Hiring a Food Service Management Company (FSMC) - PowerPoint Presentation

Hiring a Food Service Management Company (FSMC) Geriann Headrick, Program SpecialistChild and Adult Nutrition Services – DOEDecember 2018 1

Terminology Agency – Governing body which has responsibility for administration of one or more entities, and has legal authority to operate Child Nutrition Programs.State Agency (SA) – South Dakota Department of Education – Child and Adult Nutrition Services (CANS)Request for Proposal (RFP) – Type of solicitation document used for the formal procurement method of competitive proposals.Food Service Management Company (FSMC) – A commercial enterprise or a nonprofit organization that enters into a contract with an Agency to manage any aspect of the Child Nutrition Programs. 2

Topics State Agencies role in the contracting processItems to considerFixed Price FSMC RFPTimelineAgencies completion of RFPEvaluation of FSMC Proposals by the AgencySA’s approval of FSMC ProposalRequirement to monitor the FSMC Contract 3

Responsibilities The SA administers the USDA Child Nutrition Programs in South DakotaThe Agency is responsible for Operating the Child Nutrition Programs in agreement with its annual application with the SA.The Agency is responsible for all FSMC contractual agreements. 4

State Agencies Role Oversight of Child Nutrition ProgramsProvide technical assistance to AgenciesRequired prototype Fixed Price RFPReview and approve all FSMC contracts and supporting documents PRIOR to contract executionAdministrative ReviewProcurement Review 5

How Does the Process Start? A FSMC has approached the Agency.The Agency has contact with another Agency that is contracting with a FSMC. 6

State Agency USDA Guidance Manual, “Contracting with FSMCs: Guidance for SFAshttps://www.fns.usda.gov/updated-guidance-contracting-food-service-managementList of FSMC’s operating in the State of SD 7

Team Decision Analyze current food service operationFinancial Factors:Current programs, feeding sites, participationFood costs, labor costs, total costsUS Foods (Commodities)Profit/loss statementOperational Factors: Facilities Equipment STAFF 8

Team Decision Visit Agencies contracting with different FSMCsFood Choices/Quality/AppearanceSanitationStaffingStudent AcceptabilityCost of Services 9

Agency Decides to Pursue FSMC Proposals 10

Procurement Agency must use competitive procurement procedures in compliance with Federal (2 CFR 200), State and local procurement regulations.Full and Open CompetitionAgency Consults with their legal authority throughout the process. 11

Obtaining the RFP Contact SA to request the required Fixed Price FSMC RFPAgencies are REQUIRED to use the State RFP prototype for hiring a FSMC. Agencies are not allowed to create their own.RFP is updated annually to reflect current USDA policy. Available November 1 12

Fixed Price FSMC Contract Fixed Price FSMC contracts in SDFSMC charges a set price per meal typeIncludes operational and administrative costs FoodLaborExpendable equipmentFSMC’s administrative costs and profit 13

Fixed Price FSMC Contract Ala Carte sales are converted to meal equivalents for billing purposesRFP/Contract allows for an annual economic cost adjustment provision tied to a public standard index 14

Fixed Price FSMC Contract One Year Contract – Effective Date: July 1 End Date: June 30Option for up to four annual renewalsTermination Clause for cause or convenience 15

Fixed Price FSMC Contract Contains provisions detailing the FSMC responsibilities in managing the Food Service program in accordance with Child Nutrition Regulations, the Agency - SA agreement, and the goals the Agency hopes to achieve.Identifies responsibilities of both the Agency and FSMC.16

Timeline November 1 – RFP availableDecember 1 – Deadline for requesting RFP prototype Start completing the information, it takes time.January 15 Submit completed RFP package to SA for approvalBe available to make modifications 17

Timeline March 1 – Due date for RFP public notification. Send notification to FSMCs operating in SD.60 calendar day – Solicitation period after notification made public.10-14 days after notification a pre-proposal meeting on site. 18

Timeline Agency establishes the due date/time for proposals to be received for the RFP.May 15 - Deadline for SA to receive RFP/Contract/required information. SA MUST approve the Contract before it can be signed and implemented.July 1 – Start of the new program year and the FSMC contract. 19

