NATIONAL

COMMUNITY
DRIVEN
DEVELOPMENT
PROGRAM
(NCDDP)

Department of Social Welfare and Development

KALAHI-CIDSS
NATIONAL COMMUNITY DRIVEN DEVELOPMENT PROJECT
(NCDDP)

COMMUNITY BASED
PROCUREMENT
MANUAL
VOLUME ONE
(October 2014)

ii

PREFACE

TABLE OF CONTENTS
Preface............................................................................................................................
Acronyms and Abbreviations .......................................................................................

i
iv

CHAPTER ONE: GENERAL PROVISIONS FOR COMMUNITY BASED PROCUREMENT

1.1. Purpose .....................................................................................................................
1.2. Scope ........................................................................................................................
1.3. Coverage ..................................................................................................................
1.4. Application .................................................................................................................
1.5. Principles in Community Driven Procurement ...........................................................

1
2
2
3
3
3

CHAPTER TWO: PROCUREMENT ORGANIZATION AND CAPACITY BUILDING ......

2.1. Organizational Structure at the Community Level .....................................................
2.2. Barangay Sub-Project Management Committee .....................................................
2.3. Bids and Awards Committee ....................................................................................
2.4. Procurement Team ...................................................................................................
2.5. Technical Working Group..........................................................................................
2.6. Observers .................................................................................................................
2.7. Functions and Responsibilities .................................................................................
2.8. Other Procurement Stakeholders ..............................................................................
2.9. Capacity Building for Community Based Procurement Groups.................................

5
6
6
6
7
7
7
8
10
11

CHAPTER THREE: PROCUREMENT PLANNING FOR COMMUNITY BASED

PROCUREMENTS ...........................................................................................................
3.1. Community Empowerment Activity Cycle (CEAC) .....................................................
3.2. Procurement Planning .............................................................................................
3.3. Preparation of the Program of Works .......................................................................
3.4. Preparation of the Initial Community Procurement Plan ............................................
3.5. Finalization of the Community Procurement Plan .....................................................

13
14
14
15
17
22

CHAPTER FOUR: COMMUNITY BASED PROCUREMENT METHODS AND SUBPROJECTS .....................................................................................................................

4.1. Community Participation in Procurement .................................................................
4.2. Community Based Procurement Methods ................................................................
4.3. Thresholds for the Use of Community-Based Procurement Methods and
Prior Review Thresholds ..........................................................................................
4.4. Possible Types of Community Projects Requiring Procurement ...............................
CHAPTER FIVE: COMMUNITY BASED PROCUREMENT PROCEDURES .................... .
5.1. Community Shopping for Goods and Works ............................................................
5.2. Community Direct Contracting for Goods and Works ...............................................
5.3. Community Repeat Order for Goods ........................................................................
5.4. Small Value Procurement for Goods and Works ......................................................
5.5. Pakyaw Contracts ....................................................................................................
5.6. Community Bidding ..................................................................................................
5.7. Consultant Qualification Selection/Single Source Selection and
Individual Consultant Selection for Consulting Services ...........................................

23
24
24
25
26
30
31
39
46
48
51
54
76

CHAPTER SIX: CONTRACT IMPLEMENTATION FOR COMMUNITY BASED GOODS

AND SERVICES ............................................................................................................... 97
6.1. Warranty .................................................................................................................. 98
6.2. Amendment to Order ............................................................................................... 99

ii

6.3. Suspension of Delivery ............................................................................................ 101

6.4. Delays in Delivery and Liquidated Damages ............................................................ 102
6.5. Incidental Services ................................................................................................... 103
6.6. Spare Parts and Maintenance .................................................................................. 103
6.7. Prices....................................................................................................................... 104
6.8. Payments ................................................................................................................ 104
6.9. Subcontracts and Assignments ............................................................................... 104
6.10. Standards ............................................................................................................... 105
6.11. Inspection and Tests ................................................................................................ 105
6.12. Force Majeure .......................................................................................................... 105
6.13. Contract Termination ............................................................................................... 106
6.14. Blacklisting ............................................................................................................... 108
CHAPTER SEVEN: CONTRACT IMPLEMENTATION FOR COMMUNITY BASED
WORKS ... 109
7.1.Subcontracting ............................................................................................................ 110
7.2. Contractors Program of Works ................................................................................ 111
7.3. Inspection and Tests ................................................................................................ 111
7.4.Dayworks .................................................................................................................... 112
7.5. Measurement of Works .............................................................................................. 112
7.6. Contractors Obligations and Responsibilities .......................................................... 113
7.7.Contract Price and Payment ....................................................................................... 113
7.8. Variation Orders ....................................................................................................... 115
7.9. Suspension of Work ................................................................................................... 117
7.10. Contract Time Extension .......................................................................................... 118
7.11. Delays in Work Completion and Liquidated Damages .............................................. 120
7.12. Contract Termination ............................................................................................... 120
7.13. Contract Completion ................................................................................................ 122
7.14. Warranty and Defects Liability Period ...................................................................... 123
7.15. Settlement of Disputes ............................................................................................. 124
CHAPTER EIGHT: COMMUNITY BASED PROCUREMENT MONITORING ................... 125
8.1. Importance of Community Procurement Monitoring .................................................. 126
8.2. Community Procurement Compliance Monitoring ..................................................... 126
8.3. Project Billboard ........................................................................................................ 127
8.4. Community Procurement Performance Monitoring .................................................... 128
8.5. Integrated Procurement Compliance and Performance Monitoring Report ................ 129
8.6. Procurement Post Review Assessment .................................................................... 129
GLOSSARY OF TERMS .................................................................................................. 130
PERIOD OF ACTION ON PROCUREMENT ACTIVITIES ................................................ 139

iii

ACRONYMS, ABBREVIATIONS
ACT
BA
BAC
BDC
C/BSPMC
CBPM
CD
CDD
CEAC
CENRO
CFA
CFMS
CIO
COA
CPO
CPP
CSO
DSWD
DA
DENR
DEPED
DOH
DPWH
DTI
DV
ECPP
GOP
GPRA
IB
IPCPMR
IRR
ITB
KALAHI- CIDSS
KC-NCDDP
LCB
LCC
LCCQ
LCRB
LCRQ
LGC
LGU
MAO
ME
MENRO
MFA
MIAC
MIBF
MIT
NDRRMC
NFCC

Area Coordinating Team

Barangay Assembly
Bids and Awards Committee
Barangay Development Council
Community/Barangay Sub-Project Management Committee
Community Based Procurement Manual
Calendar Days
Community Driven Development
Community Empowerment Activity Cycle
Community Environment and Natural Resource Management Officer
Community Force Account
Community Financial Management System
Community Infrastructure Officer
Commission on Audit
Community Procurement Officer
Community Procurement Plan
Civil Society Organization
Department of Social Welfare and Development
Department of Agriculture
Department of Environment and Natural Resources
Department of Education
Department of Health
Department of Public Works and Highways
Department of Trade and Industry
Disbursement Vouchers
Emergency Community Procurement Plan
Government of the Philippines
Government Procurement Reform Act
Invitation to Bid
Integrated Procurement Compliance and Performance Monitoring
Report
Implementing Rules and Regulations
Instruction to Bidders
Kapit-bisig Laban sa Kahirapan-Comprehensive and Integrated Delivery
of Social Services
KALAHI-CIDDS National Community Driven Development Project
Lowest Calculated Bid
Local Counterpart Contribution
Lowest Calculated and Complying Quotation
Lowest Calculated and Responsive Bid
Lowest Calculated and Responsive Quotation
Local Government Code
Local Government Unit
Municipal Agricultural Officer
Municipal Engineer
Municipal Environmental and Natural Resource Office
Municipal Financial Analyst
Municipal Inter Agency Committee
Municipal Inter-Barangay Forum
Monitoring and Inspection Team
National Disaster Rick Reduction Management Council
Net Financial Contracting Capacity

iv

NOA
NOL
NPMO
NPMT
NRM
NRQ
NTP
OR
PCAB
PCMR
PDNA
Phil-GEPS
PIAC
PIT
PNS
PO
POW
PPMR
PPT
PS
PT
RCIS
RFQ
ROW
RPM
RPMO
RPMT
RPO
RTA
SEC
SOW
SPA
TA
TAF
TF
TWG
WB

Notice of Award
No Objection Letter
National Project Management Office
National Project Management Team
Natural Resources Management
Notice of Request for Quotation
Notice to Proceed
Official Receipt
Philippine Contractors Accreditation Board
Procurement Compliance Monitoring Report
Post-Disaster Needs Assessment
Philippine Government Electronic Procurement System
Provincial Inter Agency Committee
Project Implementation Team
Philippine National Standards
Purchase Order
Program of Works
Procurement Performance Monitoring Report
Project Preparation Team
Project Supervisor
Procurement Team
Regional Community Infrastructure Specialist
Request for Quotation
Right of Way
Regional Program Manager
Regional Program Management Office
Regional Program Management Team
Regional Procurement Officer
Resolution to Award
Securities and Exchange Commission
Scope of Work
Special Power of Attorney
Technical Assistance
Technical Assistance Fund
Technical Facilitator
Technical Working Group
World Bank

CHAPTER ONE: GENERAL PROVISIONS

FOR COMMUNITY BASED PROCUREMENT
1.1.
1.2.
1.3.
1.4.
1.5.

Purpose
Scope
Coverage
Application
Principles in Community Driven
Procurement

1.1.

Purpose

This Community Based Procurement Manual (CBPM) for the KALAHI-CIDSS1 National
Community Driven Development Project (KC-NCDDP) is developed for the purpose of setting
guidelines for community participation in procurement based on the experience gained from the
first KALAHI-CIDDS project. It aims to provide community based officials and volunteers
implementing planning and investment grants under the project with a clear and concise set of
procedures to follow in its procurement activities. These procedures incorporate the relevant
provisions of the Government Procurement Reform Act (RA 9184) and its implementing rules
and regulations, the Local Government Code (LGC), and the procurement guidelines of
international financing institutions involved in the project, among them, the Asian Development
Bank (ADB) and the World Bank (WB). It also discusses important issues that may confront
community based officials in the different stages of procurement.
The Government Procurement Reform Act (GPRA) states that for foreign funded procurements,
its implementing rules and regulations (IRR) shall apply, unless a treaty or international or
executive agreement expressly provides for the use of the procurement procedures and
guidelines of the foreign governments or international financing institutions. However, in case of
conflict between the terms of the treaty or international or executive agreement and this IRR,
the former shall prevail. (Section 4.2. IRR-A)
Community driven development (CDD) is an approach that gives control over planning decisions
and investment resources for development projects to community groups based on the
principles of local empowerment, participatory governance, demand-responsiveness,
administrative autonomy, greater downward accountability and enhanced local capacity.
Procurement is one of the most critical activities in community project planning and
implementation as it empowers communities to establish needs, identify activities to address
such needs, and to take control of decision making in the judicious use and disbursement of
limited resources. It can also help stir up the local economy through the purchase of goods and
services from local entrepreneurs and the employment of local labor. It is, therefore, important
to provide a standardized set of procurement procedures in accordance with the loan
agreements to prevent confusion and ensure transparency among community officials and other
stakeholders. Community based procurement provides equal opportunity for men and women
to take part in all procurement activities.
The CBPM is a harmonized version of the procurement and contract implementation procedures
under the GPRA as well as the ADB and WB procedures on community participation in
procurement based on the experience gained from the first KC project. This edition clarifies
many gray areas that were not discussed in the previous manual and includes strengthened
provisions on contract implementation and procurement monitoring.
1.2. Scope
The CBPM shall apply to all community based procurement activities under the KC-NCDDP
based on the approved Community Procurement Plan (CPP) regardless of source of funds. It
shall not cover the acquisition of right-of-way site or location for infrastructure projects, leasing
of government-owned facilities and those projects included in the negative list discussed in
Section 4.4 of this manual.

KALAHI-CIDSS stands for Kapit-Bisig Laban sa Kahirapan Comprehensive and Integrated Delivery of Social
Services.

1.3. Coverage
The procedures provided in this CBPM shall cover all procurements of goods and services,
infrastructure or works projects and consulting services under the Community Empowerment
Activity Cycle (CEAC) stages of social preparation; project identification, preparation, selection
and planning; and implementation of sub-projects.
1.4. Application
The procurement procedures provided in this manual shall apply to the following:
1. Goods and services This refers to all items, supplies, materials, and general support
services which may be needed in undertaking the project related activities or in the
operations of the Community/Barangay Sub-Project Management Committee
(C/BSPMC). This includes, among others, equipment (transport, production, post
production, processing and storage), furniture, office supplies, construction materials,
agricultural or aquacultural inputs, seedlings or trees, hand tools. It also refers to nonpersonal or contractual services such as fabrication, lease, repair and maintenance of
equipment, trucking, hauling, security, rental of venues and facilities, hiring of short term
resource persons or facilitators, catering services for workshops and trainings,
attendance to external trainings and seminars and other short term services not
considered as consulting services.
2. Works or Infrastructure Projects This refers to undertakings to construct, improve,
upgrade, rehabilitate, demolish, repair, restore, or maintain small scale infrastructure and
all types of physical works such as construction, improvement, upgrading of barangay
roads and bridges, buildings, classrooms, barangay health stations, day care centers,
communal irrigation, flood control and drainage, water supply, sanitation, sewerage,
solid waste, water shed protection and other natural resource management systems,
shore and slope protection, energy/power and electrification and other common service
facilities, as well as physical labor to complete such projects.
3. Consulting ServicesThis refers to services provided by external technical service
providers2 or experts that are beyond the capacity of the C/BSPMC or Local Government
Unit (LGU) staff to undertake such as but not limited to feasibility studies; engineering
and architectural design; construction supervision; capacity building; and, special
studies, among others.

1.5. Principles in Community Driven Procurement

Community driven procurement under the KC-NCDDP shall be governed by the following
principles:
1. Fairness (Fair dealing) - it should provide fair and equal opportunities to all competing
bidders ensuring fair grounds for competition where no single bidder influences the
outcome of the process. Competition should urge bidders to offer more beneficial terms
to the community. Service providers should be treated fairly and without unfair
discrimination, including protection of commercial confidentiality where required.
2. Effectiveness the processes must be simple and streamlined to encourage
communities to plan and implement sub-projects that will redound to their benefit rather
2Service

providers referred to in these guidelines pertain to suppliers, contractors and consultants.

than creating layers of bureaucratic red tape that will delay service delivery. Procurement
should also be carried out in the most cost effective manner as possible.
3. Economy it should ensure that communities obtain the optimal benefit from projects
through processes that promote value for money approaches. Thus, award of contracts
shall be based on the Lowest Calculated and Responsive Bid/Quotation for community
bidding and bids or quotations that are most advantageous to the community. The
communitys ownership of the project encourages its responsible use, extends the
project life, thereby maximizing its beneficial value to the community.
4. Transparency procurement policies and procedures should be clear and should be
open in its implementation. The community should be made aware of important
decisions ensuring that the rationale behind such decisions and actions are understood.
Financial management of project funds is open and shared with the entire community.
Toward this end, posting of contract award and implementation information including
payments to suppliers, contractors and local workers must be well disseminated. Bid
opportunities shall be published in regional or provincial newspapers (for Community
Bidding) and in conspicuous places within the Region, Province, Municipality or
Barangay, in television or radio stations or any other possible means, as applicable, for
all procurements. Other procurement related information shall be reported through the
conduct of barangay assemblies or the posting of such reports in the KC-NCDDP
designated billboards or bulletin boards within the barangay. The BAC shall also invite
observers to observe any or all stages of the procurement process. Finally, each
procurement transaction must be properly documented and such records must be
maintained and made available at the C/BSPMC office/s.
5. Accountability all roles and responsibilities as well as liabilities of community officials
directly or indirectly involved in the procurement and implementation of contracts and
private parties that deal with the community shall be made clear and legally identifiable.
When warranted by circumstances, they shall be investigated and held liable for any
unfavorable actions and decisions. Participating communities which violate the
prescribed procurement policies, methods and procedures are liable for sanctions and
will be penalized. Procurement that does not follow guidelines will be disallowed and
grant funds used will be returned to the KC-NCDDP. Depending on the degree of
violation, the sanctions can range from disallowance, suspension of further fund
releases, and withdrawal of the community project. If there are anomalous transactions,
persons responsible will be charged with civil and/or criminal cases. Blacklisted and
suspended suppliers and contractors by the KC-NCDDP and the Government of the
Philippines (GOP) shall not be allowed to participate in project related procurement.

CHAPTER TWO: PROCUREMENT

ORGANIZATION AND CAPACITY
BUILDING
2.1. Organizational Structure at the
Community Level
2.2. Barangay
Sub-Project
Management
Committee (C/BSPMC)
2.3. Bids and Awards Committee (BAC)
2.4. Procurement Team
2.5. Technical Working Group
2.6. Observers
2.7. Functions and Responsibilities
2.8. Other Procurement Stakeholders
2.9. Capacity Building for Community Based
Procurement Groups

2.1. Organizational Structure at the Community Level

Barangay Assembly

Barangay Development Council

Barangay
Representation
Team (BRT)

Community/Barangay
Sub-Project Management
Committee (C/BSPMC)

Project
Preparation Team
(PPT)

Audit and
Inventory Team
(AIT)

Bids and Awards

Committee (BAC)
Technical
Working Group

Barangay Treasurer
Secretary

Observers

Bookkeeper

Procurement Team
(PT)

Project Implementation
Team (PIT)

Operation and Maintenance

Team(OMT)

Monitoring and
Inspection Team (MIT)

Figure 1: Barangay Sub-Project Organization Structure

At the community level, the KC-NCDDP works with the Barangay Assembly (BA) in the planning
and implementation of community based projects. For procurement related activities, the
following are the important units involved:
2.2. Community/Barangay Sub-Project Management Committee (C/BSPMC)
The Community/Barangay Sub-Project Management Committee (C/BSPMC) provides overall
management of the community based sub-projects and oversees sub-project implementation,
monitoring, completion. The C/BSPMC serves as the community procuring entity (CPE), has
the authority to make decisions related to procurement and ensures the quality of the goods and
services based on the technical specifications. It is in charge of the Procurement Team (PT).
They make sure that the procurement processes used for sub-projects are in accordance with
this Community Based Procurement Manual (CBPM). They also verify that the award is made
using the criterion of Lowest Calculated and Responsive Bid/Quotation and makes sure that
transparency and fair competition is observed among qualified contractors and suppliers.
2.3. Bids and Awards Committee (BAC)
Each C/BSPMC establishes a single Bids and Awards Committee (BAC) for its procurement.
The C/BSPMC may use the existing BAC (from previous KALAHI CIDSS projects) or create a
new BAC with the following composition:
1. Barangay Treasurer
2. Chairperson of the Barangay Sub-Project Preparation Committee
3. One member to be elected by C/BSPMC Executive Committee3.
The BSPMC executive committee is composed of the BSPMC chairperson and heads of teams under the BSPMC
as shown in Figure 1.
3

The BAC members shall elect the BAC chairperson. The following officials are disqualified to sit
as member of the BAC: (a) elected barangay officials who are members of the BDC as the Local
Government Code (RA 7160) specifies that their principal function involve the monitoring and
evaluation of local programs and projects; and (b) the C/BSPMC Chairperson, as approving
authority for all transactions. The Barangay Treasurer is disqualified to act as BAC Chairperson
since he/she will certify to the fairness and soundness of the transactions.
The simple majority (two members) of the BAC members constitutes a quorum in all meetings
and deliberations. The Chairperson presides over the meetings. In his absence, any one of the
two members present may preside. All BAC decisions are embodied in resolutions or minutes
of meetings duly signed by at least a majority of the members.
2.4. Procurement Team
The Procurement Team (PT) is responsible for preparing the procurement requirements for the
sub-project and for providing support to the Bids and Awards Committee (BAC) in ensuring that
the appropriate procurement procedures are applied in accordance with this manual. It is in
charge of activities required to facilitate acquisition of all supplies, materials, equipment, labor
from suppliers and contractors for the sub-projects.
The Procurement Team shall be composed of at least three members who are elected by the
Barangay Assembly (BA) during the social preparation stage of the project cycle. In order to
qualify for selection, a PT member should have completed a minimum of elementary or grade
school studies. They should be able to read, write, perform the procurement functions and are
committed to performing the assigned tasks. Members who automatically meet the minimum
qualifications must also be able to comply with all the documentary and other requirements
specified in this manual and must be a person known for his/her integrity within the community.
2.5. Technical Working Group
The BAC shall form a Technical Working Group (TWG) with the assistance of the Area
Coordinating Team (ACT) to provide technical, financial or legal support in the procurement
process. The TWG shall be created based on the required expertise and nature of the
procurement. The TWG shall assist the BAC in bid evaluation and shall be composed of the
following:
1. Area Coordinator or Technical Facilitator
2. Municipal Engineer/Municipal Agricultural Officer/CENRO/MENRO (depending on the
type of contract)
3. Supervising Community Project Engineer/Leadman/Foreman (if municipal engineer is
not available)
4. Municipal Financial Analyst
5. Volunteer professionals in the community with expertise related to the sub-project (if
any)
2.6. Observers
To enhance the transparency of the procurement process, the BAC shall invite any of the
following to act as observers: the LGU Commission on Audit (COA) Auditor, Barangay Captain,
local government officials, Area Coordinator, Technical Facilitator, Regional Infrastructure
Engineer, Barangay Audit and Inventory Committee Head, or where available representatives
from Civil Society Organizations (CSOs). They shall sit as non-voting members and shall
observe any or all stages of the procurement process. Other interested parties are also
encouraged to observe as long as they have knowledge, experience or expertise in procurement

or in the subject matter of the contract to be bid and have no direct or indirect financial interest
in the contract to be bid. The mere non-attendance of observers does not invalidate the
proceedings.
The community through the Barangay Assembly or the municipality through the mayor may also
designate community observers composed of volunteers who are not involved in any of the
NCDDP related activities and whose function is to observe whether the procedures followed by
the C/BSPMC, BAC, PT and TWG are in accordance with those discussed in this manual. The
community observers shall be trained alongside the C/BSPMC, BAC and PT on procurement
procedures to carry out their responsibilities. The Special Participatory Audit Team (SPAT) is
an example of an innovative idea to mobilize community volunteers as observers by the
municipality of Ajuy, Iloilo under the KC project. Communities are encouraged to adapt similar
initiatives to mobilize community volunteers in observing procurement and other related
activities to ensure transparency in project implementation. Where such community observers
have been organized, they may provide their services or share their experience with other
communities within the vicinity or municipality.
2.7. Functions and Responsibilities
2.7.1. C/BSPMC
The Community/Barangay Sub-Project Management Committee (C/BSPMC) has the
following functions and responsibilities:
i. Acts for and in behalf of the barangay as Procuring Entity;
ii. Ensures that the procurement procedures and requirements are in accordance
with the CBPM;
iii. Acts on the recommendations of the BAC and approves or disapproves the award
of contracts and purchase orders;
iv. Reviews and signs Resolution to Award (RTA)
v. Issues Notice of Award (NOA) and Notice to Proceed (NTP)
vi. For contracts requiring prior review, requests for clearance from the ACT to sign
contracts and coordinates any assistance from the TWG relevant to the
procurement on hand;
vii. Imposes the necessary administrative sanctions on errant members of the PT and
BAC and bidders in accordance with appropriate rules and regulations.
2.7.2. Bids and Awards Committee
The Bids and Awards Committee (BAC) has the following functions and responsibilities:
i. Advertises and /or posts the invitation to bid;
ii. Conducts pre-procurement and pre-bid conferences;
iii. Determines eligibility of prospective bidders;
iv. Receives bids;
v. Conducts the evaluation of bids with assistance of the TWG;
vi. Undertakes the post-qualification proceedings;
vii. Recommends the award of contract to C/BSPMC Chairperson; and
viii. Performs such other related functions as may be necessary, including the creation
of Technical Working Group from a pool of technical, financial and/or legal experts
to assist in the procurement process
2.7.3. Procurement Team
The Procurement Team (PT) has the following functions and responsibilities:

i.

Acts as Secretariat and provides administrative support to the BAC (organize and
attend meetings, assist in the drafting of resolutions, minutes);
ii. Prepares and takes custody of procurement documents;
iii. Prepares and delivers invitation to bid and requests for quotation
iv. Prepares quotation forms and acts as canvassers by delivering quotation forms to
suppliers;
v. Prepares and finalizes the Community Procurement Plan (CPP) with the
assistance of BAC;
vi. Assists in the presentation of CPP during Barangay Assembly;
vii. Receives and records bids/quotations, quotations;
viii. Assists in updating the status of CPP;
ix. Prepares and delivers purchase orders and contract documents;
x. Performs such other related functions as may be necessary to assist in the
procurement process.
2.7.4. Technical Working Group
The Technical Working Group has the following functions and responsibilities:
i.

Provides assistance to the BAC in terms of the technical, legal and other aspects
of the procurement at hand;
ii. Assists the BAC in the conduct of eligibility screening, evaluation of bids, post
qualification and preparation of the accompanying reports for the C/BSPMC
consideration and approval;
iii. Assists the BAC and PT in drafting contracts and in preparing the resolution
recommending award, with regard to the technical aspect, if necessary;
iv. Performs such other functions as may be necessary
2.7.5. Observers
The Observers have the following functions and responsibilities:
i.

Observes and assesses the extent of compliance with the substantive and
procedural requirements of this manual;
ii. Where there are findings of substantive or procedural irregularities (red flags) in the
procurement at hand, bring this to the attention of the Technical Facilitator (TF)
who shall include the findings in the Procurement Compliance Monitoring Report to
be submitted to the Regional/National Office for appropriate action. The Observer
may request copies of any procurement related documents;
iii. Signs as witness in the Records of Bid Opening, Abstract of Bids, PostQualification Report and in the Resolution to Award.
2.7.6. Bidders
An eligible bidder shall be responsible for having:
i. Taken steps to carefully examine all of the bidding documents;
ii. Acknowledged all conditions, local or otherwise, affecting the implementation of the
contract;
iii. Made an estimate of the facilities available and necessary requirements for the
contract to be bid, if any; and
iv. Complied with his responsibilities as stipulated in the instruction to bidders and
in the condition of contracts and relevant project regulations that may affect
the contract in any way.

2.8. Other Procurement Stakeholders

In addition to the key procurement related personnel discussed above, there are other
stakeholder who are in one way or another involved in the community based procurement
process. These individuals and their functions and responsibilities include the following:
2.8.1. Community Level
2.8.1.1. C/BSPMC Bookkeeperresponsible for keeping records of procurement and
financial management transactions and documents for the sub-project from planning to
implementation
2.8.1.2. Monitoring and Inspection Team (MIT) responsible for signing the purchase
order, receiving and storing goods procured for the project, preparing stock cards or
records and turning over these items to the Project Implementation Team (PIT).
2.8.1.3. C/BSPMC Chairperson as head of the community procuring entity, he is
responsible for approving the Community Procurement Plan (CPP), contracts and
purchase orders, reviewing and signing the Resolution to Award (RTA), Notice of Award
(NOA), Notice to Proceed (NTP), request for clearance or No Objection Letters (NOL)
from Area Coordinator (AC),Regional Program Management Team (RPMT), National
Project Management Team (NPMT) and International Development Partners (such as
the WB, ADB, AECID, others) to purchase goods and works in accordance with the
specified prior review thresholds found in Chapter 4.3 prior to signing of purchase orders
and notices, among others.
2.8.1.4. Barangay Treasurer responsible for certifying to availability of funds and
preparation of disbursement vouchers and checks.
2.8.1.5. Community Facilitator responsible for providing guidance to the C/BSPMC
in the preparation of minutes of meetings ensuring that the contents are in order and
filed accordingly, monitoring red flag abnormalities in the procurement process,
conducting contract review ensuring the completeness of documents. The CF may also
assist the PTs during the first issuance of request for quotation or Instruction to Bidders
(ITB) and help organize pakyaw groups.
2.8.2. Municipal and Regional Level
2.8.2.1.Municipal Finance Analyst (MFA) responsible for keeping and maintaining
copies of procurement documents at Area Coordinating Team (ACT) Office, conducting
fiduciary review based on the provisions of the Community Financial Management
System and Community Based Procurement Manual.
2.8.2.2. Technical Facilitator (TF) together with the municipal engineer, provides
technical support and training on procurement and project implementation and is
responsible for assisting the community in the preparation of the CPP, attending the prebid conference and the bid opening as a member of the TWG, providing technical
support during bid evaluation and recommending action to be taken when there are
findings on red flags and abnormalities

10

2.8.2.3. Area Coordinator (AC) responsible for issuing clearance for the procurement
of goods within the limit of his approving authority and endorsing the request for NOL to
RPMO, NPMO, ADB/WB, attending the pre-bid conference and the bid opening as
observer, and providing the appropriate action on findings regarding red flags and
abnormalities.
2.8.2.4. Regional Community Infrastructure Specialist (RCIS) Assists the Regional
Procurement Officer (RPO) and Community Procurement Officers (CPO) in providing
technical assistance to the ACTs/MCTs through but not limited to on-the job-training and
coaching, attending the pre-bid conference and bid opening as observer and providing
inputs on the preparation of technical specifications based on the program of works
(POW) and plans, consolidating all action taken regarding findings of red flags and
abnormalities on procurement, and in ensuring that subproject implementation and
procurement activities are coordinated.
2.8.2.5. Regional Program Manager (RPM) responsible for providing action regarding
red flags and abnormalities not resolved by the ACT, issuing clearance for direct
contracting and appropriate actions for requests of No Objection Letters for
Variation/Change Orders and procurement actions in accordance with the specified prior
review thresholds found in Chapter 4.3.
2.8.2.6. Regional Procurement Officer (RPO) responsible in overseeing the overall
procurement at the RPMO and ACTs in accordance with the NCDDP procurement
guidelines. The RPO provides technical assistance to the CPOs in (i) training ACTs,
LGUs, community volunteers on community based procurement processes; (ii) providing
Technical Assistance (TA) to Sub-Regional Program Management Teams (SRPMT),
ACTs and LGUs in setting-up systems and processes for community-based procurement
management and fiduciary control; (iii) directly exercising Quality Assurance (QA) and
Quality Control (QC) responsibilities over community procurement actions and activities;
and (iv) coordinating procurement actions required from the National Project
Management Office (NPMO) and providing consolidated procurement reports.
2.8.2.7. Community Procurement Officer (CPO) acts as the focal person for
procurement technical assistance and monitoring at the Sub-Regional Program
Management Office SRPMO), responsible for ensuring that the implementation of
community procurement systems in the region is compliant with the CBPM.
2.8.2.8. Community Infrastructure Officer (CIO) - acts as focal person for
infrastructure at the Sub-Regional Program Management Office (SRPMO) office per
region, responsible for reviewing first time works submitted by the municipalities and
those requiring procurement action from the ACTs, developing standards, mechanisms
and tools to improve the project implementing capability of project field engineers and
communities.
2.9. Capacity Building for Community Based Procurement Groups
Capacity building refers to the development of knowledge, skills and attitudes among community
volunteers involved in the planning, management and implementation of the community subproject including those involved in procurement related activities. Upon selection and
appointment as representatives of community based procurement groups discussed above, the
members of the C/BSPMC, BAC, and PT undergo capacity building activities to perform their
tasks more effectively. In addition, the C/BSPMC Chairperson, Bookkeeper, Storekeeper, and
Barangay Treasurer also attend the procurement training. The general scope of the capacity
building activities for community procurement personnel include the following:

11

2.9.1. General Orientation on Community Based Procurement

At the social preparation stage, the community is briefed on the KC-NCDDP through an
orientation workshop. The C/BSPMC, BAC and PT members are required to undergo an
orientation on the community based procurement process particularly on their individual
roles, functions, responsibilities and expectations. The orientation shall explain the
requirements for various stages of procurement to determine the level of commitment and
specific training needs of each procurement group member.
2.9.2. Skills Training
At the project identification, selection and planning stage, the procurement group members
are exposed to the key processes and tools to identify, select, and design appropriate
solutions to address community problems and are trained on the salient provisions of the
CBPM. This is to enable members to plan and package community procurement
requirements based on the identified community proposals for sub-projects proposed for
KC-NCDDP funding. At the end of the training, procurement group members are expected
to prepare the Community Procurement Plan (CPP) based on inputs from the feasibility
study, project technical design, program of works and estimated budgets for contracts.
2.9.3. Job Coaching and Mentoring
In the course of sub-project implementation and the conduct of actual procurement, the
specific technical assistance requirements of the procurement groups are identified and
where needed, practical on-the job training, job coaching and mentoring are provided to help
them carry out their tasks. During this period, procurement team members are advised on
how to resolve issues and challenges faced by the procurement at hand. Job coaching is
generally provided during the updating and finalization of the CPP, the preparation of bidding
documents, evaluation of bids, postqualification. The Technical Facilitator (TF) provides
technical assistance to the community volunteers relative to matters relating to procurement
and contract management with assistance from the Community Procurement Officer (CPO)
and the Regional Community Infrastructure Specialist (RCIS) who also provides coaching
and on-the-job training.

