CMO Procurement & Contract Administration 5 — Questions and Answers
Question 1: A vendor protests a solicitation on the grounds that the specifications were written to favor a specific brand. The municipality's FIRST step should be to:
- Proceed with award and address the protest after contract execution
- Suspend the procurement and conduct a formal review of the protest allegations (Correct answer)
- Dismiss the protest without investigation if award has not yet been made
- Immediately cancel the solicitation without review
Correct answer: Suspend the procurement and conduct a formal review of the protest allegations
Best practice and most procurement codes require suspending the process and formally reviewing protest allegations before proceeding to award.
Question 2: Which of the following BEST describes a 'cooperative purchasing agreement' between municipalities?
- A joint agreement where municipalities pool their purchasing volumes to obtain better pricing (Correct answer)
- An agreement that allows one municipality to use another's general fund
- A contract where a vendor provides services to multiple municipalities simultaneously without competition
- A shared-services agreement for administrative staff only
Correct answer: A joint agreement where municipalities pool their purchasing volumes to obtain better pricing
Cooperative purchasing agreements allow multiple government entities to combine buying power, resulting in volume discounts and reduced administrative duplication.
Question 3: A payment bond on a public construction project PRIMARILY protects:
- The municipality from contractor default on performance
- Subcontractors and suppliers who may not have lien rights on public property (Correct answer)
- The contractor from owner-caused delays
- The surety from contractor insolvency
Correct answer: Subcontractors and suppliers who may not have lien rights on public property
Because public property cannot be liened, a payment bond ensures that subcontractors and material suppliers get paid even if the prime contractor defaults.
Question 4: In a Request for Proposals (RFP), the 'evaluation criteria' section MUST be included because it:
- Sets the contract duration and renewal options
- Informs proposers how their submissions will be scored so they can compete fairly (Correct answer)
- Lists the insurance requirements for the contract
- Defines the payment schedule for the awarded contract
Correct answer: Informs proposers how their submissions will be scored so they can compete fairly
Publishing evaluation criteria gives proposers the information needed to craft competitive responses and ensures the government evaluates proposals consistently and transparently.
Question 5: A municipality's procurement policy requires a written determination of non-responsibility before rejecting a low bidder. This requirement PRIMARILY serves to:
- Speed up the award timeline
- Ensure due process and document the factual basis for the rejection (Correct answer)
- Allow the municipality to negotiate price with the second-low bidder
- Prevent the rejected bidder from re-bidding in the future
Correct answer: Ensure due process and document the factual basis for the rejection
A written non-responsibility determination protects due process rights, creates an auditable record, and gives the rejected bidder grounds for an appeal.
Question 6: Which of the following actions MOST clearly constitutes bid rigging?
- Two vendors submitting bids at the same dollar amount by coincidence
- Competing vendors agreeing in advance on who will win a bid and at what price (Correct answer)
- A vendor declining to bid on a solicitation outside its expertise
- A municipality clarifying specifications after bid opening
Correct answer: Competing vendors agreeing in advance on who will win a bid and at what price
Bid rigging — an antitrust violation — occurs when competitors collude to predetermine the winner and suppress genuine price competition.
Question 7: When a contract is terminated for the convenience of the municipality, the contractor is generally entitled to:
- Lost profits on the entire uncompleted contract balance
- Allowable costs incurred plus a reasonable profit on work performed (Correct answer)
- Nothing beyond the last approved progress payment
- Liquidated damages as specified in the contract
Correct answer: Allowable costs incurred plus a reasonable profit on work performed
A termination for convenience settlement covers the contractor's allowable, allocable costs and a fair profit on work done, but not anticipated profits on unperformed work.
CMO Procurement & Contract Administration 5
A vendor protests a solicitation on the grounds that the specifications were written to favor a specific brand.
The municipality's FIRST step should be to: