desk monitoring activity for which the contract manager will request documentation evidencing completion of tasks from the provider on a sample basis. Conversely, all high risk agreements will undergo an annual onsite review, selective deliverable review (with documentation that evidences work completed), audit report review, monthly expenditures review, monthly invoice processing with budget review, and quarterly review of reports. High risk agreements may undergo more frequent and more extensive types of monitoring. Remember, each agency will have different monitoring activities established for contracts and grants that are low, medium, or high risk.



Monitoring Tool

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A monitoring tool is a checklist that identifies the procedures that will be performed during a monitoring activity. The monitoring tool:

• Formally documents the monitoring activity

• Identifies the criteria used to assess the providers’ performance and compliance

• Should include requirements that are critical to your project’s issues The monitoring tool should be customized based on the requirements of the agreement. You can find some examples of monitoring tools in References and Resources on DMS’ website: https://www.dms.myflorida.com/business_operations/state_purchasing/public_procurement_professional_development/florida_certified_contract_manager. If you’ve never put a monitoring tool together before, a good place to start is by listing out the deliverables and performance expectations in your contract.





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The monitoring tool will become a part of your contract manager’s file. Therefore, you will want to maintain adequate records of the date, time, location, and reviewer information when the monitoring activity was performed. In addition to reading the entire agreement to capture all applicable criteria to include in a monitoring tool, a review of the Catalog of Federal Domestic Assistance, Office of Management and Budget circulars, and Catalog of State Financial Assistance (as applicable) will provide information on restrictions and requirements on the use of state and/or federal funds in agreements with recipients and sub-recipients.

Monitoring Sampling

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Sampling is useful when a contract manager or other monitoring unit cannot review the total population. In this case, a selected sample of records that would fairly represent the total population would be reviewed. In some instances, when the population is large and our resources are limited, we may need to employ a sampling methodology.

Documentation

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Some examples of evidence that is reliable and relevant:

• Paid detailed invoices – Statements are not adequate

• Cancelled Checks/Bank Statements

• Payroll Registers/Signed Employee Project Time Sheets

• Travel vouchers in accordance with Section 112.061, F.S.

• Case notes

• IRS Return (Not-For-Profit Organizations)

• Attendance records/Sign-in sheets Remember to maintain evidence of the monitoring activities performed to determine contract deliverables have been met.



Reporting Results

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Once you have completed your monitoring, it is important to share your conclusions with:

• the provider so they are aware of how they are doing and any deficiencies they need to address, and

• agency leadership so they are aware of any potential problems that need attention. Maintain documentation in the contract manager’s file of results. When monitoring activities identify deficiencies, the provider should create and submit to the agency a corrective action plan detailing how they will address identified issues. Following are some possible issues that you may encounter in day-to-day management activities.



Delays

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Excusable Delays Excusable delays are delays caused by factors that are outside of the providers’ control.

• Force Majeure (Acts of God) o Hurricane o Earthquake o Tornado o Flood

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• Act of Public Agency o Any action taken by a public agency to enable or ensure health, safety, or

welfare of citizens ▪ Response to terrorist events ▪ Epidemic

• Fires, Freight Embargos o That are not caused by the provider’s negligence

For excusable delays, a time extension to the deliverables may be granted, depending on the impact and risk to the contract.

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Remedies can include changes to:

• Deliverable timeline

• Delivery/inspection location

• Specifications within scope of solicitation All changes must be documented and incorporated by amendment, as necessary.



Delays that are NOT Excusable

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Delays that are not excusable are those that are considered to be avoidable and any actions are within the control of the provider.

• Financial problems o Provider has cash flow problems

• Lack of equipment o Provider’s equipment is inadequate or back-ordered

• Personnel issues o Labor strike

• Lack of materials

• Lack of knowledge o Personnel turnover



Conflict Resolution

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As a contract manager, you have a responsibility to both your agency’s customers and the provider. Once you’ve identified a problem and its impact, you should try to work with all parties to resolve the issue. Here are some key points to keep in mind during any conflict.

• Respect all parties. o Pledge a fair process.

• Listen to all sides with an open mind. o Listen to what is being said – the words, body language, intonation, etc.

• Identify and focus on the problem. o Maintain a clear understanding of the issue.



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• Think before acting. Consider all options and weigh possibilities.

• Communicate clearly and convey your message purposefully

• Follow the process you develop. Always remember the agreed-upon system of proceedings.