12

CHAPTER THREE: PROCUREMENT

PLANNING FOR COMMUNITY BASED
PROCUREMENTS
3.1. Community Empowerment Activity
Cycle (CEAC)
3.2. Procurement Planning
3.3. Preparation of the Program of Works
3.4. Preparation of the Initial Community
Procurement Plan
3.5. Finalization of the Community
Procurement Plan

13

3.1.

Community Empowerment Activity Cycle (CEAC)

It is important to understand the Community Empowerment Activity Cycle (CEAC) and its role
in the community development process in order to better situate the procurement planning
process for community based procurements. The CEAC has four major stages: social
preparation; project identification, selection and planning; project approval and project
implementation. Figure 2 shows where the procurement related activities occur under this
process.
Figure 2. Procurement Related Activities under the CEAC Process

Transition

CPP
Implemen
tation
Conduct of
Actual
Procurement

Finalization of
CPP,
Technical
Specs, TOR,
POW

Implementation
of SP & O&M
Plan & M&E
Stage

Project Approval
Stage

COMMUNITY
EMPOWERMENT
ACTIVITY CYCLE

Social
Preparation
Stage

Project
Identification ,
Selection and
Planning Stage

Organization
of BSPMC,
PT and BAC

Training of
Procurement
Volunteers
Preparation
of Initial CPP

It is at the social preparation stage where the C/BSPMC, PPT and BAC are organized. At the
project identification, selection and planning stage, the procurement related community
volunteers begin their training on the CBPM and conduct preliminary planning related
procurement activities. At the project approval stage, the Barangay Sub-Project Preparation
Team (BSPPT) completes the detailed project proposal and budget, technical specifications,
drawings and bill of materials (for infra community projects). After project approval, the cycle
moves on to the implementation of sub-projects where the most important procurement activities
take place.
3.2. Procurement Planning
Procurement planning is important in community based projects as it enables the C/BSPMC to
effectively manage and track procurement activities to ensure achievement of overall project
goals and objectives. It involves identifying the sub-project procurement requirements, writing
the technical specifications, determining the approved estimated budget, the schedule of
milestone activities, and determining the method of procurement to be used.

14

Procurement planning begins during the Project Development Workshop and the training of
community volunteers where the sub-project requirements such as the conduct of feasibility
study and the preparation of the program of work (POW) are undertaken. The Community
Procurement Plan (CPP) is prepared simultaneously and in close coordination with the POW.
Figure 3 provides an overview of the procurement planning process for community based subprojects.
Figure 3. Community Procurement Planning Process

Project Identification,
Selection and Planning

Preparation of
Program of
Works

Preparation of
Initial CPP

Project Approval

Sub-Project Implementation

3.3.

Preparation of Technical
Specifications
Terms of Reference
Final Program of Work
Items to be Procured
Number of Packages
Procurement Methods
Estimated Costs and Schedule of
Funds Release
Proposed Implementation
Schedule

Finalization of
CPP

Conduct of Actual
Procurement

Preparation of the Program of Works

The program of work (POW) provides detailed information on how the sub-project is to be
implemented and includes among others the following: detailed estimates, bill of materials,
construction schedule, manpower and equipment requirements, construction method, initial
inventory of contractors and suppliers, local counterpart contribution plan, other requirements
specific to the project at hand. It is based on a feasibility study to determine technical viability of
the project and its conformance to land use and zoning guidelines and environmental and social
safeguards prescribed by applicable laws. During the preparation of the POW, project
preparation team (PPT) to identify items to be procured, quantities, estimated costs, market
availability, delivery and implementation schedules which serve as inputs to the Community
Procurement Plan (CPP). An important consideration in the preparation of the POW is the
preparation of technical and design specifications, scope of work and terms of reference. Other
activities that are conducted simultaneous with the preparation of the POW are discussed in the
next section on the preparation of the Community Procurement Plan.
3.3.1. Technical Specifications, Scope of Work and Terms of Reference
In the planning process for sub-projects, the initial Technical Specifications (for Procurement
of Goods) and Scope of Works (for Infrastructure Projects) are prepared and finalized to
consider inputs from the community and other stakeholders as well as project requirements.

15

For goods, the term technical specifications refer to the physical description of the goods
or services, as well as the requirements of the community in terms of the functional,
performance, environmental interface and design standard requirements to be met by the
goods to be manufactured or supplied, or the services to be rendered. The technical
specifications must include the testing parameters for goods, when such testing is required
in the contract.
i.

Functional description is the description of the functions for which the goods are
to be utilized, for example, in the case of water pumps this may include pipe size,
materials (stainless steel, galvanized or cast iron, etc.), length, water demand
volume, method of displacement.

ii. Performance description refers to the manner in which goods are required to perform
the functions expected of them, for example, in the case of water pumps, this may
include horsepower or pressure capacity, flow rate, outlet pressure or inlet suction of
head (feet or meters).
iii. Environmental interface refers to the environment in which the required functions
are performed at the desired level, for example in the case of water pumps, kinds
and types of pump priming (centrifugal, twin screw, progressive cavity, electric
submersible, buffer tank) .
iv. Design refers to the technical design or drawing of the goods being procured. A
Design standard is particularly useful in cases where the goods procured are
specially manufactured for the community.
In determining the technical specifications of the goods it will procure, the community must
consider the objectives of the project or the procurement at hand, and identify the standards
that should be met by the goods in terms of function, performance, environmental interface
and/or design. In-house experts who are part of the TWG may be tapped to provide technical
advice in the preparation of technical specifications.
As a general rule, Philippine national standards (PNS), as specified by the Bureau of Product
Standards (BPS), shall be used in the preparation of technical specifications. This is to
ensure that the goods to be procured have passed the quality, safety, reliability, testing and
certification requirements specified for such products. Community planners must therefore
include the appropriate PS Mark, where applicable, in the technical specifications of goods
to be procured. The PS Mark reveals a manufacturers compliance to the requirements of a
Philippine National Standard (PNS). The BPS authorizes a manufacturer to affix the PS
mark on its product or its products packaging material, to let the buying public know that the
marketed product has successfully passed Department of Trade and Industry (DTI)
requirements.
It is important to note that the use of brand names is prohibited. This limits competition,
fairness and the provision of other alternatives that may be of better quality and price.
Specifications for the procurement of goods shall be based on relevant characteristics and/or
performance requirements. Hence, a generic description of the product or service shall be
used.
For works, the technical designs and specifications to be used must be in accordance with
relevant national, municipal and local design codes and standards applicable to the project.
Construction supervision, quality control, contract management, completion inspection,
acceptance, operation and maintenance procedures shall be in accordance with the
requirements of the projects.

16

Most technical plans and specifications for KC-NCDDP sub-projects were adopted from the
standard plans of partner agencies implementing or mandated to perform such
programs/services. This includes the Barangay Health Station (BHS) from the Department
of Health (DOH), school buildings from the Department of Education (DepEd) and structures,
sections and profiles of rural roads and bridges from the Department of Public Works and
Highways (DPWH). These specification were modified to suit the local conditions and
requirement of the project.
In setting the standards and technical specifications for works, the following should be
considered:
i.

Standards and technical specifications quoted in the bidding documents should

promote the broadest possible competition, while assuring the critical
performance or other requirements for the works under procurement;

ii. As far as possible, the community should specify prevailing local standards for
rural infrastructure prescribed by local government units with which the equipment
or materials or workmanship should comply.
The PPT may also refer to the standards developed in the first Kalahi CIDSS project.
For short term services or consulting services, the Terms of Reference for the service
required should specify the type of required expertise, qualifications, scope of work,
expected output or deliverable and schedule and duration of the engagement.
3.4.

Preparation of the Initial Community Procurement Plan

Upon completion of the program of work, community based procurement planning commences
through the preparation of the initial Community Procurement Plan (CPP). The initial CPP
summarizes the project requirements based on identified needs and available alternative
solutions for the purpose of procurement. Proper planning ensures that only the appropriate
goods and infrastructure projects have been included in the approved CPP. At this stage, the
project preparation team (PPT) is responsible in the preparation of the initial procurement plan.
This is done through the identification of required materials and work items based on the detailed
estimates, bill of materials, proposed construction method and work schedule. This information
(CBPM Form A-1) will assist in the determination of the appropriate number of packages and
procurement methods to be used for the proposed sub-project. Among the many considerations
in the preparation of the CCP are the following:
3.4.1. Market Survey for Goods, Works and Consulting Services
After the review of the items to be procured, an assessment of the resources within the
barangay or municipality should be conducted to find out which items are available in the
local market. For goods, the PPT can visit the municipalitys commercial center to check for
possible suppliers and prevailing prices. The survey should also check the availability of
goods, equipment and construction materials with the appropriate PS mark that meet the
required technical specifications. Please refer to CBPM Form A-3 for goods and services
and Form A-4 for works.
If there are no available suppliers within the municipality, the PPT may inquire from other
possible sources in the area near the municipality or the province. They can also refer to
the ACT (Area Coordinating Team) and RPMT (Regional Program Management Team)
inventory of resource institutions, technical assistance (TA) providers and suppliers for a

17

possible list of suppliers and the prevailing prices. The data can be used in the preparation
of the project budget and the selection procurement methods.
For works, the PPT can conduct an inventory of possible contractors and construction
materials suppliers as well as skills of construction workers available in the community,
municipality or province. The availability and number of skilled and unskilled construction
workers in the community can help determine the types of work that can be done through
pakyaw contracts.
For consulting services, the Technical Facilitator (TF) shall conduct an inventory of potential
service providers (individuals or firms) within the municipality or the province. The list shall
be classified according to the area of expertise (e.g. surveying, engineering design
construction supervision, among others, and/or its combination of services). This shall be
supported by company profile for firms, information sheet or curriculum vitae for individual
firms, including track record or work experiences which shall be duly validated. The TF shall
also conduct research on the prevailing professional fees for the required service in
coordination with professional associations (e.g. Philippine Institute of Civil Engineers
(PICE) in the municipality, province or region. The list of potential consultants shall be
consolidated at the RPMO and shall serve as a data base for service providers in the area.
Service providers who are personnel of construction firms interested in bidding or offering
quotations for community sub-projects shall not be engaged in the preparation of detailed
designs or cost estimates to avoid conflict of interest during the procurement process. The
list of service providers shall be made available to communities or municipalities requiring
technical assistance.
3.4.2. Preparation of Procurement Packages
A procurement package is a group of similar goods, works or services that can be
purchased from one supplier, or work items that can be performed or implemented by a
single contractor. There are generally two forms of procurement packages: (a) grouping of
requirements into a category (goods, works or services) for the purpose of procuring them
under one contract; (b) grouping of several procurement categories (e.g. supply and install
contracts) when this is considered most practical.
3.4.2.1. Examples of Procurement Packages
As a general rule, goods, supplies or construction and other types of similar materials
can be grouped and purchased from possible suppliers in the locality through the
inventory of suppliers obtained during the market survey. General works or specific items
of work can be performed or implemented by a single contractor or labor requirements
can be done through pakyaw.
Case 1:Grouping of Requirements in a Category (Goods, Works, Services)
Under a Single Contract or Several Contracts
Example: For the following list of construction materials, depending on the availability
of suppliers in the locality, this can be grouped or package into only one, or more
procurement packages (where suppliers can supply all the materials needed).
Particulars
Selected Filling Materials
Aggregate Base Coarse
Sand
Boulders
Portland Cement

Quantity
50
40
30
20
100

Unit
cubic meter
cubic meter
cubic meter
cubic meter
bags

18

16 mm diameter RSB x 6M
10 mm diameter RSB x 6M
2"x3"x10' Coco Lumber
1/4" thick Ordinary Plywood
3 inches CWN

110
150
500
12
15

pieces
pieces
board foot
pieces
kilos

Possible Packaging:
Package 1: (for similar or related types of materials such as aggregates available
through a local gravel and sand supplier)
Selected Filling Materials
Aggregate Base Coarse
Sand
Boulders

50
40
30
20

cubic meter
cubic meter
cubic meter
cubic meter

Package 2: (for different types of materials available from one supplier)

Portland Cement
16 mm diameter RSB x 6M
10 mm diameter RSB x 6M
1/4" thick Ordinary Plywood
3 inches CWN

100
110
150
12
15

bags
pieces
pieces
pieces
kilos

Package 3: (for one material available from only one supplier)

2"x3"x10' Coco Lumber

500

Bd. Ft.

The number of procurement packages may be determined by the number of

available suppliers in the locality. Contract packaging should be applied to facilitate
the procurement of goods. The Procurement Team is advised that contract splitting
is not allowed. Under no circumstances should the community combine items into
one package to favor only one supplier.
Case 2:For Works, grouping of Requirements into Items of Work that can be
Done Through Community Bidding or Pakyaw Contracts
Example: For a road project with common work items such as: Item 100 (Clearing
and Grubbing), Item 105 (Sub-grade Preparation), Item 200 (Aggregate Sub-Base
Coarse), Item 201 (Aggregate Base Coarse), Item 311 (Portland Cement Concrete
Pavement), Item 500 (Reinforced Concrete Pipe Culvert), Item 505 (Grouted
Riprap) packaging can be as follows:
Possible Packaging
Option 1: (one package since all items can be undertaken by one contractor)
Item 105
Item 200
Item 201
Item 311
Item 500
Item 505

Sub-grade Preparation
Aggregate Sub-Base
Aggregate Base Coarse
300 Linear Meter Item 311 (PCCP)
RCPC (0.61M diameter)
Grouted Riprap

19

Option 2: (two packages since some items can be done by one contractor and
others through pakyaw contracts)
Package 1: (this can be done through Community Bidding or Shopping by one
contractor depending on the package threshold since the items of work are
mechanized)
Item 105
Item 200
Item 201

Sub-grade Preparation
Aggregate Sub-Base
Aggregate Base Coarse

Package 2: or more (this can be done through Pakyaw Contracts since materials
and labor are available in the community by one or two pakyaw groups)
Item 311
Item 500
Item 505

300 Linear Meter (PCCP)

RCPC (0.61M diameter)
Grouted Riprap

In this case, the use of two procurement methods is not considered contract splitting
since the decision was based on the availability of local materials and the capacity
of local laborers to implement the project. Moreover, majority of the community can
participate in the implementation and procurement process thus generating
employment for local labor.
Case 3: Grouping of Several Procurement Categories When this is Considered
Most Practical
Example: For a Level I Water Supply system that involves deep well drilling (works),
supply of submersible pump and motor (goods), supply of concrete water tank (works),
construction of pump house (works) packaging can be as follows:
Particulars
Deep Well Drilling and installation of
pipe casing
Supply of Submersible Pump and
Motor
Supply of concrete water tank
Construction of pump house

Quantity

Unit

400

feet

1
1
1

unit
unit
unit

Option 1: (one package since all items can be undertaken by one contractor)
Option2: (two or more packages since some items can be done by one or more
contractors or through pakyaw contracts and equipment can be provided by a
supplier)
Package 1: (this can be done through Community Bidding or Shopping by a drilling
contractor depending on the package threshold since the items of work are
mechanized)
Particulars
Deep Well Drilling and installation of
pipe casing

Quantity

Unit

400

feet

20

Package 2: (this can be done through Community Bidding or Shopping by an

equipment supplier depending on the package threshold since the items of work
are mechanized)
Particulars
Supply of Submersible Pump and
Motor

Quantity

Unit
unit

Package 3: or more (this can be done through Pakyaw Contracts since materials
and labor are available in the community by one or two pakyaw groups)
Particulars
Supply of concrete water tank
Construction of pump house

Quantity
1
1

Unit
unit
unit

The above examples are only a few of the options available to the Procurement
Team in the preparation of the CPP. The Procurement Team should also consider
the approved procurement thresholds, and schedules for the release of grant funds
and project implementation in the preparation of planned procurement packages.
3.4.2.2. Splitting of Contracts
The project does not allow splitting of goods and items of works for the purpose of
avoiding the approved procurement thresholds and prior review requirements. Splitting
is defined as the act of dividing or breaking up contracts into smaller quantities and
amounts, or dividing contract implementation into sub-contracts in order to evade or
circumvent the procurement regulations specially the necessity for public bidding and
the requirements for alternative methods of procurement. Contract splitting may occur if
the procurement requirements are divided into several contract packages using
shopping or other alternative methods of procurement when it is clearly more efficient to
use Community Bidding in order to avoid the No-Objection-Letter (NOL) requirement
from the National Project Management Office (NPMO) or the funding donors (World
Bank, ADB, others) or to favor certain suppliers or contractors. Members of the
C/BSPMC, the Procurement Team or colluding bidders, who are found guilty of contract
splitting, shall be held liable and appropriate sanctions shall be imposed that may include
disallowance of fund grants, suspension of fund releases or withdrawal of the community
sub-project notwithstanding the filing of criminal or civil cases in accordance with the
provisions of the Anti-Graft and Corrupt Practices Act (RA 3019).
3.4.3. Identification of Appropriate Procurement Methods
Upon determination of the procurement packages, the appropriate methods of procurement
need to be identified. This can also been done simultaneously with the preparation of the
procurement packages and the preparation of the project budget. The detailed discussion
on the different modes of community based procurement is found in Chapter Four.
3.4.4. Estimated Costs and Schedules of Fund Release
Once the items to be procured and the packages have been determined, the unit cost per
item of materials or work can be provided based on the survey of prevailing market prices
in order to arrive at the cost per package and total project cost. The cost per package can
also provide information on applicable procurement methods to be used and should be
identified accordingly. The total project cost and the cost for each package will be the basis
for determining the amount and percent of grant funds that will be requested for release for
the project. The normal allocation of tranches for community based sub-projects is as

21

follows: 50% for the first release; 40% for the second release and 10% for the final release.
Communities may request for a different schedule of fund releases depending on project
need. For community projects requiring larger initial investments, as required in the subproject schedule, the community may request an allocation of 80% under the open tranche
for the first release, 10% for the second and final release.4 Another consideration in the
preparation of procurement packages and estimated costs is the availability of the local
counterpart contribution (LCC). Some communities will be able to provide funds coming
either from the municipality or the community itself to augment and support sub-project
costs. This should be clearly indicated in the designated columns for the schedule of LCC
release. The schedule for the release of both grant and LCC funds should also be taken into
account when the estimated costs and procurement packages are prepared.
Other considerations in determining the estimated project cost should include the following:
cost or market price of the goods or works itself, freight, insurance as may be applicable and
other incidental expenses, quantities, supply of spare parts and/or maintenance services
(for equipment), applicable taxes, cost of securing all types of securities other than cash,
among others.
3.4.5. Project Implementation Schedule
The project implementation schedule is a major consideration in preparing the CPP as it
serves as a guide in determining the applicable tranche to be requested from grant funds
and from local counterpart contribution. Since most sub-projects are expected to be
completed within a period of 2-6 months, realistic projections have to be kept in mind in
preparing the procurement packages and time schedules. Weighted percentage of possible
work items to be completed per month has to be reflected in the Gantt chart to determine
the required physical accomplishments needed in the requests for succeeding tranches. It
is important for community planners and the PT to determine the activities and
corresponding package/s needed to provide significant accomplishment in the first tranche
as the minimum requirement for the second tranche is 30% of sub-project physical
accomplishment. The total amount for funding of contract packages should be consistent
with the implementation schedule.
3.5. Finalization of the Community Procurement Plan
After the initial CPP is prepared, these are presented to the barangay assembly and the
Technical Working Group for final review. Suggestions on possible suppliers and contractors,
improvements on project design and technical requirements, commitments on local counterpart
funds are obtained and issues related to the project are resolved during this period. The CPP is
then revised, updated and finalized and forms part of the documents attached to the
communitys final community project proposal for submission to the municipal inter-barangay
forum (MIBF). The final CCP will be used as basis for the preparation of cash flow requirements,
release of funds and project implementation.

For emergency procurement in SPs due to disaster/calamity sub-projects, the first tranche may be up to 90%.

22

CHAPTER FOUR: COMMUNITY BASED

PROCUREMENT METHODS AND SUBPROJECTS
4.1. Community Participation in
Procurement
4.2. Community Based Procurement
Methods
4.3. Thresholds for the Use of CommunityBased Procurement Methods and Prior
Review Requirements
4.4. Possible Types of Community Projects
Requiring Procurement

23

4.1. Community Participation in Procurement

The KC-NCDDP employs two project implementation models. These models vary depending on
the availability of local suppliers, contractors and labor force as well as the capacity of C/BSPMC
to manage and supervise the work or contract at hand. If the community does not have the
requisite technical staff and workers to undertake the required tasks, it would be more
economical if the project were executed by contract either through community bidding, shopping
or direct contracting with a qualified contractor or supplier. However, if the community has the
technical personnel and laborers who are capable and competent enough to undertake the
design of the project as well as implement the project, then the community can administer or
execute the project by force account or through pakyaw contracts.
The first model, implementation through contracts, involves hiring one or more contractors or
suppliers to provide the requisite materials, equipment and labor to complete the work
depending on the availability and capacity of the community to manage and supervise these
works. This may be done through community bidding, shopping or direct contracting and follows
a uniform set of conditions and procedures discussed in this manual.
The second model, implementation by administration or force account, refers to the
community itself executing the work since it has the materials, equipment, labor and capacity to
perform the work. Sub-projects may be undertaken by administration where there is conclusive
evidence that greater economy and efficiency would be achieved through this arrangement. In
cases where there is sufficient labor (skilled and unskilled) to undertake all or portions of the
work, this can be done through pakyaw contracts.
The decision to complete the project through one or a combination of these implementation
models is done at the planning and procurement packaging stages of the CPP.
Community participation in procurement refers to the activities that the community undertakes
to procure project related requirements through one or a combination of the modes of
implementation, including the disbursement of grant funds and local counterpart contribution,
preparation of monitoring reports and full reporting of activities to the community. In the previous
manual, this was referred to as community force account (CFA).
For purposes of this manual and to clarify the terminologies used in community based
procurement, this and other procurement related activities are now referred to as community
participation in procurement5. It may also refer to the different methods of community based
procurement.
4.2. Community Based Procurement Methods
The following are the generally acceptable methods of procurement for community based subprojects:
1. Community Shopping
5

To be consistent with RA 9184 IRR and ADB and WB Guidelines

24

2.
3.
4.
5.

Community Bidding
Community Direct Contracting
Repeat Order
Small Value Procurement
5.1. Off-the Shelf Goods
5.2. Short Term Services
5.3. Small Works
6. Single Source Selection or Individual Consultant Recruitment for Consulting Services
7. Pakyaw Contract
8. Emergency Procurements
4.3. Thresholds for the Use of Community-Based Procurement Methods and Prior
Review Requirements
The threshold amount for procurement methods sets the allowable value of the contract for
which the method is to be used. Prior review refers to evaluation conducted by staff within the
project implementation hierarchy to ensure that the requirements for the use of the procurement
method are met. It also defines the extent and depth of supervision, post review and audits to
be carried out for the procurement at hand.The threshold amount for prior review identifies the
limit set by the KC-NCDDP for the review and evaluation of procurement contracts. This is
conducted by higher authorities, in this case, the Regional Program Management Office
(RPMO), the National Project Management Office (NPMO) and the Asian Development Bank
(ADB) and World Bank (WB). Contracts that need to undergo prior review require the issuance
of a No Objection Letter (NOL) indicating that the reviewing authority has examined said
contract, found it in order and is not objecting to its provisions or award. For purposes of this
manual, the following thresholds for the use of community based procurement methods and the
prior review requirements are provided in Table 1.
Table 1. Procurement Methods and Prior Review Thresholds for
Community Based Procurement
Procurement Method

Threshold Amount
(P)

Community Bidding
- Works
2.0 M & above
- Goods
1.0 M & above
Community Shopping
- Works
Below 2.0 M
- Goods
Below 1.0 M
Community Direct Contracting
Direct Contracting
- Works
None
- Goods
None
Direct Contracting due to Two Failed Biddings
- Works
None
- Goods
None
Direct Contracting due to Emergency
- Works
None
- Goods
None
Community -to- Government Agency Arrangements
- Works
None
- Goods
None
Direct Contracting due to Contract Termination

Prior/Post Review Requirement

Threshold (P)
RPMO
NPMO
> 500 K but <2.0 M
> 500 K but <2.0 M

2.0 M above
2.0 M & above

500 K but < 2.0 M

500 K but <2.0 M
all
all

Post
Post

all
all

Post

2.0M
2.0M

Post
Post

1.0M
1.0M

Post
Post

25

- Works
None
all
- Goods
None
all
Direct Contracting for Adjacent and Contiguous Projects
- Works
None
all
Repeat Order
- Goods
50% of previous contract
all
Small Value Procurement
1.Off-the-Shelf (Goods)
10,000.00
2.Short Term services
10,000.00
3.Small Works
10,000.00
Qualification/Single Source /Individual Consultant Selection for Consulting Services
Single Source/Individual
None
Below 1.0 M
Consultant Selection
Pakyaw Contract
- Works (labor only)
100,000.00
- Works (labor with local
300,000.00
6materials)
Variation Order for Works
Up to 20% of original
All
contract
Aggregated contracts
2M to 3.0 M

Post
Post

Post

Above 1.0 M

above 3.0M

In addition to the contracts above the specified thresholds, ADB/WB prior review requirement
shall cover the first three contracts for the first year sub-projects in each of the three new
Regions (I and III). This shall be adjusted in the succeeding years based on the findings of the
post review and the assessment of performance and risk analysis for the whole of Component
1.
Aggregated contracts7 refer to one or more on-going KC-NCDDP contracts with a single
contractor/supplier regardless of KALAHI-CIDSS area. Prior-review threshold for aggregated
contracts consider all contracts with below 50% physical accomplishment or delivery.
Completed contracts will not be included in the threshold of aggregated contracts.
Contractors/suppliers with aggregated contracts should have completed at least fifty (50%)
percent of all on-going contracts and should have performed well in these contracts with no
slippages due to poor performance or reasons by contractor/supplier negligence before any new
contracts are awarded to them. In cases where there are more than one new contracts in
addition to the ongoing contracts that reached the aggregated threshold, the higher/est contract
cost shall be subject to prior review as specified in Table 1 to ensure that they continue to have
the capacity to deliver or perform the procurement at hand. A list/table of all ongoing contracts
indicating the contract costs and percentage of physical accomplishment will be submitted as
part of the documents for review by the ACT.
4.4. Possible Types of Community Projects Requiring Procurement
The KC-NCDDP provides two types of grants to participating communities. Planning grants
cover costs associated with community mobilization, preparation of proposals by community
volunteers, project operations, maintenance, and community-based monitoring. The Technical
Assistance Fund (TAF) is a fund under planning grants which is provided to support the
community by engaging technical services in the preparation and implementation of subprojects. Investment grants provide funding assistance for selected community sub-project
proposals. KC-NCDDP supports those that: are not on the negative list; have been prioritized
6

e.g. boulders, sand , gravel, lumber scaffoldings and others which are indigenous in the area and can be provided by the
community pakyaw group
7
Prior review for aggregated contracts aims to determine the capacity of contractor/supplier to perform the works or deliver the
goods/services required.

26

and approved by the community through a barangay assembly; have a clear long-term strategy,
e.g., operations and maintenance plan, business plan, etc.; will have buy-in from the community,
as shown by the amount of community contribution/counterpart; and are technically and
economically viable.
The KC-NCDDP has adopted an open menu that allows the community to propose almost any
type of community sub-project that can respond to their priority needs. Under the open menu
scheme, communities can request funds to construct infrastructure, such as roads, bridges,
water supply systems, and sanitation facilities. The community can also propose livelihood
support sub-projects, such as, agricultural production or funding for small-scale production
equipment, and additional capital for community enterprises.
For purposes of procurement, the following are some examples of community projects under
the KC-NCDDP identified by sub-project category:
4.4.1. Construction, Repair, Improvement, Upgrading of Small Scale Infrastructure
1.
2.
3.
4.
5.
6.
7.

Access/Barangay roads;
Bridges (footbridge, reinforced concrete, cable foot, rural road bridge);
Pathways for pedestrians;
School buildings/classrooms for basic education (elementary and high school);
Day care centers;
Barangay Health Center;
Domestic water supply systems;
a. Level I
b. Level II
c. Level III
8. Rural electrification (on-grid, off-grid, renewable energy);
9. Small-scale communal irrigation;
10. Public sanitation facilities (toilets);
11. Flood control facilities
4.4.2. Environmental Protection and Conservation
i.
ii.
iii.
iv.
v.

Seawall;
Slope protection;
River control;
Drainage;
Waste/sanitation management facility

4.4.3. Enterprise or Common Service Facilities

i.

Post harvest facilities (equipment for production, harvest, drying, processing,

storage);
ii. Processing facilities (meat, vegetables, etc.);
iii. Corn or rice mill;
iv. Fabrication works
4.4.4. Disaster Recovery Operations8
The list shall be guided by an open menu to be determined in the course of project
implementation and a limited number of activities not allowed under regular KCNCDDP process shall be permitted.
8

Please refer to NCDDP Disaster Response Operations Manual

27

i. Repair of rural and local roads;

ii. Backfill, reshaping and landscaping of areas affected by erosion;
iii. Repair of riverbank protection systems and earth-fill dykes up to 5m height if
supervised by a qualified engineer;
iv. Repair/reconstruction of small bridges (up to 15m);
v. Construction of temporary bypass roads up to 500 m length, if not located in
sensitive habitats and land acquisition follows the provisions of the main ESMF and
bypasses are completely removed and the alignment restored to its original
conditions once the need for their service has expired;
vi. Repair / reconstruction of communal irrigation and water supply systems and of
facilities that have been completed with project funding;
vii. Collection and removal of technogenic debris (building parts, mixed waste, timber)
as uprooted trees and plant debris from public infrastructure, public spaces and
agricultural areas, and its deposition in pre-existing waste management facilities that
are operating under national licensing and regulations and comply with normal
practice in the country;
viii. Repair of public buildings (including government offices, meeting hall and places of
religious worship) and infrastructure (e.g. transmission lines, street lighting, traffic
signs, bus stops);
ix. Collection and removal of earth, mud and plant debris from public infrastructure
and spaces as well as agricultural areas and its deposition, landscaping and
greening at appropriate locations.
xi. Construction/reconstruction of bunk houses or damaged homes of the most
affected households.
xii. Other similar undertaking such as temporary setting up of school, health and water
facilities for access to basic needs and services of affected population including
temporary housing for vulnerable population such as children, lactating and
pregnant women, elderly and persons with disabilities (PWD).
4.4.5. Consulting services
i.

Consultancy services for the following: survey works, preparation of technical

plans, specifications, detailed cost estimates, work programs, required pay items,
design and shop drawings; feasibility studies for enterprise development subprojects and other special technical proposals; supervision of critical sub-projects
(i.e., bridges, water system, road construction and rehabilitations) beyond the LGU
and/or project capacity, as well as implementation of appropriate quality control
procedures; preparation and/or training on operations and management plans for
revenue-generating sub-projects or those with cost recovery schemes.

4.4.6. Negative List

The negative list includes projects that are not eligible for funding and include the following:
i. Acquisition or purchase of land;
ii. Construction or repair of government offices, meeting halls and places of
worship;
iii. Environmentally hazardous materials, such as, explosives, asbestos and other
potentially dangerous materials;
iv. Fishing boats (beyond the weight limit set by the Bureau of Fisheries and
Aquatic Resources (BFAR);)
v. Road construction into protected areas;
vi. Activities that have alternative prior sources of committed funding;
vii. Recurrent government expenditures such as remuneration of government

28

employees;
viii. Micro-credit and livelihood activities which involve on-lending of project funds;
ix. Activities for fiesta and other religious and cultural activities;
x. International travel;
xi. Maintenance and operation of infrastructure built from project funds;
xii. Assistance to, or training of, the military, police, national guard, or other quasimilitary organization or unit;
xiii. Salaried activities that employ children below the age of 16 years;
xiv. Activities that unfairly exploit women or men at any age;
xv. To pay for performance of abortions as a method of family planning or to
motivate or coerce any person to practice abortions, to pay for the performance
of involuntary sterilizations as a method of family planning or to coerce or
provide any financial incentive to any person to undergo sterilizations;
xvi. Any activity or funds relating to trafficking of person/s;
xvii. Any proposed projects intended to benefit commercial logging, (provided this
shall not include tree removal incidental to the project), must be sent to the
funding donor for review prior to project approval;
xviii. Other activities with environmental or social impact as governed by ADB/WB
safeguard environmental or social impact as governed by ADB/WB safeguard
policies.

