Glossary of Commonly Used Procurement Terms

Source Key:
ApB - Appendix B, General Specifications
PG - Procurement Council Guidelines
SFL - State Finance Law Article XI
WBS - OGS/NYSPro website
WBST - OGS/NYSPro website/Technology Guidelines

20% Rule:   Some OGS Information Technology product contracts contain a 20% rule . This means that if an agency is buying product and also needs to buy ancillary services (e.g.: consulting and training) under the same contract for the purposes of customizing the product, or product roll-out and implementation, the agency may be able to purchase those services up to 20% of the value of the product and first year's maintenance. The 20% rule currently applies to microcomputer, printer, software, interactive voice response systems, videoconferencing systems and networking hardware and software contracts. When using the 20% option, the awarding agency must first do an independent estimate for the services needed. In the event the estimate exceeds the 20% limit, the agency should either: undertake a competitive procurement, or justify a single/sole procurement. (WBST)
Agency Specific Contract:   Agency Specific contracts are contracts where the specifications for a Product or a particular scope of work are described by centralized procurement to meet the needs of one or more specific agency's needs. These contracts are usually limited by quantities and delivery points. Agency specific contracts are agency term contracts for purchases made during a specified term period. (See also "As Specified Contracts" definition.)
Aggregated Buy:   An Aggregated Buy is the process whereby an Authorized User determines the specific contractor and final pricing for the purchase of a product, service or system on behalf of more than one Authorized User . Participation in an Aggregated Buy eliminates the need for an Authorized User to conduct a mini-bid or a best and final negotiation. (WBST)
Ancillary Product:   An ancillary product is a product which is purchased or licensed on a restricted use basis in conjunction with the principal manufacturer's product being acquired (e.g., may be used only in combination, or by educational institutions for research use). (ApB)
As-Specified Contract:   As Specified contracts are contracts where the specifications for a Product or a particular scope of work are described and defined to meet one individual agency's needs. As specified contracts are "one time" purchases. (See also "Agency Specific Contracts" definition.)
Authorized User:   An agency, or other entity authorized by the laws of the State of New York to participate in NYS centralized contracts (including but not limited to political subdivisions, public authorities, public benefit corporations and certain other entities set forth in law), or the State of New York acting on behalf of one or more Agencies and other entities, provided that each such Agency or other entity shall be solely responsible for liabilities or payments due as a result of participation. (WBST)
Authorized Users:   Authorized users are agencies or any other entities authorized by the laws of the State of New York to participate in NYS centralized contracts (including but not limited to political subdivisions, public authorities, public benefit corporations and certain other entities set forth in law). Each such agency or other entity shall be held solely responsible for liabilities or payments due as a result of its participation. The term "Authorized User " shall include "Licensees." (ApB)
Back-Drop:   Back-Drop contracts are a pool of qualified vendors who are contracted with the State of New York and eligible to participate in the secondary mini-bid award process. (WBS) Appendix B defines back-drop contracts as multiple award , centralized contracts where OGS defines the specifications for a general scope of work or product(s) to meet the needs of contract users. Bids are taken either at a certain date and time or may be accepted on a continuous recruitment basis, as described in the bid specifications. Selection of a contractor from among back-drop contract holders for an actual product, project or particular scope of work may subsequently be made on the basis of a mini-bid among qualified backdrop contract holders, on a single or sole source basis where the authorized user can establish appropriate justification, or such other method as described in the bid document. (ApB)
Best & Final Negotiations:   This is the process required for an Authorized User when making significant purchases from brand bid or negotiated contracts, or, in some cases, any purchase from a limited multiple award contract. A brand bid or negotiated contract covers the full product line of a specific brand of product (i.e. Compaq microcomputers, Cisco networking hardware and software, Hewlett-Packard printers, Oracle software, Polycom video systems, etc.). In addition, whenever an agency is making a first time major purchase such as purchasing a new system, or installing software for the first time, all options available to the agency should be evaluated, including an agency competitive procurement or use of a centralized contract. When the decision is made to purchase from a centralized contract, an agency should solicit best and final offers, based on the agency's statement of needs. Smaller purchases can be made directly from these contracts, but it is required that for certain minimum size orders and recommended for other smaller size orders, that Users either: Draft an informal statement of their needs and solicit best and final offers from competitive sources; or If the user can document a single source procurement, negotiate with the contractor of choice to finalize a best value purchase. The following awards include multiple contracts awarded by region. When making any purchase from these awards, it is required that the Authorized User solicit best and final offers from all contractors for the applicable region: Electronic Key Systems and Telephone Equipment; Digital Centrex Equipment; and Cable (installed). Awards that include multiple contracts outline the required Procurement Procedures for soliciting best and final offers. (WBST)  
Best Value:   A Best Value award is one that optimizes quality, cost and efficiency, typically applies to complex services and technology contracts, and is quantifiable whenever possible. Costs in the case of best value are distinguished from price . Costs include conversion costs , life-cycle costs , etc., and embody price , which is the amount charged by the vendor for the given commodity or service. (PG)

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