Agency Completes RFP The RFP details the Agencies current and anticipated foodservice needs:Programs agency currently participates inFeeding sites:Enrollment, Grade Levels, Kitchen TypesNumber of Serving PeriodsMeal TimesNumber of Operating daysPrograms planned in the future Material Change 20

Agency Completes RFP Foodservice BudgetLabor CostsFood CostsOther CostsRevenueUS Foods Entitlement/Actual UsageReimbursement Claims Current/Anticipated Paid Student/Adult Meal Prices and Ala Carte Prices Charge Policy 21

Agency Completes RFP Food Service StaffFSMC will have a Food Service DirectorFood Service Staff – can be either Agency staff or FSMC staffAgency is required to have a Contract Manager, or Food Service Director Must meet Professional Standards requirements. 22

Agency Completes RFP Current programWhat would you like to keep or changeAre there services, menu choices, or customer surveys the Agency is requesting?23

Agency RFP Development Agency may request a specified guaranteed year-end balance in the non-profit foodservice account.Replace or purchase new equipment24

Agency Completes RFP Proposal award criteria is specified in the RFP/Contract.Agency assigns points to each criteria.Price must be the highest scored criteria. 25

RFP Package Submitted to SA Entire RFP packet, including all exhibits and attachments, must be submitted to the SA for approval PRIOR to publishing in the newspaper.Notification must appear once and emailed to all FSMC contacts on the SA provided list. 26

Solicitation Period 60 calendar days from public notification date until due date for proposals.Pre-proposal on-site meetingSFA documents and responds to questions from FSMCs throughout the solicitation period. Share with all potential respondents. 27

Due Date for Proposals Proposals must be received by the date and time specified in the RFP.Proposals can be opened at that time, but no information is announced.28

Proposal Evaluation Committee Committee Members – Familiar with the goals of the agency and requirements of the RFP.Experience in the following is beneficial:School Food ServiceFinancial ManagementEvaluating Proposals 29

Proposal Evaluation Committee Reviews proposals on completenessScores each proposal independently without comparison to other proposals.Only scoring criteria listed in the RFP can be used. 30

Proposal Evaluation Committee Proposals failing to address all requirements of the RFP are considered unresponsive.Proposals containing services or items not requested in the RFP are considered overly responsive.31

Awarding the Contract Award made to the FSMC whose proposal is the most advantageous to the Agency.Cost has to be the primary factor.SA approval of RFP/Contract is required BEFORE the contract can be signed/implemented. 32

Contract July 1 – Start of the School Year (SY) and initial year of the FSMC Contract.Agency required to monitor contractOn-site visits to ensure compliance with program regulationsMonthly review of FSMC billingMonthly credit received for US FoodsEstablishment of Advisory Board 33

Specific Challenges Determining what public index to use and definingFixed Price Contract, II. General Terms and Conditions, C. FeesList what public index is to be used and where to find it.Bureau of Labor Statistics www.bls.gov/cpi 34

Specific Challenges 35

Specific Challenges 36

Specific Challenges Due date for proposals versus opening of proposals.Definition of “Other” in scoring matrix.Unpaid Balance Policy and the FSMC. 37

Questions? 38 This Photo by Unknown Author is licensed under CC BY-SA-NC

In Conclusion Involve various people at your agency throughout the entire process.Talk to other agencies that have gone through the process.Use your attorney.Start early!!!Contact CANS office if you have questions:605-773-3413doe.schoollunch@state.sd.us geriann.Headrick@state.sd.us or 605-773-4718 direct line 39

Resources www.fns.usda.gov7 CFR Part 210.16 Food Service Management CompaniesUSDA memo SP 05-2011, Crediting and Use of Donated Foods in Contracts with Food Service Management CompaniesContracting with Food Service Management Companies: Guidance for School Food AuthoritiesCANS officeOther Agencies 40

Training Confirmation Please send an email tocourtney.martin@state.sd.usTitled: Hiring a Food Service Management CompanyA certificate of completion will be emailed back to you. 41