29

CHAPTER FIVE: COMMUNITY BASED

PROCUREMENT PROCEDURES
5.1. Community Shopping for Goods and
Works
5.2. Community Direct Contracting for
Goods and Works
5.3. Community Repeat Order for Goods
5.4. Small Value Procurement for Goods and
Works
5.5. Pakyaw Contracts for Works
5.6. Community Bidding for Goods and
Works
5.7. Qualification/Single Source or
Individual Consultant Selection for
Consulting Services
5.8. Emergency Procurement

30

This chapter explains the procedures for the procurement of goods, works and consulting
services using the different procurement methods. The discussions shall be based on the
most commonly used methods under the KC NCDDP.
5.1. Community Shopping for Goods and Works
Community Shopping is a method of procurement where the community simply requests
for the submission of price quotations from a minimum of three suppliers for readily available
off-the-shelf goods or standard specification commodities of small value or a minimum of
three contractors for simple works of small value with known qualifications.
Community Shopping is expected to be the most frequently used among the different
methods.
The price quotations are compared to assure competitive prices. Requests for quotations
shall indicate the description and quantity of the goods or specifications of works, as well as
the desired delivery (or completion) time and place. Quotations may be submitted in the
prescribed CBPM form. The evaluation of quotations shall follow the same principles as
community bidding. The terms of the accepted offer shall be incorporated in a purchase
order or brief contract.
For Community Shopping, suppliers and contractors from whom goods and works are
procured should be in good standing, and have not committed any breach of contract (e.g.,
short deliveries, unreasonable delays in delivery of goods, delivery of defective goods, or
similar acts) in previous transactions with the community or municipality. Community
shopping involves the following procedures:
5.1.1. Identification of Items for Community Shopping
The Procurement Team identifies the items to be procured through Community Shopping
from the approved Community Procurement Plan (CPP). This is then submitted to the
Chairperson of the Barangay Sub-Project Management Committee (C/BSPMC) and the
Bids and Awards Committee (BAC) for review and validation.
5.1.2. Preparation of the Request for Quotations (RFQ)
Upon approval by the C/BSPMC of the items to be procured, the PT prepares the following
documents to be used:
For Goods and Services,
i.
ii.
iii.
iv.
v.

Request for Quotation (RFQ Form)

Acknowledgement Receipt
Abstract of Quotations
Purchase Order
Technical Specifications

For Works,

31

i.
ii.
iii.
iv.
v.
vi.

Request for Quotation (RFQ)

Contract Agreement
Technical Specifications
Drawings, if applicable
Bill of Quantities
Standard forms for Community Shopping for works (performance securities,
notice of approval, notice to proceed, etc.)

5.1.3. Conduct of Procurement Preparation Meeting

The procurement preparation meeting is the forum called by the BAC where all officials
involved in the procurement meet and discuss all aspects of a specific procurement activity.
It is required to ensure that the procurement is in accordance with the CPP and confirms the
availability of funds for the contract.
For goods, the required documents for review include:
i.
ii.
iii.
iv.
v.

Technical Specifications;
Cost estimates;
Quotation Forms, and
Notice of Request for Quotations
Availability of the pertinent budget release for the project.

For works, the required documents for review include:

i.
ii.
iii.
iv.
v.
vi.
vii.

Technical plans, specifications, scope of work;

Engineering/architectural plans and designs;
Availability of the right-of-way (ROW) or ownership of affected properties;
Cost estimates,
Quotation Forms, and
Notice of Request for Quotations
Availability of the pertinent budget release for the project.

The PT, BAC, C/BSPMC, and Technical Working Group (TWG) shall meet to discuss the
procurement at hand and to ensure that all requirements are in order. During the same
meeting, the BAC will review and approve the quotation forms and contents of the Notice of
Request for Quotation (NRQ) and the Chairperson will sign the form for posting. The PT will
prepare the minutes of the procurement preparation meeting and the C/BSPMC Bookkeeper
will keep a copy of all the documents.
If the C/BSPMC has to procure goods or works with different packages or work items , it is
best to hold just one procurement preparation meeting to save time.
5.1.4. Posting of Notice of Request for Quotation (NRQ)
The BAC may post the Notice of Request for Quotation (NRQ) for a period of three (3) to
seven (7) days for information purposes only at any of the following: municipal/ barangay
hall bulletin boards, KC-NCDDP designated billboard or bulletin board, offices of Municipal
Inter-Agency Committee (MIAC).
The Notice of Request for Quotation (CBPM Form B-1 for goods and B-2 for works) should
contain the following information:
i.

Brief description of the goods to be procured for goods or the type, size, major

32

items and other important or relevant features of the works for works;
ii. The date, time and place for the deadline for the submission, receipt and
opening of quotations;
iii. Delivery schedule for goods or contract duration for works;
iv. The name, address of the designated contact person;
v. Such other necessary information deemed relevant by the BAC.
5.1.5. Issuance of Request for Quotation
For Goods:
The PT issues the Request for Quotation (RFQ) Form to at least three (3) suppliers in good
standing. The CF should accompany the members during the first serving of the quotation
to help explain the objectives of the procurement and the project to the prospective supplier.
They will either wait for the supplier to accomplish the form and seal it in an envelope or ask
the suppliers to submit the quotation in a sealed envelope to the C/BSPMC at the barangay
hall within three (3) days. The PT should ask the supplier to acknowledge receipt of the
quotation form by signing the acknowledgement receipt. Interested suppliers who were not
issued RFQs may submit their respective quotation forms and other requirements in a
sealed envelope to the C/BSPMC before the deadline for the opening of quotations. The
suppliers shall accomplish the Quotation Form and submit this in a sealed envelope with
the following written outside the sealed envelope:
NAME OF SUPPLIER
ADDRESS
Quotation for:_________________
KC-NCDDP Barangay Sub-Project Management Committee
Address of Barangay
What is a Supplier of Good Standing ?
A supplier of good standing is one who is known in the community to be in the business of
providing the goods to be procured for at least one year, duly registered with the DTI, SEC or
CDA and possessing a mayors permit/municipal license from the suppliers principal place of
business with no outstanding record of being blacklisted by any government agency or local
government unit. In case of previous or existing suppliers to KC-NCDDP sub-projects, they
should have satisfactory performance or completed all contracts awarded.

For Works:
Only bona fide contractors licensed by the PCAB and who have been classified under the
type of contract/project where the subject contract falls are eligible to be invited to submit
quotations for shopping for works. The contractor should have a satisfactory performance
for any on-going or completed KC-NCDDP projects. At least two members of the PT delivers
the Request for Quotation (RFQ) with the attached specifications, drawings and bill of
materials to at least three (3) licensed contractors.
The CF should accompany the members during the first serving of the RFQ for communities
in far flung areas to help explain the objectives of the procurement and the project to the
prospective contractor. They will ask the contractor to submit the quotation in a sealed
envelope to the C/BSPMC at the barangay hall within three (3) days. The PT should ask the
contractor to acknowledge receipt of the RFQ by signing the acknowledgement receipt.

33

Interested contractors who were not issued RFQs may submit their respective quotation
forms and other requirements in a sealed envelope to the C/BSPMC before the deadline for
the opening of quotations. The contractor shall submit this in a sealed envelope with the
following written outside the sealed envelope:

NAME OF CONTRACTOR
ADDRESS
Quotation for Community Shopping for: (Name of Project)
KC-NCDDP Barangay Sub-Project Management Committee
Address of Barangay
5.1.6. Conduct of Conference for Community Shopping for Works
The conference for the community shopping for works is the forum where the PT, C/BSPMC,
BAC and the prospective contractors discuss the different aspects of the procurement at
hand, details of the contract and forms to submit, issues that may arise during the
preparation of the quotation. The conference for shopping for works is to be done at least
three (3) days before the deadline for the submission of quotation. Attendance to the
conference is encouraged for all invited contractors for contracts above P 1M. Conduct of
conference for contracts below P1M is optional.
The ME and TF provides technical assistance to the BAC and acts as resource person in
case of requests for clarification. The PT shall prepare the minutes of conference.
The BAC shall organize a site visit or inspection of the project site for prospective
contractors. All prospective contractors are required to attend the site visit for contracts
above P 1M as this will enable them to offer a more realistic quotation. However, for
contracts bellow P 1M attendance to the site inspection is optional. Those who are not able
to attend the scheduled site inspection may conduct their own inspection provided this is
done before the submission of proposals. The C/BSPMC Chairperson shall issue a
Certificate of Site Inspection to the representative of the prospective contractor and this shall
be presented as a requirement in the opening of quotations.
5.1.7. Submission and Receipt of Quotations
The prospective contractor shall fill up and submit the Request for Quotation in a sealed
envelope within the prescribed period for submission which is usually three (3) days after
the conference. The PT shall receive the sealed quotations at the barangay hall on the date
specified. If the quotation is submitted before the deadline, the PT member records receipt
in the logbook with the following information:
i.
ii.
iii.
iv.

Name of Goods/Works Project to be Procured

Name of Supplier/Contractor
Date and Time Received
Name and signature of procurement team member receiving the sealed
enveloped

Suppliers or contractor who were not issued RFQs but submitted quotations shall be
considered for evaluation. The sealed quotations and logbook will be placed at C/BSPMC
office inside a secure filing cabinet. Any quotations submitted after the deadline shall be
declared Late and shall not be accepted.
5.1.8. Opening and Evaluation of Quotations

34

5.1.8.1. Opening of Quotations

The BAC shall invite the following to assist in the review and evaluation of quotations on
the day specified for the opening of the quotations: the Head of the Audit and Inventory
Team (AIT) for goods, the Head of the Project Implementation Team (PIT) for works and
the members of the Technical Working Group (TWG).
The PT shall bring the logbook and sealed envelopes containing the quotations and
place this inside the bid box located in the barangay hall. The bid box shall be locked.
The BAC Chairperson shall determine the presence or absence of a quorum and shall
declare a quorum if there is one. The Chairperson shall open the padlock of the bid box
and shall proceed with the opening of the sealed quotations.
As a general rule, a minimum of three sealed quotations should be received for the BAC
to proceed with the opening of quotations. The BAC can declare a failure of opening if
only one or two envelopes are received and proceed with a re-canvass. However, if in
the second attempt only one or two envelopes are received, the opening will push
through. The acknowledgement receipt shall serve as proof that the procedure was
complied with.
All members of the BAC shall initial every page of the original copies of all quotations
received and opened. The PT shall prepare the minutes of the opening of quotations.
5.1.8.2. Evaluation of Quotations
The purpose of the evaluation of quotations is to determine the Lowest Calculated and
Responsive Quotation (LCRQ) based on the conditions set forth in the quotation.
For Goods:
A quotation is considered responsive if it provides complete information that meets the
required technical specifications; indicates the quoted price for all items specified in the
quotation by item or by package whether for delivery or by pick up, specifies the date of
delivery. The ACT through the TF shall bring the list of prevailing local prices for
purposes of comparison and reference. If a quotation is not responsive, the supplier is
disqualified and his quotation is not included in the ranking. If only one or two suppliers
quoted on all items and is considered responsive, the BAC shall proceed with the
evaluation.
An Abstract of Quotation is prepared by the PT for all calculated and responsive
quotations. This is signed by all members of the BAC. All quotations are ranked from
lowest to highest and the lowest price is encircled. Award is made to the supplier with
the lowest price quotation who meets all the requirements specified in the quotation. The
C/BSPMC Chairperson shall review and approve the Abstract of Quotations.
A supplier is allowed to submit an offer which provides for superior specifications and/or
better terms and conditions to the community at no extra cost. However, the BAC should
not give any bonus, credit or premium to such offer in the evaluation of quotations.
If the lowest supplier refuses to accept the quotation, the second lowest is considered.
If the second lowest refuses to accept, the third lowest quotation is considered
provided his quoted price is within 110% of the price of the second lowest, otherwise
the BAC may proceed to community direct contracting or re-canvass.
For Works:

35

The BAC shall examine the contractors license and check if this is genuine and valid for
the contracting period required. The certificate of site inspection shall also be validated.
The bill of quantities shall also be examined and evaluated for completeness of
information that meets the technical specifications and the quoted price for all items of
work specified in the quotation. The evaluation of quotations shall take the following into
consideration:
i.

The quotation must be complete. Partial quotations or quotations not

addressing or providing all of the required items in the bill of quantities, shall
be automatically disqualified. In this regard, where a required item is provided,
but no price is indicated, the same shall be considered as non-responsive, but
specifying a0 (zero) for the said item would mean that it is being offered for free.

ii. Minor arithmetical corrections to consider computational errors and omissions

shall be made to enable proper comparison of all quotations. Discounts shall be
incorporated in the quotation for each work item. Any adjustment shall be
calculated in monetary terms to determine the calculated prices.
iii. All bids shall be evaluated on equal footing to ensure fair and competitive bid
evaluation. For this purpose, all bidders shall be required to include the cost of
all taxes, such as, but not limited to, value added tax (VAT), income tax, local
taxes, and other fiscal levies and duties which shall be itemized in the quotation
form and reflected in the detailed estimates. Such bids, including said taxes, shall
be the basis for bid evaluation and comparison.
iv. Quoted prices in words, unit prices, and unit cost in the bill of quantities shall
prevail in case of discrepancy. In case of discrepancies between: (a) quoted
prices in figures and in words, the latter shall prevail; (b) total prices and unit
prices, the latter shall prevail; (c) unit cost in the detailed estimate and unit cost
in the bill of quantities, the latter shall prevail.
Based on the detailed evaluation of quotations, those that comply with the abovementioned requirements shall be ranked in the ascending order of their total calculated
quoted prices, as evaluated and corrected for computational errors, and other
modifications, to identify the Lowest Calculated Quotation (LCQ). The total calculated
bid prices, as evaluated and corrected for computational errors, and other modifications,
will be used in the ranking.
The entire evaluation process for the evaluation of quotations must be completed in not
more than two (2) calendar days from the deadline for receipt of proposals. The BAC
should exert effort to complete the process even before the lapse of the 2-day period,
as this will expedite the procurement process.
If only one or two contractors quoted on all items and is considered responsive, the BAC
shall proceed with the evaluation.
An Abstract of Quotation is prepared by the PT for all calculated quotations. This is
signed by all members of the BAC. Award is made to the contractor with the lowest price
quotation that meets all the requirements specified in the quotation. The C/BSPMC
Chairperson shall review and approve the Abstract of Quotation.
If the lowest calculated contractor refuses to accept the quotation, the second lowest
is considered. If the second lowest refuses to accept, the third lowest quotation is
considered provided his quoted price is within 110% of the price of the second

36

lowest, otherwise the BAC may proceed to community direct contracting or requotation.
For both goods and works, the PT prepares the minutes of the evaluation of
quotations. The TF shall ensure that the lowest calculated and responsive quotation
is the one indicated in the minutes of evaluation of quotations.
In the case of awards that are waived without acceptable/valid reasons, the
supplier/contractor shall be blacklisted in future KC-NCDDP procurements.
5.1.9. Prior Review of Contract
Prior to the signing of the Purchase Order/Contract, the C/BSPMC Chairperson shall request
for clearance to award and to conduct prior review for contracts within the thresholds
specified under Table 1 of Section 4.3.
For Community Shopping for goods and works these are:
Regional Program Management Office (RPMO) contracts more than P 500,000 and
less than P 2.0 M
In the request for No-Objection-Letter (NOL), the PT shall attach photocopies of all the
contract documents with the exception of the letter itself which should be submitted in its
original form.

5.1.10. Contract Award

For Goods:
The PT shall prepare three (3) copies of the Purchase Order (PO) and shall agree with the
Monitoring and Inspection Team (MIT) on the date of delivery. The Barangay Treasurer
certifies to the availability of funds and this is submitted to the Chairperson of the C/BSPMC
who approves and signs the PO.
The PT delivers the PO to the winning supplier who signs his conforme and retains his copy.
The PT furnishes a copy of the PO to the Barangay Bookkeeper and the Monitoring and
Inspection Team (MIT) member.

What is a Purchase Order?

A purchase order is a contract between the community and the supplier/dealer for
the delivery of supplies, subject to stipulations in the order. Thus, for contracts covered
by purchase orders, the inclusion of a clause in the purchase order making reference to
the general and specific conditions of the contract as reflected in the bidding documents
shall be necessary to indicate that those conditions form part of the contract between
the parties.
For Works:
5.1.10.1. Contract Approval and Issuance of Notice of Award

37

Upon receipt of the NOL, as applicable, the PT shall prepare three (3) copies of the Notice
of Award (NOA) and shall submit the same to the C/BSPMC Chairperson for signature. The
BAC shall award the contract to the contractor with the LCRQ at its submitted quoted price
or its calculated quoted price, whichever is lower.
The PT consolidates all the documents and/or records of the proceedings of the BAC with
regard to the procurement at hand, and attaches the same to the BAC Resolution. The PT
drafts the BAC Resolution recommending award. The BAC approves and signs the
Resolution Recommending Award, and transmits the same to the C/BSPMC Chairperson
who acts on the recommendation.
The PT shall prepare three (3) copies of the Notice of Award (NOA) and shall submit the
same to the C/BSPMC Chairperson for signature. The PT delivers the NOA to the contractor
who shall sign his/her conforme and returns two (2) copies to the PT.
For contracts requiring prior review, the C/BSPMC Chair shall wait until the NOL has
been issued by the appropriate authority before the NOA is sent to the winning contractor.
5.1.10.2. Contract Signing and Posting of Performance Security
Upon receipt of the NOA, the BAC schedules the signing of the contract with the winning
contractor who will then post the required performance security and submit other
documentary requirements. The C/BSPMC Chairperson signs the contract (three copies)
upon submission of the performance security and the signing of the contract by the winning
contractor (two copies) within ten (10) calendar days from receipt of the NOA. The PT
forwards the contract together with the rest of the supporting documents for filing and
safekeeping.
For Community Shopping for works, the contractor shall post the same form and
corresponding amount of performance security specified in Section 5.6.11.2. on Community
Bidding for works. The same applications and conditions for the performance security shall
also prevail.
Upon signing of the contract and submission of the performance security, the BAC shall
issue the Notice to Proceed (NTP) together with a copy or copies of the approved contract
to the successful contractor within three (3) calendar days from the date of approval of the
contract by the C/BSPMC Chairperson. Unless otherwise specified in the contract, a contract
is effective upon receipt of the NTP. If an effectivity date is provided in the NTP, such date
shall not be later than seven (7) calendar days from issuance thereof.
The PT shall furnish copies of the signed contract to the Municipal Auditor and the RPMO.
5.1.11. Contract Implementation
For Goods:
The winning supplier delivers the goods in accordance with the provisions of the PO,
technical specifications and other requirements on the scheduled delivery date. The MIT
with the concerned TWG members inspects the goods against the delivery receipt and the
PO. If they find all requirements are complied with and in order, they accept the delivery
receipt and stamp it inspected and sign the PO. Otherwise, if they find that the delivery is
incomplete and does not comply with the specifications, the goods should not be accepted.
If the supplier fails to start the delivery despite follow ups by the PT within 15 days and the
BSPMC through the evaluation of the PIT delay the implementation, the BSPMC can cancel

38

the P.O. and award the contract to the succeeding responsive supplier, otherwise, conduct
recanvass.

For Works:
The winning contractor mobilizes and starts work within seven (7) days from receipt of the
NTP. The contractor has the option to claim for advance payment equivalent to 15% of the
contract price subject to the submission of a certification from the TF that equipment and
materials are already on the jobsite and a bank guarantee equivalent to the amount
requested within three (3) calendar days.
The Project Implementation Team (PIT) and the Monitoring and Inspection Team (MIT) shall
regularly monitor the execution of the contract. The Municipal Engineer, TF and Community
Infrastructure Officer (CIO) shall conduct regular inspection of the project site and shall
provide technical assistance to the community.
Tables 2 and 3 provide a summary of all procedures for the procurement of goods and works
through Community Shopping and explain the functions of different personnel involved.
5.2. Community Direct Contracting for Goods and Works
Community Direct Contracting is a method of procurement of goods and works where the
community directly negotiates a contract with a technically, legally and financially capable
supplier or contractor. This does not require elaborate bidding procedures and documents.
The supplier/contractor is simply asked to submit a price quotation or a pro-forma invoice
together with the conditions of sale. The offer may be accepted immediately or after some
negotiations. Community direct contracting may be resorted to by a community under any
of the following conditions:
i.

Where there is only one supplier/contractor in the municipality or vicinity capable of

providing the goods, services or works (known as Direct Contracting);
ii. Where there has been failure of community bidding for the second time (Direct
Contracting due to Two Failed Biddings);
iii. When time is of the essence to avert an imminent danger to life or property or to
restore damaged community projects arising from natural or man-made calamity or
emergency as declared by appropriate authorities. For works, the community has
the option to undertake the project through direct contracting or by administration
(Direct Contracting due to Emergencies);
iv. Where upon sufficient justification, it is found that it is more efficient and
economical for the community to enter into an Community-to-Government Agency
Arrangement with another government agency for the procurement of goods, works
and consulting services provided that the Servicing Agency has the mandate to
deliver the goods and services required, has the technical expertise to deliver such
services and owns or has access to the necessary tools and equipment required for
the project
(Community-to-Government Agency Arrangements)
v. For works: where the community decides to take over a contract that has been
rescinded or terminated for causes provided for in the contract and existing laws
(Direct Contracting due to Contract Termination);
vi. For works: where the subject contract is adjacent or contiguous to an on-going
infrastructure project and it will be more advantageous to hire the services of the
single contractor than to undergo a new bidding process
(Direct Contracting for Adjacent and Similar Projects);
vii. In the case of island municipalities, remote or far flung communities as certified by

39

the Area Coordinator (AC) or conflict areas with peace and order problems as
certified by the municipal Chief of Police.
Direct Contracting due to Failure of Bidding may occur in any of the following
instances:
i.
ii.
iii.
iv.

No bids are received;

All prospective bidders are declared ineligible;
All bids fail to comply with all the bid requirements or fail post qualification;
The bidder with the lowest calculated and responsive bid refuses, without justifiable
cause, to accept the award of contract.

Direct Contracting due to Emergencies shall be supported by the issuance of a

state of calamity declaration from the National Disaster Risk Reduction and
Management Council (NDRRMC) covering the said community or as declared by a
local government.
Direct Contracting through Community to Government Agency Arrangement may
be applied under the following conditions:
i.

The community shall provide sufficient justification indicating that entering into an
Community-to-Government Agency Agreement with the Servicing Agency is more
efficient and economical for the community;
ii. The community lacks the proficiency or capacity to undertake the particular
procurement;
iii. The Servicing Agency has the mandate to deliver the services required to be
procured or to undertake the infrastructure project or consultancy; and
iv. The Servicing Agency owns or has access to the necessary tools and equipment
required for the project.
Community-to-Government Agency Arrangements may be undertaken with
government agencies such as the Technical Education and Skills Development
(TESDA) and others as well as; local government units (province, city or a
municipality) as appropriate based on the above conditions. A memorandum of
agreement (MOA) shall be executed with the Servicing Agency defining the conditions,
roles and responsibilities of the C/BSPMC, the Servicing Agency and other
stakeholders, the schedules/timeline, scope of works/deliverables and project costs as
established in the sub-projects approved program of works (POW)/ proposal.
Direct Contracting due to Contract Termination may happen in any of the following
instances:
i.

There is breach of contract or termination for default (either by the C/BSPMC or the
contractor/supplier).
ii. If the contract is abandoned by contractor.
iii. The C/BSPMC terminated the contract for convenience, in whole or in part, as it
determined the existence of conditions that make project implementation
economically, financially or technically impractical and/or unnecessary, such as, but
not limited to, fortuitous event(s) or changes in law and national government policies.
iv. Due to unlawful acts that include, but are not limited to, the following: (a) corrupt,
fraudulent, collusive and coercive practices; (b) drawing up or using forged
documents; and, (c) any other act analogous to the foregoing.
Direct Contracting for Adjacent or Contiguous Projects may be resorted to under
any of the following conditions:

40

i.

The original contract is the result of a Community Shopping, Direct Contracting or

Bidding;
ii. The subject contract to be negotiated has similar or related scopes of work;
iii. It is within the contracting capacity of the contractor;
iv. The contractor uses either an acceptable price, the same or lower unit prices as in
the original contract less mobilization cost based on prevailing market conditions;
v. The amount involved does not exceed the amount of the on-going project; and
vi. For contractors of previous KC projects, a proven satisfactory track record in the
completion of such projects;
vii. Negotiations for the procurement are commenced before the expiry of the original
contract.
The following procedures are applicable for all types of contracts procured under
community direct contracting.
5.2.1. Identification of Items for Community Direct Contracting
The Procurement Team identifies the items to be procured through community direct
contracting from the approved Community Procurement Plan (CPP). The CPP shall specify
the type of community direct contracting to be used based on the above discussions. The
Procurement Team shall ensure that the required justification for the use of this type of
community direct contracting method is included as an attachment to the CPP. This is then
submitted to the Chairperson of the Barangay Sub-Project Management Committee
(C/BSPMC) and the Bids and Awards Committee (BAC) for review and validation to ensure
that the conditions for this type of community direct contracting are met.
5.2.2. Preparation of the Request for Quotation (RFQ)
Upon approval by the C/BSPMC of the items to be procured, the PT prepares the following
documents:
For Goods:
i. Notice of Request for Quotation (NRQ)
ii. Computation to show that it is cheaper to purchase from a lone supplier rather
than several suppliers (For Direct Contracting);
iii. Request for Quotation (RFQ) Form;
iv. Purchase Order;
v. Technical Specifications;
vi. Standard forms for community direct contracting for works;
vii. Justification for the use of the type of community direct contracting method;
viii. Certification from the TF that there is only one qualified supplier in the
Municipality.
For Works:
i. Notice of Request for Quotation (NRQ);
ii. Request for Quotation (RFQ) Form ;
iii. Contract Agreement;
iv. Technical Specifications;
v. Drawings, if applicable;
vi. Bill of Quantities;
vii. Standard forms for community direct contracting for works;
viii. Certification from the TF that there is only one qualified contractor in the

41

municipality or in the vicinity.

5.2.3. Conduct of Procurement Preparation Meeting
The BAC Chairperson shall call for a procurement preparation meeting to discuss all aspects
of the procurement at hand, among others the:
i.
ii.
iii.
iv.

Technical Plans/Specifications;
Cost estimates/Bill of Quantities;
Quotation Forms, and
Availability of the pertinent budget release for the project.

The PT, BAC, C/BSPMC, and Project Implementation Team (PIT) meet to discuss the
procurement at hand and to ensure that all requirements are in order. The Municipal
Engineer and the Technical Facilitator (TF) shall certify that there is only one
supplier/contractor available in the municipality.
For works, in case there is more than one contractor available in the vicinity, the BAC shall
choose the most capable based on the following criteria: satisfactory performance in
completed or on-going KC-NCDDP sub-projects and no negative slippage of more than
15%. The selected contractor shall then be invited.
During the same meeting, the BAC will review and approve the quotations forms. The PT
will prepare the minutes of the procurement preparation meeting and the C/BSPMC
Bookkeeper will keep a copy of all the documents.
5.2.4. Posting of Notice of Request for Quotation (NRQ)
The BAC may post the Notice of Request for Quotation (NRQ) for a period of three (3) days
for information purposes only at any of the following: municipal/ barangay hall bulletin
boards, KC-NCDDP designated billboard or bulletin board, offices of Municipal Inter-Agency
Committee (MIAC).
The Notice of Request for Quotation (CBPM Form B-1 for goods and CBPM Form B-2 for
works) should contain the following information:
i.

Brief description of the goods to be procured or the type, size, major items, and
other important or relevant features of the works;
ii. The date, time and place for the deadline for the submission, receipt and
opening of quotations;
iii. Delivery schedule for goods and contract duration for works;
iv. The name, address of the designated contact person;
v. Such other necessary information deemed relevant by the BAC.
5.2.5. Issuance of Request for Quotation
For Goods:
The PT issues the Request for Quotation (RFQ) Form to the lone supplier of good standing.
They will either wait for the supplier to accomplish the form and seal it in an envelope or ask
the supplier to submit the quotation in a sealed envelope to the C/BSPMC at the barangay
hall within three (3) days. The lone supplier shall then accomplish the Quotation Form and
submit this in a sealed envelope with the following written outside the sealed envelope:
NAME OF SUPPLIER

42

ADDRESS
Quotation for:_________________
KC-NCDDP Barangay Sub-Project Management Committee
Address of Barangay
If the procurement is being directly contracted in case of an emergency or an imminent
danger to life or property, the direct contracting shall be made with a previous supplier of
good standing of the community, or a supplier of good standing situated within the vicinity
where the calamity or emergency occurred.
For Works:
After ascertaining that there is only one bona fide contractor classified under the type of
contract/project where the subject contract falls within the vicinity, the PT delivers the Notice
of Request for Quotation (NRQ) Form to the lone licensed contractor in the vicinity.
The CF should accompany the members during the first serving of the RFQ for communities
in far flung areas to help explain the objectives of the procurement and the project to the
prospective contractor. They will ask the contractor to submit the quotation in a sealed
envelope to the C/BSPMC at the barangay hall within three (3) days. The PT should ask the
contractor to acknowledge receipt of the RFQ by signing the acknowledgement receipt. The
contractor shall submit this in a sealed envelope with the following written outside the sealed
envelope:

NAME OF CONTRACTOR
ADDRESS
Quotation for Community Direct Contracting for: (Name of Project)
If the procurement is being negotiated in case of an emergency or an imminent danger to
life or property, the direct contracting shall be made with a previous contractor operating
within the vicinity where the calamity or emergency occurred. If the procurement is being
negotiated because of two previous failures of biddings, the BAC, through the BAC
Secretariat, shall draw up a list of at least three (3) bonafide contractors who will be invited
to submit bids and negotiate with the lowest calculated bidder.
The lone contractor may request for a meeting to discuss the various aspects of the
procurement at hand. The Municipal Engineer (ME) and the Technical Facilitator (TF) may
also be invited to attend this meeting. The TF provides technical assistance to the BAC and
acts as resource person in case of requests for clarification. The PT shall prepare the
minutes of conference.
The BAC shall organize a site visit or inspection of the project site for the lone contractor or
in the case of a failed bidding, contractors. The prospective contractor/s are required to
attend the site visit as this will enable him/them to offer a more realistic quotation. Those
who are not able to attend the scheduled site inspection may conduct their own inspection
provided this is done before the submission of proposals. The C/BSPMC Chairperson shall
issue a Certificate of Site Inspection to the representative of the prospective contractor and
this shall be presented as a requirement in the opening of quotations.
5.2.6. Submission and Receipt of Quotation
The prospective supplier/contractor shall fill up and submit the Request for Quotation in a
sealed envelope within the prescribed period for submission which is usually three (3) days
after the meeting. The PT receives the sealed quotation at the barangay hall on the date

43

specified. If the quotation is submitted before the deadline, the PT member records receipt
in the logbook with the following information:
i.
ii.
iii.
iv.

Name of Goods/Works Project to be Procured

Name of Supplier/Contractor
Date and Time Received
Name and signature of procurement team member receiving the sealed
enveloped

The sealed bids and logbook will be placed at C/BSPMC office inside a secure bid box
stored in a filing cabinet. For failed biddings, any quotations submitted after the deadline
shall be declared Late and shall not be accepted.
5.2.7. Opening and Evaluation of Quotation
5.2.7.1. Opening of Quotation
The BAC shall invite the following to assist in the review and evaluation of quotation on
the day specified for the opening of the quotations: the Head of the Audit and Inventory
Team (AIT) and the members of the Technical Working Group (TWG) for goods and the
Head of the Project Implementation Team (PIT) and the members of the Technical
Working Group (TWG) for works.
The PT shall bring the logbook and sealed envelope/s containing the quotation, ideally
placed inside the bid box located in the barangay hall. The BAC Chairperson shall
determine the presence or absence of a quorum and shall declare a quorum if there is
one. The Chairperson shall open the padlock of the bid box and shall proceed with the
opening of the sealed quotation. He shall read aloud in public the name of
supplier/contractor and the amount of quotations.
All members of the BAC shall initial every page of the original copies of the quotation
received and opened. The PT shall prepare the minutes of the opening of quotation.
5.2.7.2. Evaluation of Quotation
The BAC shall determine if the quotation is responsive in terms of meeting the required
technical specifications; indicating the quoted price for all items specified in the quotation
by item or by package, specifying the date of delivery. The TF shall provide a certification
that there is only one or very limited number of suppliers.
The quotation shall be evaluated as provided for in Section 5.1.8.2 for goods and works.
If the quotation is not responsive due to incomplete documentary requirements, the BAC
shall request the supplier/contractor to comply with such requirements. If the bid prices
are higher than the estimated budget cost, the BAC and C/BSPMC shall determine if
there are available funds to cover the difference and if available, the contract is awarded
at the suppliers/contractors price. If funds are not available, the BAC and C/BSPMC
shall negotiate with the winning supplier/contractor to bring down the price to the
estimated budget cost with the consent of the supplier/contractor. If the
supplier/contractor does not agree to a change in contract price, the scope of works shall
be adjusted to consider available budget as long it does not significantly affect the
purpose of the project.
5.2.8. Prior Review of Contract

44

For Goods:
All Purchase Orders (PO) of goods procured through community direct contracting and
Community-to-Government Agency Arrangements above P 1 M shall undergo prior review
by the Regional Program Management Office (RPMO). Goods procured through community
direct contracting due to failed bidding and contract termination shall undergo prior review
by both the RPMO and the NPMO. Goods procured through community direct contracting
due to emergencies shall be subject to post review by both the RPMO and the NPMO.
For works:
All Purchase Orders (PO) of works procured through community direct contracting,
Community-to-Government Agency Arrangements above P 1.0 M and adjacent and
contiguous projects shall undergo prior review by the Regional Program Management Office
(RPMO). Works procured through community direct contracting due to failed bidding and
contract termination shall undergo prior review by both the RPMO and the NPMO. Works
procured through community direct contracting due to emergencies shall be subject to post
review by both the RPMO and the NPMO.
Prior to the signing of the contract, the C/BSPMC Chairperson shall request for clearance to
award and to conduct prior review for contracts within the thresholds specified under Table
1 of Section 4.3.
In the request for No-Objection-Letter (NOL), the PT shall attach photocopies of all the
procurement related documents with the exception of the letter itself which should be
submitted in its original form.
In the request for No-Objection-Letter (NOL), the PT shall attach photocopies of all the
procurement related documents with the exception of the letter itself which should be
submitted in its original form.
5.2.9. Contract Award
For Goods:
Upon receipt of the NOL, the PT shall prepare three (3) copies of the Purchase Order (PO)
and this is submitted to the Chairperson of the C/BSPMC who approves and signs the PO.
The PT shall then deliver the same to the lone supplier who signs his conforme and retains
his copy. Performance security is not required if the procurement is through community
direct contracting, emergencies or under Community-to-Government Agency
Arrangements. However, this is still required to be posted by the winning supplier for all other
types of community direct contracting.
The PT furnishes a copy of the PO to the Barangay Bookkeeper and the Monitoring and
Inspection Team (MIT) member.
For Works:
5.2.9.1. Contract Approval and Issuance of Notice of Award
Upon receipt of the NOL, the PT shall prepare three (3) copies of the Notice of Award
(NOA) and shall submit the same to the C/BSPMC Chairperson for signature. The PT
delivers the NOA to the contractor who shall sign his/her conforme and returns two (2)
copies to the PT. The PT shall prepare three (3) copies of the Notice of Award (NOA)
and shall submit the same to the C/BSPMC Chairperson for signature. The PT delivers

45

the NOA to the contractor who shall sign his/her conforme and returns two (2) copies to
the PT. For contracts requiring prior review, the C/BSPMC Chair shall wait until the
NOL has been issued by the appropriate authority before the NOA is sent to the winning
contractor.

