training course review form

sandra foss: good afternoon. this is sandra foss with the foodnutrition services in alexandria, virginia. i have with me courtney haueterwho is also in the fns office in alexandria and we have on locationwith us eleanor thompson with the midwest regional office in chicago. i appreciate you all being withus this afternoon as we seek to demonstrate the local agency procurementreview tool that fns developed. so thank you for sharing yourtime with us this afternoon. before we begin i want to encourageyou that if you have trouble hearing

the audio through your computer,we have put the telephone number and access code at the lower left hand cornerof the screen under the chat information. i will read that information toyou if you need that to please call (866)740-1260. the access code will be 6054013. so if you need to call in because itwill provide you with a better audio, we want to give you thatinformation up front. also if the screen is small and itdoes not take up the entire screen on your computer monitor then it maywork that you can access the larger

version by simply enhancing thescreen on your monitor because we have identified this as being aslarge as we are able to get it as far as full screen is concerned. so just a little bit of logisticsalong with that if you have questions, we will be receiving thesequestions via the chat line again in the lower left handcorner of your screen. if you will type your questions as weare going through we are going to try our best to address as many questionsas we possibly can and then at the end if there are additional questionsand we have time, we will seek to

provide you with theresponses to those as well. anything we don't get answered thisafternoon we will receive a list of these and we will do our best to putout a q&a in the very near future. so without further ado i'm going tobegin by sharing a little bit about local agency procurement reviews in school years '16-'17. as you may have read through thepolicy guidance that went out in july, the use of the fns to all is a draft in school years '16-'17. it is optional for schools -- stateagencies to use however, if there is an alternative approach that thestate agency wants to develop or

modify, they are welcome to do thatand they will simply need to submit it to their regionaloffice for prior approval. so we hope that you are reviewingthe tool at this time and that you are looking at the various informationthat is found there and if you have a system that will allow you to developsomething that is equal to this, then you are welcome to submitit to the regional office. so i will share with you as well thatyour procurement reviews are required in school year '16-'17 and just aswas done in the 2015-16 school year, the state agencies must ensurecompliance with procurement standards

in the program regulations as wellas in the government wide regulations that are found in 2 cfr 200. they will also be assessing thedocumentation that details the history of an fsa's procurement andthat will not be any different than what was the expectation in school year '15-'16. as you know, the tool that fnshas developed and published is the results of a very extensive workproject that was done with assistance from state agencies and nine stateagencies reviewed and tested this tool in school year '15-'16.

they provided us with feedback thatresulted in us doing some additional updates and those updates were toincrease more functionality which we knew we needed to do. they also suggested that westreamline the questions and they wanted us to provide clarification oninstructions and to -- their feedback was basically let us use this as atool that is a draft for this coming school year so that all of thestates could begin to look at this and determine the procurementreview process and the approach that might be considered.

so that is why we put it out as adraft this year because we do want to encourage the updates, we do want toencourage the feedback, we do want to provide states with the mostfunctional approach to conducting these procurements as is possible. and again, if there are alternateapproaches out there, we want to see those. so we really appreciate what you aredoing to provide us with the feedback so that we can utilize fns resourcesto finalize the final version and that the state does not have to dotheir -- use their resources for that. the procurement review cycle is suchthat we really do encourage states to

use the same review cycleas the administrative review. we feel this prevents the burden oftracking two review cycles; one for administrative reviews andone for procurement reviews. we are including this option forstate agencies that have a waiver away from the three year review cycle forconducting administrative reviews. the same waiver would apply tothe procurement review cycle. state agencies will also have thediscretion of conducting this at the same time as they are conducting anadministrative review or they can use a different timeframe then theadministrative review cycle went they

are -- not cycle, i'm sorry, theactual review, they can do it at the same time, but they cando it at a separate time. they also have the discretion ofbeing able to conduct a procurement review off site as long as they canobtain all of the documentation that is needed to conduct the review orthey can do it on site if they prefer. these are decisions the statehas the discretion to make. we simply want to provide themwith a tool for how they are conducting these reviews. how to handle noncompliancewith procurement?

as in school year '15-'16, if the state determines there are findings of noncompliance with procurementstandards, these must be documented, technical assistance providedand corrective action required. corrective action cantake various forms. it can include amending contractsto remove unallowable provisions, if those are determined. it can mean re-soliciting contractsto ensure contracts are awarded only to responsive and responsible biddersor offerors whose price is lowest and most advantageous withprice as the primary factor.

this is required by 2 cfr 200.320and in policy guidance it goes back as far as 2005 dated july 14, 2005. another option for a correctiveaction may be that a new solicitation and contract must be finalized bythe next school year which would be 2017-18 and state agencies mayrequire a pre-issuance review of the proposed procurement which hasalways been in 7 cfr 210.21 under the procurement standards in the nationalschool lunch program regulations. states may also provide the trainingfor the sfa to -- may require them to participate in that so they increasetheir knowledge of procurement

standards and the potential existsthat they may assess the need to recover funds to thenonprofit food service account. as was in the case in school year '15-'16 if assessing the need to restore the nonprofit service accountor requiring a new solicitation is needed, we would like for the stateagency to work with the regional office on a case-by-case basis sothat we ensure that we are enabling the sfa to conduct the procurement incompliance with procurement standards as well as not providing an excessiveburden on them in this process. so i am pretty much giving you theoverview of the expectations for

school year 17 -- '16-'17. this is the last of two webinars toactually demonstrate the tool, but we do hope to be moving towardsconference calls in the very near future as the states begin to usethis tool and/or tool that they may be developing and as we announcethose conference calls, we will put those out on partner web. we envision that that possibly willoccur sometime this fall and we will make these on a semi regular basis. you may check with your regionaloffice because the regional offices

are consideringconducting some trainings. they are also considering having somecalls to work with their states in various capacities on the varioustypes of procurements that are being conducted so you may checkwith your regional office. anything that we are going to besponsoring here from the national office we will certainly beannouncing via partner web. and last, but not least, during thecourse of this year, if your state agency is planning to adopt the useof the fns tool, we are going to be looking for opportunities to havefeedback on how we can streamline

and improve the tool. and you might be aware that duringthe state agency usda meeting october 31 through, i believe, november the3rd, we are going to be doing some hands-on work with conductinga review and we are going to be reaching out to some statesto provide us with some actual information from school foodauthorities and we are going to work through the tool and actually work throughand conduct a review using the tool. so be on the lookout foradditional information. it's going to be forthcoming onadditional opportunities to learn

about the procurement reviewprocess and we hope to provide more information out on partner webin the very near future as well. so without further ado, i'm goingto turn this over to eleanor thompson who is going to be sharing with youthe procurement review tool and she may share also some of the updatesand changes that we are going to be making in the very near future soeleanor, i'm going to turn it over to you. eleanor thompson: thanks,sandra. good afternoon everyone. well first what i would like to dotoday is just to provide you with a brief overview of the tool and theni will go into a little more depth

about what is contained in each ofthe review tabs and how to use them. so overall, the order of the tabs inthis excel tool reflect the order in which the procurement review willtake place with one or two exceptions. the first tab here is just a chartto show sort of some information about how the review process will takeplace and the order of operations. so it's just a quick down and dirtyvisual for how these reviews will occur. so that just the first tab here. the state agency review instructiontab and its partner the sfa instructions tab, both in purple,are places in which the state agency

conducting the review can obtainadditional information about the review process itself at the stepsthat need to take place as part of the review using the too in additionto the sfa instructions which we also provide as part of the tool becausewe really wanted to have a one-stop shop information and we also inmany cases the sfa will actually be filling out some information in thetool itself and so we wanted to make sure that we provided someinstructions here as well. so there are two instructiontabs here in the tool. in addition, we have sfa procurementtables which collects information

from the school food authority aboutthe types of procurements that they entered into during the course of theprevious school year, so this is -- i'll go into this in some more depth. and then we also have a procurementselection chart which provides information to the state agencyreviewer about the number of procurements or contracts that theywill actually review depending on the number of contracts or procurementsthat the sfa has entered into. we then have -- and then we havea number of different review tabs and those tabs are in green.

and this is where the state agencyreviewer will actually go through and answer questions that pertain to theschool food authority's procurement procedures and also looking atindividual procurements and contracts. so we have a generalprocurement procedures tab. we have a micropurchase tab. these are the different types andmethods of procurements that the sfa may have entered into; smallpurchases, formal procurements and then we have a couple more tabs. now one thing to keep in mind is thatfor many school food authorities the

state agency reviewer may only endup using a small number of these actual review tabs. we understand that over 70 percentof school food authorities across the country are small school foodauthorities and for those particular sfas state agency reviewers may onlyend up only using a couple of these tabs because these smaller schooldistricts may not enter into more formal methods of procurementthat are a little more involved. so we really do envision that in somecases, or in a number of cases, state agencies might not actuallybe using all of these tabs.

it really depends on numbers andtypes of procurements that their school food authoritieshave entered into. we have a fsmc tab, a processingtab; i'll talk a little bit more about our base year review tabs. and then in addition we alsohave summary of findings tabs and those are in red. those i will talk about a littlebit more as well as we delve into the different tabs of the tool butsuffice to say our summary of findings tabs were an effort toprovide some ease of use for our

state agency reviewers so that asthey identify findings during the course of their review, thosefindings will then be pulled into the separate summary of findings tabs. so we will talk about thoseas well in a little bit. so and then finally our final tabsthat we have here in the tool are actually a series, the series ofdifferent procurement regulations. and we included them in the tabs sothat if you are out on a review and need to quickly access a regulationto better understand what it says you can do that easily withoutan internet connection.

we did our best to include citationsalong with each of the questions that we included in the tool. as you know, there are new 2 cfr200 regulations that pertain to procurement and those regulationsreplace a variety of older procurement regulations such as 7 cfr3016 and 7 cfr 3019 but we reference both of the new regulations under 2cfr and the old regulations for most of the questions as there is agrace period for fsas to conduct procurements utilizing theold requirements as well. but in many cases the new regulationsare similar to the old ones with the

exception of micropurchases which arenow allowed under the new regulation, so we will talk aboutthem more in a little bit. so let me get back tothe start of your review. the first piece of the reviewinvolves the collection of information from your sfa to learnmore about the different types of procurements that they've entered into. this information will help youdetermine which procurements and contracts should be selected forreview and hopefully make it easier for you to decide if you canconduct the review on or off site.

as sandra mentioned, we wanted toprovide flexibility for you so that you can determine whether or notyou will conduct the review entirely off-site, entirely on-siteor a combination of both. and when you select your contractsfor review that will give you some critical information that should helpyou better determine whether or not the review in its entirety or parts ofit may need to be done on or off site. now the way we envision this is that,as sandra mentioned, often times we are assuming that state agencies willconduct this procurement review as part of their admin review or atleast they will look at their school

food authorities that arereceiving an administrative review during the same school year. so you may do it one of two ways,for example, you may have your state agency reviewer or you as a reviewerthat are going out and conducting an administrative review. you might look at procurement at thesame time that you are out there on site for your administrative reviewor you may have different staff that are actually going to do theprocurement review itself. so either way once you havescheduled your procurement review --

the procurement review of your sfa,your first step after that will be to provide the local agency procurementreview tool to the sfa so that the sfa can complete the informationrequested in this sfa procurement table. at that time in addition you willalso want to ask your sfa that is receiving the review for theirwritten code of conduct as well as their documented procurementstandards and those are requirements that school food authorities havethose, those are requirements under the federal regulations. we know that in some instances ormaybe in a number of instances there

are a lot -- there are sfas outthere that don't have those particular documents but you will want to askfor them at least initially to see whether or not they have them andthen if they don't, we will walk you through the tool to show you whatcourse of action you'll want to take. in addition to requesting that thesfa complete this sfa procurement table as well as provide you withtheir written code of conduct and documented procurement standards, youare also going to want to ask the sfa for what we are calling a vendor paidlist which is basically a summary of procurements that includes theexpenditures made by the sfa for the

goods and services they procuredduring the previous school year. now the goal of collecting thisvendor paid list or summary of expenditures is to identifyprocurement expenditures that the sfa may not have included in thesfa procurement table when they provided that to you. when we were developing this toolwith the assistance of a number of states, one of the states that weworked with said, you know, when we collect the sfa procurement table,that is great information to have, but in some ways i'm actually moreconcerned about procurements or

expenditures that our sfas may havehad that they don't include in the chart because maybe they didn'treally think of it as a procurement or maybe they just decided notto include it and so after further discussion after that comment wasmade we said okay, it makes sense to ask for this vendor paid listor summary of expenditures. and we know in an instance, i believeof north carolina, they actually do that as part of the procurementreviews that they are doing. now for large school districts thathave multiple procurements, far more perhaps than what can easily orreasonably be included in the chart,

the state agency has the discretionto simply accept the sfa's vendor paid list or summary of procurementsas long as it reflects the same information asked for inthis sfa procurement table. so let me walk you through the table. we'll talk about that just a littlebit more and again if folks do have questions we will have time at theend of this presentation for q&a so please don't hesitate to let us knowif you are still scratching your head after i go through this so that wecan try and clarify any information you may need.

so the first thing that we have onthis sfa procurement table for the sfa to complete is basically -- justsome basic information and i just plugged in some examples here, forinformation about the individuals at the sfa who are involved in procurement. one thing that we found duringour testing of the tool was that sometimes state agencies actuallyhad a challenge figuring out well who at the school level, who at theschool district is responsible for handling procurement. it may be multiple people and it may notalways be as clear as one might think.

so one of the suggestions that weincorporated as part of the feedback from the testing was the inclusion ofa chart in which the sfa can provide some information, contact informationand names and the like for the people on their teams that are responsiblefor procurement so that when state agency is asking questions andactually doing the review, they know who they need to reach out to. so that is some easy informationthere that can be filled out. the next information we ask for, andagain i pre-populated this but these will actually be blank as part of thesfa procurement table is information

that we want to know from the sfaabout their small purchase threshold. as you all know on the phone, thefederal small purchase threshold is $150,000 but we also know that statesand sometimes localities will have lower small purchase thresholdsthat they must abide by. so here is where your sfa shouldinclude information or if you know it you can include it as well. this is where we would include orwant to see some information about the amount of the small purchasethreshold at the local level and at the state agency level.

and then this information is pulledinto some other tabs so that the reviewer has it at their fingertips. so as i said, i had just inputtedsome information in there previously. it's not a drop down. it's just where the additionalinformation can be provided. if no information is provided, youcould probably assume that they are using the same small purchasethreshold as the federal, but we did want to make sure that we capturedthat information as it's good information to have as you arelooking at their procurements,

particularly their smaller ones. in addition to asking about theirsmall purchase thresholds, you want to find out from your sfa if theyhave been working with a group purchasing organization or groupbuying organization or some type of third-party entity. we are not talkingabout an sfa only co-op. we are talking here about a differenttype of entity that is responsible for procurements on behalf of the sfa. and so we have a question here thatasks if the sfa paid a membership

fee, joined at no cost or otherwiseentered into an agreement with a group purchasing organization, groupbuying organization or third-party entity. we expect, as you all know, this isa draft tool and it will undergo a number of iterations i'm sure beforewe release the final tool next year. we expect that once fns releases itsgroup purchasing organization memo that we plan to release in thefall that we may end up adding some additional questions to the tool,but right now since we don't have that guidance, we just are asking onequestion just to get again some background information fromthe school food authority.

then as you delve down deeper intothe chart you will see here, and again these are areas in whichi've already pre-populated some information but i will walk youthrough some of it is where your school food authority would provideinformation about the micropurchases, if they were conducting procurementunder the new -- we are not calling it the super circular i guess,but the 2 cfr 200 regulations. we would also ask for informationabout their small purchases, their formal procurements, fsmc contractsand processing contracts and i will show you where those are foundin this tab in one moment.

so let me first take you through themicropurchase information here and again i just pre-populated some of theinformation due to time constraints. so here if you are an sfa you wouldprovide some information if you are using micropurchase about thedifferent vendors that you use for which you procured items usingmicropurchase procedures and those are for procurementsthat are $3,500 and below. so if the sfa used micropurchaseprocedures you want to know a little bit about them because you want to takea look at them as part of the review. so here you'll see i included someinformation about three different

entities that an sfa inthis example may be using. so they are using safeway, foodservice warehouse and costco as -- under which they are purchasing itemsunder the micropurchase threshold. some of these particularcolumns have drop-downs. some of them don't. and you can tell whether or notthere's a drop-down simply by clicking to the right of the box. if there's no arrow, there is nodrop-down so in many instances we want the school food authority orthe state agency if the state agency

decides to fill out thistool on behalf of the sfa. let's say that they've received thevendor paid list and they are filling out some of this on behalf of thesfa, this is where they would include information about the goods and servicesprovided by these particular vendors. so we just included some examples there. the next column is total paid to vendor. now we have a couple of options here. we have a drop-down here and iapologize it's a little bit small of my screen.

if you need to adjust theresolution please feel free. it's hard to fit this whole thing onone page so you may need to increase the size as you are looking at it. but you can see herethat we have a drop-down. and it may be for instance that inthis example that the school food authority used safeway for let'sjust say they used them once for a purchase that was under $3,500. so in that instance they would selectthe selection that this particular vendor, the total paid to that vendor theprevious school year was $3,500 or below.

now it may be a situation in whichthe school food authority used this vendor for multiplepurchases under $3,500. that is allowable in many instancesunder micropurchase procedures. you don't want sfas to be breakingup purchases simply to fall under the micropurchase procedures thresholdbut they could have a very valid reason for having multiplemicropurchases from a particular vendor and in which case, let'ssay in this situation the sfa had multiple purchases from safewayusing micropurchase procedures. as a result they are looking at atotal paid to vendor that is above

$3,500 but that is below $150,000,which again is the small purchase threshold at the federal level. here we have another drop-down forproducts and/or services purchased. we may end up getting rid of this tab. as we mentioned, we will be providinga new version of this tool hopefully the final one for school year '16-'17. we know that there is some additionalfunctionality needs that the tool that was posted on partner web stillhas and we've also found some areas where we can furtherstreamline the questions.

so for those areas i will give youa heads up to let you know some areas in which we may be tweaking a littlebit so that the final version of this tool which we hope to get out withinthe next two weeks, it will look a little bit different from the toolthat we currently have on partner web, but the overall reviewprocess will remain the same. this particular column may end updisappearing but right now we have it in here and again it's an opportunityfor the sfa to provide some information about the types ofservices or products that they purchased from this particular vendor.

there is no drop-down for thistab what we want to know how many purchases were made from thisvendor during the school year. again, micropurchases can be usedmultiple times throughout the school year again as long as the sfa isn'tbreaking up purchases to avoid doing a more formal type of procurement. but you may see in a situation wherelet's say you might see 10 or more purchases from a particular vendor,we would want the sfa to include information here about how manypurchases were made from this vendor during the school year.

in this instance we justhave two as an example. any comments that the sfa may have here. and then we have an option here thatis for state agency reviewers only. so typically when the school foodauthority would see this tab, these would not be selected and this isonly for the state agency to use once they decide which contracts to selectand i will walk you through that as well so you can see how that works. but so you can see for micropurchasethere are not a ton of questions because these are pretty simpleprocurements so there are not a lot

of rules and restrictions surroundingthem so there is less information that we need to know. as we move down and we look at smallpurchases, you will see that we have a number of the same columns,just as we did for micropurchases. we would want to know the name ofthe vendor, the goods and services provided, the total paid to vendor. again we have a drop-down here. the products and/or goodsand services purchased. but then in this case, because this-- small purchase procedures are a

little more involved thanmicropurchase, we would want to know whether or not this is a one-timepurchase or if the school food authority used this vendorfor multiple purchases. so we ask that question as wellwhether it's a one-time purchase or multiple purchases. we'd also want to know if the schoolfood authority received more than one response to its solicitation. we don't ask that in micropurchasebecause micropurchases are by their nature not a competitive procurement.

