The Federal Fiscal Control Board approved the Uniform Regulations for Purchases and Auctions of Goods, Works and Non-Professional Services of the General Services Administration (ASG), which centralizes all purchases by government entities and seeks to prevent irregularities and inefficiencies that have plagued Puerto Rico’s hiring system.
The announcement was made today at a virtual press conference where the executive director of the Federal Fiscal Control Board, Natalie Jaresko, participated together with the administrator of the ASG, Karla Mercado. The regulation would be filing today in the State Department, so it goes into effect 30 days after its filing, according to Mercado. Once it is filed, all purchases from the effective date must be governed in accordance with the processes.
This regulation – which is required by Law 73-2019 of the ASG for the Centralization of Procurement of the Government of Puerto Rico – was reviewed by the fiscal board in order to comply with best practices, the Certified Fiscal Plan and the fiscal responsibility required by the Puerto Rico Supervision, Administration and Economic Stability Act (Promesa, for its acronym in English).
Indeed, Mercado stressed that “this is not just another regulation”, as it is the instrument that will allow the treasury to generate significant savings and greater efficiency. To questions from a journalist about the savings expected with the promulgation of this regulation, Mercado responded: “We are talking about billions of dollars … Savings have already been achieved by various centralized categories that we are quantifying as $ 20 million annually” .
“Certainly the implementation of Law 73 and the purchasing regulations comes with an execution plan. First, we are focusing the entities that did not have an Auction Board -which made the awards by committees-, after this the entities that had a Auction Board will come and it is very important to emphasize that the ASG does not establish that the entities are going to buy rather, it regulates the process. So by giving it uniformity and increasing the volume in the centralized categories, savings are achieved ”, explained the also main government procurement official.
Mercado affirmed that the process of developing the new regulation, which took months to reach a consensus, had the participation of representatives of different industries such as the Industrial Association, the United Center for Retailers (CUD) and the Contractors Association, among others. . Prior to approval, he said, public hearings were held in order to guarantee transparency and equal opportunity for all sectors and providers of government goods and services.
“We do not want all this to remain a dead letter, we want to take it so that it is operationally viable and we call on all private sector organizations to participate in the processes, to be part of and also monitor the way from where you are. of how to do business with the government of Puerto Rico, “added Mercado.
Likewise, Mercado said that the planning process is essential. He added that many of the emergency purchases arise because there is no planning of what is acquired and an emergency arises because a certain agency – for example – did not have gauze at the time of purchase. “Well, how does a gauze emergency arise when we know that hospital entities buy them on a recurring basis? There has to be planning, that a contract is made in negotiation and in competitive processes to reduce bids individually and that they are reactionary, “he said.
For his part, Jaresko stressed that “this regulation is a great step forward for Puerto Rico,” since it allows the acquisition of goods and services efficiently and effectively at the best possible prices. “The bidding of goods and services, transparent contracting and defined controls are the guiding principle for the proper functioning of the procurement process, and that is what this new regulation allows,” added the executive director of the fiscal board.
In this sense, he stressed that the acquisition of goods and services is like the plumbing that hides behind the walls of a house: “it is essential for the lives of all residents, but above all it is noticeable only when it stops working, and when it doesn’t work, it’s dangerous ”.
Jaresko specified that the new regulation minimizes what qualifies as exceptional acquisition, allowing direct purchases of goods and services outside the normal acquisition processes; and establishes a defined process for exceptional purchases, including purchases during emergencies.
In addition, the regulation requires a new bidding process when no offers or proposals were received in the process of acquiring ordinary contracts for goods and services; establishes open-book tenders (also known as cost-plus contracts) to require suppliers to include all their costs, margins, and services to aid in transparency in decision-making; and stipulates the publication of all purchase orders, in addition to all contracts, following the same procedure.
Recognize work in consensus
Meanwhile, Carlos Rodríguez, president of the Industrial Association, recognized the work in consensus achieved by the ASG under the leadership of the lawyer Mercado in conjunction with the fiscal board. “We must also recognize the work team of our Puerto Rican industry committee that worked hand in hand both in the hearings and in the round tables to achieve a quality regulation that has been approved,” he added.
Rodríguez said that the Industrial Association, which represents manufacturing and other service sectors, understands that the adoption of this regulation is an extremely important step as part of the structural reforms that the government of Puerto Rico must carry out in order to be one more entity. efficient, effective and transparent.
“We contributed ideas so that this regulation would be one that stipulates economic development in Puerto Rico and promotes broad participation by the local goods and services industry in government purchasing processes. In the same way, we understand that this regulation provides an adequate basis for inspection ”, he concluded.