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What happens when something goes wrong? What if your monitoring activities reveal that the provider isn’t spending funds in accordance with the contract or that they are using unqualified staff to perform services? You’ll need to identify the steps you must take to correct the identified problem and resolve the issue, which may include having the provider develop a corrective action plan.



Corrective Action Plan Your first step is to identify the problem and its impact. Your next step is to clearly communicate the issue to all parties and, if necessary, have the provider develop a corrective action plan. Ask yourself:

• What is the problem? o Miscommunication o Poor Specifications or Requirements o Unforeseen impacts o Poor planning or design o Insufficient documentation o Non-performance

• What business units are affected?

• What is the severity of the problem? o Level of impact to the performance of the contract o Is consultation with legal office appropriate and prudent?

A well-constructed corrective action plan will address the impact, risk, and best solution.

Complaint to Vendor If you aren’t able to resolve an issue through the corrective action plan, a complaint to vendor is necessary.

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Follow these steps for vendor contracts: 1. Document all communication regarding the contract. 2. Clearly and specifically identify the issue in writing. Use as much detail as possible,

including dates, number of occurrences, etc. 3. Notify the provider using form PUR 7017 Complaint to Vendor of the corrective action

plan and the steps that must be taken to correct the problem (including due dates). DMS will add the provider to the Vendor Complaint List pursuant to Rule 60A-1.006, Florida Administrative Code.

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4. Follow-up with the provider if corrective action steps are not completed or if a deadline

is missed. 5. Confer with your agency’s General Counsel if the corrective action steps are

unsuccessful. 6. Once a resolution has been reached, request that DMS remove the provider from the

Vendor Complaint List. Or If a resolution is not reached, use form PUR 9999 Notice of Default to request that DMS default the provider and place him/her on the Suspended Vendor List. The provider’s contract/grant is terminated and the agency may not do business with that provider until re-procurement costs are paid to the agency by that provider.

Remember to keep documentation of all correspondence with the provider in the contract file. Resources:

• PUR 7017, Complaint to Vendor

• PUR 9999, Notice of Default

http://www.dms.myflorida.com/content/download/127446/791141/PUR_7017_Complaint_to_Vendor.doc

http://www.dms.myflorida.com/business_operations/state_purchasing/documents_forms_references_resources/purchasing_forms

http://www.dms.myflorida.com/content/download/3607/14173/PUR_9999_Notice_of_Default.doc


Module 3 – Deliverables, Payments, and Enforcing Terms & Conditions 112

MODULE 3 – DELIVERABLES, PAYMENTS, AND ENFORCING TERMS & CONDITIONS

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In this module, you will discuss what you’re responsible for when receiving deliverables and processing payments for the contracts/grants you manage.

Deliverables, Payments, and Enforcing Terms & Conditions

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When you complete this module, you will be able to describe requirements for a payment to be issued and identify requirements for receiving deliverables and processing invoices. You will also identify remedies for enforcing contract terms and conditions.

Receive Deliverables and Provide Written Certification

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According to § 215.422(1), Florida Statutes, “approval and inspection of goods or services shall take no longer than 5 working days unless the bid specifications, purchase order, or contract specifies otherwise.” However, please remember that an invoice submitted to an agency that is not in a bona fide dispute shall be submitted to the Chief Financial Officer no later than 20 days after receipt of invoice and receipt, inspection, and approval of the goods or services. Inspection and approval can take longer than 5 working days if the agreement specifies a different timeline for this process. One of your primary responsibilities is to ensure that the state is receiving the commodities or contractual services as they are specified in the contract. You must ensure that deliverables were received on time and that they met the performance measures specified in the contract. The contract must specify the documentation that must accompany the request for payment to evidence delivery of goods/services. Remember, if it isn’t documented, it didn’t happen.



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Before payment is made, you must provide written certification that the provider has delivered the commodities or provided the contractual services as specified in the contract. This can be done using the Contract Summary Form. CFO Memo No. 01 (2012-2013) outlines how and when to use the Contract Summary Form and how to process payments through FLAIR and MFMP.

Process Invoices

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Once deliverables have been verified and accepted, you must review and process the provider’s invoice for payment. The contract will state how and when the provider may invoice. As invoices are processed, you must track expenditures to ensure costs are within budget and in compliance with the terms of the contract.



According to § 215.422(1), Florida Statutes, invoices submitted for payment must be approved by the agency “and filed with the Chief Financial Officer not later than 20 days after receipt of the invoice and receipt, inspection, and approval of the goods or services, except that in the case of a bona fide dispute…” The 20 day clock starts with the latter of three dates:

• Date the complete and accurate invoice is received

• Date the goods are received and approved

• Service end date It is vital that the documents you receive are date stamped. These date stamps help ensure that you are adhering to timelines established in statute.

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Before requesting payment, you should:

• Review the invoice for accuracy and completeness.

o According to Rule 69I-40.002, Florida Administrative Code, invoices must clearly

reflect:

• Description of the item(s)

• Number of units

• Cost per unit

o The service dates coincide with the invoice period

o The minimum level of service has been provided

o The amount invoiced coincides with the terms of the contract

• Verify that any required supporting documentation has been submitted.



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• Review documentation to gain reasonable assurance that commodities/contractual services have been satisfactorily provided within the terms of the contract.

• Complete any agency-unique requirements.

• Certify the agency’s receipt of the commodities or contractual services

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If there is a dispute about the receipt of commodities/contractual services, an invoice may be prorated, reduced, or withheld according to the financial consequences established in the contract. Partial or prorated payments must be made based on the deliverables that can be validated and supported by adequate documentation.



If the contract doesn’t provide a financial consequence for the disputed issue or documentation can’t be provided to support the payment for deliverables, then the payment should be withheld until the issue is resolved or a settlement is reached.

Invoice Activity

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The contract tells us how and when a provider can invoice and what documentation is required. Start there. Review Attachment A: Scope of Work, Section L: Payment Structure in the handout.


Handout 6 – Sample Invoice Page 19



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WORKSHEET 3: SAMPLE INVOICE WORKSHEET

Review the sample contract excerpt, invoice, and supporting documentation. Then, answer the following questions.

1. Was this invoice submitted on time?

2. What does the contract require to be included on and submitted with the invoice?

3. Did the provider submit the required supporting documentation with this invoice?

4. Based on when this invoice was submitted, what timeframe should the invoice and supporting documentation represent?

5. By what date are you required to approve and submit this invoice for payment to the Chief Financial Officer?



DFS Invoice Audits

DFS Pre-Audit

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Once you have concluded your invoice review and certified receipt of the deliverable(s), the documentation is provided to your agency Finance and Accounting office. When they have completed processing, it is sent as a payment request to DFS’ Bureau of Auditing. Upon receipt of a payment request from a state agency, DFS will perform a pre-audit. The pre-audit will include review of:

• The invoice and supporting documentation.

• The Contract Summary Form providing summary of the contract/grant terms and

written certification that goods and services have been satisfactorily received and

payment is due.

• The method of procurement.

• The expenditure to determine that it is a valid use of public funds.



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§ 287.057(14)/215.971(2)(b), Florida Statutes tasks the Chief Financial Officer (CFO) with establishing and disseminating uniform procedures to ensure that contractual/grant services have been rendered in accordance with the contract/grant terms before the agency processes the invoice for payment. Below are resources for procedures for certification of deliverables. Resources:

• CFO Memo No. 01 (2012-2013)

• CFO Memo No. 06 (2011-2012)

• CFO Memo No. 02 (2007-2008)

• Reference Guide for State Expenditures (DFS) The Deliverable Tracker and Deliverable Acceptance Form are resources you may find helpful. The Deliverable Tracker is meant to help you keep track of your deliverables schedule. The Deliverable Acceptance Form is a way for you to document that a deliverable has been accepted. Feel free to modify these documents to meet your needs. This does not replace the signed certification statement on the summary form.


Handout 3 – Summary of Contractual Services Agreement/Purchase Order Handout 4 – Deliverable Tracker

Handout 5 – Deliverable Acceptance Form Pages 9-17

https://www.myfloridacfo.com/Division/AA/Memos/cfo/2010s/CFOM121301.pdf


https://www.myfloridacfo.com/Division/AA/Memos/cfo/2000s/cm070802.pdf

https://www.myfloridacfo.com/Division/AA/Manuals/Auditing/Reference_Guide_For_State_Expenditures.pdf



Enforce Terms and Conditions

Contracts contain remedies that are enforced for non-performance or non-compliance. As a party to the contract you should work with the provider to ensure that the contract terms are enforced and that a resolution is reached.

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Financial Consequences With a few exceptions, all agreements for contractual services in excess of $35,000 (Category Two) and all agreements that provide state financial assistance to a recipient or sub-recipient or federal financial assistance to a sub-recipient must include financial consequences (§ 287.058, and § 215.971 Florida Statutes). Financial consequences are applied if the provider fails to perform in accordance with the contract/grant. Financial consequences may allow the State to withhold payment or recover money paid. For example, if service downtime exceeds 5% during the service period, the invoice will be reduced by $1,000 for each percentage point above 5%.

