Rhode Island towns pool buying power

Town of Middleton, R.I. Vendor Area

Officials from three small Rhode Island municipalities, which share a Web-based application that automatically notifies vendors about competitive bid opportunities, hope the system could help them offer joint projects in the future.

Marc Agin, chief purchasing officer of Newport, which originally purchased the application, said the city and the towns of Portsmouth and Middletown – which are located on Aquidneck Island in Narrangansett Bay – could combine solicitations on similar items, such as police cruisers, or major projects to increase their buying power.

For example, if each municipality offered separate solicitations for its share of an islandwide road construction or paving project, three different vendors could win work on the project, he said. Instead, the system would allow them to jointly offer the bid and select one vendor in more quickly and efficiently, he added.

Agin said that hasn’t happened yet because of financial and governance issues that the municipalities must resolve, but it is one potential use of the system.

About a year ago, Newport purchased the NovusVENDOR application, which was developed by Novusolutions, and the city invited Middletown and Portsmouth to join six months later. In Newport, which has a population of 26,000, Agin said the system replaced a cumbersome process that included manually maintaining vendor records on a Microsoft Excel spreadsheet.

When city employees prepared and mailed out bid packages – sometimes 100 to 200 pages long – they were occasionally returned undeliverable because addresses were wrong or out of date, he said. The city does about 100 to 120 bids annually, while each town offers about 20 per year.

The automated system requires vendors to register through the secure Web site and update their accounts, which includes updating addresses and contacts and choosing commodities and services they are interested in. Novusolutions hosts the system, which cost Newport about $11,000, but the municipalities do not have to pay anything more. Agin said they would need to pay extra for additional customized functionality.

When a municipality offers a competitive solicitation, the system sends e-mails to interested vendors, who get a brief description and a link to see the bid specifications. If they want to pursue it, they simply print out the bid and mail in their proposals.

“Ninety-nine percent of the folks like it,” Agin said, referring to the vendors. “We’re kind of spoon feeding them.”

The municipal employees save time, and the system has spurred broader vendor participation. So far, 800 vendors have signed up, some from as far west as Texas and as far north as Canada, Agin said. He added the city also receives fewer complaints from vendors about not receiving notification about proposals.

There are now more bidders per opportunities, said Edward “Ned” Draper, director of Newport’s administrative services, and local vendors are taking notice.

“Just by virtue of outside players showing up, even if they don’t bid, our local competitors are aware somebody else is looking,” he said. “It tends to sharpen the pencil.”

David Faucher, Portsmouth’s director of finance, said the town usually had a pool of 60 vendors that normally bid on projects, but it can now send opportunities to 800 vendors. That has saved money on advertising about solicitations in newspapers.

The system, Faucher added, has created a more disciplined, efficient and standardized approach to bidding and has freed up his time since he performs multiple duties for his town.

Agin said he’s even created a bid library providing templates or boilerplates of previous bids, which he’s opened up to other municipalities. He said he would like to see other municipalities, schools and public-sector agencies join the system. He is also interested in eventually allowing vendors to send back electronic proposals rather than paper ones.

John Kercher, managing partner at Novusolutions, which primarily focuses on providing the government and education sectors with various automated applications, said the system is set up to accept electronic proposals from vendors, but the state needs to pass legislation to allow electronic signatures and change other processes.

He said the municipalities on Aquidneck Island are ahead of the curve because many municipalities nationwide still rely on paper.