there's no need for the schoolfood authority go out and solicit different vendors to find out who has thecheapest price for the products they need. but for small purchases you do needto do that and we do want to know whether or not the school foodauthority received more than one on its face that does not mean thatif they did receive only one that there's a problem but we would wantto prioritize contracts in which only one response is received so that wecan select one of them when we are doing our review just to make surethat the sfa is doing what it needs to as far as procuring the items.

we want to know if a gpo orthird-party entity was awarded this contract so we have that questionthere as well under small purchase. and then again we have a commentbox and this area again is simply for state agency's use only. so i will go through you have a sensefor the information that we ask under these particular sections of thesfa procurement table for formal contracts when we are talking aboutinvitations for bid or request for proposal, again those have morerequirements than do small purchase procedures so again, you may see an extraquestion or two that we did not ask above.

but many of the columns again aresimilar; name of vendor, goods and services, contract value, buthere we want to know what type of solicitation was involved. was it an invitation for bid orwas it a request for proposal? and the answer to that if thecontract is selected for review is going to help determine whatquestions you are going to ask or what things you are going to reviewin the contract to make sure that it's in compliance. we would want to know if the contracttype was a fixed price or cost

reimbursable for the same reasonsbecause you want to know which questions you need to ask as part ofthat tab and we try and provide some specifics there, and when i take youthrough you will see what i'm talking about. we want to know about contract duration. unlike food service managementcompany contracts that are restricted to the initial base year and 4renewal years, formal contracts are not -- there is nothingin the federal regulations that restrict their length. and so for that reason we want toknow how long the contract duration is.

because again, if it's a multiyearcontract, that might be one that you want to take a lookat during your review. again we ask if the sfa receivedmore than one response, was the vendor contracted through a gpo, grouppurchasing organization, group buying organization ornon-fsa only co-op. we also ask for this: were anyamendments made to the contract after it was awarded? and again, we just pre-populatedsome answers in here. it's a drop-down; youcan pick yes or no.

and again then we have the comments and we have the state agencies - for now the next section of the sfaprocurement table pertains to food service management company contractsand one thing that i do want to mention is that when you areconducting a review of a food service management company, we know atthis stage that the food service management company contract wasalready approved by the state agency. so as you all know, state agencieshave a requirement that they have to review and approve fsmccontracts prior to execution. when you are using this local agencyprocurement review tool, you will

have already conducted that review. there is no need for you to goback out and look at the base year contract and determine whether or notit's in compliance because hopefully you already did thatand did it thoroughly. but what we would want our reviewersto look at would be were any changes made during the renewal years,so were any amendments made? and is the school food authorityengaging in contract management? are they actually making sure thatthe goods and services and the other provisions that are included in thefsmc contract, are they getting what

they should be getting? and are they monitoring it becausesometimes we see unfortunately, the school food authorities and weunderstand how it happens, but it can't really happen this way is thatthe reason why an sfa may turn over some of their operations to an fsmcis because they need that assistance and that's all well and good butit does not absolve them of the responsibility to make sure that thefsmc is doing what it should be doing and in accordance with thecontract that it has with the sfa. just as though if you were havingrenovations done to your home and you

had a contract for that, you wouldwant to make sure that the individual doing the reservation did everythingthat they said they were going to do in accordance with the contract. our sfas need to also ensure thatthey are getting what they should be from the fsmcs that theyenter into contracts with. so again, many of the questionshere are very similar to what you saw under formal contractsasking about amendments. here we actually ask which yearof the contract that the sfa was in during the previous school yearso that state agency reviewer knows

okay, it's the first renewal year, soi'm looking at that, and we will take a look at any amendmentsor what have you. or let's say we are in the thirdyear and i may need to look and see if there were amendments duringthe previous two years as well. and the review tabs we willwalk you through how to do that. then last and finally, we have --we ask questions about processing. now this tab has probably undergonethe most significant changes currently compared to theversion that's on partner web. and we recognize that for many of youmay not -- you may have a different

entity within your state agency orit may even be a completely different agency that looks at processing. so what we are telling folks duringthis first year of these procurement reviews is that, as you know,processing contracts are very similar in some ways to other types of formalor small purchase or other types of contracts that you will be reviewing. they have to follow the same federalrequirements, but then in addition, where it makes sense for you tocollaborate with your other state agency colleagues either within yourdepartment or with another agency,

we encourage you to do that and wewill be eagerly securing additional feedback from all of you that decideto use this tool as to how is it going. are we having -- are there challenges with trying to get this information? are there challenges surrounding theskill sets of your reviewers in as far as understanding processing? are there other folks thattypically that look at this? so we will be looking for somefeedback on this, but in the meantime, we would encourage youagain to work with your colleagues if you yourself don't typically handleprocessing, to collaborate as you can

with others to look at processing orto see what others may be looking at currently as far asprocessing contracts go. but at least for this purpose here wewould want to know from your sfa what kind of processing contracts do theyhave, how much are they and so on and so forth just as we do for theother types of procurements. once your sfa provides thisinformation as part of the sfa procurement table or -- and/or theprovide a vendor paid list, again that's the summary of procurementexpenditures for the previous school year as well as their written codeof conduct and documented procurement

standards which again are requiredas part of -- under the federal regulation, the state agencyreviewers will then go to the procurement selection chart. this is where you go in orderto determine how to prioritize the review -- the selection ofdifferent contracts and how many you need to actually look at. so we tried to include as partof this chart, and it's not a very dynamic chart. there's not a lot thatyou really do here.

it's just more for informationalpurposes only although ideally once all of the functionality has beencompleted with the tool that we will post again on partner web,these pieces here actually should pre-populate so the informationthat you see here for instance, is information from that sfa procurementtable that was received by the state agency from the sfa and it basicallytells you how many contracts or how many in this instance small purchaseprocedures the sfa indicated it had in the procurement table. that information just pops uphere so that the reviewer does not

necessarily have to go back to theprocurement table and start counting how many small purchases the sfa had. that information will be right here,so let's say if this number was 10 then it would be easy enough to seehere how many you would need to review. you can see here with the sfaprocurement -- i'm sorry, with the procurement selection chart as wellthat we also provide some information about the greatest number of contractsthat you would need to look at. and again the number of contractsthat you would look at depends on the number of procurements undereach category that the sfa has.

but in many instances, the greatestnumber of contracts that you will be looking at would justbe a small handful. so for instance, for micropurchases,if you have an sfa that used 10 different vendors using micropurchaseprocedures, the greatest number of procurements that you would look atwould be two so you would look at two vendors, you will look at someinvoices, answer some questions in the review tool, and then that'sall you would need to look at. so you always would have thediscretion to look at more if you wish, but for our purposes, thegreatest number of vendors that you

would need to look at wouldbe two under micropurchase. you can see here under small purchaseprocedures the greatest number that a state agency reviewer would need tolook at, the greatest number of small purchases would be four. and we actually start to prioritizehow we would want the reviewer to select the contracts orthe procurements for review. so for instance, if the sfa indicatedthat they used a gpo to obtain the goods and services using smallpurchase procedures or if they had -- if only one response was received totheir solicitation, you would want to

make sure that you selectedthose as part of your sample. so let's say in this instance thatthe sfa has five small purchase, five small purchases that theyindicated in the sfa procurement table and one of them is via a third partyentity, one of them is they only received one response to the solicitation,then you would select those two for sure out of the five. and then you would select two morefrom the remaining three that are left and you'd select one that mightbe a higher amount, but then you would have some discretionto select the remaining two.

so the greatest number ofpurchases that you look at under the small purchase procedureswould actually be four. and we will provide some additionalinstructions surrounding this table when we release the newest update. so we will provide some additionalinformation about how to prioritize and how to read this tool for you. but overall, you can see that we docap the number of contracts to review at a handful. so the greatest number you would reviewunder small purchase would be four.

the greatest number under formalprocurement methods, ifbs or rfps would be six; in some instances itmay be less again depending on the number of contracts at the sfa holds. for fsmc contracts, the sfawould look at all fsmc contracts. we recognize that fsas may have morethan one fsmc contract, but it's our understanding in the majorityof cases if an fsa uses an fsmc they are probably only using one. they may do other procurements on topof the procurement that they did with the food service management companybut they probably only have in most

instances one food service managementcompany contract and again, you would be looking at the renewal yearsnot at the base year contracts. so you would look at all fsmccontracts, but we think then practically speaking that typicallywould be just one contract, maybe two at the most. and then for processing contractsthe greatest number that would be reviewed would be six. so for larger sfas that have a largenumber of contracts under each of the different types or under several ofthe types here, you really will be

looking at a pretty small sample ofcontracts for those particular fsas. and for those smaller fsas thatmay only use micropurchase and small purchase, your review would stop there. so you might look at twomicropurchases and four small purchases and be done. so hopefully that seemsreasonable to folks. we really tried to make it asreasonable as we could at the same time wanting to ensure that if thereare issues with the procurements that they are identified and thatdoes oftentimes mean that you need

to look at more than one or two. once you decide which contracts youare going to review, the state agency reviewer then goes back to the sfaprocurement table because then here is where you do yourselection of contracts. and when you do your selection ofcontracts in the sfa procurement table, that will then allowinformation to be pre-populated into the appropriate review tabs. so for instance, if i decide thatsafeway is going to be one of the micropurchases that i wish to review,i as the state agency reviewer am

going to go and select thatparticular procurement review. and while i'm at it, i need to lookat two so i'm going to look at the second one as well and i'm goingto select that one for review too. so i would do that throughoutthe rest of this particular sfa procurement table. i would make my selection of thedifferent contracts and i'm just selecting the top ones here. but again, you would want to baseyour selection on the criteria that we provide as part of the procurementselection chart so sometimes those

contracts have a greater dollarvalue, ones that involves a group purchasing organization, a thirdparty entity, one for which say the sfa may have only received oneresponse and those are the ones that you are going to want to select soagain, i'm just doing this for speed but, then the state agency wouldgo back in as i said and they would select those contracts for review. so once you've selected yourcontracts for review, you can start -- at that point you will need tosecure some information from your sfa. you'd want to notify them okay, hereare the contracts and procurements

that we want to take a look at anddepending on the type of procurement that's involved there are differentpieces of information that you may wish to gather from the sfa. some of it may be pretty easy togather, things surrounding invoices and the like for micropurchasesthat might not be that difficult. it may be more challenging to obtainsome of the documentation that you might need for a formal contractin which you are going to be looking at the solicitation. you will ensure that you are lookingat the way in which the contract was

evaluated and awarded although thatshould be part of the solicitation and then you will also belooking at some invoices. so as we mentioned while the reviewin its entirety can be done off-site, it will really be up to you todetermine based on the sfa that you are working with if that is an option. if you can do all of it off-sitefor those smaller sfas, that might be a pretty reasonable option. it may even be so as well for someof the larger fsas, but that will be something that you as a state agencyreviewer will have to determine when

you are working with your sfa. so once you have received thedocumentation that you need from the sfa whether you are on-site oroff-site, and you've received their written procurement standardsand code of conduct because you'll remember we asked for that as wellat the beginning, you will be ready to conduct your review. and let me back up, one piece ofinformation that i did neglect to provide and i apologizeis the vendor paid list. i had indicated that one piece ofinformation that you are going to

want to ask for in addition to thesfa procurement table is this vendor paid list or summary of procurementexpenditures and what you will want to do with that when you receive itand assuming that your sfa fills out this chart, the sfa procurementtable, then you would want to compare that vendor paid list with the tableto see are there actually -- were there procurements made that are notreflected in the chart, and if so, you could add them into the sfaprocurement table to give you a more complete view of the types ofprocurements that they entered into. so my apologies, i neglected tomention that, but that's how that

vendor paid list is used. it can be used or should be used bothto compare it with the information that you received in the sfaprocurement table or if you choose not to take -- not to requirethe sfa to complete all of the sfa procurement table, that vendorpaid list, as long as it has the information, same information in itas we request in the sfa procurement table, you can use that vendorpaid list instead to select your contracts, but then you would wantto include information about the ones that you select in the sfa procurementtable itself if the sfa did not

complete the table so that thefunctionality of the tool is available. so let me move on. as i mentioned once you receive thewritten procurement -- the written code of conduct and the documentedprocurement standards from the sfa now you can do --start on your review. again the green tabs here are yourreview tabs and this first tab that we have is generalprocurement procedures. this is where you are going towant to take a look at the written standards of conduct and documentedprocurement procedures or code of

conduct that the sfa has. and you can see that each questionthat we ask here when we ask the reviewer to look at these particulardocuments, all of the questions pertain to the federal regulations. so we have the citation for theregulation next to each question so that if you need to you can go anduse some of those tabs that pertain to the procurement regulation andyou can see for yourself if you need a little more information whereto go, exactly what the reg says. but what typically will happen withthis tab is that the name of the sfa

will be pre-populated here, righthere it says you need to type it in because i did not type it in on thesfa procurement table, but if i had, it would have been pulled in righthere as the name of the school food authority that you are reviewing andthen each one of the questions here in white, there is a drop-down forthe state agency reviewer to answer and the options provided are:yes, no, and not applicable. please note that in some instancesa not applicable may not be your best answer because for instance, in thiscase, the federal regulations require sfas and other units to have writtencodes of conduct so to answer not

applicable would not really be --probably wouldn't be your best answer. you would want to answer yes or no. when we release the final, final toolnext year our goal will be to ensure that those questions for which onlya yes or no answer really should be selected, those are the only optionsprovided, but because this tool has changed a number of times, we hada change in the regulations midway through it and we continue to tweakthe questions at this point, we provide all three options. but just know for some questionsnot applicable may not be your

best option to select. so the reviewer goes through, theyanswer the questions looking at, in this case, the sfa's code of conduct. then they may look at the sfa'sdocumented procurement procedures. we know from our testing that some sfasdon't have these particular resources. and that they need technicalassistance as to how to develop them and the best way to do that. so in this instance i'm going to sayno, that they don't have documented procurement procedures and then icould include information here in the

comments, let's say in this case thatthe sfa is in the process, but they don't actually have final proceduresyet and i could just type that in. no final procedures,but developing a draft. and then i can just include thatso that i have that information. and so the reviewer just goes through thedifferent tabs and conducts the review. so this first one is again is thegeneral procurement procedures. you see we only have eight questionsas part of this particular tab. we have a couple of sub questions,but not a lot and they are pretty straightforward.

once you finish with this taband assuming that your sfa does do micropurchases as part of theirprocurement processes, you then would answer the questions in this tab. you can see that the names of thevendors that i selected for review are pre-populated intothis particular review tab. so see safeway and food servicewarehouse were my two vendors for which i conduct micropurchases andthey are here in the micropurchase tab. so that is part of the functionality. it's why when you select yourcontracts for review you want to if

you can use that sfa procurementtable because it's going to help make your life a little bit easier so youdon't have to go back and forth and type in the name and what have you. we only have three questions here. we will be providing some additionalinformation as i think i mentioned with our most updated version of thistool that will come out in the near future that will provide information forstate agency reviewers about invoices. we will be asking reviewers to lookat some invoices, a minimal number we think, when they are looking atdifferent types of procurements.

so we will be asking for a review ofsome invoices as part of the reviews of the different contractsand the different procurements. so please keep that in mind. we will provide somemore details about that. so again there are only threequestions here under micropurchase and you would simply go through andanswer the questions after looking at the necessary documents. so i'm just putting them in there. and then i would do the same withmy next micropurchase with the next

vendor that i'm looking at. and if you had multiple and youwanted to look at more, the tool allows you to do that so thereare additional columns for which additional procurements could be pulledinto from that sfa procurement table. so if i decided to look at morethan i needed to, i could do that. the rest of the review tabsare really very similar. again, under small purchases whichis the review tab i'm in now, hood dairy, which is one of the contractsi selected, is pulled into this particular review tab so i know thatthat's the contract i'm looking at or

in this case, the solicitationunder the small purchase procedures i'm going to want to look at. and then i go -- again i go through thequestions, each one with a drop-down. and i'm going to seeif i have one in here. in some instances wedo have reviewer tips. i think we have more of them maybeon some of the more formal procurement reviews, but in some instances iwill find one for you, we do have some reviewer tips here. you will see a little red bar hereand you'd click on it and it provides

a reviewer suggestion or reviewertip for that particular question. you will see that for theprocurements as well we try to look at the procurement or the contract duringsort of the life stage of the contract. we would want to know if thesolicitation had clearly indicated the types of goods or servicesthat the sfa needed, were there any unreasonable restrictionsincluded in it, so on and so forth. we want to know as well was theevaluation and award done correctly, and so you will see in each of thereview tabs we have a question or two surrounding the evaluation and award.

and then finally, again as imentioned earlier, we want to know whether or not the sfa isengaged in contract management. are they ensuring that the contractprovisions or the agreement that the sfa has with the vendor are beingfollowed the way that they should be in accordance with thecontract or with the agreement? and you can see here we have somebasic questions: for food purchases did the sfa provide sufficientoversight to ensure compliance with the buy american provisions? we do have some new buy american review-- a new buy american review

process as part of the admin reviewprimarily as part of this tool we will be looking mostly at contractlanguage, but there are more buy american questions in the actualadministrative review itself because for some of the buy american reviewand monitoring you really have to be able to look at labels and the likeand because this particular review is -- can be done on or off site,we felt that that actual visual inspection of labels is better aspart of that on-site review during the admin review. so if you have not seen that, keepan eye out for it in the revised

administrative review materialsthat came out i think on july 1. and then i won't take a lot more timegoing through all of the other review tabs but they are similar. certainly as you get to the formalprocurement procedures, you will find that there are more questionsbecause again these contracts and solicitations there are morerequirements because we are talking about more money and as a resultthere's a need for more specific procedures to be followed. so we talk a little bit about thegeneral solicitation process for

formal procurements thatthe sfa may have engaged in. and then we also have some questionsthat are specific to certain types of formal procurements. this one is -- and this is for bothinvitation for bids or request for proposals, but then further downthere are some questions that are specific to specific types of proposals. so for here you will see we asksome questions regarding rfps under this section here. if the contract you're looking at isan ifb, in this instance we would say

skip to the evaluation and awardsection and so you would be skipping questions nine and 10 of thatparticular section, as well as perhaps 11 and go downto evaluation and award. so there are instructions withinthe tabs themselves for where the reviewer would need to skip aquestion or when they need to answer certain questions depending on thecontract that they are reviewing. again we are looking at the not atthe base year contract, not at the contract prior to execution fora fsmc, but we are looking at the contract renewal.

there are handful of questions here. we also have some additionalquestions in here surrounding fsmcs that process usda foods so there aresome questions there as well, but as you can see overall the total numberof questions under this particular review tab is nine. and again we will be providing someadditional information about what reviewers need to do when looking ata small sample of invoices to ensure that credits were being applied inthis instance for a cost reimbursable contract, so we will have some moreinformation in the newest release

of the tool. the processing tab as i mentionedwill look much different to you compared to the versionthat is on partner web. the newer version has been streamlined. we have fewer questions within this tab. we really tried to consolidate someof the questions and focus as much as we could on questions that primarilydeal with procurement activities. we had had some additional questionsin there that sort of are more general to processing.

we've tried to target these questionsso that they are now more focused on the procurement activities themselves. so you will see that when the newversion comes out and again we will have some additionalreviewer instructions for you. this one is a little bit longer. and then finally, we do havea fsmc base year review tab. this tab is for you if you separatelyfrom your procurement review, if you have an sfa that is asking youto review a fsmc contract prior to execution, this particular reviewtab you could open up the local agency

procurement review tool and usethis particular tab to evaluate the contract that you received. and all of the questions in this tabpertain to all the required federal clauses and provisionsthat must be in there. it asks information about theevaluation and award so all of the things that you need to look at as astate agency when you are looking at an fsmc contract prior to executionis here in this particular tab. so if you choose it really is justdesigned to be a one-stop shop. you don't have to use it.