Liquidated Damages Liquidated damages are pre-determined damages to compensate the state for any losses realized. For example, a contract for construction consulting services requires the provider to begin work within 14 calendar days of receiving a work order. For each day that this timeframe is not met, liquidated damages are applied – $25,000 for each day the provider does not begin work.



Settlement Agreements

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A settlement agreement is used when the amount the State or an agency owes to a provider is in dispute. The settlement agreement process is lengthy, cumbersome, and expensive. Several parties are involved in the process including legal and the Department of Financial Services.

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A settlement agreement could be required for many situations, such as:

• To settle a lawsuit, damages, or legal fees

• Absence of an executed agreement

• Agreement was executed after services were rendered

• Additional services not included in the agreement were provided

• Services were rendered after the agreement expired



It’s important to know that the settlement agreement process is not something you’ll complete on your own. You should always seek advice and assistance from your general counsel.

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Handout 7 – Applying Financial Consequences Page 29


Module 4 – Changes and Closeout 126

MODULE 4 – CHANGES AND CLOSEOUT

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Changes to the Contract

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By the end of this section, you’ll be able to identify the types of modifications can be made to a contract and the requirements that must be met for each modification. Throughout the contract life cycle, it may be necessary to document changes to the original contract terms. These changes can be minor administrative changes, such as a change of address, or they can be substantive changes affecting the terms or amount of the contract.



While each agency may have a different procedure, generally it is the contract manager’s responsibility to initiate the request for changes with the contract administrator as soon as feasible.

Amendments

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A contract amendment is a change in a contractual agreement made by adding, altering, or omitting a certain part or term of the original document. Once an amendment document has been signed by all parties, it retains the legal validity of the original contract and should be kept in the contract file. Amendments cannot be retroactive; they are effective from the date they are executed. Unless the contract/grant stipulates that no formal amendment is required (such as for a change in the contract manager), all amendments must occur in writing and should follow the same routing and approval review as the original contract. Amendments can include, but are not limited to:

• Changes to project budget after award

• Changes to deliverables, due dates, or milestones

• Changes to contract performance measures

• Changes to supplier performance schedule



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A change may be requested by the contract manager, other agency staff, or the provider. Upon receipt of a substantive change-order request, you must determine whether the proposed change is within the scope of the contract. This may require input from other staff, such as your contract administrator, program manager, or agency legal counsel. Once a contract is executed, the amount of the contract cannot be increased unless the services are also increased, § 215.425, Florida Statutes. Amendments must also stay within the scope of the original contract.

Renewals

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If the original contract contains a renewal clause, the contract may be renewed for a period that may not exceed 3 years or the term of the original contract, whichever is longer. Contracts that are renewed are subject to the same terms and conditions that were specified in the original contract. For contracts that are the result of a competitive solicitation, contract pricing for the renewal must be specified in the initial competitive solicitation. Emergency purchase and single source contracts are not eligible to be renewed.

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The renewal:

• must be in writing,

• must be agreed to by both parties,

• is contingent upon satisfactory performance evaluations, and

• is subject to availability of funds. § 287.057(13) and § 287.058(1)(g), Florida Statutes.

Contract renewal is often time sensitive. A renewal must be in place before a contract expires. It’s a best practice to start the renewal process at least 60 days prior to the expiration date of the contract.



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Before you may renew a contract, you must:

• Verify that the contract is eligible to be renewed,

• Verify availability of funds,

• Request any updated documents necessary to support the new contract term, including, but not limited to:

o Insurance Certificate (as applicable) o Performance Bond (as applicable) o Payment Bond (as applicable) o Letter of Credit (as applicable)

Extensions

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An extension is an increase in the length of the contract term. Extensions should not be a standard practice. Extensions for contractual services contracts may not exceed 6 months, must be in writing, and must be subject to the same terms and conditions set forth in the initial contract and any written amendments signed by the parties. Only one extension of a contract is allowed, unless the failure to meet the criteria set forth in the contract for completion of the contract is due to events beyond the control of the provider (§ 287.057(12), Florida Statutes). For example, if a solicitation protest takes longer than 6 months to be resolved.

Assignments

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An assignment occurs when a provider hands off contractual duties or obligations to another party with agency approval. Contracts with the State of Florida are assignable under the conditions and provisions provided in form PUR 1000. However, a contract may include an assignability clause that supersedes form PUR 1000. For issues regarding assignability, you should review the contract language and check with your general counsel or other designated legal advisor.



