Monday, March 21, 2005

Businesses Oppose Lab Purchase Proposal

From Anonymous:

This is not directly related to the UC contract but is an example of LANL's over-reaction to DOE audits. More spineless behavior! Of course some of the statements from the vendors are bullshit. I have made diligent attempts to procure things locally. BUT, the vendors are often either greedy or not competetive. In one case, an Espanola vendor bid on desktop computers. The vendor was 30% higher than DELL and could really not provide any warranty support. However, the LANL statement that $398.5M of procurements are placed in Northern New Mexico is misleading. That figure includes the labor contracts of KSL, PTLA, Butler, etc.

Albuquerque Journal North
Monday, March 21, 2005

Businesses Oppose Lab Purchase Proposal

By Adam Rankin
Journal Staff Writer
Los Alamos National Laboratory's proposed new guidelines for buying from small businesses have riled some local business owners.

Betty Jacques with Franks Supply of Los Alamos said the guidelines propose having several businesses selected as contract suppliers compete over price for nearly every catalog order.

"It is going to be a popularity contest," she said. "Companies from Española are worried they are going to spend money to compete to win a contract then be guaranteed nothing."

In the past, procurement contracts have been exclusive to single supplier for certain items. Under the proposed guidelines, there would multiple suppliers competing on price each time the lab went out for a purchase. Critics contend the new rules favor bigger companies who can take more risks to get LANL's business.

Lab officials, for now, are delaying the release of procurement bid requests for small business contracts due to a technical problem. They are gathering more comments on the proposed guidelines that have upset at least a few local business owners.

"We are going to look at those comments and suggestions very carefully before our (request for proposals) are issued," LANL spokesman James Rickman said.

Rich Marquez, LANL's associate director of administration, said he is going to have LANL's Business Advisory Council— made up of state business leaders, including some voicing concerns— review the request for proposals before they are issued.

"We may not be able to accommodate all of their concerns, but at least we will have reviewed them carefully," he said.

A few northern New Mexico business leaders criticized LANL's proposed procurement guidelines at a hearing earlier this month over concerns the guidelines created too much financial risk for small regional businesses, with no guarantees the lab will actually buy anything from the businesses which meet LANL requirements and qualify to compete.

"There are a lot of things on that list that say, hey, if you are a small business you have no business bidding on those contracts— you will lose your shirt," said J. R. Trujillo, an Española City Councilor and owner of Quick Fix Home Improvement Center.

"They don't have to buy squat from you," Trujillo said. "Are businesses in Española asking for a handout? No way. Nobody is asking for them to spend more dollars than they have to spend ... we're asking for an opportunity for a level playing field (against larger businesses)."

Jay Gould, Northern New Mexico Suppliers Alliance president, has also spoken out against the proposed guidelines.

Marquez said LANL probably won't be able to return to exclusive contracts, because the laboratory has made a priority of creating increased flexibility within its buying program to ensure scientists and procurement officers get what they need in a timely way and at a competitive price.

"If there are a few places we can make concessions, I think we ought to do that" without compromising LANL's fiscal priorities, he said.

Rickman said LANL officials went out to regional business leaders for input.

"We heard people saying that they wanted the opportunity for more people to compete for these catalog contracts, so we reduced the size of the contracts which makes more of them and also came up with this idea for multiple awards for certain contracts," he said. "The object of this is to enhance the laboratory's business in northern New Mexico, particularly with small businesses."

He said LANL has received few complaints to date, but that most of the complaints the lab did receive were from larger firms, concerned the guidelines unfairly favored smaller businesses.

"Catalog" contract purchases— items bought as needed on a quick turnaround— comprise about $60 million of LANL's procurement, Rickman said. Overall, LANL spent about $398.5 million in northern New Mexico in 2004 out of nearly $1 billion in procurement spending.

Rickman said LANL is hoping to spend about 81 percent of its catalog contract purchases with state businesses and 74 percent of that on northern New Mexico businesses. He also said LANL officials plan to more accurately determine whether businesses qualify as northern New Mexican.

Another proposal is to establish procurement contracts for a base of two years, with possible one-year extensions up to a maximum term of seven years. Previously, contract terms were five year lengths.

Rickman said he expects about 30 requests for proposals to be issued in about a week resulting in procurement contracts for between 30 to 50 small businesses or more. Comments should be sent to LANL within the next week to be considered, Rickman said.

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