As a public institution, UC encourages competitive bidding whenever possible because it is a tool in obtaining services at the lowest possible cost.
If a competitive bid requirement is waived, the appropriate sole source forms must be approved and on file.
Competitive Bid Requirements
Professional Services: Contracts for professional services are not legally required to be competitively bid so long as the price is justifiable (the price must be proven to be fair and reasonable). However, competitive bidding is strongly encouraged where possible.
Independent Consultants: Current law requires any consulting agreement over $100,000 be competitively bid, though the university strongly encourages consulting contracts in excess of $50,000 be bid. Note that the $100,000 threshold is the total contract amount, not just the cost for the first phase. It is imperative to develop a total project budget to ensure that all phases can be completed within the no-bid threshold. If they cannot, the project must be bid at its inception.
Note: Section 10515 of the California Public Contract Code strictly limits a consultant’s ability to perform services, procure goods or supplies, or take any action related to Consultant’s findings and recommendations pursuant to this agreement. If you believe the consultant should complete specific tasks that may result from the outcome of their review, please inform Business & Revenue Contracts when your original request for an RF (Request for Proposal) and/or agreement is submitted.
Independent Contractor and Vendor Agreements: As with independent consultants, current law requires any independent contractor agreements and agreements with vendors over $100,000 be competitively bid. Note that the $100,000 threshold is the total contract amount, not just the cost for the first phase. It is imperative to develop a total project budget to ensure that all phases can be completed within the no-bid threshold. Any service agreement between $50K and 100K do not need to be competitively bid so long as the price is justifiable—typically by obtaining three quotes.
Revenue Agreements: If the university will be receiving a commission or payment based on the presence of or an activity of a contractor, the contractor will be financially benefiting from the university. So long as the financial benefit is substantial and exclusive only to one contractor, a competitive bid should be held to allow all interested parties to have the opportunity to bid on the partnership.
Business & Revenue Contracts have a responsibility to substantiate that all payments made to contractors are fair and reasonable. For this reason, if a competitive bid process is not required, the requesting department may be contacted for additional information about pricing and your reason for selection of a particular contractor.
Requesting departments should always attach copies of all quotes and proposals received from other service providers to their KFS request.