Termination

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A termination occurs when a contract is ended prior to the ending date stated in the contract. According to form PUR 1000, contracts may be terminated for convenience or for cause. Termination information is specified in form PUR 1000. However, a contract may include termination clauses that supersede form PUR 1000. In situations where a document other than form PUR 1000 might be used, you should be aware of the termination clauses in that document. Convenience

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Termination for convenience must be in writing. A contract may be terminated, in whole or in part, when it is determined that it is in either party’s best interest to do so. Providers must be notified of termination and must not furnish any additional product or receive any payment once terminated.

Cause

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Termination for cause can occur if the provider(s) fails to:

• Deliver the product within the time specified,

• Maintain adequate progress, thus endangering performance of the contract,

• Honor any term of the contract, or

• Abide by any statutory, regulatory, or licensing requirement. If the contract/grant was terminated due to the provider defaulting, the provider is placed on the Suspended Vendor List. The provider will not be able to do business with the agency again until re-procurement costs are paid.



Contract Closeout

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When a contract expires or when all commodities/contractual services required by the contract are delivered and final payments are made, the contract must be formally closed out. Your goal for this phase is to answer two important questions:

• “Did we accomplish the program goals and objectives for which these commodities/contractual services were procured?”

• “Were all funds properly accounted for?”

The time and level of effort required for this phase is driven by the complexity and size of the contract. As a contract draws to a close, you should create a contract closeout checklist that lists all the areas that will be examined during the contract closeout. This phase is extremely important since programmatic, provider performance, and contract fiscal information gathered during closeout will be used as a basis for future contracts.


Handout 8 – Contract Closeout Checklist Page 35



During contract closeout, you will collect and analyze two types of information:

• Programmatic Details

• Fiscal Information

Collect and Resolve Programmatic Details

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The purpose of programmatic closeout is to determine whether program goals and objectives were met. When a contract is nearing expiration, you should begin the process of programmatic closeout. A programmatic closeout includes, but is not limited to, determining and documenting that:

• All deliverables and services have been delivered and accepted in writing.

• All reports (including Financial Status Report) have been received and accepted in writing.

• Performance standards have been met.

• All contract terms and conditions have been met.

• Any instances of non-performance have been documented and all appropriate remedies for non-compliance have been applied.

• The contract file is complete, clearly organized, and labeled for storage and retention purposes.



Reconcile all Fiscal Information

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The purpose of fiscal closeout is to verify that all funds are properly accounted for. When a contract is nearing expiration, you should work with the appropriate state and provider personnel to collect and reconcile all financial information about the contract. A fiscal reconciliation and closeout of a contract involves determining and documenting that:

• Invoices have been properly documented and paid.

• Advances and/or interest earned on advances have been recovered or applied against what is owed.

• If applicable, financial consequences have been assessed and collected for nonperformance/non-compliance.

• Disallowed costs and/or unused grant funds have been recovered.

• Final payment to provider has been made only after all programmatic and fiscal steps have been completed.

• Acquired non-expendable property (having a unit value in excess of $1,000 and a useful life of greater than one year) has been returned to the state.

• Match requirements have been met (if required).

• Financial Status Report has been reviewed and approved in writing.

• Cost audit has been performed.



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For grant agreements, it is incredibly important that you have received and reviewed the final state and federal financial assistance audit reports, review the reports for any disallowed costs, and recover any unobligated funds. Resources:

• CFO Memo No. 03 (2014-2015)

• CFO Memo No. 02 (2012-2013)

• 2 CFR Part 200

https://www.myfloridacfo.com/Division/AA/Memos/cfo/2010s/cfom0314.pdf


https://www.archives.gov/federal-register/cfr


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LEGAL REFERENCES

FEDERAL

CODE OF FEDERAL REGULATIONS

Provides program/project specific guidance.