5.2.9.2. Contract Signing and Posting of Performance Security

Upon receipt of the NOA, the BAC schedules the signing of the contract with the winning
contractor who will then post the required performance security and submit other
documentary requirements. The C/BSPMC Chairperson signs the Contract (three
copies) upon submission of the performance security and the signing of the contract by
the winning contractor (two copies) within ten (10) calendar days from receipt of the
NOA. The PT forwards the contract together with the rest of the supporting documents
for filing and safekeeping.
Performance securities are required to be posted by the winning contractor for all types
of community direct contracting with the exception of the Community-to-Government
Agency Arrangement. The contractor shall post the same form and corresponding
amount specified in Section 5.6.11.2. on community bidding for works. The same
applications and conditions for the performance security shall also prevail.
Upon signing of the contract and submission of the performance security, the BAC shall
issue the Notice to Proceed (NTP) together with a copy or copies of the approved
contract to the successful contractor within three (3) calendar days from the date of
approval of the contract by the C/BSPMC Chairperson. Unless otherwise specified in the
contract, a contract is effective upon receipt of the NTP. If an effectivity date is provided
in the NTP, such date shall not be later than seven (7) calendar days from issuance
thereof.
The PT shall furnish copies of the signed contract to the Barangay Bookkeeper,
Monitoring and Inspection Team (MIT), Municipal Auditor and the RPMO.
5.2.10. Contract Implementation
Contract implementation procedures for goods and services procured through Community
Direct Contracting shall follow those discussed in Section 5.1.11 and Chapter 6.
Contract implementation procedures for Community Direct Contracting for works shall follow
those discussed under Section 5.1.11 and Chapter 7.
Tables 4 and 5 provide a summary of all procedures for the procurement of goods and works
through Community Direct Contracting and explain the functions of different personnel
involved.
5.3.

Community Repeat Order for Goods

Community Repeat Order is a method of procurement for goods from the previous winning
supplier under a contract previously awarded through community bidding, shopping or direct
contracting, where an additional quantity of the same items are urgently needed to meet the
requirements of the project, there are sufficient funds available for this purpose and it can
be clearly shown that no advantage can be gained by going through a new round of
community bidding, shopping or direct contracting. Repeat Order may be resorted to only

46

in cases where the procured item is clearly superior to other bids/quotations not only in the
price quoted but also in equipment reliability, availability of spare parts, after-sales service
and delivery period, among others. Repeat Order may be resorted to if the following
conditions are satisfied:
i.
ii.

iii.
iv.
v.

The original contract must have been procured through community bidding,
shopping or direct contracting;
Contract prices of the repeat order must be the same as or lower than those in the
original contract, provided that such prices are still the most advantageous to the
community after price verification;
The repeat order shall be used only once and shall not exceed fifty percent (50%)
of the quantity of each item in the original contract.
The repeat order shall be availed of only within three (3) months of the original
contract;
It shall not result in splitting of contracts, requisitions or purchase orders.

The following procedures are applicable for all types of contracts procured under
community repeat order.
5.3.1. Identification of Items for Community Repeat Order
The Project Implementation Team (PIT) shall request for the procurement of additional
goods previously procured through the community repeat order method based on the
conditions stated above to the Chairperson of the Barangay Sub-Project Management
Committee (C/BSPMC). Upon approval, the Procurement Team shall make the necessary
revisions in the Community Procurement Plan (CPP) which shall be approved by the Bids
and Awards Committee (BAC). The Procurement Team shall ensure that the required
justification for the use repeat order is included as an attachment to the CPP. This is then
submitted to the Chairperson of the Barangay Sub-Project Management Committee
(C/BSPMC) and the Bids and Awards Committee (BAC) for review and validation.
5.3.2. Conduct of Procurement Preparation Meeting
The BAC Chairperson shall call for a procurement preparation meeting to discuss the
aspects of the procurement at hand, among others the:
i. the review of the technical specifications;
ii. confirmation from the PIT of the necessity and quantity of the additional
requirements;
iii. confirmation that the price and the terms of the original contract is most
advantageous to the community;
iv. existence of the conditions required for procurement through community repeat
order.
5.3.3. Posting of Notice for Request for Repeat Order (NRRO)
The BAC shall post the Notice of Request for Repeat Order (NRRO) for a period of three (3)
days for information purposes only at any of the following: municipal/ barangay hall bulletin
boards, KC-NCDDP designated billboard or bulletin board, offices of Municipal Inter-Agency
Committee (MIAC).
5.3.4. Conduct of Canvass
The BAC, through the Procurement Team, shall conduct a canvass of the prevailing
market price of the goods to be procured and compares this with the price of the goods in

47

the original contract. The BAC shall also confirm from the supplier whether the price of the
goods won from the previous community bidding, shopping or direct contracting remains
valid.
Upon confirmation that there are no changes in unit prices and quantities from the original
contract price and the conditions for the use of community repeat order are met, the BAC
issues instructions to the Procurement Team to proceed with the preparation of the
Supplemental Contract or Purchase Order, using the Technical Specifications in the
Contract documents used in the previous procurement.
5.3.5. Contract Approval, Signing and Implementation
The BAC shall proceed with contract approval, signing, and implementation in accordance
with the provisions of the original contract.
5.4. Small Value Procurement for Goods and Works
Small Value Procurement refers to a method for the procurement of goods, services, works
and consulting services where direct purchase is used for items of very small quantities and
value since it is more practical and economical to do so. The decision to resort to small
value/off-the-shelf procurement must be reflected in the CPP. If such procedure was not
anticipated in the earlier planning, the CPP needs to be updated. Splitting of contracts to
evade or circumvent the requirements of this manual using this method is not allowed. There
are four types of small value procurement:
1. Off-the Shelf Goods
Off-the-Shelf Goods Procurement applies to the purchase of readily available goods
from local market outlets/stores. This may include the purchase of food, perishable or
non-perishable items, agricultural products, office supplies, or emergency purchases,
hand tools, or other items necessary for the implementation of the sub-project that
cannot be procured through the other identified procurement methods, among others.
Off-the-shelf procurements may be applied to support planning, implementation and
project supervision activities.
2. Short Term Services
Short Term Services procurement refers to the purchase or acquisition/engagement of
non-consultancy service requirements available in the local community and requiring a
very limited period of time. This may include hiring of caterers for workshops, training or
meetings, transportation or trucking services, repair of vehicles and other project related
equipment, hiring of resource persons for training or advisory requirements, rental of
hand tools and equipment, or other services necessary for the implementation of the
sub-project, among others.
In the rental of hand tools that are commonly used in construction projects and included
in the POW, the PT must determine the required duration of use and assess whether it
is more economical to rent or to purchase such items. If the cost of renting such tools
exceeds the threshold provided above, then the PT should consider purchasing such
items either through community bidding, shopping or direct contracting as goods or
equipment, as applicable, provided that: this is included in the CPP; the procedures for
operation and maintenance of such tools and equipment are clearly established
including its turn-over and custody after project completion; and a cost comparison is
submitted/attached as part of the readiness filter.

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3. Small Works
Small Works procurement refers to the purchase of construction related service
requirements available in the local community and requiring a very limited period of time
and skilled labor such as painting, repair or renovation of roofs, walls, plumbing or
electrical works, fabrication of small structures or other services necessary for the
implementation of the sub-project which would be more economical to procure as small
works rather than pakyaw contract. In this case, the C/BSPMC directly engage worker/s
in the community with known capacity to perform the job. The cost and scope of works
should have been established in the POW or as discussed in the C/BSPMC meeting or
at the Barangay Assembly (BA). Payroll, accomplishment report prepared by the PIT
and checked by the TF/engineer in-charge and Timesheets or a photocopy logbook will
be the supporting documents for payment.
The following procedures are applicable for all types of contracts procured under small
value procurements.
5.4.1. Identification of Items for Small Value Procurement
The Procurement Team identifies the items to be procured through Small Value
procurement from the approved Community Procurement Plan (CPP). If such procedure
was not anticipated earlier, then the CPP shall be updated to identify items to be
procured through Small Value procurement. In order to facilitate the procurement of
these small items, the CPP may simply include general descriptions of small value
procurement such as perishable or non-perishable food for trainings and seminars, office
supplies, catering services, transport services, various hand tools, etc. This is then
submitted to the Chairperson of the Barangay Sub-Project Management Committee
(C/BSPMC) for review and validation.
All items to be procured through small value procurements shall be supported by an
itemized list with the quantity, unit price and cost estimate of these items and shall be
submitted to the BAC for approval before it is included in the CPP (CBPM C-1). For short
term services, small works and short term consulting services, this shall be accompanied
by a terms of reference or a scope of work with the specific outputs/deliverables. For
short term services and short term consulting services involving the hiring of experts, the
bio data or resume of the expert shall be reviewed by the BAC. All small value
procurements shall not exceed the threshold of P 10,000.00.
5.4.2. Survey of Available Suppliers
Upon approval by the C/BSPMC of the items to be procured, the PT shall proceed to the
local market or stores to conduct an informal survey of vendors/suppliers providing the
most advantageous prices using CBPM Form C-2.
5.4.3. Direct Purchase of Items
For the procurement of perishable items within the amount allowed by the community
finance manual on direct purchase, the PT shall procure the items directly from the
vendors/suppliers offering the most advantageous price based on the survey conducted;
otherwise, prepare a Purchase Order. They shall request for an official receipt or in its
absence, shall provide a list of items procured duly signed by the vendor/supplier. A
pro-forma receipt is also provided and used by the PT members (CBPM Form C-3). In
cases of non-registered suppliers, payment may be made under the name of the
treasurer in accordance to the provision of the Community Finance Manual.

49

For short term services, the PT shall prepare a short contract or a job order or in its
absence a pro-forma contract to support the hiring, rental, lease of such services (CBPM
Form C-4).
For technical and professional services such as the hiring of resource persons and
consultants, the PT shall issue a letter of invitation specifying the special service to be
covered, the number of lecture or consultation hours needed, the period when the
service shall be rendered and the fee that shall be paid. The resource person shall sign
his/her conforme to the offer letter and shall attach his/her curriculum vitae to the said
letter. The C/BSPMC Chairperson shall certify to the necessity of the service and the CF
shall certify that the service was rendered(CBPM Form C-5).
For both short term services, the PT shall submit a request for payment to the C/BSPMC
Chairperson for review and approval and shall order the Barangay Treasurer to issue
payment.
5.4.4. Inspection of Goods/Services
Immediately upon procurement of off-the-shelf items, the PT shall present the items
procured to the MIT and the Barangay Treasurer for inspection against the receipt or
signed form. If they find all items in order, they accept the receipt and stamp it inspected
and sign the receipt. If they find the items to be incomplete, they prepare a report to the
C/BSPMC Chairperson.
For short term services, the MIT and the Barangay Treasurer shall check if such a
service was in fact delivered and shall accept and sign the pro-forma contract to
validate its existence.
For Small Works
5.4.5. Identification of Small Works
The Procurement Team identifies the small works from the approved Community
Procurement Plan (CPP). If such was not anticipated earlier, then the CPP shall be
updated to identify items to be procured through small works. In order to facilitate the
procurement of these small works, quantities and corresponding cost should be defined
in the CPP. This is then submitted to the Chairperson of the Barangay Sub-Project
Management Committee (C/BSPMC) for review and validation.
The PT shall submit an itemized list of small works, timetable for implementation, the
cost estimate and the purpose for procurement which shall not exceed the threshold of
P 10,000.00. The C/BSPMC Chairperson shall review and approve the itemized list and
shall order the Barangay Treasurer to prepare the amount readily available for payment
upon satisfactory completion of the small works. Similar with the payment of labor, the
small work may be under the name of the treasurer should the payee do not have any
identification to transact with the bank.
5.4.6. Survey of Available Contractors/Pakyaw Groups
Upon approval by the C/BSPMC of the small works to be procured, the PT shall check
available contractors or Pakyaw groups who can provide the services within the specified
time frame and at the most advantageous prices. Priority shall be given to pakyaw
groups within the community who are capable of completing the small works to
encourage community employment.

50

5.4.7. Direct Purchase of Small Works

The PT shall prepare a short contract or a job order or in its absence a pro-forma contract
to support the small works.
For payment of small works, the PT shall submit a request for payment to the C/BSPMC
Chairperson for review and approval and shall order the Barangay Treasurer to issue
payment in accordance with the community finance manual.
5.4.8. Inspection of Small Works
Immediately upon completion of the small works, the PT shall request the PIT, MIT and
the Barangay Treasurer to inspect such works against the job order or pro-forma contract
to determine if the work specifications were complied with. If they find the work in order,
they shall accept and sign the pro-forma contract to acknowledge completion of small
works per conditions and requirements. If they find the items to be incomplete, they
prepare a report to the C/BSPMC Chairperson and request the contractor to correct any
error or complete the unfinished work.
5.5. Pakyaw Contract for Works
Pakyaw Contract refers to a system of direct hiring or contracting a group of skilled or
unskilled workers within the community or its vicinity by the community itself for the
performance of a specific work incidental to the implementation of the project where tools
and local indigenous materials may or may not be furnished by the community. It is an
alternative method of procurement where the partial or full implementation of an
infrastructure project or items of work for its completion is carried out by labor from the
community or its vicinity.
Pakyaw contracts are used to complete items of work defined by a specific quantity or output
(e.g. excavation, clearing and grubbing). Where available, the community through the
C/BSPMC may also supply needed equipment to complete the work. This may be done by
organizing and hiring its members to supply labor under pakyaw contracts; through the
direct provision of construction and other needed materials; or through the use of its own or
the leasing of construction equipment, or Labor only; or any of these combinations.
Payment will be based on the scope of works quantity output derived from the POW and
reflected in the statement of works accomplishment. Particular scope of works, quantities,
schedule and corresponding costs will be prepared and attached to the Pakyaw Agreement.
For the specific works output, a lump-sum payment may be made based on a statement of
work accomplished either through the group leader or divided among the pakyaw workers
and disbursed using a payroll system through the C/BSPMC/Barangay treasurer. A list or
payroll that reflects the cost due to every member of the Pakyaw should be provided as an
attachment to the disbursement voucher. The payroll shall then be concurred by the member
to indicate acknowledgement of the payment expected. The method for paying community
based labor under the pakyaw contract should be discussed and agreed upon during the
Barangay Assembly.
Pakyaw contracts may be justified where:
i.

there is sufficient labor in the community or its vicinity to undertake the items of
work;
ii. quantities of work involved cannot be defined in advance;
iii. works are small and scattered or in remote locations for which qualified
construction firms are unlikely to bid at reasonable prices;

51

iv. work is required to be carried out without disrupting ongoing operations;

v. risks of unavoidable work interruption are better borne by the community than by
a contractor; or
vi. there are emergencies needing prompt attention.
There are two cases where community based labor may be provided to complete
projects:
Case 1: Where labor supply forms part of the share of community counterpart as in kind
contribution. In this case, the C/BSPMC through the PIT will manage and
supervise community workers participating in the implementation of the
community project and will pay the workers in accordance with the agreed rate
for skilled and unskilled labor using community funds. The actual cash to be paid
and the equity (bayanihan) monetized cost will be indicated in the Community
Employment Record (CER). During implementation, should the community opt
to implement the works through Pakyaw, the cost will be computed based on the
cash for the labor in the POW. The in-kind (bayanihan) community counterpart
will still be monitored and reported.
Case 2: Interested laborers form themselves into groups and provide their services
through the pakyaw method of procurement. The use of such method should be
reflected in the CPP.
The community through the C/BSPMC with technical assistance from the engineers shall
discuss the scope of works, number of contracts and number and size of groups that need
to be organized to complete the work to be done through the pakyaw contracting system.
Pakyaw labor shall be drawn from the vicinity of the community, or from Pakyaw labor groups
belonging to various Barangay contiguous to the project site. As a priority, un-skilled, semiskilled and skilled workers should be drawn from the community where the project is
located;.
The C/BSPMC with the Community Facilitator (CF) shall ensure that all members of the
community including women who are interested to join Pakyaw groups being formed for the
project are known to be members of the concerned community where the subproject is
located or from the adjacent Barangays. Women must be given equal oppurtunity to
participate in performing the works. The community facilitator and BSPMC should ensure
that men and women who can perform certain tasks under the Pakyaw work contract will be
paid with equal rate. During the community or Barangay assembly, the engineer should
present and discuss works that can be performed by women; corresponding technical
assistance or capacity building shall be provided depending on the nature and type of works.
Appropriate safeguards must be considered in involving women in construction
activities i.e. culture, expossure to risks and others.
A Project Supervisor (PS)9, who shall either be a C/BSPMC representative, a member of the
PIT or hired for the project shall assist oversee the organization of Pakyaw Groups and in
the preparation of Pakyaw contracts. The PS shall be actively involved in the selection of
the members who will constitute the Pakyaw Groups to ensure that Pakyaw
members/leaders are inclined or with similar experience to the scope of works under
consideration. The CF, for purposes of informing the community of the project and of
organizing pakyaw groups, shall convene community meetings, with the assistance of the
C/BSPMC Chairperson.

The Project Supervisor shall be a hired foreman with knowledge and experience on construction.

52

The Pakyaw workers shall be formed into groups of workers based on the item of works to
be implemented through the Pakyaw system. The determination by the PS of the number of
members per Pakyaw Group shall be exercised with regard to the objective of providing
work to as many laborers as possible to facilitate completion of the scope of Pakyaw works.
A Pakyaw labor group shall consist of at least threepersons. The PS shall also oversee the
work of the Pakyaw groups to ensure that these are in compliance with design standards
and technical specifications.
The Pakyaw Contract may be directly awarded by the BAC to the organized group based
on their similar experience inclined to the scope of works under consideration.
A Group Leader shall be elected from among the members of the group who shall be the
signatory to the Pakyaw Contract and any other documents pertaining to the work on behalf
of the Pakyaw Group. He will assist the Project Supervisor in setting out the task and
assuring that the work is undertaken as directed. He may be replaced at any time by the
group through an election for that purpose, after due notice to the PS, CF and the C/BSPMC
Chairperson. Any such replacement shall not invalidate any previous documents entered for
the Pakyaw Contract.
In cases where the C/BSPMC shall supply construction materials, hand tools and
equipment, the PS shall be responsible for safekeeping and maintaining these items and for
ensuring that these are in good working order.
Organized Pakyaw groups from other communities in the vicinity of the municipality with the
experience of carrying out similar types of works may be allowed to participate in the Pakyaw
contracts.
Where there are more than one organized pakyaw groups within the community and the
items of work will require only one pakyaw group, the pakyaw groups shall submit quotations
for the work based on the procedures used for community shopping10. The BAC shall
evaluate the quotations of each pakyaw group in terms of meeting the technical
specifications and quoted price. Award shall be made to the pakyaw group with the most
responsive quotation.
In no case may Pakyaw Groups be regular or licensed contractors or organized by and/or
under the management of a regular or licensed contractor.
The award of Pakyaw Contracts either by Direct Contracting or shopping must be made
through a BAC resolution or minutes of meeting clearly reflecting the Pakyaw Contracts and
groups.
5.5.1. Identification of Items Covered by Pakyaw Contracts
Work items undertaken by pakyaw contracts shall be included in the approved Community
Procurement Plan (CPP). If in the earlier planning the Pakyaw contracting was not
considered but was chosen by the C/BSPMC as a more practical or responsive approach to
the implementation objective, the CPP should be updated. The PT shall identify these items
of work and shall submit the same to the C/BSPMC Chairperson and the BAC for review
and validation with the assistance of the TWG.
5.5.2. Conduct of Negotiations on Pakyaw Contracts

10

Evaluation procedure but not necessarily at least three Pakyaw Groups

53

The BAC Chairperson shall call for a meeting to discuss with the organized Pakyaw groups
their respective scope of work and outputs based on the technical specifications. The PIT,
PS, MIT, group leaders of Pakyaw groups with the assistance of the TF and the Municipal
Engineer shall discuss the work requirements, work to be assigned to each Pakyaw group,
timetable for implementation, schedule for completion, cost of each Pakyaw contract and
payment arrangements. The PT will prepare the minutes of this meeting and the C/BSPMC
Bookkeeper will keep a copy of all the documents.
5.5.3. Contract Award
The PT shall prepare three (3) copies the Pakyaw contract which shall include the
breakdown of tools and equipment to be supplied by the C/BSPMC and shall submit the
same to the C/BSPMC Chairperson for signature. The PT delivers the contract to the
Pakyaw Group Leader who shall sign the contract conforme and returns two (2) copies to
the PT. The PT shall submit copies of the procurement related documents to the ACT office
and file the other copy for records purposes.
5.5.4. Contract Implementation
The Pakyaw Group mobilizes and starts work within three (3) days from contract signing.
The Project Implementation Team (PIT) and the Monitoring and Inspection Team (MIT) shall
regularly monitor the execution of the contract. The Municipal Engineer and TF, shall
conduct regular inspection of the sub-project to ensure that Project policies are complied
and at the same time provide appropriate technical assistance to the community. Engineers
from the RPMO or SRPMT shall conduct periodic or random inspection to validate
implementation compliance.
Payment of contract may be done through: (a) the preparation of a weekly or bimonthly
payroll; or (b) upon submission of a request for payment from the Pakyaw group leader and
endorsed by the PS. The Barangay Treasurer processes payments based on complete
requirements including the work accomplished which are approved and signed by the
C/BSPMC Chairperson. The Community Bookkeeper keeps a record of all files and
documents.
Table 6 provides a summary of all procedures for the pakyaw contracts and explain the
functions of different personnel involved.
5.6. Community Bidding for Goods and Works
Competitive, public or Community Bidding refer to the method of procurement which is
open to participation by any interested and qualified party and which consists of the following
processes: advertisement, pre-bid conference, receipt and opening of bids, evaluation of
bids, postqualification, and award of contract. Competitive bidding opens up the
procurement opportunity to a greater number of suppliers or contractors who compete
among themselves in providing the best goods or services to the community for the best
value. This enables the community to obtain goods and infrastructure projects at the most
advantageous terms.
Community Bidding utilizes simplified tendering procedures where advertisement of bid
opportunities is done locally (within the community, municipality or with other municipalities
and provinces within the vicinity of the sub-project) by posting notices at KC-NCDDP
designated billboards or bulletin boards, public offices of the MIAC and the PIAC, and NGOs,
through local media such as radio or newspaper. The request for bids spells out the
works or goods needed, the criteria for selection and the deadline for submission of
bids. Simplified bidding documents are used as found in Annexes B and C. Bids are

54

opened and evaluated at a designated date and venue presided over by the community
Bids and Awards Committee (BAC). These are examined to determine whether they meet
the minimum specifications mentioned in the bidding documents. Those that meet the
minimum requirements are retained for further evaluation. Contract award is made to
the bidder submitting the Lowest Calculated and Responsive Bid (LCRB) who passes the
post-qualification evaluation and requirements. The award and the amount of the contract
should be announced to all bidders. Contracting will follow the forms specified in this
manual.
The following procedures are applicable for all types of contracts procured under
community bidding.
5.6.1. Identification of Items for Bidding
The Procurement Team identifies the items to be procured through Community Bidding from
the approved Community Procurement Plan (CPP) based on the technical specifications for
goods and the Program of Work (POW) for works. This is then submitted to the Chairperson
of the Barangay Sub-Project Management Committee (C/BSPMC) and the Bids and Awards
Committee (BAC) for review and validation.
5.6.2. Preparation/Revision of the Bidding Documents
Bidding documents are documents issued by the BAC to provide prospective bidders all the
necessary information that they need to prepare their bids. These documents form part of
the contract and clearly and adequately define, among others:
i.
ii.
iii.
iv.
v.

The objectives, scope and expected outputs and/or results of the proposed
contract;
The technical specifications of goods to be procured/scope of work of the works to
be constructed;
Expected contract duration, the estimated quantity in the case of procurement of
goods, delivery schedule and/or time frame;
The obligations, duties and/or functions of the winning bidder; and
The minimum eligibility requirements of bidders, such as track record to be
determined by the C/BSPMC.

The PT and BAC are required to use the standard bidding documents found in Annex B as
the standard format in the preparation of bidding documents.
Upon approval by the C/BSPMC of the items to be procured, the PT prepares the following
documents to be used:
For Goods:
i.
ii.
iii.
i.
ii.
iii.
iv.

Invitation to Bid
Instruction to Bidders
Bid Data Sheet
Conditions of Contract
Schedule of Requirements
Technical Specifications of the goods to be procured
Sample Forms

For Works:
i.

Invitation to Bid (IB)

55

ii. Instruction to Bidders(ITB)

iii. Bid Data Sheet (BDS)
iv. Conditions of Contract (CC)
v. Scope of Work (SOW)
vi. Drawings (if applicable)
vii. Bill of Quantities
vii. Sample Forms
The specifications and other terms in the bidding documents reflect only the minimum
requirements or specifications required so that the bidder may be properly guided in clear
and unambiguous terms on specific needs of the community in its procurement of
infrastructure projects. A bidder can always submit a superior offer than that specified in the
bidding documents. His bid, however, should not be given any premium or bonus during bid
evaluation.
The bidding documents must be prepared in time for presentation at the procurement
preparation meeting. These documents must be finalized before the advertisement and/or
posting of the Invitation to Bid. The C/BSPMC and the BAC shall review the bidding
documents with the assistance of the Community Facilitator (CF) and the Technical
Facilitator.
5.6.3. Conduct of Procurement Preparation Meeting
The procurement preparation meeting is the forum called by the BAC where all officials
involved in the procurement meet and discuss all aspects of a specific procurement activity,
which includes, among others the:
i. Technical Specifications/Scope of Works;
ii. Cost estimates;
iii. Applicability and appropriateness of the recommended method of procurement
and the related milestones;
iv. Bidding documents, and
v. Availability of the pertinent budget release for the project.
The procurement preparation meeting is required to ensure that the procurement is in
accordance with the CPP; confirms the availability of funds for the contract, determines: the
readiness of the community to procure goods and services, in terms of the legal, technical
and financial requirements of the project and works in terms of: availability of the right-ofway (ROW), engineering plans and designs, ownership of affected properties, adherence to
bidding documents, technical plans, specifications and scope of work to relevant general
procurement guidelines; and the availability of all relevant documents in relation to their
adherence to the law.
The PT, BAC, C/BSPMC, and Technical Working Group (TWG) shall meet to discuss the
procurement at hand and to ensure that all requirements are in order. During the same
meeting, the BAC will review and approve the contents of the Invitation to Bid (IB) and the
Chairperson will sign the form for posting. The PT will prepare the minutes of the
procurement preparation meeting and the C/BSPMC Bookkeeper will keep a copy of all the
documents.
5.6.4. Posting/Advertisement of Invitation to Bid
The Invitation to Bid (IB) serves as the notice to the public and all interested parties of the
procurement and bidding opportunities of the community. The posting and/or advertisement
of the IB ensures transparency of the procurement process, widest possible dissemination

56

to increase the number of prospective bidders, and intensify competition for the procurement
activity or project.
The IB may be advertised by the PT once for a minimum period of seven (7) days in any of
the following: regional/provincial newspapers, provincial/municipal/ barangay hall bulletin
boards, KC-NCDDP designated billboard or bulletin board, offices of Municipal Inter-Agency
Committee (MIAC) and Provincial Inter-Agency Committee (PIAC) members, offices of nongovernmental organizations and conspicuous public places such as bus, jeep, tricycle
terminals, public markets, etc. For larger contracts, the BAC may decide to extend the period
for posting and advertisement to a maximum of fourteen (14) days to provide bidders ample
time to prepare their bids. Where computer and internet facilities are available within or in
the vicinity of the community, the IB shall also be posted in the Phil-GEPS website or in the
regional or national KC-NCDDP website. For works, at least three contractors may also be
given direct invitation to participate in the bid.
The Invitation to Bid (CBPM Form D-5 for goods and CBPM Form D-1 for works) shall
contain the following information:
i. For goods: brief description of the goods to be procured;
ii. For works: Name and location of the contract to be bid and project background and
other relevant information regarding the proposed project, including a brief
description of the type, size, major items, and other important or relevant features
of the works;
iii. A general statement on the criteria to be used by the community for eligibility
check; examination and evaluation of bids; and post-qualification;
iv. The date, time and place of the deadline for:
a. The submission, receipt and opening of bids; and
b. The pre-bid conference if any;
v. The source of funding;
vi. The period of availability of the bidding documents and the place where the
bidding documents may be secured;
vii. The contract duration or delivery schedule;
viii. The name, address of the designated contact person;
ix. Such other necessary information deemed relevant by the BAC.
5.6.5. Issuance of Bidding Documents
Bidding documents are documents issued by the PT to provide prospective bidders all the
necessary information that they need to prepare their bids. Prospective bidders must be
allowed to acquire the bidding documents in order to prepare for their eligibility
requirements and bids.
The PT shall promptly issue the bidding documents free of charge to the prospective
bidders from the time the IB is first advertised until immediately before the deadline for
submission of bids which is usually a period of two weeks from posting/publication. The
cost of reproduction and bidding documents preparation shall be charged to the
administrative cost of the sub-project. Hence, a budget should be included in the Program
of Works (POW) for bidding documents. The BAC must issue copies of the bidding
documents to the Observers free of charge.
The Bidding Documents shall contain the following information:
For Goods:
i.

Invitation to Bid (IB)

57

ii. Instruction to Bidders (ITB)

iii. Bid Data Sheet
v. Conditions of Contract
v. Forms of Bid Security and Performance Security
vi. Schedule of Requirements and Drawings (if applicable)
vii. Technical Specifications
viii. Form of Contract Agreement
ix. Sample Forms
For Works:
i. Invitation to Bid (IB)
ii. Instructions to Bidders (ITB)
iii. Bid Data Sheet
iv. Conditions of Contract (General and Special)
v. Form of Contract Agreement (draft)
vi. Scope of Work (SOW)
vii. Engineering Drawings
viii. Bill of Quantities
ix. Form of Bid and Performance Securities
x. Sample Forms
5.6.6. Conduct of Pre-Bid Conference
The pre-bid conference is the initial forum where the BAC, PT and the prospective bidders
discuss the different aspects of the procurement at hand, details of the contract and to clarify
issues that bidders may raise. The pre-bid conference is to be done at least seven (7) days
before the deadline for the submission of bids. Attendance to the pre-bid conference is not
compulsory and should not be a ground for the disqualification of a bidder.
Other members of the community who may attend the pre-bid conference include:
representatives of the Project Implementation Team (PIT) and the Monitoring and Inspection
Team (MIT). The Municipal Engineer (ME) and the Technical Facilitator (TF) shall attend to
provide technical assistance to the BAC and act as resource person in case of requests for
clarification.
During the pre-bid conference, the following items may be discussed:
i.

The eligibility requirements, technical and financial components of the contract to

be bid, the bid evaluation procedure, evaluation criteria, postqualification procedures
and
possible causes of failure of the bidding;
ii. Other requirements in the IB, the replies to the bidders queries about the
requirements, specifications and other conditions of the contract.
iii. The written recording by the PT of minutes of the pre-bid conference, which shall
be available to all participants not later than five (5) days before the opening of
bids.
Practical Tip
It is advisable that technical and knowledgeable officials attend the conference. The
persons who actually formulated the scope of work, plans and technical
specifications for the project should be present and among those representing the
community. Bidders, on the other hand, should be encouraged to send representatives
who are legally and technically knowledgeable about the requirements of the
procurement at hand. It is also important that the bidders are given ample time to

58

review the bidding documents prior to the pre-bid conference.

Practical Tip
The BAC must initiate discussions on contentious issues, most especially if the
participating prospective bidders have no ready questions. It is probable that there are
issues that may not be apparent in the bidding documents but are known to the
representatives of the community. If these issues are brought out and openly discussed,
prospective bidders will be able to prepare responsive bids, thus avoiding situations that
may give rise to a failure of bidding due to lack of bids received or failure
of bids to comply with all the bid requirements. This would also help prevent the birth
contentious issues during the bidding itself.
The BAC may still entertain requests for clarification(s) on any part of the bidding documents
or for an interpretation by prospective bidders provided the following requirements are
complied with:
i. Requests for clarification should be in writing.
ii. Requests for clarification should be submitted to the BAC at least two (2)
calendar days after the pre-bid conference.
5.6.6.1. Supplemental/Bid Bulletins
If there is a request for clarification during the pre-bid conference or thereafter, the BAC
shall issue its response by issuing a supplemental/bid bulletin, to be made available to
all those who have properly secured the bidding documents at least two (2) calendar
days after the submission of request for clarification. The supplemental/bid bulletins shall
clarify or modify any provision of the bidding documents. Any modification to the bidding
documents must be identified as an AMENDMENT.
The BAC should also post the supplemental/bid bulletin in any of the following:
community barangay hall bulletin boards, KC-NCDDP designated billboard or bulletin
board, offices of non-governmental organizations. It will be the prospective bidders
responsibility to ask for, and secure, these bulletins. Bidders who have submitted
bids before a supplemental/bid bulletin is issued have to be informed in writing and
allowed to modify or withdraw their respective bids.
The PT prepares the minutes of the pre-bid conference and posts it at the billboard or
community bulletin board, offices of Municipal Inter-Agency Committee (MIAC) two (2)
calendar days after the pre-bid conference.
5.6.6.2. Site Visit or Inspection
The BAC may organize a site visit or inspection of the community/project site for
prospective bidders if this is critical for the costing and delivery of the goods/works to be
procured. All prospective bidders are required to attend the site visit as this will enable
them to offer a more realistic bid price. Prospective bidders who are not able to attend
the scheduled site inspection may conduct their own inspection provided this is done
before the submission of proposals. The C/BSPMC Chairperson shall issue a Certificate
of Site Inspection to the representative of the prospective bidder and this shall be
presented as a requirement in the opening of bids.
5.6.7. Preparation, Submission and Receipt of Bids

59

The prospective bidder shall take the following considerations in bid submission:
5.6.7.1. Eligibility Check
An Eligibility Check is a procedure used to determine if a prospective bidder is eligible
to participate in the bidding at hand. In the eligibility check, the BAC shall use nondiscretionary pass/fail criteria. A prospective bidder is
eligible to bid for a particular
project if it complies with the eligibility requirements prescribed. The absence,
incompleteness or insufficiency of a document shall render a prospective bidder
ineligible and disqualified to bid for the particular procurement.
Eligibility Requirements for Goods and Services
The prospective bidder shall comply with the following eligibility requirements:
Legal
i. The following manufacturers, suppliers, distributors, and/or service providers
with legal personality and capacity to undertake the contract are allowed to
participate in the bidding: duly registered sole proprietors, partnerships,
corporations or cooperatives duly registered with the Cooperatives Development
Authority (CDA).
ii. Department of Trade and Industry (DTI) business name registration in the case
of Single Proprietorships; or Security and Exchange Commission (SEC)
registration
certificate, in the case of Partnerships or Corporations; or CDA
Registration, in the case of cooperatives;
iii. Valid and current Mayors permit/municipal license from the bidders
principal place of business.
Technical
i.

the experience of having completed, a single contract or an aggregate of

similar contracts that is similar to the contract to be bid or the estimated budget
for the package to be bid, and whose value, must be at least fifty percent (50%)
of the project cost estimate. (CBPM Form D 5-2)
A contract is similar to the contract to be bid if it involves goods or related services
of the same nature and complexity as those which are the subject of the
Community Bidding. This is to assure the community that the prospective bidder
has the technical and financial capability to undertake the contract to be bid.

ii. A statement of the prospective bidder of all its ongoing and completed
government and private contracts within the period specified in the IB, including
contracts awarded but not yet started, if any (please refer to CBPM Form D 53).
Financial
i.

The prospective bidders audited financial statements, stamped received by

the BIR or its duly accredited and authorized institutions, for the immediately
preceding calendar year, showing, among others, the prospective bidders
total and current assets and liabilities;

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ii. The prospective bidders computation of its Net Financial Contracting Capacity
(NFCC) (CBPM Form D 5-4) that is at least equal to the project cost estimate,
calculated as follows:
NFCC =

[(Current assets minus current liabilities) (K)] minus the value of all
outstanding projects under ongoing contracts, including awarded
contracts yet to be started.

Where:
K = 10 for a contract duration of one year or less, 15 for a contract duration
of more than one year up to two years
The NFCC establishes the bidders liquidity, its capacity to absorb the additional
obligations in connection with the contract to be bid and to finance its
implementation/completion.
Eligibility Requirements for Infrastructure Projects
Legal
i. The following contractors with legal personality and capacity to undertake
the contract are allowed to participate in the bidding: duly licensed sole
proprietors, partnerships, corporations or cooperatives duly registered with the
Cooperatives Development Authority (CDA).
ii. A valid license issued by the Philippine Contractors Accreditation Board
(PCAB);
Technical
i.

The experience of having satisfactorily completed a single contract similar to

the contract to be bid, and whose value must be at least fifty percent (50%) of
the estimated budget for the contract to be bid (CBPM Form D 5-2);

ii. A statement of the prospective bidder of all its ongoing and completed
government and private contracts within the period specified in the IB,
including contracts awarded but not yet started, if any (please refer to CBPM
Form B 5-3)
iii. A statement on the:
a. Availability of key personnel, such as project managers, project
engineers, and foremen, that may be used for construction contracts;
and
b. Availability of equipment that it owns, has under lease, and/or has under
purchase agreements, that may be used for construction contracts,
provided that ownership of equipment is not a requisite for eligibility
Financial
i.

The prospective bidders audited financial statements, stamped received

by the BIR or its duly accredited and authorized institutions, for the
immediately preceding calendar year, showing, among others, the
prospective bidders total and current assets and liabilities;

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ii. The prospective bidders computation of its Net Financial Contracting

Capacity (NFCC) (CBPM Form D 5-4) which should at least be equal to the
estimated budget of the contract, calculated as follows:
NFCC = [(Current assets minus current liabilities) multiplied by (K)] minus
The value of all outstanding works or projects under ongoing
contracts, including awarded contracts yet to be started.
Where:
K = 10 for a contract duration of one year or less, 15 for a contract
Duration of more than one year up to two years
Example Given:
Current Assets = P 3,000,000.00
Current Liabilities = P 500,000.00
Value of Outstanding Works = P 4,000,000.00
Contract Duration = 1 year
NFCC = [(P3,000,000 P500,000) x 10] P4,000,000
= P 25,000,000 P 4,000,000
= P 21,000,000.00
The NFCC establishes the bidders liquidity, its capacity to absorb the additional
obligations in connection with the contract to be bid and to finance its
implementation/completion.
5.6.7.2.Technical Proposal
A Bid refers to a signed offer or proposal to undertake a contract submitted by a bidder
in response to the requirements stated in the bidding documents. Bid is also
equivalent to and may be used interchangeably with Proposal. A Bid has two
components, the Technical Proposal and the Financial Proposal. The Technical and
Financial Proposals shall be contained in a single sealed bid envelope.
The Technical Proposal shall contain, at the minimum, the following technical
information/documents:
For Goods:
i. The Bid Security as to form, amount and validity period (CBPM Form D 5-5);
ii. Authority of the signatory (Board Resolution if the bidder is a corporation or
a cooperative, a Partnership Resolution if the bidder is a Partnership, or a
Special Power of Attorney (SPA) issued by the General Manager or
Proprietor if the bidder is a sole proprietor;
i. Delivery schedule;
iv. Manpower requirements, if applicable;
v. After-sales service/parts, if applicable;
vi. Technical specifications;
Although the community is not allowed to refer to brand names in setting technical
specifications/criteria in the bidding documents, a bidder may be required to state the

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brand of the goods offered. However, in the evaluation of bids there

preference to a particular brand name.

shall

be

no

vii. Certificate from the bidder under oath of its compliance with existing labor laws
and standards, in the case of procurement of services (CBPM D 5-7);
vii. Other documents/materials as stated in the Instructions to Bidders (ITB).

For Works:
i.

The Bid Security as to form, amount and validity period (CBPM Form D 55);
ii. Authority of the signatory (Board Resolution if the bidder is a corporation
or a cooperative, a Partnership Resolution if the bidder is a Partnership,
or a Special Power of Attorney (SPA) issued by the General Manager or
Proprietor if the bidder is a sole proprietor;
iii. Construction schedule (bar chart or PERT/CPM) and S-curve;
iv. Manpower schedule (weekly or monthly scheduling of skilled and unskilled
workers, including the Project Manager, Project Engineers, Materials Engineers,
and Foremen);
v. Construction methods (narrative description of how the contractor will
undertake the works under the contract;
vi. Organizational chart for the contract to be bid,
vii. List of contractors key personnel (viz. the Project Manager, Project Engineers,
Materials Engineers, and Foremen), to be assigned to the contract to be bid, their
complete qualification and experience data, and the key personnels signed
written commitment to work on the contract once awarded to the
contractor (CBPM Form D 5-10, 5-11);
viii. List of contractors equipment units pledged for the contract to be bid, which
are owned (supported by proof/s of ownership), leased, and/or under
purchase agreements (with corresponding engine numbers, chassis numbers
and/or serial numbers), supported by certification of availability of equipment
from the equipment lessor/vendor for the duration of the contract (CBPM Form D
5-9);
ix. Equipment utilization schedule (weekly or monthly scheduling of the
minimum equipment required for the contract);
x. Certificate of site inspection signed by the C/BSPMC Chairperson (CBPM
Form D 5-1);
xi. Construction safety and health program of the contractor;
xii. Certificate from the bidder under oath of its compliance with existing labor
laws and standards (CBPM Form D 5-7);
What is a Special Power of Attorney ?
A Special Power of Attorney (SPA) is a legal document where a principal, in this case, a
bidder, grants authority to an agent (Attorney-in-Fact) who is an officer or staff of the firm to
represent him in certain procurement related transactions in case he is not available. For
KC NCDDDP, the SPA can be used solely for the purpose of representing the principal
during the conduct of procurement activities (bid submission, attendance to pre-bid
conference and bid opening) but not in the signing of the contract, its implementation and
execution.
For infrastructure projects, no bidder shall be allowed to submit an absolute SPA authorizing
him to use the valid contractors license of another person or firm.

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5.6.7.3. Financial Proposal

The Financial Proposal shall contain the following financial information/documents, at
the least:

For Goods:
i.

The financial proposal submission sheet, which includes the bid prices and the
bill of quantities for procurement of goods, or scope of work for procurement
of services, and the applicable price schedules; and
ii. The recurring and the maintenance costs, if applicable.
For Works:
i. Bid prices in the Bill of Quantities in the prescribed Bid Form;
ii. Detailed estimates including a summary sheet indicating the unit prices of
construction materials, labor rates and equipment rentals used, indicating
also the direct and indirect costs, in coming up with the bid; and
iii. Cash flow by the quarter and payments schedule.
The prospective bidder shall prepare and submit the eligibility requirements, technical
and financial proposals in three separate envelopes duly marked inside a single sealed
envelope on or before the deadline given by the BAC as provided for in the IB. The
envelope must be marked in the following manner:
(Name of Bidder)
Community Bidding for ______ (name of the contract to be bid)
KC-NCDDP Barangay Sub-Project Management Committee
Address of Barangay
5.6.7.4. Submission and Receipt of Bids
The PT receives the sealed bids at the designated location in the IB. If the bid is
submitted before the deadline stipulated in the IB, the PT member records receipt in the
logbook with the following information:
a.
b.
c.
d.

Date and time received

Name of goods for procurement/Name of Project or Contract to be Bid
Name of Supplier/Contractor
Name and signature of procurement team member receiving the sealed
enveloped

The sealed bids and logbook will be placed in a bid box at C/BSPMC office inside a
secure filing cabinet.
Any technical or financial bid submitted after the deadline for submission and receipt
of bids prescribed by the BAC shall be declared Late and shall not be accepted.
5.6.8. Bid Opening and Evaluation

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Before the prescribed date of the opening of bids, the BAC shall invite the following to
witness the process as observers: the LGU COA Auditor, Barangay Captain, local
government officials, Area Coordinator, Technical Facilitator, Regional Infrastructure
Engineer, Barangay Audit and Inventory Committee Head, or where available
representatives from Civil Society Organizations (CSOs) or community observers. The
invitation shall be in writing and shall be sent at least one week before bid opening. A day
before the bid opening, the PT shall prepare the barangay/community hall for the public
opening of bids.
For adjacent communities or far flung and inaccessible areas within a municipality, it is
advisable that bid opening is done at the municipal hall in order to allow bidders to attend.
On the day of the bid opening, the PT shall bring the logbook and the bid box containing the
sealed envelopes. The bid box shall be locked.
The Eligibility requirements must be marked and must be received from the bidder together
with the Technical and Financial bid duly marked in a single sealed envelope on or before
the deadline as stated in the IB. Any eligibility, technical or financial bid envelope submitted
after the deadline for submission and receipt of bids prescribed in the IB shall be declared
Late and shall not be accepted by the BAC.
The BAC Chairperson shall determine the presence or absence of a quorum and shall
declare a quorum if there is one. The Chairperson shall open the padlock of the bid box and
shall proceed with the opening of the bid envelope.

What is an Ineligible Bid ?

An ineligible bid is a proposal submitted by a supplier/contractor that is considered
disqualified due to the following reasons: (a) late submission; (b) inability to meet the
eligibility requirements such as, non-submission of correct bid security, or lack of eligibility
or technical requirements, among others.
5.6.8.1. Conduct of Eligibility Check
The BAC shall read in public the contents of the eligibility documents, and shall examine
each prospective bidders eligibility requirements or statements. It shall determine the
presence or absence of the required eligibility requirements against a checklist using
non-discretionary pass/fail criteria. A prospective bidder is
eligible to bid for a
particular project if it complies with the eligibility requirements prescribed. The absence,
incompleteness or insufficiency of a document shall render a prospective bidder
ineligible to bid for the particular procurement.
The BAC shall declare prospective bidders as either eligible or ineligible, based on
its findings and inform them accordingly. The eligibility documents shall be marked as
such, and these marking shall be countersigned by the BAC Chairperson. The BAC may
prepare a pro-forma Notice of Eligibility (CBPM Form E-11) and a Notice of Ineligibility
(E-12), which will be duly accomplished by the PT and signed by the BAC members
present. In case a prospective bidder is declared ineligible, the Notice of Ineligibility shall
state the reason for such ineligibility. The Notice will be received officially by the Bidders
authorized representative.
The BAC shall inquire from ineligible bidders who are present during the Eligibility Check
whether or not they intend to file a motion for reconsideration. Those who are present at

65

the time of opening of eligibility requirements, will be notified verbally while those who
are not present will be informed in writing. If they signify their intention to do so upon
verbal notification or written notice, the BAC shall keep the envelope containing the
eligibility requirements and re-seal the same in the presence of all the participants.
These shall be deposited in the Bid Box or any other secured place or location, together
with the Technical and Financial bid, ensuring that the latter documents remain sealed.
The BAC shall have three days to resolve the motion for reconsideration.
The BAC may return the Eligibility, Technical and Financial Bid envelope of an ineligible
bidder if it does not intend to file a request for reconsideration or expressly waives its
right to file a motion for reconsideration.
Even if only one prospective bidder passes the eligibility check, the bidding process
continues. Again, if the eligible bidder submits a bid that is found to be responsive to the
bidding requirements, its bid shall be declared as a Single Calculated and Responsive
Bid (SCRB) and considered for contract award.
If no prospective bidder is found to be eligible, the BAC should declare the bidding a
failure. The BAC then reviews the terms and conditions stated in the IB. If warranted, it
changes any of the terms and conditions, including the quantities or specifications,
provided that the estimated budget cost is left unchanged. It must, thereafter, conduct a
re-bidding, in the process formulating a new IB and posting and publishing this as
required. All bidders that have initially responded to the IB in the first bidding shall be
allowed to submit new bids.
Should a second failure of bidding occur and the C/BSPMC finds that there is a need
to evaluate the responsiveness of the estimated budget for the contract and to revise it,
the C/BSPMC should conduct another public bidding with re-advertisement and/or
posting. Alternatively, the C/BSPMC may enter into direct contracting with a legally,
technically, and financially capable constructor. However, if the C/BSPMC resorts to
direct contracting, the terms, conditions, and specifications of the project as well as the
estimated budget cost must be maintained.
5.6.8.2. Preliminary Review of Technical and Financial Proposals
The BAC shall proceed with the opening of the technical proposal of the eligible bidders,
to determine each bidders compliance with the documents that are required to be
submitted for the technical component of the bid. The opening shall also be done in
public. The BAC shall check the submitted technical documents of each bidder against
a checklist of required technical documents to ascertain if they are all present, using
non-discretionary pass/fail criteria. If the preliminary examination is not completed in
one day, all documents must be kept under lock and key in the designated bid box stored
in a filing cabinet at the barangay hall.
If a bidder submits the required document and meets the eligibility criteria, it shall be
rated passed for that particular requirement. Otherwise, it shall be rated as failed. In
case one or more of the above-required documents in the Technical Proposal is missing,
incomplete or patently insufficient, the bid shall be declared as failed and the
documents are immediately returned to the bidder concerned, together with the Financial
Proposal. A bidder determined as failed has three (3) calendar days upon receipt of
written notice or, if present at the time of bid opening, upon verbal notification, within
which to file a request for a reconsideration with the BAC.
Immediately after determining compliance with the technical requirements, the BAC shall
open the Financial Proposal of each remaining technically complying bidder whose

66

submitted technical requirements were rated passed on the same day. The BAC shall
determine whether one or more of the requirements of the Financial Proposal is missing,
incomplete or patently insufficient. If the Financial Bid is complete, the BAC shall rate it
passed and shall proceed with the evaluation of the Bid. Only bids that are determined
to contain all the bid requirements for both Technical and Financial components shall be
rated passed and shall be considered for evaluation and comparison.
All members of the BAC shall initial every page of the original copies of all bids received
and opened. The entire preliminary review process shall be completed within the day of
the deadline of bid submission. The PT shall prepare the minutes of the bid opening
(CBPM Form E-5) immediately after the bid opening or not later than three (3) calendar
days after the bid opening date, so that copies thereof could immediately be sent to the
BAC members, observers, bidders and other interested parties.
A prospective bidder found ineligible or whose bid was declared failed has three (3)
calendar days from receipt of the Notice of Ineligibility/Failure, within which to file a
written request for reconsideration before the BAC. The BAC has thee (3) calendar days
after it receives a letter requesting for reconsideration, within which to resolve such
request. In the meantime, it will hold on to the Technical and Financial envelope of the
prospective bidder until the request for reconsideration is resolved.
The BAC may return the Eligibility, Technical and Financial envelope if the prospective
bidder is declared ineligible and expressly waives his right to file a request for
reconsideration. Such waiver shall be made in writing, to be executed by the authorized
representative of the ineligible bidder.
A bidder may modify its bid, provided that this is done before the deadline for the
submission and receipt of bids. If such bidder modifies its bid, it shall not be allowed to
retrieve its original bid, but shall only be allowed to send another bid equally sealed,
properly identified, linked or related to its original bid and marked as a MODIFICATION
of the original, and stamped RECEIVED by the BAC. Bid modifications received after
the applicable deadline will not be considered and must be returned to the bidder
unopened. Any discount should form part of the bid submission in the financial proposal.
A bidder may, through a letter, withdraw its bid before the deadline for the receipt of bids.
A bidder may also express its intention not to participate in the bidding through a letter
which should reach and be stamped RECEIVED by the BAC before the deadline for
the receipt of bids. A bidder that withdraws its bid shall not be permitted to submit another
bid, directly or indirectly, for the same contract. A bidder that withdraws its bid prior to
the deadline for submission of bids, for a justifiable cause, does not forfeit its bid security.
5.6.8.3. Bid Security
A bid security is a guarantee that the successful bidder will not default on its offer, and
enter into contract with the community as indicated in the IB, from receipt of the Notice
of Award (NOA), and furnish the performance security. A bid security must be enclosed
with every bid. It must be operative on the date of bid opening. Failure to enclose the
required bid security in the form and amount prescribed by the community shall
automatically disqualify the bid concerned.
Forms and Corresponding Amounts of Bid Security
The bid security shall be in any of the following forms, with the corresponding required
amount:

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FORM OF BID SECURITY

a.
Cash,
certified
check,
cashiers
check/managers check, bank draft; or
b. Bank guarantee confirmed by a reputable
local bank; or
c. Bid Securing Declaration

MINIMUM AMOUNT
2% of Bid
2 % of Bid

Bid Securing Declarations may be used for contracts below 2M procured through
community bidding. Bid Securities in the form of cash or (managers check or cashiers
check) must be deposited in the C/BSPMC Account. All checks and bank guarantees
shall be issued in favor of the C/BSPMC of the community/barangay. Personal checks
are not acceptable as bid security. Bank guarantee as bid security shall be submitted as
part of the bidding documents.
The corresponding deposit slips shall be submitted as part of the bid requirements. Bank
Guarantee as bid security shall be submitted as part of the bidding documents. The
BAC determines the period of validity of the bids and must be included in the bidding
documents. The validity period should not be more sixty (60)calendar days from the date
of the opening of bids. The BAC may extend the period of validity of the bids and the bid
securities by requesting the same in writing from all those who submitted bids before the
expiry date of the same. Bidders, however, shall have the right to refuse to grant such
extension without forfeiting their bid securities. The bidders who refuse to grant the
BACs request for an extension of the period of validity of their bid and bid security will
have the same returned to them. However, they are deemed to have waived their right
to further participate in the bidding.
A Bid Securing Declaration is an undertaking by a prospective bidder, committing to
abide with the bidding conditions including sanctions in the event it violates any of the
following conditions:
i.

Withdraws its bid during the period of bid validity required in the bidding
documents; or
ii. Fails or refuses to accept the award and enter into contract or perform any and
all acts necessary for the execution of the contract, in accordance with the
bidding documents, after having been duly notified of the acceptance of its Bid
during the period of bid validity.
The Bid Securing Declaration shall comply with the standard format found in CBPM Form
E 5-6.The following sanctions shall be applied in case of commission of the
abovementioned acts:
i.

Penalty of automatic blacklisting for two (2) years in all KC-NCDDP

procurement activities; and
ii. Payment of a fine equivalent to the difference between the evaluated bid price
and the project cost estimate.
No bid securities shall be returned to bidders after the opening of bids and before
contract signing, except under any of the following circumstances:
i.

When the bidders failed to comply with any of the requirements to be

submitted in the bid proposal, or
ii. When the bidders were post-disqualified and submitted a written waiver of its
right to file a motion for reconsideration and/or protest.

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Bid securities shall be returned only after the bidder with the LCRB has signed the
contract and furnished the performance security, but in no case later than the expiration
of the bid security validity period indicated in the ITB.
A bidders bid security may be forfeited when:
i. The bidder withdraws its bid beyond the deadline;
ii. The bidder does not accept correction of arithmetical errors;
iii. The bidder being considered for award does not accept the award or does
not sign the contract within the period prescribed in the bidding documents;
5.6.8.4. Detailed Evaluation of Bid
The purpose of detailed bid evaluation is to determine the Lowest Calculated Bid (LCB).
This is done by:
i.

Establishing the correct calculated prices of the bids, through a detailed

evaluation of the financial component of the bids; and
ii. Ranking of the total bid prices as so calculated from the lowest to the
highest.
The bid with the lowest price shall be identified as the LCB.
The entire evaluation process for the evaluation of bids for the procurement of goods
must be completed in not more than two (2) calendar days from the deadline for receipt
of proposals. The BAC should exert effort to complete the process even before the lapse
of the 2-day period, as this will expedite the procurement process.
After the preliminary examination of bids, the BAC, or through the TWG, shall
immediately conduct a detailed evaluation of all bids rated passed, using a nondiscretionary pass/fail criteria, as stated in the IB, which shall include a consideration of
the following:
i.

The bid must be complete. Partial bids or bids not addressing or providing
all of the required items in the bidding documents including, where applicable the
bill of quantities shall be considered non-responsive and automatically
disqualified. If a required item is provided in the financial proposal, but no price
is indicated, the same shall be considered as non-responsive. Specifying a 0
(zero) for the said item, however, would mean that it is being offered for free to
the community and such bid should be considered. A partial bid will not be
considered non-responsive and disqualified if the IB specifically allow partial bids.

ii. For works, the bid must be balanced. The bid for each item of work must be
carefully examined to check if there are no unreasonable deviations from the
Engineers Estimate and that there are no mathematically or materially
unbalanced work items. If there is any finding of an unbalanced bid, the BAC,
may ask the bidder to explain the bid. If the BAC with the assistance of the TWG
is satisfied with the explanation of the bidder, then the BAC will proceed with the
other considerations for bid evaluation. If there is a finding of an attempt to
defraud, the BAC shall recommend to the C/BSPMC Chairperson to reject the
bid.
iii. Computational errors will be corrected. Minor arithmetical corrections to consider
computational errors and omissions shall be made to enable proper comparison
of all eligible bids. Discounts shall be incorporated in the bid price as provided in

69

the bidding documents. Any adjustment shall be calculated in monetary terms to

determine the calculated prices.
iv. All bids shall be evaluated on equal footing. For this purpose, all bidders shall
be required to include the cost of all taxes, such as, but not limited to, value
added tax (VAT), income tax, local taxes, and other fiscal levies and duties which
shall be itemized in the bid form and reflected in the detailed estimates. Such
bids, including said taxes, shall be the basis for bid evaluation and comparison.
The BAC should therefore
presume that the financial proposals submitted by
the bidders include taxes and other costs, such as freight, insurance, and bank
charges, in the evaluation of bid. Hence, a re-computation to factor in these
things is inappropriate and unnecessary.
A bidder is allowed to submit an offer which provides for superior specifications
and/or better terms and conditions to the community at no extra cost. However,
the BAC should not give any bonus, credit or premium to such offer in the bid
evaluation.
v. Bid prices in words, unit prices, and unit cost in the bill of quantities shall prevail
in case of discrepancy. In case of discrepancies between: (a) bid prices in figures
and in words, the latter shall prevail; (b) total prices and unit prices, the latter
shall prevail; (c) unit cost in the detailed estimate and unit cost in the bill of
quantities, the latter shall prevail.
Based on the detailed evaluation of bids, those that comply with the above-mentioned
requirements shall be ranked in the ascending order of their total calculated bid prices,
as evaluated and corrected for computational errors, discounts and other modifications,
to identify the LCB. Total calculated bid prices, as evaluated and corrected for
computational errors, and other modifications, which exceed the estimate shall be
disqualified.

What is an Unbalanced Quotation/Bid ?

An Unbalanced Quotation/Bid is a bid where part of the cost of one work item is shifted to
another item of work making the cost of such item unreasonably high and other items
unreasonably low. There are two types of Unbalanced Quotation/Bid. The first is a
mathematically unbalanced bid where lump sum or unit items appear to be unreasonably high
in the early stages of the project (front loading) to justify a high advance payment and to
collect as much of the contract price leaving very limited funds to complete the latter part of
the project. The second is a materially unbalanced bid where prices for unit items that require
greater quantities are overpriced while prices for those requiring lesser items are underpriced
significantly.
The BAC shall carefully evaluate the unit prices submitted by the bidders to ensure that there
are no unreasonable deviations from the Engineers Estimate. When this occurs, the BAC with
the assistance of the TWG shall conduct a detailed review of the unbalanced bid in terms of
quantities and prices of the work items for errors in the interpretation of plans or estimates,
frontloading, anticipated overruns or underruns and excessive overhead expenses and profit.
Where there is finding to defraud, the unbalanced bid shall be rejected outright. Where all
bidders submit unbalanced bids, the BAC shall declare a failure of bidding and conduct a
second round of bidding or enter into negotiations, where applicable.
5.6.8.5. Abstract of Bids

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After all bids have been received, opened, examined, evaluated and ranked, the BAC
shall prepare the corresponding Abstract of Bids. All members of the BAC shall sign
the Abstract of Bids and attach all the bids with their corresponding bid securities and
the minutes or proceedings of the bidding. The Observers who are present may also
sign the Abstract of Bids if, in their independent observation, the bidding activity
conducted by the BAC followed the correct procedure. The Abstract of Bids shall contain
the following:
i. Name of the contract and its location, if applicable;
ii. Time, date and place of bid opening; and
iii. Names of bidders and their corresponding calculated bid prices arranged from
lowest to highest, the amount of bid security and the name of the issuing entity.
If no bid complies with all bid requirements, the BAC should declare the bidding a failure.
The BAC then reviews the terms and conditions stated in the IB. If warranted, it may
change any of the terms and conditions, including the quantities or specifications,
provided that the estimated cost is left unchanged. The BAC must, thereafter, conduct a
re-bidding, in the process formulating anew IB and posting and publishing this as
required. All bidders who have initially responded to the IB and have been declared
eligible in the first bidding shall be allowed to submit new bids.
Should a second failure of bidding occur and the C/BSPMC finds that there is a need to
evaluate the responsiveness of the estimated cost, and so decides to revise the
estimates cost accordingly, the C/BSPMC should conduct another public bidding with
readvertisement and/or posting. Alternatively, the C/BSPMC may enter into community
direct contracting with a legally, technically, and financially capable supplier/contractor.
However, if the community resorts to direct contracting, the terms, conditions, and
specifications of the project as well as the estimated cost must be maintained.
5.6.9. Postqualification
Post-qualification is the process of verifying, validating and ascertaining all the statements
made and documents submitted by the bidder with the LCB. The post-qualification process
must be conducted and completed within two (2)calendar days from the determination of the
LCB.
During this process, the BAC with the assistance of the TWG verifies and validates the
bidders compliance with the legal, financial and technical requirements of the bid as to their
genuineness and their responsiveness to the requirements. The legal review verifies that
all required licenses, permits and other documents submitted are in order. For works, the
legal requirements verifies that the bidder is not included in any government blacklist, and
the submitted PCAB license belongs to the bidder and is valid for the period of bidding.
For goods, the technical requirements are verified to prove compliance of the goods and
services offered with the requirements of the contract and bidding documents (suppliers
stated expertise and experience, testing and inspection of the goods/products, after-sales
and/or maintenance capabilities, authenticity and sufficiency of the bid security as to type,
amount, form and wording, and validity period.
For works, the technical requirements are verified to ascertain the veracity of documents
submitted to prove the bidders stated competence and experience with regards to the
subject contract and its bidding documents, as well as the competence and experience of
its key personnel to be assigned to the project, to ensure that these meet the minimum
requirements. Verification also shall include the availability and commitment, and/or
inspection and testing, of equipment units owned or to be leased by the bidder, as well as

71

checking the performance of the bidder in its ongoing government and private contracts,
e.g., examination of the Construction Schedule, Construction Methods, Equipment Units and
Equipment Utilization Schedule, List of projects that are on-going, completed and to be
started; statement on similar projects to ensure that these meet the minimum requirements.
Validation shall also be conducted on on-going contracts to check if there are any negative
slippages of at least fifteen percent (15%); or substandard quality of work as per contract
plans and specifications; or unsatisfactory performance of his obligations as per contract
terms and conditions, at the time of inspection; or there are overlaps in the proposed
utilization of the minimum required equipment with those equipment in the on-going works
of the contractor; or that the minimum required experience of the bidders key personnel
were not met; all of which are grounds for disqualification if found by the BAC to be due to
the bidders fault or negligence. Finally, the BAC shall also ascertain the sufficiency of the
bid security as to type, amount, form and wording, and validity period.
For goods, the financial requirements are validated to check the Net Financial Contracting
Capacity (NFCC) in the amount specified over the period stipulated in the ITB. This is to
ensure that the bidder can sustain the operating cash flow of the transaction. The BAC/TWG
conducts a site inspection of the bidders place of business and may also test samples for
compliance with specifications and performance levels, where applicable.
For works, the financial requirements are validated to check the bidders stated net worth
and liquid assets, net working capital, the value of all outstanding or unfinished works under
ongoing contracts, and the bidders NFCC, as recalculated considering developments in the
bidders other projects, whenever applicable. This is done to ensure that the bidder can
sustain the operating cash flow of the contract. This process involves: the examination of
the Bill of Quantities, Detailed Estimates and Cash Flow; and the Bureau of Internal Revenue
(BIR) received audited financial statement.
If the TWG conducts the post-qualification, it prepares a Post-qualification Report to be
submitted to the BAC. The Report shall contain, among others, the activities undertaken with
regard to the post-qualification process, feedback from inquiries conducted, and the results
of any tests conducted by the TWG or an accredited government testing center, where
applicable. The BAC reviews the Post-qualification Report submitted by the TWG. The BAC
determines whether the bidder with the LCB passes all the criteria for post-qualification. If
the LCB passes the post-qualification, the BAC declares it as the Lowest Calculated and
Responsive Bid (LCRB).
After the BAC has determined the LCRB, the PT, with the assistance of the TWG, prepares
the BAC Resolution (Resolution to Award) (CBPM Form E-16) declaring the LCRB and the
corresponding Notice of Award (NOA) (CBPM Form E-17) to the said bidder informing it of
its successful postqualification.
If the bidder with the LCB fails to pass post qualification, the BAC shall immediately notify
the said bidder in writing of its postdisqualification and the grounds for it. The
postdisqualified bidder shall have three (3) calendar days from receipt of the said notification to
request from the BAC, if it so wishes, are consideration of its decision. The BAC shall
evaluate the request for reconsideration, if any, using the same non-discretionary criteria,
and shall issue its final determination of the said request within seven (7) calendar days from
receipt thereof.
Immediately after the BAC has notified the first bidder of its postdisqualification, and
notwithstanding any pending request for reconsideration, the BAC shall initiate and complete
the same post-qualification process on the bidder with the second LCB. If the second bidder
passes the post-qualification, and provided that the request for reconsideration of the first
bidder has been denied, the BAC shall declare the second bidder as the bidder with the

72

LCRB. The C/BSPMC shall then award the contract to it. If the second bidder, however, fails
the post-qualification, the procedure for post-qualification shall be repeated for the bidder
with the next LCB, and soon until the LCRB, is determined for award.
If no bidder passes post-qualification, the BAC shall issue a Resolution declaring a failure of
bidding. The BAC shall then proceed with the procedures specified in the last paragraph of
Section 5.6.8.5.
5.6.10. Prior Review of Contract
Prior to the signing of the contract with the LCRB, the C/BSPMC Chairperson shall request
for clearance to award and to conduct prior review for contracts within the thresholds
specified under Table 1 of Section 4.3.
For Community Bidding for goods and works these are:
Regional Program Management Office (RPMO) contracts more than P 500,000 and
less than P 2.0 M
National Project Management Team (RPMO) - contracts more than P2.0M
Asian Development Bank/World Bank - the first three contracts for the first year sub-projects
in each of the three new Regions (I and III). This shall be adjusted in the succeeding years
based on the findings of the post review and the assessment of performance and risk
analysis for the whole of Component 1.
In the request for No-Objection-Letter (NOL), the PT shall attach photocopies of all the
contract documents with the exception of the letter itself which should be submitted in its
original form.
The staff of the RPMT, NPMT and the ADB/WB shall review all the contract documents and
shall recommend the issuance of the NOL if it finds the documents in order or shall notify
the C/BSPMC Chairperson of its findings and reasons for deferring the issuance of the NOL.
The C/BSPMC Chairperson shall act upon these findings immediately.
5.6.11. Contract Award
5.6.11.1. Contract Approval and Issuance of Notice of Award
The BAC shall issue a Resolution (CBPM Form E-16) recommending to the C/BSPMC
Chairperson to award
the contract to the bidder with the LCRB at its submitted bid
price or its calculated bid price, whichever is lower. Prior to the expiration of the period
of bid validity, the C/BSPMC Chairperson should notify the successful bidder in writing
that its bid has been accepted, through a NOA (CBPM Form E-17).
The PT consolidates all the documents and/or records of the proceedings of the BAC
with regard to the procurement at hand, and attaches the same to the BAC Resolution.
The PT drafts the BAC Resolution recommending award. The BAC approves and signs
the Resolution Recommending Award, and transmits the same to the C/BSPMC
Chairperson who acts on the recommendation. The bidder with the LCRB accepts the
NOA. For contracts requiring prior review, the C/BSPMC Chair
shall wait until the
NOL has been issued by the appropriate authority before the NOA is sent to the winning
bidder.
If the bidder refuses to accept the award within the bid validity period, the BAC shall
forfeit the bid security of the bidder. The BAC may also impose on the erring bidder the

73

penalty of suspension for one (1) year from participation in KC-NCDDP procurement for
the first offense, and suspension for two (2) years for the second offense.
5.6.11.2. Contract Signing and Posting of Performance Security
Upon receipt of the NOA/NOL, where applicable, the BAC schedules the signing of the
contract with the winning bidder who will then post the required performance security
and submit other documentary requirements. The C/BSPMC Chairperson signs the
Contract (three copies) upon submission of the performance security and the signing of
the contract by the winning bidder (two copies) within ten (10) calendar days from receipt
of the NOA. The PT forwards the contract together with the rest of the supporting
documents for filing and safekeeping.
A performance security is a guarantee that the winning bidder will faithfully perform its
obligations under the contract prepared in accordance with the bidding documents. It
must be posted in favor of the community, and will be forfeited in its favor in the event it
is established that the winning bidder fails to perform any of its obligations under the
contract. The winning bidder should furnish the community with the performance security
in accordance with the Conditions of the Contract, and in the form prescribed in the
bidding documents within a maximum period of ten (10) calendar days from the receipt
of the NOA, and in all cases upon the signing of the contract. The performance security
forms part of the contract.
The following steps are followed in the posting of the performance security:
1. The bidder with the LCRB posts a performance security. In so doing, it must
comply with the following conditions:
i.

The performance security must be executed in the form prescribed by the

community in the IB; and
ii. The performance security must at least be co-terminus with the period
of completion of the contract.
2. The community accepts the performance security and indicates such posting and
acceptance by attaching the appropriate form to the contract.
Forms and Corresponding Amounts of Performance Security
The performance security shall be in any of the following forms, with the corresponding
required amount:
FORM OF PERFORMANCE SECURITY
a.
Cash,
certified
check,
cashiers
check/managers check, bank draft; or
b. Bank guarantee confirmed by a reputable
local bank; or

MINIMUM AMOUNT
5% of Contract Price
10% of Contract Price

All checks and bank guarantees for performance security shall be issued in favor of the
Chairperson of the C/BSPMC and shall be deposited in the C/BSPMC Account. The
winning bidder must choose which among the preferred forms it shall submit.
Practical Tip
A deficient performance security should be rejected outright by the community
regardless of the amount of its deficiency. The community should not accept the

74

performance security furnished by the winning bidder if it is deficient as to the minimum

amount prescribed above, even if the
deficiency is minimal and insignificant.
There shall be a corresponding change in the amount of the Performance Security
posted by the winning bidder in the following instances: (a) issuance of an Amendment
to Order/Variation/Change Order- The winning bidder shall post an additional
performance security following the schedule above to cover any cumulative increase of
more than ten percent (10%) over the original value of the contract as a result of an
amendment to order/variation/change order. The percentages in the schedule above
must be applied to increases in the original value of the contract. The winning bidder
must also cause the extension of the validity of the performance security to cover
approved contract time extensions; (b) partial delivery/performance/completion of works
- If the contract value is reduced because part of the goods or services under the contract
had already been delivered or completed, and accepted, or if the contract value is
reduced for partial completion of works which are usable and accepted by the C/BSPMC,
and the use of it will not affect the structural integrity of the entire project, the community
shall allow a proportional reduction in the original performance security. However, this
proportional reduction in the value of the performance security is allowed only when the
contract allows for partial deliveries or performance. Moreover, the reductions must be
more than ten percent (10%), and the aggregate of such reductions must not be more
than fifty percent (50%) of the original performance security.
The C/BSPMC may release the performance security to the winning bidder after the
issuance of the Certificate of Acceptance of the goods/works, provided that there are no
claims for labor and materials filed against the contractor. However, it must ensure that
the performance security is replaced by a warranty covering the defects liability period.
For works, upon signing of the contract and submission of the performance security, the
BAC shall issue the Notice to Proceed (NTP) together with a copy or copies of the
approved contract to the successful bidder within three (3) calendar days from the date
of approval of the contract by the C/BSPMC Chairperson. Unless otherwise specified in
the contract, a contract is effective upon receipt of the NTP. If an effectivity date is
provided in the NTP, such date shall not be later than seven (7) calendar days from
issuance thereof.
5.6.12. Contract Implementation
For Goods:
The winning bidder delivers the goods in accordance with the provisions of the contract,
technical specifications and other requirements on the scheduled delivery date. The Project
Implementation Team (PIT) with the assistance of the Municipal Engineer, concerned MIAC
member and the TF monitors the delivery of the goods. The Barangay Treasurer processes
payments of the delivered items through the preparation of disbursement vouchers (DV)
signed by him with the C/BSPMC Chairperson. The Municipal Financial Analyst (MFA)
reviews the documents submitted, initials the duplicate copy of the check to indicate all
documents are in order before the Area Coordinator (AC) finally signs the check. The
winning bidder signs the DV, logbook and issues an official receipt.
In the case of staggered deliveries, monitoring, inspection and payments shall be made on
a staggered basis in accordance with the procedures discussed above and as provided for
in the bidding documents.
For Works:

75

The winning contractor mobilizes and starts work within seven (7) days from receipt of the
NTP. The contractor has the option to claim for advance payment equivalent to 15% of the
contract price subject to the submission of a certification from the TF that equipment and
materials are already on the jobsite and a bank guarantee equivalent to the amount
requested within three (3) calendar days.
The Project Implementation Team (PIT) and the Monitoring and Inspection Team (MIT) shall
regularly monitor the execution of the contract. The Municipal Engineer, TF, Community
Infrastructure Officer (CIO) shall conduct regular inspection of the project site and provide
technical assistance to the community.
The Barangay Treasurer processes payments of the work accomplishment through the
preparation of disbursement vouchers (DV) which is approved and signed by the C/BSPMC
Chairperson as recommended by the PIT and noted by the Municipal Engineer.
The Municipal Financial Analyst (MFA) reviews the documents submitted, initials the
duplicate copy of the check to indicate all documents are in order before the Area
Coordinator (AC) finally signs the check. The winning contractor signs the DV, logbook and
issues an official receipt.
All records of documents pertaining to procurement, finance and project implementation
based on a checklist shall be reviewed by the Community Facilitator and turned over to the
Municipal Financial Analyst who shall reproduce four copies with the following mode of
distribution: the original documents submitted to COA, a copy for the community, a copy for
the ACT and a copy for the RPMT.
As often as necessary, the Municipal Engineer, TF, Area Coordinator (AC) and the
Community Infrastructure Officer(CIO) shall conduct regular inspection of the goods/works
and provide technical assistance to the community.
Tables 7 and 8 provide a summary of all procedures for the procurement of goods and works
through Community Bidding and explain the functions of different personnel involved.
5.7. Consultant QualificationSelection/Single Source Selection/Individual Consultant
Selection for Consulting Services
Consulting Services refer to services offered by external technical service providers or
professional experts in the planning and implementation of project specific activities that are
beyond the capability of C/BSPMC or the local government unit (LGU) to undertake. Such
services are generally funded under the Technical Assistance Fund (TAF) to support subproject proposals that are identified as technically-complicated for community volunteers to
carry out. Communities are allowed to pool their individual allocation of P 15,000 with other
communities within the municipality to hire the services of such technical experts to assist
in the preparation of the feasibility studies, technical plans and drawings, detailed cost
estimates, program of work, supervise construction work, among others. Examples of
consulting services that may be required include: survey works (horizontal and vertical
controls), technical specifications, design drawings, detailed cost estimates, construction
supervision, feasibility studies for enterprise development projects, training on operations
and maintenance plans for revenue generating sub-projects, among others. These are
generally individual consultants who are based in the area where the projects are located or
consulting firms in the case of municipalities with common technical requirements for their
sub-projects. Consulting firms may be hired through consultant qualification selection (CQS)
where there is more than one qualified consulting firm; single source selection (SSS) where

76

there is only one consulting firm, while individual consultants may be hired through individual
consultant selection (ICS) or single source selection (SSS).
The need to procure consulting service providers shall be decided upon during the Municipal
Inter-Barangay Forum for Criteria Setting Workshop (MIBF-CSW). The TF shall assist the
communities in the preparation of the Terms of Reference (TOR) which shall include the
type of required expertise, qualification requirements, scope of work, deliverables/outputs
and duration of services, among others. The TAF-eligible communities shall submit a
request to the RPMO (for contracts below P 1M) and the NPMO (for contracts above P 1M)
for the use of the TAF to procure consulting services. The request shall include the following
supporting documents: the TOR, the identification of the TAF-eligible communities, the type
of consulting service to be used (firm or individual), the appropriate method of procurement,
the estimated cost and schedule of fund releases, the project implementation schedule, the
draft contract agreement, among others. The RPMO/NPMO shall review the submitted
documents and once the documents are considered to be in order, they shall provide the
necessary approval. It shall also create a Technical Working Group for the purpose.
A Lead Barangay shall be elected from among the TAF-eligible barangays and will serve as
the contracting party on behalf of the eligible barangays who may need the services for their
proposed community projects. The Lead Barangay will open a community account where
the TAF grant and the required local counterpart contributions from the concerned
barangays shall be deposited and withdrawn.
RPMO Managed TAF:
The RPMO through the SRPMO may consolidate the proposed subprojects requesting for
TAF and facilitate the engagement of service providers at the regional level.
TAF may be used to hire service providers who will be assigned or based at the
RPMO/SRPMO to provide technical assistance to the municipalities. The service providers
may be contracted output based or time based as may be appropriate based on the terms
of reference (TOR) prepared for the engagement.
Hiring of Service Providers will be facilitated by the RPMO following the procedures in the
NCDDP Program Procurement Guidelines. Funding and payment shall be made in
accordance with the KC-NCDDP FMS sub-manual.
A separate guidelines for TAF will be prepared as annex of this manual. The guidelines will
cover the use of TAF in disaster affected areas.
5.7.1. Ad-Hoc Bids and Awards Committee (BAC) for Consulting Services at the
Community level
The TAF-eligible communities shall decide among themselves whether they will appoint an
existing Bids and Awards Committee (BAC) and Procurement Team (PT) or create a
separate BAC composed of at least three (3) members including the BAC chairperson from
the eligible communities who shall serve in an ad-hoc capacity for purposes of procuring the
consulting services. The ad-hoc BAC (AHBAC) and ad-hoc Procurement Team (AHPT) shall
be responsible for undertaking the procurement process. The project preparation team
(PPT) may serve as procurement team at this stage in case the community do not have
existing PT or in the case of new areas.
5.7.2. Preparation of Request for Proposal/Quotation

77

Upon approval of the RPMO/NPMO of the request to utilize the TAF and to hire consultants,
the AHPT shall prepare the following:
For Consulting Firms
i.
ii.
iii.
iv.
iv.

A short list of eligible service providers for qualification selection (for firms to
be eligible, they must meet the qualification requirements stated in the TOR);
Request for Proposal Forms;
Consultancy Agreement/Contract;
Abstract of Technical/Financial Proposals;
Terms of Reference, as approved

For Individual Consultants or Service Providers

i.

When there are more than three applicant service providers, a short list of at
least three (3) candidates (for individuals to be qualified, they must meet the
requirements stated in the TOR); in case, there is less than three qualified
candidates, evaluation may still proceed with the BAC resolution that there is
limited service providers in the area
ii. Curriculum Vitae/Resume Forms;
iii. Consultancy Agreement;
iv. Terms of Reference, as approved
5.7.3. Conduct of Procurement Preparation Meeting
The AHPT, AHBAC, Lead Barangay and Technical Working Group (TWG) shall meet to
discuss the procurement at hand and to ensure that all requirements are in order. During
the procurement preparation meeting, the firms/individuals in the short list of eligible service
providers/qualified candidates shall be invited and oriented on the objectives of the project
and the terms of reference, the number of barangays to be covered, types of sub-projects
requiring technical assistance, contract management and payment arrangements. The
conference shall also cover the following in the agenda:
i. Dates of submission and opening of proposals;
ii. Evaluation criteria, preparation and submission of work plan/schedule of
activities including the cost breakdown;
iii. CEAC schedule and procedures for MIBF-Project Development Planning and
Resource Allocation (PDPRA) where the technical outputs of the service
providers are critical in the identification and selection of sub-projects for the
barangay to avail of project grants.
iv. Process review of the technical outputs and leveling-off on the technical
standards of the Project;
v. Conditions of the contract, (e.g., schedule for submission of deliverables
and basis and mode of payment).
In the same meeting, the BAC will review and approve the proposal forms and contents of
the Notice of Request for Proposals (NRFP) and the Chairperson will sign the form for
posting. The AHPT will prepare the minutes of the procurement preparation meeting and
the Lead Barangay will keep a copy of all the documents. The procurement preparation
meeting shall continue even if there is only one consulting firm/individual attending or
signifying interest to submit a proposal.
The AHBAC and the TWG shall decide on the criteria for the selection of consulting firms
based on qualification selection and may assign the weights to be provided as follows:

78

i.
ii.
iii.

Experience of the firm related to the proposed projects (30%)

Plan, approach, methodology or schedule (30%)
Experience and qualification of individual experts based on the TOR (40%)

5.7.4. Posting of Notice of Request for Proposal (NRFP)

The BAC may post the Notice of Request for Proposal (NRFP) for a period of at least three
(3) days for information purposes only at any of the following: municipal/ barangay hall
bulletin boards, KC-NCDDP designated billboard or bulletin board, offices of Municipal InterAgency Committee (MIAC).
The Notice of Request for Proposal shall contain the following information:
i. Brief description of the services to be procured;
ii. The date, time and place for the deadline for the submission, receipt and
opening of proposals;
iii. Contract duration;
iv. The name, address of the designated contact person;
v. Such other necessary information deemed relevant by the BAC.
5.7.5. Issuance of Request for Proposal
The AHPT issues the Request for Proposal (RFP) to the eligible service providers/qualified
candidates included in the shortlist who attended the procurement preparation meeting.
They shall request the consultants to submit the proposal/resume in a sealed envelope at
the duly designated municipal hall or at the barangay hall of the Lead Barangay, whichever
is applicable within three (3) days. The AHPT should ask the consultant to acknowledge
receipt of the proposal form by signing the acknowledgement receipt. Only those consultants
included in the short-list may submit proposals.
5.7.6. Submission, Receipt and Evaluation of Proposals for Consulting Firms
The prospective consulting firm shall fill up and submit the Request for Proposal in a sealed
envelope within the prescribed period for submission. The AHPT shall receive the sealed
proposals at the duly designated venue on the date specified. Where there are at least three
consulting firms in the area, the proposals shall be evaluated through qualification selection,
when there is only one available consulting firm, single source selection shall apply.
The AHBAC shall invite the following to assist in the review and evaluation of proposals on
the day specified for the opening of the proposals: the Municipal Auditor, Area Coordinator,
Regional Community Development Specialist and the members of the Technical Working
Group (TWG).
CONTENTS OF THE TECHNICAL PROPOSAL FOR QUALIFICATION SELECTION
The Technical Proposal should contain, at the minimum, the following technical
information/documents:
i. List of completed and on-going projects;
ii. Approach, work plan, and schedule; and
iii. List of key personnel to be assigned to the contract to be bid, with their complete
qualification and experience data.
CONTENTS OF THE FINANCIAL PROPOSAL FOR QUALIFICATION SELECTION

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The Financial Proposal shall contain the following financial information/documents, at the
least:
i.

Remuneration cost indicating the basic salary, overhead cost, and management
fee for consulting firms;
ii. Reimbursable cost; and
iii. Other items as may be required in the TOR.
The financial proposal should clearly estimate the value added tax, income tax, local taxes,
duties, fees, levies and other charges, as applicable.
The purpose of the evaluation of proposals is to determine the Highest Rated Proposal
(HRP) based on the conditions set forth in the RFP. The proposal shall be subject to
validation of qualifications and experience requirements where the service provider is
determined as the Highest Rated and Responsive Proposal (HRRP). For single source
selection, the proposal of the firm shall also be validated.
The AHBAC with the assistance of the TWG shall first open the technical proposals of the
service provider and ranks the firm according to: its experience; the experience of individual
personnel to be assigned to the project; and approach or work plan. The firm with the most
appropriate qualifications that meet the requirements of the TOR shall be selected. They
shall be invited for negotiations based on the estimated cost of the project and the submitted
financial proposal. When an agreement is reached, the contract shall be awarded to the firm
but when negotiations fail, the AHBAC shall start negotiations with the next ranked firm until
an agreement is reached. For single source selection, the AHBAC shall still negotiate with
the firm based on the submitted requirements and estimated contract cost until an
agreement is reached.
Individual consultants do not need to submit technical or financial proposals.
However, they need to submit their curriculum vitae highlighting the relevant work
experience required for the project. The AHBAC, with the assistance of the TWG shall
select among the shortlisted consultants, the most qualified based on the TOR. They
shall be invited for negotiations based on the estimated cost of the project and when
an agreement is reached, the contract shall be awarded to them. Where there is only
one qualified individual consultant, the contract shall be awarded to him/her based
on the estimated contract cost.

5.7.7. Prior Review of Contract

Prior to the signing of the Contract, the Chairperson of the Lead Barangay shall request for
clearance to award and to conduct prior review for contracts within the thresholds specified
under Table 1 of Section 4.3.
For contracts up to P 1M - Regional Program Management Office (RPMO)
For contracts above P 1M National Project Management Office (NPMO)
In the request for No-Objection-Letter (NOL), the AHPT shall attach photocopies of all the
contract documents with the exception of the letter itself which should be submitted in its
original form.

5.7.8. Contract Award and Contract Signing

Upon receipt of the NOL, the AHPT shall prepare three (3) copies of the Notice of Award
(NOA) and shall submit the same to the Chairperson of the Lead Barangay for signature.

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The NOA shall be issued to the winning consulting firm/individual who shall sign his/her
conforme and returns two (2) copies to the AHPT.
Upon receipt of the NOA, the AHBAC schedules the signing of the contract with the winning
consultant. The Chairperson of the Lead Barangay signs the contract (three copies) with the
winning consultant within ten (10) calendar days from receipt of the NOA. The AHPT
forwards the contract together with the rest of the supporting documents for filing and
safekeeping. No performance bond shall be required for these types of consultancy
contracts.
Upon signing of the contract, the AHBAC shall issue the Notice to Proceed (NTP) together
with a copy or copies of the approved contract to the successful consultant within three (3)
calendar days from the date of signing. Unless otherwise specified in the contract, a contract
is effective upon receipt of the NTP. If an effectivity date is provided in the NTP, such date
shall not be later than seven (7) calendar days from issuance thereof.
The PT shall furnish copies of the signed contract to the Municipal Auditor and the RPMO.
Table 9 provides a summary of all procedures for the procurement of consulting services
through Qualification/Single Source and Individual Consultant Selection and explains the
functions of different personnel involved.

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Table 2. Matrix of Procedures for Community Shopping for Goods with Functions of Various Procurement Personnel
Procedures

Time Frame

1. Identify items for Community Shopping from

approved CPP

1 cd

2.Prepare Requests for Quotation Form

3.Conduct of Procurement Preparation

SUPPLIER

BAC

C/BSPMC

TWG

Prepare items for

procurement

Review items
to be procured

1 cd

Prepare quotation
documents

1cd

Discuss
procurement at
hand
Prepare minutes

Review
quotation s
forms
Discuss
procurement at
hand
Sign NRQ for
posting

Review items
to be
procured
Review
quotation
forms
Discuss
procurement
at hand

Discuss
procurement
at hand

Meeting

4. Posting of Notice of Request for Quotation

5. Issuance of Request for Quotation Form

Once for a
minimum of 3
cd
2c d

6. Submission and Receipt of Quotations

3cd

7. Opening and Evaluation of Quotations

1c d

PT

ACT

RPMO/NPMO/AD
B/WB

CF calls for the

meeting
TF provides
technical
assistance and
acts as resource
person

Posts NRQ

Prepares
quotation and
submits the
same to the
BAC

Issues quotation
forms
Receives the
sealed quotations
on or before the
deadline
Receives all
quotation
Prepares minutes of
quotation
evaluation
Prepares Abstract
of Quotations

CF to accompany
PT members

Invites TWG
and AIT Head
to assist in
quotation
evaluation
Opens
quotations and
checks
responsivenes
s of quotation

Assists the
BAC in the
evaluation of
quotations

TF provide
technical
assistance

82

Procedures
8. Prior Review of Contract

9. Contract Award

10. Contract Implementation

Time Frame

SUPPLIER

PT

BAC

Not more
than 30 days

1c d

As specified
in the PO

Signs the PO

Delivers goods
as provided in
contract

C/BSPMC

TWG

ACT

C/BSPMC
Chair
Requests for
Clearance to
Award
Signs the PO
Approves and
signs the PO

Prepares and
delivers the PO
Provides LGU COA
and RPMO with
copies of PO and
supporting
documents
Compiles copies of
all documents for
consolidation with
other project related
documents

RPMO/NPMO/AD
B/WB
Reviews contract
documents and
issues NOL

MIT and
TWG
inspects and
receives
goods and
signs PO and
delivery
receipt

Table 3. Matrix of Procedures for Community Shopping for Works with Functions of Various Procurement Personnel
Procedures

Time Frame

SUPPLIER

PT

BAC

C/BSPMC

TWG

Review items
to be
procured
Review IFQ
documents
and forms
Discuss
procurement
at hand

Discuss
procurement
at hand

1. Identify items for Community Shopping

from approved CPP

1 cd

Prepare items for

procurement

Review items
to be procured

2.Prepare Notice of Request for Quotation

(NRFQ)

1 cd

Prepare IFQ
documents

3.Conduct of Procurement Preparation

2cd

Discuss
procurement at
hand
Prepare minutes

Review IFQ
documents
and forms
Discuss
procurement at
hand
Sign NRQ for
posting

Meeting

ACT

RPMO/NPMO/AD
B/WB

CF calls for the

meeting
TF provides
technical
assistance and

83

Procedures

Time Frame

SUPPLIER

PT

BAC

C/BSPMC

TWG

ACT

RPMO/NPMO/AD
B/WB

acts as resource
person
4. Posting of Notice of Request for
Quotation (NRQ)
5. Issuance of Notice of Request for
Quotation

6. Conduct of Conference for Shopping

for Works

Once for a
minimum of 3 c d
1cd
At least 5 days
before the
submission of
quotations
At least 3 days
before the
submission of
quotations

7. Submission and Receipt of Quotations

3cd

8. Opening and Evaluation of Quotations

Not more than 2

days

Posts NRQ
Issues IFQ forms

Attends
conference

Prepares required
documents and
minutes

Prepares
quotation and
submits the
same to the
BAC

Receives the
sealed quotations
on or before the
deadline
Receives all
quotations
Prepares minutes of
quotation
evaluation
Prepares Abstract
of quotations

CF to accompany
PT members

Attends
conference
Invites Project
Implementatio
n Team (PIT),
Municipal
Implementatio
n Team (MIT),
Municipal
Engineer, TF
and
contractors

Invites TWG
and PIT Head
to assist in
quotation
evaluation
Opens
quotations and
checks
responsivenes
s of quotation

Attends
conference
Chairperson
issues
Certificate of
Site
Inspection to
participating
contractors

TF to attend
conference and
provide technical
assistance

Assists the
BAC in the
evaluation of
quotations

TF provide
technical
assistance

84

Procedures
9. Prior Review of Contract

10. Contract Award

11. Contract Implementation

Time Frame

SUPPLIER

PT

BAC

Not more than 5

days upon
receipt of NOL
documents
1cd

As specified in
the contract

Signs the
contract
Posts the
required
performance
security
Mobilizes and
starts work as
provided in
contract
May request
for advance
payment

C/BSPMC

TWG

ACT

C/BSPMC
Chair
Requests for
Clearance to
Award
Signs the
contract
Approves and
signs the
contract

Prepares and
delivers the contract
Provides LGU COA
and RPMO with
copies of PO and
supporting
documents
Compiles copies of
all documents for
consolidation with
other project related
documents

RPMO/NPMO/AD
B/WB
Reviews contract
documents and
issues NOL

PIT, MIT and

TWG
inspects and
monitors
status of
accomplishm
ent

Table 4. Matrix of Procedures for Community Direct Contracting for Goods with Functions of Various Procurement Personnel
Procedures

Time Frame

SUPPLIER

PT

BAC

C/BSPMC

TWG

Review items
to be
procured
Review
forms
Discuss
procurement
at hand

Discuss
procurement
at hand

1. Identify items for Community Direct

Contracting from approved CPP

1 cd

Prepare items for

procurement

Review items
to be procured

2.Prepare Requests for Quotation

1 cd

Prepare documents

Review forms

3.Conduct of Procurement Preparation

1cd

Discuss
procurement at
hand
Prepare minutes

Discuss
procurement at
hand
Sign NRQ for
posting

Meeting

ACT

RPMO/NPMO/AD
B/WB

CF calls for the

meeting
TF provides
technical
assistance and
acts as resource
person

85

Procedures
4. Posting of Notice of Request for Quotation
5. Issuance of Request for Quotation Form

Time Frame
Once for a
minimum of 3
cd
2cd

6. Submission and Receipt of Quotations

3cd

7. Opening and Evaluation of Quotations

1cd

8. Prior Review of Contract

9. Contract Award

10. Contract Implementation

SUPPLIER

PT

As specified
in the PO

C/BSPMC

TWG

ACT

RPMO/NPMO/AD
B/WB

Posts NRQ

Prepares
quotation and
submits the
same to the
BAC

Issues quotation
forms
Receives the
sealed quotations
on or before the
deadline
Receives all
quotation Prepares
minutes of
quotation
evaluation
Prepares Abstract
of Quotation

Not more
than 30 days

1cd

BAC

Signs the PO

Delivers goods
as provided in
contract

Prepares and
delivers the PO
Provides LGU COA
and RPMO with
copies of PO and
supporting
documents
Compiles copies of
all documents for
consolidation with

CF to accompany
PT members

Invites TWG
and AIT Head
to assist in
quotation
evaluation
Opens
quotations and
checks
responsivenes
s of quotation

Assists the
BAC in the
evaluation of
quotations

C/BSPMC
Chair
Requests for
Clearance to
Award
Signs the PO
Approves and
signs the PO

TF provide
technical
assistance

Reviews contract
documents and
issues NOL

MIT and
TWG
inspects and
receives

86

Procedures

Time Frame

SUPPLIER

PT

BAC

other project related

documents

C/BSPMC

TWG

ACT

RPMO/NPMO/AD
B/WB

goods and
signs PO and
delivery
receipt

Table 5. Matrix of Procedures for Community Direct Contracting for Works with Functions of Various Procurement Personnel
Procedures

Time Frame

SUPPLIER

PT

BAC

C/BSPMC

TWG

Review items
to be
procured
Review
forms
Discuss
procurement
at hand

Discuss
procurement
at hand

1. Identify items for Community Direct

Contracting from approved CPP

1 cd

Prepare items for

procurement

Review items
to be procured

2.Prepare Requests for Quotation

1 cd

Prepare documents

Review forms

3.Conduct of Procurement

1cd

Discuss
procurement at
hand
Prepare minutes

Discuss
procurement at
hand
Sign NRQ for
posting

Preparation Meeting

4. Posting of Notice of Request for

Quotation
5. Issuance of Request for Quotation
Form

Once for a
minimum of 3 c d
1cd

6. Submission and Receipt of

Quotations

Within 5 days after

issuance of IFQ

ACT

RPMO/NPMO/AD
B/WB

CF calls for the

meeting
TF provides
technical
assistance and
acts as resource
person

Posts NRQ
Attends the
site inspection
as may be
applicable

Issues quotation
forms

Prepares
quotation and
submits the

Receives the
sealed quotations

Issues a
Certificate of
Site
Inspection as
may be
applicable

CF to accompany
PT members

87

Procedures

Time Frame

SUPPLIER
same to the
BAC

7. Opening and Evaluation of Quotations

8. Prior Review of Contract/ NOL

issuance

9. Contract Award

10. Contract Implementation

1cd

PT
on or before the
deadline
Receives all
quotation
Prepares minutes of
quotation
evaluation
Prepares Abstract
of Quotation

Procurement action
not more than 5
days upon receipt
of NOL Documents
1cd

As specified in the
contract

Signs the
contract and
posts required
performance
security
Mobilizes and
starts work as
provided in
contract
May request
for advance
payment

Prepares and
delivers the PO
Provides LGU COA
and RPMO with
copies of PO and
supporting
documents
Compiles copies of
all documents for
consolidation with
other project related
documents

BAC

C/BSPMC

Invites TWG
and PIT Head
to assist in
quotation
evaluation
Opens
quotations and
checks
responsivenes
s of canvass

TWG

Assists the
BAC in the
evaluation of
quotations

C/BSPMC
Chair
Requests for
Clearance to
Award
Signs the PO
Approves and
signs the PO

ACT

RPMO/NPMO/AD
B/WB

TF provide
technical
assistance

Reviews contract
documents and
issues NOL

PIT, MIT and

TWG
inspects and
monitors
status of
accomplishm
ent

88

Table 6. Matrix of Procedures for Pakyaw Contracts for Works with Functions of Various Procurement Personnel
Procedures
1. Organization of Pakyaw Groups

Time Frame

2. Identify items Covered by Pakyaw Contract

in approved CPP
3.Conduct of Negotiations on Pakyaw

4.Contract Award
5. Contract Implementation

PAKYAW GROUP

1 cd
1 cd

1cd
As specified
in the
contract

PT

BAC

Identify items of
work for Pakyaw
Prepare minutes

Attend meeting

GL sign contract
Mobilizes and starts work
as provided in contract

Review items
Call for
meeting to
discuss scope
of work and
technical
specs

Prepare contract
Compiles copies of
all documents for
consolidation with
other project
related documents