this is completely optional, but wethought it could be helpful for folks that do decide to use it that sayyou have a contract that you are reviewing, a base year contract in school year '16-'17 or a contract prior to execution in '16-'17 and that sfa is up for a procurement review in school year '18-'19, you could pull up this tool, you could see, you know, again who won thecontract, all of the information that you would want to have as part of thebase year contract, you could go back and take a look at the informationhere and you'd have it in one place. now after the base year review tab,and again, that's optional, that's

separate from the reviewthat's conducted during a regular procurement review. we have a summary of findings tab andwe are still working on some of the functionality for this so you'llsee it's not perfect, but what should happen and what will happen once thisis fully functional is that you will recall that when i was answeringsome of the questions in the general procurement procedures tab thatone of the questions i indicated there was a finding. it was where i believe the sfa did nothave written procurement procedures.

and so what will happen when thetab is fully operational is that the question that triggers the -- forwhich a finding is identified would be listed here, so thereview question would be here. any reviewer comments that wereprovided would be pre-populated here, so that piece worked and this here,the finding and corrective action, those two areas would be blankbecause as sandra mentioned at the beginning of our call, there aredifferent types of corrective actions that state agencies may choose toenforce depending on the finding itself. so for something that is easilyfixable, say something that can be

easily amended in the formal contractthat might just be that they need to amend the contract at the next juncture. but for a more serious violationfor instance, where price was not the primary method of awarding thecontract or was not the primary criteria when awarding the contract,that might result in the sfa having to rebid the contractat the next juncture. so we did not specifically includecorrective actions here because we do want state agencies tohave some discretion. if at any point during your reviewsyou have a question about what would

be an appropriate correctiveaction for a finding let your regional office know. we can walk you through and workwith you on that and in addition as we continue to hold conference callsas sandra mentioned or we have additional trainings, we can talksome more about different situations that state agencies are identifyingas part of their procurement reviews and talk some more about whatappropriate corrective actions would be so know that we will be providingsome additional opportunities for questions to be raised aboutcorrective action and of course, you

can always go to your regionaloffice for more information. the procurement findings areeach separated into different tabs depending on the type of contractthat was being reviewed so again there is a tab for generalprocurement, standard findings, micropurchase, small purchase and thelist goes on and on and so for those contracts that you review, those-- any findings that are identified based on how the question isanswered will be pulled into those particular review tabs. so that is an overview of the processby which a state agency would use the

local agency procurementreview tool to conduct a review. again, we will be providing moreinformation to folks when we release the newest version of the tool withinthe next 2-3 weeks and hopefully that provides you with a helpful overviewfor the process itself for how you can use this tool as a resource ortake parts of it if you choose to utilize your own checklist or whathave you, hopefully this will be a good resource for you as far as beingable to identify what you should be looking at and making sure that youare covering everything that you need to cover as part ofyour procurement review.

so with that and without further ado,sandra, i'm going to turn the call back over to you to see what kindof questions we are seeing from folks participating in the webinar. sandra foss: okay, thank you, eleanor. i had to take my phone offmute for a moment there. we have had a number of questions andwe've been able to answer these as we go. i will kind of summarize much of this. we've had a number of questions aboutthe vendor paid list or what we've -- that is the title we have kind ofgiven to it, but it's actually just a

summary of vendors paid using thenonprofit food service account. we anticipate that the sfa'saccounting system should be able to give this summary report. we would like for it to be a summary. it does not necessarily have to beby transaction because that could be hundreds of pages. it is a summary of vendors paid usingthe nonprofit food service account. and we want this to be a way that thestate can assess the priority for who they will review because youwill possibly recall that on the

procurement selection chart, one ofthose criteria that the state agency will determine is thosecontracts of highest value. so the vendor paid list is away of determining what vendors have been paid the most. and we had a question about well whatdo you do if the number of vendors these large sfas have, this could behundreds possibly, among the largest of sfas. and there are not enough rows forthe sfa to enter into the chart. and we acknowledge that. there are and should be enough rowsunder each procurement method tab --

i'm sorry, under each procurementmethod section to equal the number of vendors to be reviewed. so if a state agency wants to for thevery largest sfas, they might could reach out to the sfa and obtain thatvendor paid list or that summary of vendors paid from their accountingsystem and have them send them that information in advance along withtheir procurement procedures, along with their code of conduct, alongwith their information that is being requested in the tool and once thestate agency reviewer receives that information and they review andsee that oh, my goodness, there are

hundreds of vendors here, then theymight could use that vendor paid list to determine which of the vendorsthey are going to review and then call or notify the sfa of the vendorsthat they are going to select and then have only thatinformation within the chart. i will -- that gives the statethe option of either inputting the information themselves into thetable because unless it's put into the table, it won't pre-populate. or they can have the sfa put thatinformation into the table once the state provides them withthat feedback of which vendors

they are going to review. we had another question about wellwhat if they don't have a vendor paid list or if they don't have thisaccounting methodology; some small sfas don't have this. we'd like to believe, and wedo believe, that there is some mechanism, the resource managementreview is a way that might inform how they are accounting for the nonprofitfood service account so there will be some type of accounting process thatcan identify the number of vendors that are being paid using thenonprofit food service account

because those account dollars haveto be coded if they don't have a separate account for them. so i hope that answers and helpsyou inform that process as well. one of the questions that we alsoreceived was if you are in the base year and you are using the tab inthe tool in your review of the sfa solicitation during that initialreview and approval process, if you are using that tool, the tool toanswer those questions at that time, does that suffice for your -- their reviewof the food service management company. no -- yes and no shall i say.

yes, it suffices for ensuringthat all of the required contract provisions are present. when you are approving that contractthe one thing you will need to do is you will need to obtain a copy ofthose invoices that the food service management company is providing tothe sfa and that the sfa is using to pay their bills and you will needto obtain a minimum -- we will be recommending a minimum of three, toensure that the way in which the sfa is to be paying the fsmc whetherit's on a fixed meal rate based on the number of meals served during thatclaim period, if that is the way they

are paying for them, or if they areusing a cost reimbursable contract, how they are identifying those costsfor food or for labor, supplies, however that contract has beenawarded, and if the discounts, rebates and credits that the --for cost reimbursable are being identified on that invoice. you will not be looking at theprocurement of the food service management company itself, how theyare buying the food, the groceries or the supplies or thatkind of information. you will only be looking at theinvoice the food service management

company gave to the sfa and that thesfa used to process payment to the fsmc. and you will be lookingat probably three of those. but that still does not the end thereview of the food service management company contract because the sfa maybe buying outside of the food service management company. this is something we determinedwhile we were testing. we really thought we would find thatthe food service management company was purchasing and buying everythingand then including it either in the fixed meal price, if that was thefixed meal contract type, or if the

cost reimbursable that the costreimbursable additional purchases, all purchases would be made by thefood service management company and therefore, that would be paid tothe food service management company. so our surprise, surprisewas that that is not the case. there are potentially other vendorsthat the sfa may be purchasing and they may be doing so outside of thefood service management company and paying for them with a nonprofitfood service account so you will still need to determine whether or notthere are other purchases being made using the nonprofit food serviceaccount and how are those being made

and how are they being competitivelyprocured and then you would look at some sample invoices, no more thanthree, from those vendors as well. so doing the check off of thebaseline or the renewal year when you are renewing those -- reviewing thosecontracts for the renewal process, there's a little more to it than justchecking off those questions there. you are going to need to doan invoice review as well and determining whether or notother vendors are out there. we also had a question on whether or not --how do you determine equitable distribution. this is where this vendor paid listis also a very key piece because you

will be able to determine as may bewhat eleanor had shown on the screen was they were purchasing from thesafeway, they were purchasing from the food service warehouse, theywere purchasing from the costco. so those were the three and on theselection chart there if you were 1-3 you would review the two thatthey were going to select. and so in this particular instancethey had safeway, they were spending between $3,500 and $150,000, but withboth costco and the food service warehouse, they were spending only $3,500is what was on the chart. when you look at the vendor paid listyou may see that they are spending

$143,000 at safeway and they werespending $3,300 and something and at costco it's $1,300 and something. you would be able to see thatthere really is not a full equitable distribution there. they are favoring safewayin their purchases. so even though you may pull theinvoices and see that all of the transactions are less than $3,500,all of their product prices appear to be reasonable, the one thing they arenot doing is equitably distributing among available sources.

and so they would need to bemonitoring whether or not they should be buying more from safeway, whetherthey should be buying more from the food service warehouse, whether theyshould be buying more from costco. so periodically spreading the wealth,that is kind of the term that we coined attached to themicropurchase threshold. it does not have to mean that theyare constantly meeting that exact dollar value every month butthey are relatively close. they are relatively well-balancedwhen they are using these micropurchase procedures.

we have a few questions that arestill coming in and we have a few minutes remaining so i'm going toread through this and see if we can't possibly answer some ofthese questions as well. we have a question that says if weconduct this review in conjunction with an administrative review, shouldthe procurement review cover the previous full year orthe partial current year? what we've said in the information isthat the prior year information will be the procurement review and thatyou would look at how they conducted that procurement.

that information will be availablefor the full year and that full year is the way we need to determine howthey are conducting their procurement. looking at a current year wouldnot give us that full picture. if you were on site in anadministrative review you may be there as early as say september oroctober or in some cases earlier and so what they would have spentyear-to-date would not necessarily represent what they willpurchase during the full year. so we made the decision during thetest as we were asking folks to look at various review approaches whetherit was a full year or the review

month only or during one quarter, welooked at the various approaches and determined that the best way for usto begin would be to look at the full year using the prior year informationand then if issues were determined you could always come forwardinto the current year as well. so i hope that answersyour question there. we have a question that says while welook at invoices provided by the food service management company we look tosee if the items on the invoices that back up the invoices to the fsa areallowable, necessary, and reasonable. yes, that would be one of theapproaches that you would certainly

want to ensure there because acost reimbursable contract, these purchases must be necessary,reasonable, and allowable and they must be net of those discounts,rebates, and credits so you would want to determine if those discounts,rebates, and credits are being shown and how they are being shown becausethe regulations in 210.21(f) require them to put that information on that billto the sfa, to disclose that information. as far as the fixed price, you wouldlook at the fsmc invoice to the sfa that says this was the bid price forthe fixed price reimbursement that we bid and it would be basedon the number of meals.

one of the things that we -- servethat month in the prior month. one of the things we found in thetest was that a fixed price contract had no number of meals and apparentlythe sfa and the fsmc had made an arrangement whereby they were goingto pay the fsmc in equal amounts over the 12 month period as opposed tobased on the actual number of meals that were servedduring that prior month. and the contract did not callfor that equitable split of one-twelfth every month. it was based on a per meal cost,based on the number of meals served.

and so that information -- the way they were billing was not compliant with the contract and so this was aninteresting find during the testing period. so we want to make sure that thecontract is being monitored and that the monitoring is being done priorto payment to the particular vendor. and that the way in which the vendoris supposed to be paid is being paid. so i hope that helps there as well. okay, there's anotherone about the prior year. so we answered that one. and we have a question is theresupplemental school food authority

contracting with food servicemanagement company review form for the '16-'17 administrative reviews or is all the information gathered via the procurement tool? you may find in the appendix of thenew food service management company guidance we did put some checklistsback there that will help that the state agencies may use. we also provided one foran sfa may use and consider. it's just a sample. it's something that may need to betweaked a bit more specific to what

the sfa's fsmc contract lookslike, but it was a sample. something to use as a guide for havingsome form of documentation for that the sfa is using to review their foodservice management company contract. so refer to the new version ofthe contracting with a food service management company handbookthat we posted earlier this year. we have a question about can theinformation be pulled from the yearly school financial audit reportsto initially populate the tool. this is a good question. we have talked about how audits, andwe put into some guidance, how audits

may be used to informthe procurement reviews. we don't think they are going toreplace but we do so like that they can help inform and so i don't knowexactly what is in that audit report, but that is certainly something thatstates may want to refer to and see how it informs them of whether or not therewas an audit finding in procurement. if there was an audit finding inprocurement then you would certainly want to obtain theadditional information. and so we think that that can informthe review, it won't alleviate the review, it won't to eliminate thereview, but we do think it will

inform the review. so i do hope that helps as well. we are officially out of time so iwant to wind up by telling you all thank you for spendingyour afternoon with us. we hope that you can see that thetool has been developed and provided in such a way as to provideyou with a one-stop shop. it will help you to know where theregulations are around procurement. we hope you will see that all of thishas the citations and a copy of the actual regulation so that youhave everything that you need to

conduct this review. we will be working to provideadditional instructions of which we will include instructions on thenumber of invoices to be reviewed, which we think will beapproximately three per vendor. and there will be some state agencydiscretion around whether those are three in one month, three, oneper month for three months, one per quarter, and then what to do if therewill be major findings and the state agency certainly at your discretion canexpand the review beyond that amount. so i think that is pretty much all wehave for this afternoon and certainly

all the time we have. and so thank you very much, and ifyou all have questions, please feel free to reach out to your regionaloffice for this information and if the regional office needs additionalassistance they are always welcome to reach out to us at the national office. so thank you very much forbeing with us this afternoon. i hope everything goes wellduring your procurement reviews this coming school year. thank you and goodbye.