• 2 CFR Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards; effective December 26, 2014 replaces:

o 2 CFR Parts 215, 220, 225, and 230 o OMB Circulars A-21, A-87, A-110, A-122, and A-133

STATE

FLORIDA STATUTES

• Chapter 112 – Public Officers and Employees: General Provisions

• Chapter 119 – Public Records

• Chapter 120 – Administrative Procedure Act

• Chapter 215 – Financial Matters: General Provisions

• Chapter 216 – Planning and Budgeting

• Chapter 255 – Public Property and Publicly Owned Buildings

• Chapter 286 – Public Business: Miscellaneous Provisions

• Chapter 287 – Procurement of Personal Property and Services

• Chapter 402 – Health and Human Services: Miscellaneous Provisions

FLORIDA ADMINISTRATIVE CODE

• Chapter 60A – Division of Purchasing (DMS)

• Chapter 69I – Division of Auditing and Accounting (DFS)

DEPARTMENT OF FINANCIAL SERVICES (DFS)

• Reference Guide for State Expenditures • Chief Financial Officer (CFO) Memoranda

AGENCY

• Procurement Policies and Procedures • Contract Management Policies and Procedures

ORDER OF PRECEDENCE

For the above legal references, the most stringent requirements apply.

https://www.archives.gov/federal-register/cfr

http://www.leg.state.fl.us/STATUTES/

https://www.flrules.org/

https://www.myfloridacfo.com/Division/AA/Manuals/Auditing/Reference_Guide_For_State_Expenditures.pdf

http://www.myfloridacfo.com/Division/AA/Memos/default.htm


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RESOURCES

CONTRACT PAYMENTS AND COMPLIANCE

• CFO Memo No. 03 (2014-2015)

• CFO Memo No. 01 (2012-2013)

• CFO Memo No. 02 (2012-2013)

• CFO Memo No. 06 (2011-2012)

• PUR 1000, General Contract Conditions

• PUR 1001, General Instructions to Respondents

ETHICS

• Florida Commission on Ethics • PUR 7662, Attestation of No Conflict

FLORIDA SINGLE AUDIT ACT (FSAA)

• FSAA Information (DFS) • DFS-A2-NS, FSAA Checklist for Non-State Organizations - Recipient/Subrecipient vs. Vendor Determination

RECORDS MANAGEMENT

• Department of State, Records Management

SYSTEM RESOURCES

• Florida Accountability Contract Tracking System (FACTS)

• Florida Accounting Information Resource (FLAIR)

• FACTS/FLAIR User Manuals

• MyFloridaMarketPlace (MFMP)

• Vendor Bid System (VBS)

• MFMP/VBS User Manuals

VENDOR PERFORMANCE

• Vendor Complaint List (DMS)

• Suspended Vendor List (DMS)

• PUR 7017, Complaint to Vendor

• PUR 9999, Notice of Default

https://www.myfloridacfo.com/Division/AA/Memos/cfo/2010s/cfom0314.pdf




http://www.dms.myflorida.com/content/download/2933/11777/PUR_1000_General_Contract_Conditions.pdf

http://www.dms.myflorida.com/content/download/2934/11780/PUR_1001_General_Instructions_to_Respondents.pdf

http://www.dms.myflorida.com/content/download/2934/11780/PUR_1001_General_Instructions_to_Respondents.pdf

http://www.ethics.state.fl.us/

http://www.dms.myflorida.com/content/download/1668/7151/PUR_7662_Attestation_of_No_Conflict.docx

https://apps.fldfs.com/fsaa/

https://www.myfloridacfo.com/Division/AA/Forms/DFS-A2-NSFSAAChecklist-NonState.docx



http://dos.myflorida.com/library-archives/records-management



https://flair.dbf.state.fl.us/

https://flair.dbf.state.fl.us/

http://www.myfloridacfo.com/Division/AA/Manuals/default.htm

https://buyer.myfloridamarketplace.com/Buyer/

http://www.myflorida.com/apps/vbs/

https://www.dms.myflorida.com/business_operations/state_purchasing/myfloridamarketplace/mfmp_agency_customers/mfmp_university/manuals_and_job_aids

http://www.dms.myflorida.com/business_operations/state_purchasing/vendor_information/convicted_suspended_discriminatory_complaints_vendor_lists/vendor_complaint_list

http://www.dms.myflorida.com/business_operations/state_purchasing/vendor_information/convicted_suspended_discriminatory_complaints_vendor_lists/suspended_vendor_list

http://www.dms.myflorida.com/content/download/127446/791141/PUR_7017_Complaint_to_Vendor.doc

http://www.dms.myflorida.com/business_operations/state_purchasing/documents_forms_references_resources/purchasing_forms

http://www.dms.myflorida.com/content/download/3607/14173/PUR_9999_Notice_of_Default.doc


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SOURCES

Condelli, L., Coleman, S., & Shaewitz, D. (May 2007). Desk Monitoring: Improving Program

Performance. Retrieved from http://www.nrsweb.org/trainings/documents/NRS_Monitoring_Guide.508.doc.

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