C/BSPMC
C/BSPMC to hire/
appoint PS
PS to assist organize
community labor into
Pakyaw groups
Review items

CF/PIT/MIT
CF to enlist
available labor in
the community

Review forms

Discuss work
requirements and
assignments,
timetables,
contract cost,
payment
arrangements

TF/ME

Assist the
PT
Discuss the
technical
aspect of
the subproject

Sign contract
PIT, MIT to inspect
and regularly
monitor works
executions

Conduct
regular
inspection

Table 7. Matrix of Procedures for Community Bidding for Goods with Functions of Various Procurement Personnel
Procedures
1. Identify items for Community Bidding from
approved CPP

Time Frame
1 cd

2.Prepare/revise bidding documents

3.Conduct of Procurement Preparation

Meeting

SUPPLIER

PT
Prepare items for
procurement
Prepare bidding
documents

1cd

Discuss
procurement at
hand
Prepare minutes

BAC

C/BSPMC

Review and
validate items
to be procured
Review
bidding
documents
Discuss
procurement at
hand
Sign IB for
posting

Review and
validate items
to be procured
Review bidding
documents
Discuss
procurement at
hand

TWG

ACT

RPMO/NPMO/AD
B/WB

CF and TF assists
in the review
Discuss
procurement
at hand

CF calls for the

meeting
TF provides
technical
assistance and

89

Procedures

4. Posting/advertisement of Invitation to Bid

5. Issuance of Bidding Documents

6. Conduct of Pre-Bid Conference

Time Frame

SUPPLIER

2cd
Once for a
minimum
period of 7 c
d
2 weeks from
date of
posting of IB

PT

Posts Invitation to
Bid

Approves
issuance of IB

Issues bidding
documents

Approves
issuance of
bidding
documents
Attends prebid conference
Invites Project
Implementatio
n Team (PIT),
Municipal
Implementatio
n Team (MIT),
Municipal
Engineer, TF
and bidders

1cd
At least 7
days before
deadline for
bid
submission

Attends prebid conference

Prepares required
documents, minutes
and supplemental
bid bulletins where
applicable

7. Preparation, Submission and Receipt of

Bids

As prescribed
in the bidding
documents

Receives the
sealed bids on or
before the deadline

8. Issuance of Supplemental/Bid Bulletins

Within 2 days
after pre-bid
conference
Not more
than 5 c d

Prepares
technical and
financial
proposal and
submits the
same to the
BAC
Submits
request for
clarification

9. Eligibility and Bid Opening and Evaluation

BAC

Posts
Supplemental/Bid
Bulletin
Prepares barangay
hall for bid opening
Places received
bids in bid box

Issues
Supplemental/
Bid Bulletin
Invites
Observers to
witness bid
opening

C/BSPMC

TWG

ACT

RPMO/NPMO/AD
B/WB

acts as resource
person
CF ensures wide
circulation of IB

TF to provide
technical
assistance
Attends pre-bid
conference
Chairperson
issues
Certificate of
Site Inspection
to participating
bidders

TF to attend prebid conference

and provide
technical
assistance

Assists the
BAC in the
evaluation of
bids and

TF to provide
technical
assistance
TF to attend bid
opening and
provide technical
assistance

90

Procedures

10. Postqualification

11. Prior Review of Contract

12. Contract Award

13. Contract Implementation

Time Frame

SUPPLIER

PT

BAC

Prepares minutes of
bid evaluation
Prepares Abstract
of Bids

Opens bid
proposal and
checks
compliance
with
requirements
according to
procedures
Examines bids
using pass/fail
criteria
Conducts
verification and
validation of
submitted
legal, technical
and financial
bidding
documents

2cd

Not more
than 30 days

Maximum of
10c d

As provided
in the
contract

Signs the
contract
Posts the
required
Performance
Security

Delivers goods
as provided in
contract

Prepares contract
documents and
Notice of Award
Delivers the NOA
Provides LGU COA
and RPMO with
copies of contract
and supporting
documents
Compiles copies of
all documents for
consolidation with

C/BSPMC

TWG

ACT

RPMO/NPMO/AD
B/WB

requirement
s

Signs the
Resolution and
Notice to
Award

C/BSPMC
Chair
Requests for
Clearance to
Award
Signs the NOA
and contract
Approves and
signs the
contract

Assists the
BAC in the
conduct of
postqualifica
tion

Issues NOL

Assists the
BAC in the
preparation
of resolution
and notice
to award

Reviews contract
documents and
issues NOL

MIT, Municipal
Engineer, TFMonitors delivery
of goods

91

Procedures

Time Frame

SUPPLIER

PT

BAC

C/BSPMC

TWG

other project related

documents

ACT

RPMO/NPMO/AD
B/WB

Conducts regular
visit of project site

Table 8. Matrix of Procedures for Community Bidding for Works with Functions of Various Procurement Personnel
Procedures
1. Identify items for Community Bidding from
approved CPP

Time Frame

CONTRAC
TOR

1 cd

Prepare items for

procurement

2.Prepare/revise bidding documents

3.Conduct of Procurement Preparation

Prepare bidding
documents

5. Issuance of Bidding Documents

6. Conduct of Pre-Bid Conference

BAC

C/BSPMC

Review and
validate items
to be procured
Review
bidding
documents
Discuss
procurement at
hand
Sign IB for
posting

Review and
validate items
to be procured
Review bidding
documents

1cd

Discuss
procurement at
hand
Prepare minutes

2cd
Once for a
minimum
period of 7 c
d
2 weeks from
date of
posting of IB

Posts Invitation to
Bid

Approves
issuance of IB

Issues bidding
documents to
eligible bidders

Approves
issuance of
bidding
documents
Attends prebid conference
Invites Project
Implementatio
n Team (PIT),
Municipal
Implementatio
n Team (MIT),

Meeting

4. Posting/advertisement of Invitation to Bid

PT

1cd
At least 7
days before
deadline for
bid
submission

Attends prebid conference

Prepare required
documents, minutes
and supplemental
bid bulletins where
applicable

Discuss
procurement at
hand

TWG

Discuss
procurement
at hand

ACT

RPMO/NPMO/AD
B/WB

CF and TF
assists in the
review
CF calls for the
meeting
TF provides
technical
assistance and
acts as resource
person
CF ensures wide
circulation of IB

TF to provide
technical
assistance
Attends pre-bid
conference
Chairperson
issues
Certificate of
Site Inspection
to participating
bidders

TF to attend
pre-bid
conference and
provide technical
assistance

92

Procedures

Time Frame

CONTRAC
TOR

PT

BAC

C/BSPMC

TWG

ACT

RPMO/NPMO/AD
B/WB

Municipal
Engineer, TF
and bidders
7. Preparation, Submission and Receipt of
Bids

As prescribed
in the bidding
documents

8. Issuance of Supplemental/Bid Bulletins

Within 2 days
after pre-bid
conference
Not more
than 5 c d

9. Eligibility and Bid Opening and Evaluation

10. Postqualification

2cd

Prepares
technical and
financial
proposal and
submits the
same to the
BAC
Submits
request for
clarification

Receives the
sealed bids on or
before the deadline

Posts
Supplemental/Bid
Bulletin
Prepares barangay
hall for bid opening
Places received
bids in bid box
Prepares minutes of
bid evaluation
Prepares Abstract
of Bids

Issues
Supplemental/
Bid Bulletin
Invites
Observers to
witness bid
opening
Opens bid
proposal and
checks
compliance
with
requirements
according to
procedures
Examines bids
using pass/fail
criteria
Conducts
verification and
validation of
submitted
legal, technical
and financial
bidding
documents

Assists the
BAC in the
evaluation of
bids and
requirements

Signs the
Resolution and
Notice to
Award

TF to provide
technical
assistance
TF to attend bid
opening and
provide technical
assistance

Assists the
BAC in the
conduct of
postqualificati
on

93

Procedures
11. Prior Review /NOL

12. Contract Award

13. Contract Implementation

11

Time Frame
Period of
action 11not
more than 15
days for Devt
Partner, 5 for
NPMO and 5
for RPMO
upon receipt
of the
procurement
documents
Maximum of
10 c d

As provided
in the
contract

CONTRAC
TOR

PT

BAC

C/BSPMC

TWG

ACT

RPMO/NPMO/AD
B/WB

C/BSPMC
Chair
Requests for
Clearance to
Award

Signs the
contract
Posts the
required
Performance
Security

Starts the work

as provided for
in the contract

Prepares contract
documents and
Notice of Award
Delivers the NOA
Provides LGU COA
and RPMO with
copies of contract
and supporting
documents
Compiles copies of
all documents for
consolidation with
other project related
documents

Signs the NOA

and contract
Approves and
signs the
contract

Assists the
BAC in the
Preparation
of resolution
and notice to
award

Reviews contract
documents and
issues NOL

PIT and MIT,

monitors
accomplishment
of work
TF, ME, CIO
conducts regular
visit of project
site

Procurement actions such as comments, observation, recommendations for compliance or NOL shall be issued within the timeline/period of action

94

Table 9. Matrix of Procedures for Qualification/Single Source/Individual Consultant Selection for Consulting
Services with Functions of Various Procurement Personnel
Procedures

Time Frame

1. Submission of request to hire consultants

utilizing the TAF

5cd

2.Prepare Request for Quotation

3 cd

3.Conduct of Procurement Preparation

1cd

Meeting

4. Posting of Notice of Request for Proposal

At least 3 cd

5. Issuance of Request for Proposal (RFP)

Within 3 days
from posting
of NRFP
At least 3
days after
issuance of
RFP

6. Submission, Receipt and Evaluation of

Proposals

CONSULTAN
T

Attend
conference

AHPT

Prepare
procurement
documents
Discuss
procurement at
hand
Prepare minutes
Posts NRFP

Secures RFP
and prepares
requirements
Submits all
requirements

Issues RFP to
shortlisted firms and
individuals
Receives proposals

AHBAC

Discuss
procurement at
hand
Review and
approve
documents
Authorizes
posting of
NRFP

Reviews and
evaluates
proposals

LEAD
BARANGAY
TAF eligible
communities to
submit request
to
RPMO/SRPMO
to use TAF for
consulting
services
Lead Barangay
to be elected as
contracting
party and open
community
account

Discuss
procurement at
hand
Sign NRFP for
posting

Invites Auditor,
AC

TWG

Discuss
procurement
at hand

Assist in the
review and
evaluation of
proposals

ACT

RPMO/NPMO

TF to assist in
the preparation of
the TOR

AC to certify to
that agreement to
hire consultants
followed CEAC
process
RPMO/SRPMO to
review and
approve request
and create TWG

Assist in the
preparation of the
documents
CF calls for the
meeting
TF provides
technical
assistance

TF to provide
technical
assistance
TF to attend
provide support
and technical
assistance

95

Procedures
7. Prior Review /NOL

8. Contract Award

13. Contract Implementation

Time Frame

CONSULTAN
T

As
determined
by RPMO
and NPMO
Maximum of
10 c d

Signs the
contract

As provided
in the
contract

Starts the work

as provided for
in the contract

AHPT

Prepares contract
documents and
Notice of Award
Delivers the NOA
Provides LGU COA
and RPMO with
copies of contract
and supporting
documents
Compiles copies of
all documents for
consolidation with
other project related
documents

AHBAC

LEAD
BARANGAY
Requests for
Clearance to
Award

TWG

Signs the NOA

and contract
Approves and
signs the
contract

Assists the
AH BAC in
the
Preparation
of resolution
and notice to
award

ACT

RPMO/NPMO
Reviews
documents and
issues NOL

Municipal
Auditor, TF
monitors
accomplishment
of work and
conducts regular
review of outputs

96

CHAPTER SIX: CONTRACT

IMPLEMENTATION FOR COMMUNITY
BASED GOODS AND SERVICES
6.1.
6.2.
6.3.
6.4.

Warranty
Amendment to Order
Suspension of Delivery
Delays in Delivery and Liquidated
Damages
6.5. Incidental Services
6.6. Spare Parts and Maintenance
6.7. Prices
6.8. Payments
6.9. Subcontracts, Assignments
6.10. Standards
6.11. Inspection and Tests
6.12. Force Majeure
6.13. Contract Termination
6.14. Blacklisting

97

These contract implementation procedures shall apply to all procurements for goods and
services through Community Bidding, Community Shopping and Community Direct
Contracting. Contract implementation commences when the winning supplier delivers the
procured goods in accordance with the provisions of the contract, technical specifications and
other requirements on the scheduled delivery date. The following are involved in contract
implementation for goods:
Project Implementation Team (PIT) is responsible for supervising the
implementation of the project and for ensuring that this is done in accordance
with the procedures set out in this Chapter and the provisions of the contract
document in the case of the Community Bidding. The Project Implementation
Team is composed of community volunteers selected by the C/BSPMC
Chairperson for this purpose.
ii. Monitoring and Inspection Team (MIT) is responsible for monitoring and
inspecting whether the deliveries of goods and services are in accordance with
the purchase order and technical specifications and undertaking quality control
of delivered items. The Monitoring and Inspection Team is composed of
community volunteers selected by the C/BSPMC Chairperson for this purpose.
iii. Audit and Inventory Team (AIT) is responsible for conducting value for
money audit and for ensuring the funds are utilized according to the required
procedures. The Audit and Inventory Team is composed of community
volunteers selected by the C/BSPMC Chairperson for this purpose.
iv. Municipal Inter-Agency Committee (MIAC) is responsible for providing
technical assistance to the community in the implementation of the contract.
v. Municipal Financial Analyst responsible for processing vouchers and
checks for payment purposes and for keeping and maintaining copies of
procurement, finance and contract implementation documents at Area
Coordinating Team (ACT) Office
vi. Community Facilitator responsible for reviewing and ensuring that all
procurement, finance and contract implementation documents are in
accordance with the requirements and procedures
vii. Technical Facilitator responsible for providing technical assistance to
the community, reviewing requests for variation or change orders for approval
by the Area Coordinator and validating accomplishment reports among others
viii. Area Coordinator (AC) responsible for signing checks for payments, and
approving variation or change orders, requests for time extension, suspension,
among others.
i.

Contract implementation covers the following important milestones: suppliers performance of

his contractual obligations; C/BSPMCs performance of its contractual obligations, as specified
in the Contract; final acceptance or project sign-off; all other related activities; and payment
by the C/BSPMC. Generally, a contract becomes effective upon receipt by the winning supplier
of the Notice to Proceed. In determining the contract implementation period, the winning
supplier shall be given ample time to undertake any preparatory activities necessary for it to
comply with the conditions of the contract.
6.1. Warranty
For KC-NCDDP procured goods, a warranty is required for equipment (office, transport,
production, post production, processing and storage), water pumps, machinery, motors
and other similar items. Non-consumable items such as office supplies, construction
materials, agricultural or aquacultural inputs, seedlings and trees and hand tools, among
others need not be covered by warranty. Wear and tear due to normal usage of the
goods are excluded from the coverage of the warranty.

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The Supplier shall submit a Warranty Certificate that the Goods supplied under the Contract
are new, unused, of the most recent or current models, and that they incorporate all recent
improvements in design and materials, except when the technical specifications required by
the C/BSPMC provides otherwise. The Supplier shall further specify in the Warranty
Certificate that all Goods supplied under this Contract shall have no defect, arising from
design, materials, or workmanship or from any act or omission of the Supplier that may
develop under normal use of the supplied goods.
In order to assure that manufacturing defects shall be corrected by the Supplier, a warranty
shall be required from the Supplier either as retention money in an amount equivalent to at
least ten percent (10%) of the final payment, or a special bank guarantee equivalent to at
least ten percent (10%) of the Contract Price. The said amounts shall only be released after
the lapse of the warranty period; provided, however, that the goods delivered are free from
patent and latent defects and all the conditions imposed under this Contract have been fully
met.
The C/BSPMC shall promptly notify the Supplier in writing of any claims arising under the
warranty. Upon receipt of such notice, the Supplier should, within the period specified in
the contract and with all reasonable speed, repair or replace the defective goods or parts
thereof, within 15 days, without additional costs to the C/BSPMC. In case the supplier does
not act upon its notice, the C/BSPMC shall select the appropriate sanction from among the
following options: (a) require the supplier to return the amount paid; (b) confiscate its
performance or warranty security, where applicable, (c) automatically blacklist the
supplier in all KC-NCDDP procurements.
6.2.

Amendment to Order

An Amendment to Order refers to any necessary adjustment within the general scope
of
the contract in any one or more of the following aspects in order to fully meet the requirements
of the project:
i.

Drawings, design or specifications of the goods, provided that:

a. The goods to be furnished are to be specifically manufactured for the
community;
b. The change is an improvement of the goods and advantageous to the
community;
c. It is done at no extra cost; and
d. It is not prejudicial to the losing bidders in the sense that such change/s
could not have been foreseen during the conduct of the bidding and would
have significantly affected the other bidders bids;
ii. The method of shipment or packing;
iii. The place of delivery;
iv. The place of performance of the services;
v. Additional items needed and necessary for the protection of the goods
procured, which were not included in the original contract; or
vi. Any other change affecting the specifications or scope of work of the goods
and/or services to be procured.
Such amendment may or may not result in an increase or a decrease of the contract price,
and/or an extension or reduction of the delivery period. However, the amendment should not
have the result of changing the subject matter of the contract or the specifications of the goods
or services, in any material aspect and to such an extent that, if introduced during the bidding
stage, may have a significant effect on other bidders bids.

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Amendments to Order may be issued by the C/BSPMC at any time during contract
implementation, provided that such adjustment is required to fully meet the requirements of
the project. Any of the following circumstances may serve as basis for such amendment/s:
i.

Emergency cases, fortuitous events or unforeseen contingencies arising during

project/contract implementation, and such contingencies with an impact on the
procurement at hand, such as:

a. Changes in the conditions affecting the project, e.g., a change in the place
of delivery;
b. Time is of the essence in the implementation of the project, and any
changes require immediate implementation; and
c. Additional requirements have been identified as necessary for the
protection of the goods procured, such as changes in the packaging of the
goods, or additional items have become necessary to ensure that the goods
are sufficiently protected from the elements;
ii. When the contract does not reflect the real intention of the parties due to
mistake or accident, and the amendment is necessary to reflect the parties
intention; and
iii. Other analogous circumstances that could affect the conditions of the
procurement at hand.
If an amendment to order increases or decreases the cost of, or the time required for executing
any part of the work under the original contract, an equitable adjustment in contract price
and/or delivery schedule should be mutually agreed upon between the parties concerned, and
the contract should be modified in writing.
Any increase in contract price must not exceed ten percent(10%) of the original contract
price. Otherwise, the procurement should be subject to another bidding.
Moreover, in the adjustment of the price, the supplier and the C/BSPMC must ensure that the
principle of no loss, no gain is applied, such that neither party gains or loses anything from
the resulting price adjustment.
If the amendment to order consists of additional items, the price adjustment shall be based on
the unit prices in the original contract for items of goods similar to those in the original contract.
If the contract does not contain any rate applicable to the additional items, then suitable prices
shall be mutually agreed upon between the parties, based on prevailing market prices.
Any request for payment by the supplier for additional items must be accompanied by a
statement with the approved supporting forms, giving a detailed accounting and record of the
amount for which it claims payment.
If the amendment to order consists of a change in drawings, design or specifications of the
goods, method of shipment or packing, or place of delivery, the price adjustment shall be
equivalent to the corresponding value of the change, based on prevailing market prices.
The following steps shall be undertaken in the issuance of an Amendment to Order:
i.

The PIT determines the existence of condition/s that require an amendment

to order.
ii. The PIT discusses the adjustments in contract price and/or delivery schedule
with the supplier, if necessary.
iii. The PIT drafts the contract amendment containing the agreements reached
with the supplier.

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iv. The contract amendment is submitted to the C/BSPMC Chairperson, for

approval;
v. Upon approval by the C/BSPMC Chairperson, the PIT notifies the supplier
to proceed with the work/delivery of items in accordance with the amendment.
It shall also notify the PT of such approval, and furnish the latter with a copy
of the amended contract.
vi. The supplier proceeds with the work/delivery of items in accordance with the
amended contract.
A supplier cannot proceed with the work under an Amendment to Order without approval from
the C/BSPMC Chairperson. Payment for any work or delivery done in accordance with an
Amendment to Order shall not be made unless the approval of the C/BSPMC Chairperson has
been secured.
6.3.

Suspension of Delivery

The C/BSPMC may suspend the delivery or contract implementation, wholly or partly, by
written order for a certain period of time, as it deems necessary due to force majeure or any
fortuitous event as defined in the contract. Appropriate adjustments shall be made in the
delivery or contract schedule, or contract price, or both, and the contract shall be modified
accordingly.
When warranted, price adjustments may be made in accordance with the guidelines previously
discussed in the immediately preceding section on Amendment to Order.
Work must be resumed or delivery made either upon the lifting or the expiration of the
suspension order. However, if the C/BSPMC terminates the contract covered by such order,
resumption of work cannot be done.
The following steps are necessary for the issuance of a suspension order:
i.
i.

ii.
iii.

iv.
v.
vi.

The PIT determines the existence of a force majeure or fortuitous event that
will be the basis for the issuance of a suspension order.
Based upon the findings and recommendation of the PIT, the C/BSPMC
Chairperson issues a written order suspending the order or work, wholly or
partly, for a certain period of time.
The supplier shall take all reasonable steps to minimize the costs allocable to
the order or work covered by the order during the suspension.
The PIT discusses with the supplier any need for adjustments in the delivery
or contract schedule and/or contract price, including any need to modify the
contract.
The PIT drafts the contract amendment containing the agreements reached
with the supplier.
The contract amendment is submitted to the C/BSPMC Chairperson for
approval.
Prior to the expiration of the suspension order, the PIT determines whether
or not the grounds for suspension are still existent. If such grounds continue
to exist, or if it is no longer practicable to complete the delivery or continue
with the work, it shall cancel the delivery of the items subject of the
suspension order, or terminate the work subject of the order, by written
notice. If, however, the grounds for suspension no longer exist, and
completion of delivery or continuation of the work may already be done, the
PIT, with the approval of the C/BSPMC Chairperson shall lift the suspension
order by written notice, thereby instructing the supplier to proceed with the
delivery or work in accordance with the amended contract.

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6.4.

Delays in Delivery and Liquidated Damages

The supplier must deliver the goods or perform the services procured within the period
prescribed in the Contract. If delays are likely to be incurred, the supplier must notify the
C/BSPMC Chairperson in writing. It must state the cause/s and duration of the expected delay.
The C/BSPMC Chairperson may grant time extensions, at its discretion, if based on
meritorious grounds, with or without liquidated damages.
In all cases, the request for extension should be submitted before the lapse of the original
delivery date. The maximum allowable extension shall not be longer than the initial delivery
period as stated in the original contract.
In case the delay in the delivery of the goods/services exceeds a time duration equivalent to
ten percent (10%) of the specified contract time plus any time extension duly granted to the
Supplier, the C/BSPMC may terminate this Contract, forfeit the Supplier's performance
security and award the same to a qualified Supplier.
6.4.1. Liquidated Damages
Liquidated damages are damages agreed upon by the parties to a contract, to be paid in
case of breach.
When the supplier fails to satisfactorily deliver the goods or services under the contract
within the specified delivery schedule, inclusive of duly granted time extensions, if any, the
supplier shall be liable for damages for the delay and shall pay the C/BSPMC liquidated
damages, by way of penalty, for every day of delay until such goods or services are finally
delivered or performed and accepted by the C/BSPMC. The C/BSPMC need not prove
that it has incurred actual damages to be entitled to liquidated damages.
The supplier must pay the C/BSPMC liquidated damages, an amount equal to one-tenth
(1/10) of one percent (1%) of the cost of the delayed goods or services scheduled for
delivery or performance for every day of delay. The liquidated damages will be imposed
until such goods or services are finally delivered or performed and accepted by the
C/BSPMC. In no case shall the sum of liquidated damages reach ten percent (10%) of the
contract amount. If it does, the contract shall automatically be rescinded by the C/BSPMC,
without prejudice to other courses of action and remedies open to it. The C/BSPMC may
also take over the contract or award the same to a qualified supplier through direct
contracting. In addition to the liquidated damages, the erring suppliers performance
security shall also be forfeited.
The following steps shall be followed in the imposition of liquidated damages:
i.

The supplier submits a written request to the PIT for an extension of the
delivery or performance period, citing the reason/s for such delay.
ii. The C/BSPMC either approves or disapproves the request for extension.
iii. If the extension is granted, the liquidated damages may or may not be
imposed and the supplier is informed of this in writing. The supplier is then
asked to extend the validity of the performance bond, to conform to the
extended period.
iv. If, however, the request for extension is denied, the PIT informs the supplier
in writing of such denial, and ensures that the said notice or communication is
received by the latter within a reasonable time from receipt of the request for
extension. In this case, the C/BSPMC imposes the liquidated damages in
accordance with the provisions of the contract.

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v. If the supplier incurs delay and it does not request for an extension:
a. The C/BSPMC informs, within a reasonable time from the first day of delay,
the supplier that it shall impose the liquidated damages agreed upon by the
parties.
b. Upon delivery, the C/BSPMC and the MIT records the delay in the
inspection documents, noting the amount of the liquidated damages
imposable on the supplier.
c. Upon payment, the amount of liquidated damages due is deducted from
the total amount payable to the supplier, and the same shall be reflected in
the DVs. Or, if the contract provides that the liquidated damages is to be
collected from securities or warranties posted by the supplier, the
C/BSPMC informs the Area Coordinator (AC) to call on the securities or
warranties about the delay and the corresponding liquidated damages
imposable.
6.5.

Incidental Services

Incidental Services are those services ancillary to the supply of the goods, such as
transportation and insurance, installation, commissioning, provision of technical assistance,
training, and other such obligations of the supplier specified in the contract and the bidding
documents. The Incidental Services must be clearly specified in the contract, and identified as
separate components from the goods to be supplied or services to be rendered, so that prices
indicated on the price schedule shall be entered separately, in accordance with the ITB. The
cost shall also be indicated in the contract. In particular, these services may refer to any of the
following:
i.
ii.
iii.
iv.

v.

vi.

6.6.

Performance or supervision of on-site assembly and/or start-up of the

supplied goods;
Furnishing of tools required for assembly and/or maintenance of the supplied
goods;
Furnishing of a detailed operations and maintenance manual for each
appropriate unit of the supplied goods;
Performance or supervision or maintenance and/or repair of the supplied
goods, for a period of time agreed by the parties, provided that this service
shall not relieve the supplier of any warranty obligations under the Contract;
Training of the C/BSPMC s personnel, at the suppliers plant and/or on-site,
on assembly, start-up, operation, maintenance, and/or repair of the supplied
goods; and
Any other related services necessary for completion of the project and
indicated in the contract.

Spare Parts and Maintenance

Spare parts refer to extra components, equipment, tools, instruments or parts of machinery or
apparatus that replace the ones that are damaged or worn out.
The supplier may be required to provide any or all of the following materials, notifications, and
information pertaining to spare parts manufactured or distributed by the supplier:
i.

Such spare parts as the C/BSPMC may elect to purchase from the supplier,
provided that this election shall not relieve the supplier of any warranty
obligations under the contract;
ii. Such spare parts that the C/BSPMC may be able to purchase from other
suppliers/manufacturers but are compatible with the goods procured; and

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iii. In the event of termination of production of the spare parts:

a. Advance notification to the C/BSPMC of the pending termination, in
sufficient time to permit the C/BSPMC to procure needed requirements;
and
b. Following such termination, furnishing at no cost to the C/BSPMC the
blueprints, drawings, and specifications of the spare parts, if requested.
The supplier may likewise be required to issue a certification that spare parts, particularly
those that are product-specific, shall continue to be manufactured by them within a period of
time, e.g., five (5) years, after the bidding date. The above information shall be included in the
Technical Bid.
The C/BSPMC may include the delivery of a limited supply of fast-moving and/or hard-to-find
spare parts in the technical specifications when procuring heavy equipment or machinery. This
is to ensure the continued use or operation of the equipment.
6.7.

Prices

The contract price must not vary from the price quoted by the supplier in its bid. This is based
on the rule that the contract, as awarded, should not differ in any material aspect from the
terms stipulated in the bidding documents, considering that these terms were the basis for the
comparison of bids. Otherwise, the purpose of the Community Bidding process would have
been defeated.
For KC-NCDDP funded sub-projects, no price escalation is allowed.
6.8. Payments
The method and conditions of payment must be specified in the contract in accordance with
the provisions of the community finance manual.
6.9. Subcontracts and Assignments
Generally, a supplier may be allowed to subcontract a portion of the contract or project, which
portion must not exceed twenty percent (20%) of the total project cost. The bidding documents
must specify what are considered as significant/material component/s of the project.
All subcontracting arrangements must be disclosed at the time of bidding, and subcontractors
must be identified in the bid submitted by the supplier.
Any subcontracting arrangements made during project implementation and not disclosed at
the time of the bidding shall not be allowed. The subcontracting arrangement shall not relieve
the supplier of any liability or obligation under the contract. Moreover, subcontractors are
obliged to comply with the provisions of the contract and shall be jointly and severally liable
with the principal supplier, in case of breach thereof, in so far as the portion of the contract
subcontracted to it is concerned.
As a general rule, the supplier may not assign the contract, or any of its rights or obligations
arising from the contract, to a third party, except with the C/BSPMC s prior written consent.
Assignment of contractual obligations or the contract itself may generally not be done because
this will enable a non-bidder to become a party to the contract.

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6.10. Standards
The goods supplied under the contract must conform to the standards mentioned in the
technical specifications, which must preferably be Philippine national standards, or standards
specified by the BPS. If there is no Philippine national standard applicable, the goods must
conform to the authoritative standards appropriate to the goods country of origin. Such
standards must be the latest issued by the concerned institution.
6.11. Inspection and Tests
The C/BSPMC has the right to inspect and/or to test the goods to confirm their conformity to
the contract specifications at no extra cost to it. The bidding documents and the contract must
specify what inspections and tests are required by the C/BSPMC, and where these are to be
conducted. The C/BSPMC must notify the supplier in writing, in a timely manner, of the identity
of any representatives retained for these purposes.
The inspections and tests may be conducted on the premises of the supplier or its
subcontractor(s), at point of delivery, and/or at the goods final destination. If conducted on the
premises of the supplier or its subcontractor(s), all reasonable facilities and assistance,
including access to drawings and production data, must be provided by the supplier to the
inspectors at no charge to the C/BSPMC .
The C/BSPMC must bear its own costs and expenses incurred in connection with its
attendance at inspections, including, but not limited to, all traveling and board and lodging
expenses. The C/BSPMC may require the supplier to carry out any test and/or inspection not
required by the contract but deemed necessary to verify that the characteristics and
performance of the goods comply with the technical specifications, codes and standards under
the contract.
The reasonable costs and expenses incurred by the supplier in carrying out such test and/or
inspection will be added to the contract price. These tests shall be conducted by a government
testing laboratory, or, where there is none for the particular item being procured, in any testing
laboratory accredited by the DTI. The supplier must provide the C/BSPMC with a report of
the results of any such test and/or inspection. These results will be conclusive of the quality of
the items and not subject to further dispute between the parties.
The C/BSPMC may reject any goods or any part thereof that fail to pass any test and/or
inspection or do not conform to the specifications. The supplier shall either rectify or replace
such rejected goods or parts thereof or make alterations necessary to meet the specifications
at no cost to the C/BSPMC, and shall repeat the test and/or inspection, at no cost to the
C/BSPMC, upon giving a notice pursuant to the contract.
The supplier shall agree in the contract that neither the execution of a test and/or inspection
of the goods or any part thereof, nor the attendance by the C/BSPMC or its representative,
shall release the supplier from any warranties or other obligations under the contract.
6.12.

Force Majeure

The Supplier shall not be liable for forfeiture of its performance security, liquidated damages,
or termination for default if and to the extent that the Suppliers delay in performance or other
failure to perform its obligations under the Contract is the result of a force majeure.
For purposes of this Contract the terms force majeure and fortuitous event may be used
interchangeably. In this regard, a fortuitous event or force majeure shall be interpreted to
mean an event which the Supplier could not have foreseen, or which though foreseen, was

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inevitable. It shall not include ordinary unfavorable weather conditions; and any other cause
the effects of which could have been avoided with the exercise of reasonable diligence by
the Contractor.
If a force majeure situation arises, the Supplier shall promptly notify the C/BSPMC in writing
of such condition and the cause thereof. Unless otherwise directed by the C/BSPMC in writing,
the Supplier shall continue to perform its obligations under the Contract as far as is
reasonably practical, and shall seek all reasonable alternative means for performance not
prevented by the force majeure.
6.13. Contract Termination
6.13.1. Termination for Default
Any of the following conditions shall constitute grounds for termination of the contract for
default:
i.

There being no force majeure, the supplier fails to deliver any or all of the goods
within the period(s) specified in the contract, or within any extension
granted by the C/BSPMC pursuant to a request made by the supplier prior to
the delay, and such failure amounts to at least ten percent (10%) of the contract
price;
ii. As a result of force majeure, the supplier is unable to deliver or perform any or
all of the goods or services, amounting to at least ten percent (10%) of the
contract price, for a period of not less than sixty (60) calendar days after the
receipt of the notice from the C/BSPMC stating that the circumstance of force
majeure is deemed to have ceased;
Termination of a contract for defaults without prejudice to other remedies
available to the C/BSPMC for breach of contract, such as payment of liquidated
and other damages, if there are grounds for the latter. If the contract is not
wholly terminated, the supplier shall continue to deliver the remaining goods or
to perform the remaining services contracted.
iii. The supplier fails to perform any other obligation(s) under the contract; or
iv. The supplier, in the judgment of the C/BSPMC, has engaged incorrupt,
fraudulent, collusive or coercive practices in competing for or in executing the
contract.
If the C/BSPMC terminates the contract in whole or in part, due to default, it may procure
from third parties, through the appropriate alternative method of procurement, goods or
services similar to those undelivered. The supplier that defaulted will be liable to the
C/BSPMC for any excess costs for such similar goods or services.
6.13.2. Termination for Insolvency
The C/BSPMC may at any time terminate the contract by giving written notice to the
supplier, if the supplier is declared bankrupt or insolvent as determined with finality by a
court of competent jurisdiction. In this event, termination will be without compensation to
the supplier, provided that such termination will not prejudice or affect any right of action
or remedy which has accrued or will accrue to the C/BSPMC and/or the supplier.

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6.13.3. Termination for Convenience

The C/BSPMC, by written notice sent to the supplier, may terminate the contract, in whole
or in part, at any time for its convenience. The notice of termination shall specify that the
termination is for the C/BSPMC s convenience, the extent to which performance of the
supplier under the contract is terminated, and the date upon which such termination
becomes effective.
Any of the following circumstances may constitute sufficient grounds to terminate contract
for convenience:
i.

If physical and economic conditions have significantly changed so as to

render the project no longer economically, financially or technically feasible, as
determined by the C/BSPMC Chairperson;
ii. The C/BSPMC Chairperson has determined the existence of conditions that
make project implementation impractical and/or unnecessary, such as, but not
limited to, fortuitous event/s, changes in laws and government policies;
iii. Funding for the project has been withheld or reduced by higher authorities
through no fault of the C/BSPMC; or
iv. Any circumstance analogous to the foregoing.
The goods that are complete and ready for shipment within thirty (30) days after the
suppliers receipt of notice of termination shall be accepted by the C/BSPMC at the
contract terms and prices. For the remaining goods, the C/BSPMC may elect:
i.

To have any portion completed and delivered at the contract terms and prices;
and/or
ii. To cancel the remainder and pay to the supplier an agreed amount for partially
completed goods and services and for materials and parts previously procured
by the supplier.
If the Supplier suffers loss in its initial performance of the terminated contract, such as
purchase of raw materials for goods specially manufactured for the C/BSPMC which
cannot be sold in the open market, it shall be allowed to recover partially from the contract,
on a quantum merit basis. The fact of loss must be established before recovery may be
made.
6.13.4. Procedures for Termination of Contracts:
The following provisions shall govern the procedures for termination of this Contract:
i.

Upon receipt of a written report of acts or causes which may constitute

ground(s) for termination, or upon its own initiative, the Project Implementation
Team (PIT) shall, within a period of seven (7) calendar days, verify the
existence of such ground(s) and cause the execution of a Verified Report, with
all relevant evidence attached;

ii. Upon recommendation by the PIT, the C/BSPMC Chairman shall terminate this
Contract only by a written notice to the Supplier conveying the termination of
this Contract. The notice shall state:
a. that this Contract is being terminated for any of the ground(s) aforementioned, and a statement of the acts that constitute the ground(s)
constituting the same;
b. the extent of termination, whether in whole or in part;

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c. an instruction to the Supplier to show cause as to why this Contract should

not be terminated; and
d. special instructions of the C/BSPMC, if any.
iii. The Notice to Terminate shall be accompanied by a copy of the Verified
Report;
iv. Within a period of seven (7) calendar days from receipt of the Notice of
Termination, the Supplier shall submit to the C/BSPMC Chairman a verified
position paper stating why this Contract should not be terminated. If the
Supplier fails to show cause after the lapse of the seven (7) day period, either
by inaction or by default, the C/BSPMC Chairman shall issue an order
terminating this Contract;
v. The C/BSPMC may, at any time before receipt of the Suppliers verified position
paper described in item (d) above withdraw the Notice to Terminate if it is
determined that certain items or works subject of the notice had been
completed, delivered, or performed before the Suppliers receipt of the notice;
vi. Within a non-extendible period of ten (10) calendar days from receipt of the
verified position paper, the C/BSPMC Chairman shall decide whether or not to
terminate this Contract. It shall serve a written notice to the Supplier of its
decision and, unless otherwise provided, this Contract is deemed terminated
from receipt of the Supplier of the notice of decision. The termination shall only
be based on the ground(s) stated in the Notice to Terminate;
vii. The Supplier must serve a written notice to the C/BSPMC of its intention to
terminate the contract at least thirty (30) calendar days before its intended
termination. The Contract is deemed terminated if it is not resumed in thirty (30)
calendar days after the receipt of such notice by the C/BSPMC.
6.14. Blacklisting
The KC-NCDDP reserves the right to blacklist suppliers/contractors with previous or current
issues during his/her participation in the KALAHI-CIDSS implementation as determined by the
project that is/are violative to the principles and process of the Program. This include the act
of harassment12 to Community Volunteers, Project Staff (ACT, RPMO, NPMO), and other
Project stakeholders; misrepresentation or using another supplier/contractor business
permit/license; unsatisfactory performance due to unjustified slippage of 15% and above,
breach of contract and others as deemed necessary by the Project. The blacklisted suppliers
shall be recommended to the Government Procurement Policy Board - Technical Support
Office (GPPB-TSO) or to appropriate government agency for any sanctions applicable.
Blacklisted contactors shall be referred to the Philippine Contractors Accreditation Board
(PCAB) for license suspension/revocation.

12

Coersive,threats, misdemeanor, unlawful demands and any violative actions in violation of the Program
principles and process.

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CHAPTER SEVEN: CONTRACT

IMPLEMENTATION FOR COMMUNITY
BASED WORKS
7.1.
7.2.
7.3.
7.4.
7.5.
7.6.

Subcontracting
Contractors Program of Works
Inspection and Tests
Dayworks
Measurement of Works
Contractors Obligations and
Responsibilities
7.7. Contract Price and Payment
7.8. Variation Orders
7.9. Suspension of Work
7.10. Contract Time Extension
7.11. Delays in Work Completion and
Liquidated Damages
7.12. Contract Termination
7.13. Contract Completion
7.14. Warranty and Defects Liability Period
7.15. Settlement of Disputes

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These contract implementation procedures shall apply to all procurements for infrastructure
and civil works projects through Community Bidding, Community Shopping and Community
Direct Contracting. Contract implementation commences when the winning contractor
mobilizes its laborers, equipment and materials on the project site in accordance with the
provisions of the contract, technical specifications and other requirements. The following are
involved in contract implementation for works:
Project Implementation Team (PIT) is responsible for supervising the
implementation of the project and for ensuring that this is done in accordance
with the procedures set out in this Chapter and the provisions of the contract
document in the case of the Community Bidding. The PIT is composed of
community volunteers selected by the C/BSPMC Chairperson for this purpose.
ii. Monitoring and Inspection Team (MIT) is responsible for monitoring and
inspecting whether the constructed works are in accordance with the drawings,
plans and technical specifications. The MIT is composed of community
volunteers selected by the C/BSPMC Chairperson for this purpose.
iii. Audit and Inventory Team (AIT) is responsible for conducting value for
money audit and for ensuring the funds are utilized according to the
required procedures. The AIT is composed of community volunteers selected
by the C/BSPMC Chairperson for this purpose.
iv. C/BSPMC Chairperson is responsible for approving transactions at the
community level, for signing the checks and for issuing and approving
contract implementation related instructions.
v. Municipal Financial Analyst is responsible for processing vouchers and
checks for payment purposes and for keeping and maintaining copies of
procurement, finance and contract implementation documents at Area
Coordinating Team (ACT) Office
vi. Community Facilitator responsible for reviewing and ensuring that all
procurement, finance and
contract implementation documents are in
accordance with the requirements and procedures
vii. Technical Facilitator responsible for providing technical assistance to
the community, reviewing requests for variation or change orders for approval
by the Area Coordinator and validating accomplishment reports among
others. The TF and the Municipal Engineer serves as the Project Supervisor
for the sub-project
viii. Area Coordinator (AC) responsible for signing checks for payments, and
approving variation or change orders, requests for time extension,
suspension, among others.
ix. Community Infrastructure Officer (CIO) responsible for providing technical
assistance to the community on matters related to the implementation of
works contracts.
i.

Contract implementation covers the following important milestones: contractors performance

of his contractual obligations; C/BSPMCs performance of its contractual obligations, as
specified in the Contract; final acceptance or project sign-off; all other related activities; and
payment by the C/BSPMC. Generally, a contract becomes effective upon receipt by the
winning contractor of the Notice to Proceed. In determining the contract implementation
period, the winning contractor shall be given ample time to undertake any preparatory activities
necessary for it to comply with the conditions of the contract.
7.1. Subcontracting
Generally, a contractor may be allowed to subcontract a material or significant portion of the
contract or project, which must not exceed fifty percent (50%) of the total project cost. The

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bidding documents must specify what are considered as significant/material component(s) of

the project.
Except if otherwise provided by the contract, the contractor shall not subcontract any part of
the works without the prior consent of the C/BSPMC Chairperson. However, this consent shall
not relieve the contractor of any liability or obligation under the contract. The contractor will be
responsible for the acts, defaults and neglects of any subcontractor, his agents, servants or
workmen as fully as if these were its own acts, defaults or neglects, or those of its agents,
servants or workmen.
All subcontracting arrangements must be disclosed at the time of bidding, and subcontractors
must be identified in the bid submitted by the bidder. For them to be allowed to do so,
subcontractors should also pass the eligibility check for the portions of the contract that they
will undertake.
7.2. Contractors Program of Works
Within seven (7) days of the written notification of award, the Contractor shall submit to the
Project Supervisor for approval a Program showing the general methods, arrangements,
order, and timing for all activities of the Works. The C/BSPMC approval of the Program shall
not change the Contractors obligations. The Contractor may revise the Program and submit
it to the Project Supervisor again at any time. A revised Program will show the effect of the
changes.
The Contractor shall provide updated Activity Schedules within ten (10) days of being
instructed by the Project Supervisor. The activities on the Activity Schedule will be
coordinated with the activities of the Program.
The Contractor shall carry out and complete all the activities in accordance with the scope of
works specified in the Contract.
7.3. Inspection and Tests
All materials, plant/s and workmanship shall be of the kind described in the contract and in
accordance with the instructions of the Project Supervisor. To ensure that this is the case,
these materials, plant/s and workmanship will be subjected, from time to time, to such tests
as the Project Supervisor may require. These tests must be at the place of construction,
fabrication, or on site or at such other place or places as may be specified in the contract, or
at all or any of such places.
The Project Supervisor must, at all reasonable times, have access to the site and to all
workshops and places where materials or plant are being manufactured, fabricated or
prepared for the works. The contractor, for its part, shall afford every facility for, and every
assistance in obtaining the right to such access.
The Project Supervisor shall be entitled, during manufacture, fabrication or preparation of
materials to be used in the project, to inspect and test these materials and the plant or plants
where these materials are being manufactured, fabricated, and/or prepared. If the materials
are being manufactured, fabricated or prepared in workshops or places other than those of
the contractor, the contractor must obtain permission for the Project Supervisor to carry out
inspection and testing in those workshops or places. Such inspection or testing will not release
the contractor from any obligation under the contract.
If, at the time and place agreed above, the materials or plant are not ready for inspection or
testing, the Project Supervisor may reject these materials or the plant and must notify the

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contractor of such rejection immediately. He/she must also do so if, as a result of the inspection
or testing, he/she determines that the materials or plant are defective or otherwise not in
accordance with the contract. The notice must state the Project Supervisors objection and the
reasons for the objection. The contractor, for its part, must then promptly make good the
defector ensures that rejected materials or plant comply with the contract. If the Project
Supervisor so requests, the test of rejected materials or plant shall be made or repeated under
the same terms and conditions.
The Project Supervisor will, after consultation with the contractor, determine all the costs
incurred in the repetition of the test or tests. These costs are recoverable from the contractor
by the C/BSPMC and may be deducted from any monies due to the contractor. The Project
Supervisor must notify the contractor accordingly, with a copy being furnished the C/BSPMC.
To help ensure the quality of materials being used in infrastructure projects, the Bureau of
Research and Standards (BRS) of the DPWH, the DOST or the DTI shall accredit the testing
laboratories that can be used in C/BSPMC works projects. All C/BSPMCs implementing
infrastructure projects must use only these laboratories. Only tests done by these laboratories
shall be recognized and accepted, except for the testing of new materials to be undertaken
through procedures approved by the DPWH Secretary.
7.4. Dayworks
If applicable, as indicated in the contract, the dayworks rates in the contractors bid shall be
used for small additional amounts of work, only when the Project Supervisor has given written
instructions in advance for additional work to be paid for in that way.
All works to be paid for as day works shall be recorded by the contractor on forms approved
by the Project Supervisor. Each completed form shall be verified and signed by Project
Supervisor within two (2) days of the work being done. The contractor shall be paid for
dayworks subject to obtaining signed dayworks forms.
7.5. Measurement of Works
The quantities set out in the Bill of Quantities are the estimated quantities for the works. They
should not therefore be taken as the actual and correct quantities of the works to be executed
by the contractor in fulfillment of his obligations under the contract. They can vary to up to ten
percent (10%) of the contract price to account for variation orders.
The Project Supervisor must, except if otherwise stated in the Quantities of the Detailed
Designs, measure the value of the works actually in-place in accordance with the contract.
This measurement will be the basis for the payment that will be made to the contractor in
accordance with the Statement of Work Accomplished. The Project Supervisor must, when
he/she needs to measure any part of the works, give reasonable notice to the contractors
authorized agent, who must:
i.

Attend or send a qualified representative to assist the Project Supervisor in

making such measurement; and
ii. Supply all particulars required by the Project Supervisor.
Procedures for the measurement of work may also be found in the KC-NCDDP Infrastructure
Manual.

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7.6. Contractors Obligations and Responsibilities

The Contractor shall carry out the Works properly and in accordance with this Contract. The
Contractor shall provide all supervision, labor, materials, plant and equipment, which may be
required. The Contractor shall commence execution of the Works on the Start Date and shall
carry out the Works in accordance with the Program of Work. The Contractor shall be
responsible for the safety of all activities on the Site.
During Contract implementation, the Contractor and his subcontractors shall abide at all
times by all labor laws, and other relevant rules which may be applicable to the works
Among such regulations or laws are:
i.

Employment of unskilled local labor. 100% unskilled labor force shall come
from the barangay where the community project is located. The contractor shall
also comply with the rules on hours and conditions of work, general health
regulations, and safety and health precautions.
ii. Traffic regulations, including provision of adequate warning signs and traffic
barriers.
iii. Environmental protection. The Contractor shall carefully plan and conduct his
works in a manner, which will minimize the negative impact on the environment.
In particular, the Contractor shall not interfere with or pollute in any way
irrigation channels or watercourses. Borrow pits shall only be worked at the
location and in particular, the pits shall be left in a condition that it is not a safety
or a health hazard due to stagnant water collection.
During the execution of the works, the contractor must keep the site reasonably free from all
unnecessary obstruction. It must also store or dispose of any equipment and surplus materials
and clear away and remove from the site any wreckage, rubbish or temporary works that are
no longer required.
Upon the issuance of the Certificate of Acceptance, the contractor shall remove from that part
of the site to which the certificate relates all equipment, surplus material, rubbish and
temporary works of every kind. It must leave such part of the site and works clean and in a
workmanlike condition to the satisfaction of the Project Supervisor. However, it is entitled to
retain until the end of the defects liability period such materials, equipment and temporary
works he may need to fulfill his obligations in relation to the project.
Unless otherwise provided for in the contract, the contractor must turn-over to the C/BSPMC
all excess, used, unused and/or reusable materials paid for in the contract such as, formworks,
safety gadgets and devices, etc.
7.7. Contract Price and Payment
All contract prices and payment must be denominated and payable in Philippine currency.
The method and conditions of payment shall be specified in the contract. Generally, payment
for works can be made in two ways: unit price or lump-sum payment. Unit price payments are
made based on the unit prices of specific items as applied to actual quantities accomplished
according to the Statement of Work Accomplished. Lump-sum payments, on the other hand,
are based on the value of actual accomplished work in proportion to total contract cost.
Any kind of payment, including advance and progress payments, must be made by the
C/BSPMC as soon as possible, but in no case later than thirty (30) days after the submission
of an invoice or claim by the contractor, accompanied by documents submitted pursuant to
the contract, and upon fulfillment of other obligations stipulated in the contract. The C/BSPMC

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must also ensure that all accounting and auditing requirements are met prior to payment. The
C/BSPMC should commence inspection within twenty-four (24) hours after receiving the
Request for Inspection from the contractor.
Price escalation is generally not allowed. For the given scope of work in the contracts awarded,
the price must be considered as a fixed price.
7.7.1. Advance Payment
The contractor can request for advance payment which must not exceed fifteen percent
(15%) of the total contract price, and must be made in lump sum or, at the most, two (2)
installments according to a schedule specified in the ITB and other relevant bidding
documents. Moreover, it must be made only upon the submission by the contractor of a
written request. The contractor must also submit to the C/BSPMC a bank guarantee equal
in value to the advance payment and must be accepted by the C/BSPMC.
The C/BSPMC must recover the advance payment by deducting from the progress
payments until the advance is fully liquidated within the duration of the contract, and before
full payment is made to the contractor.
7.7.2. Progress Payment
The first progress payment may be paid by the C/BSPMC to the contractor after 20% of
the work had been accomplished. Thereafter, payments can be made once a month,
provided that the latter submits a Progress Billing or a request for payment for work
accomplished. Payments shall be released within seven (7) calendar days upon
submission of complete documents verified and approved by the PIT, C/BSPMC
Chairperson and the TF or Municipal Engineer. Such request for payment, including the
Statement of Work Accomplished by the contractor, must be verified and approved by the
TF or Municipal Engineer. Except as otherwise stipulated in the ITB, materials and
equipment delivered on the site but not completely put in place shall not be included for
payment.
The C/BSPMC has the right to deduct from the contractors progress billing such amount
as may be necessary to cover third party liabilities. It must not process any progress
payment unless the discovered defects are corrected.
7.7.3. Retention Money
Retention money refers to the amount equal to ten percent (10%) of the progress
payments, before deductions are made, that is withheld by the C/BSPMC to cover the
uncorrected discovered defects and third party liabilities. It is collected from all progress
payments until works equivalent to fifty percent (50%) of the value of works, as determined
by the C/BSPMC, is accomplished. If, after fifty percent (50%) completion, the work is
satisfactorily done and on schedule, no additional retention shall be made; otherwise, the
ten percent (10%) retention shall continue to be imposed.
The total retention money shall be due for release after the defects liability period, upon
final acceptance of the works. The contractor may request the C/BSPMC that, instead of
retention money being withheld from each progress billing, it issues in favor of the
C/BSPMC, a bank guarantee in an amount equivalent to the retention money substituted
for. They must also be valid for a duration to be determined by the C/BSPMC and will
answer for the purpose for which the ten percent (10%) retention is intended.

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7.7.4. Final Payment

The contractor may request for final payment upon one hundred percent (100%)
completion of the work. This payment will be reduced by whatever balance remains of the
amount that is needed in order to return to the C/BSPMC the fifteen percent (15%)
advance payment previously made.
7.8. Variation Orders
A Variation Order refers to any increase/decrease in quantities within the general scope of the
project as bid and awarded, in any of the following aspects:
i. Introduction of new work items that are not included in the original contract; or
ii. Reclassification of work items that are either due to change of plans, design or
alignment to suit actual field conditions resulting in disparity between the
preconstruction plans used for purposes of the bidding and the as staked
plans or construction drawings prepared after a joint survey by the contractor
and the C/BSPMC after award of the contract, or during actual construction.
A Variation Order may either be in the form of a Change Order or Extra Work Order.
A Change Order covers any increase/decrease in quantities of original work of items in the
contract. An Extra Work Order covers the introduction of new work necessary for the
completion/improvement or protection of the project which are not included as items of work
in the original contract. As an example, there may be subsurface or latent physical conditions
at the site that differ materially from those indicated in the contract. There might also be duly
unknown physical conditions at the site of an unusual nature that differ materially from those
ordinarily encountered and generally recognized as inherent in the work or character provided
for in the contract. The addition/deletion of works should be within the general scope of the
project as bid and awarded, and the deletion of the work should not affect the integrity and
usefulness of the structure.
The issuance of a Variation Order must conform to the following:
i. That there will not be any short changes in the original design;
ii. That it will not affect the structural integrity and usefulness of the structure;
and
iii. That it is covered by a Certificate of Availability of Funds (CAF), if necessary.
Under no circumstances can a contractor proceed to commence work under any Change
Order or Extra Work Order unless the C/BSPMC Chairperson has approved the order on the
recommendation of the TF or Municipal Engineer.
The C/BSPMC Chairperson, may, subject to the issuance of the CAF, authorize the immediate
start of work under any Change or Extra Work Order, subject to any or all of the following
conditions:
i.

In the event of any emergency where the prosecution of the work is urgent to
avoid any detriment to public service, or damage to life and/or property; and/or
ii. When time is of the essence, for works in the critical path based on the
approved PERT/CPM;
However, the approval is valid on work done up to the point where the cumulative increase in
value of work on the project which has not yet been fully approved does not exceed five
percent (5%) of the adjusted original contract price whichever is less. Furthermore,

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immediately after the start of work, the corresponding Change Order or Extra Work Order must
be prepared and submitted for approval in accordance with the above rules herein set.
Payments for works satisfactorily accomplished on any Change Order or Extra Work Order
may be made only after approval of the same by the C/BSPMC Chairperson.
For a Change Order or Extra Work Order involving a cumulative amount exceeding five
percent (5%) of the original contract, no work may be commenced unless said Change Order
or Extra Work Order has been approved by the C/BSPMC Chairperson on the
recommendation of the TF or the Municipal Engineer and a clearance from the RPMO.
Variation Orders may be issued by the C/BSPMC at any time during contract implementation.
However, the adjustment provided for in these orders must be necessary to fully meet the
requirements of the project.
The net cumulative amount of the Variation Order should not exceed more than ten percent
(+10%) of the original project cost.
If the adjustments provided for in a Variation Order costs more than ten percent (10%) of the
original project costs, these shall be the subjects of another contract to be bid out if the works
are separable (not part of the work to complete the original scope of work) from the original
contract. However, if these adjustments are urgently necessary to complete the original scope
of work, the C/BSPMC Chairperson, on the recommendation of the TF or the Municipal
Engineer, may authorize the Variation Order beyond ten percent (10%) but not more than
twenty percent (20%). Clearance from the RPMO is required prior to commencement of any
variation orders.
The payment to the contractor for additional work under Variation Orders must be derived
based on the following:
i.

For additional/extra works duly covered by Change Orders involving work items
which are exactly the same or similar to those in the original contract, the
applicable unit prices of work items in the original contract shall be used.
ii. For additional/extra works duly covered by Extra Works Orders involving new
work items that are not in the original contract, the unit prices will be based on
the direct unit costs used in the original contract (e.g., unit cost of cement,
rebars, form lumber, labor rate, equipment rental, etc.). All new components of
the new work item shall be fixed prices, provided the same is acceptable to
both the C/BSPMC and the contractor. The direct unit costs of new components
must also be based on the contractors estimate as validated by the C/BSPMC.
The C/BSPMC must validate these prices through a documented canvass
among three eligible suppliers in accordance with existing rules and
regulations. The direct cost of the new work item must then be combined with
the mark-up factor (i.e. taxes and profit) used by the contractor in his bid to
determine the unit price of the new work item.
The request for payment by the contractor for any extra work must be accompanied by a
statement, with the approved supporting forms, giving a detailed accounting and record of
amount for which he claims payment. This request for payment must be included in the
contractors statement for progress payment.
The following must be undertaken in issuing a Variation Order:
i.

Within seven (7) calendar days after the contractor discovers that there is a
need for variation order, the said contractor must communicate the same to the
C/BSPMC by giving it notice of the findings. Afterwards, the contractor has

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twenty-eight (28) days to submit a full documentation of the variation order.

Failure to provide either of such notices in the time stipulated shall constitute a
waiver by the contractor for any claim.
ii. If the TF or Municipal Engineer finds that a Change Order or Extra Work Order
is justified, he/she must prepare the proposed order, accompanied with the
following:
a. Notices submitted by the contractor;
b. The plans to effect the adjustments;
c. The contractors computations as to the quantities of the additional works
involved per item indicating the specific stations where such works are
needed, the date of his inspections and investigations thereon, and the
logbook thereof; and
d. A detailed estimate of the unit cost of such items of work, together with his
justifications for the need of such Change Order of Extra Work Order.
iii. The TF or Municipal Engineer, upon receipt of the proposed Change Order
or Extra Work Order shall immediately conduct an on-the-spot investigation to
verify the need for the work to be prosecuted.
iv. After being satisfied that such Change Order or Extra Work Order is justified
and necessary, the TF or Municipal Engineer shall review the estimated
quantities and prices.
v. If, after review of the plans, quantities and estimated unit cost of the items of
the work involved, the TF or Municipal Engineer finds that the Change Order
or Extra Work Order is in order and covered by the CAF, the same shall be
approved.
vi. The C/BSPMC shall notify the contractor to proceed with the work/delivery of
items in accordance with the amendment.
vii. The contractor shall proceed with the work/delivery of items in accordance
with the amended contract.
7.9. Suspension of Work
The C/BSPMC has the authority to suspend the work wholly or partly by written order due to
the following:
i. Force majeure or any fortuitous event; or
ii. Failure on the part of the contractor to:
a. Correct bad conditions which are unsafe for workers or for the general
public;
b. Carryout valid orders given by the Project Supervisor;
c. Perform any provisions of the contract; or
d. Adjustment of plans to suit field conditions as found necessary during
construction.
The contract shall specify a period of seven (7) calendar days from date of receipt of the written
order or notice, after which the said order may take effect and thus bind the contractor to
immediately comply. The order/notice shall specify the period deemed necessary for its
effectivity.
The contractor has the right to suspend work operation on any or all projects/activities along
the critical path of activities due to any of the following:
i.

There exist right-of-way problems, that prohibit the contractor from performing
work in accordance with the approved construction schedule;

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ii. Peace and order conditions make it extremely dangerous, if not impossible, to
work, such conditions having been certified in writing by the PNP station which
has responsibility over the affected area;
iii. There is a failure on the part of the C/BSPMC to deliver government
furnished materials and equipment as stipulated in the contract; or
iv. The non-payment of the contractors claim for progress billing beyond fortyfive (45) calendar days from the time the claim has been certified by the
C/BSPMC Chairperson as having been supported by complete documentation,
unless there are justifiable reasons which shall be communicated in writing to
the contractor.
The contractor may suspend work fifteen (15) calendar days after the C/BSPMC Chairperson
has received a written notice of the suspension of work.
Only in cases when the suspension of activities along the critical path is not due to the fault of
the contractor may the suspension of work be considered in the extension of time. In such
cases, the elapsed time between the effective order suspending operation and the order to
resume work shall be allowed the contractor by adjusting the contract time accordingly.
No payment can be made to the contractor for any standby time expense during the
suspension period, except when prior clearance is secured from the C/BSPMC Chairperson
and for justifiable reasons.
Work must be resumed either upon notice from the C/BSPMC of the lifting of the suspension
order or upon the expiration of the suspension order.
The following steps are undertaken in the issuance of a suspension order by the C/BSPMC:
i.
ii.
iii.
iv.
v.

vi.

The PIT determines the existence of any of the grounds for suspension
enumerated above.
The PIT drafts the suspension order for the approval of the C/BSPMC
Chairperson.
The suspension order is issued to the contractor, stating the grounds therefor.
Prior to the expiration of the suspension order, the PIT shall determine whether
or not the grounds for suspension still exist.
If such grounds continue to exist, or if it is no longer practicable to continue with
the work, it shall terminate the work subject of the order or cancel the delivery
of the items subject of such suspension.
If, however, the grounds for suspension no longer exist, and continuation of the
work is practicable, the PIT, with the approval of the C/BSPMC Chairperson,
shall lift the suspension order and notify the contractor to proceed with the
work/delivery of items in accordance with the amended contract.

7.10. Contract Time Extension

The contracts may be extended under the following conditions:
i.

There are additional works or other special circumstances that would entitle the
contractor to an extension of its contract;
ii. The affected activities fall within the critical path of the PERT/CPM network;
iii. The contractor shall have notified the C/BSPMC that the amount of additional
work or the occurrence of the special circumstance merits the extension of its
contract, and that it had done so before the expiration of the contract and within
thirty (30) calendar days after the start of the additional work or of the special
circumstance has arisen; and

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i.

The C/BSPMC, after due investigation and on the recommendation of the

TF and the Municipal Engineer finds the request justified, determines the
appropriate extension period, and approves the request of the contractor for
contract extension.

If the contractor fails to notify the C/BSPMC within the time period provided for, it waives any
claims to contract extension.
No contract extension must be given to a contractor due to:
i.

Ordinary unfavorable weather conditions, in that such weather conditions had

already been taken into consideration and anticipated in the computation of the
unworkable days; and
ii. Inexcusable failure or negligence of contractor to provide the required
equipment, supplies or materials.
Some special circumstances to be considered for contract time extension:
i.
ii.
iii.
iv.
v.
vi.

Major calamities such as exceptionally destructive typhoons, floods and

earthquakes, and epidemics;
Non-delivery on time of materials, working drawings, or written information to
be furnished by the C/BSPMC;
Non-acquisition of permit to enter private properties within the right-of-way
resulting incomplete stoppage of construction activities;
Region-wide or nationwide shortage of construction materials, as certified by
the DTI Secretary;
Region-wide or nationwide general labor strikes, as certified by the DOLE
Secretary; and
Serious peace and order problems as certified by the Municipal Chief of Police.

If a contractor incurs a delay and wishes to request for an extension of the completion of
construction period:
i.

It must submit a written request to the PIT for an extension of the completion
or construction period, citing the reason/s for such delay.
ii. The PIT shall either approve or disapprove the request for extension.
iii. If the extension is granted, the liquidated damages shall not be imposed and
the contractor will be so informed in writing.
iv. If, however, the request for extension is denied, the PIT shall inform the
contractor in writing of such denial, and ensure that the said notice or
communication is received by the latter within a reasonable time from receipt
of the request for extension. The C/BSPMC then imposes the liquidated
damages in accordance with the provisions of the contract and the procedures
outlined below.
If the Contractor incurs a delay and there is no request for extension:
i.

The PIT shall, within a reasonable time from the first day of delay, inform the
contractor that the C/BSPMC will impose the liquidated damages agreed upon
by the parties.
ii. Upon contract completion, the PIT and the MIT with the assistance of the TF
or Municipal Engineer shall record the delay in the inspection documents,
noting the amount of the liquidated damages imposable on the contractor.
iii. The amount of liquidated damages due shall be deducted from the total amount
payable to the contractor, and the same shall be reflected in the disbursement

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vouchers. Or, if the contract provides that the liquidated damages shall be
collected from the bank guarantee posted by the contractor, the PIT shall so
inform the ACT to call on the guarantee about the delay and the corresponding
liquidated damages imposable.
7.11. Delays in Work Completion and Liquidated Damages
The contractor must complete the work procured within the period prescribed by the C/BSPMC
as specified in the contract.
If delays are likely to be incurred, the contractor must notify the C/BSPMC in writing, stating
the duration and causes of the expected delay. The C/BSPMC may grant time extensions, at
its discretion, if such extensions are meritorious, with or without liquidated damages.
In all cases, the request for extension shall always be filed before the expiry of the original
completion date. Maximum allowable extension shall not exceed the original construction
period.
7.11.1. Liquidated Damages
Liquidated damages are damages agreed upon by the parties to a contract, to be paid in
case of breach.
When the contractor refuses or fails to satisfactorily complete the works under the contract
within the specified contract duration, plus any time extension duly granted, and is thus
considered in default under the contract, it will be liable for liquidated damages for the
delay. The contractor must pay the amount equal to one-tenth (1/10) of one percent (1%)
of the contract cost of the delayed works for every day of delay. The liquidated damages
will be imposed until such works are finally delivered or performed and accepted by the
C/BSPMC.
The C/BSPMC need not prove that it has incurred actual damages to be entitled to
liquidated damages from the contractor, and the same shall not be by way of penalty. Such
amount shall be deducted from any money due or which may become due the contractor
under the contract and/or from the retention money or other securities posted by the
contractor, whichever is convenient to the C/BSPMC.
In no case shall the sum of liquidated damages exceed ten percent (10%) of the contract
amount. If it does, the contract shall be deemed automatically terminated by the C/BSPMC,
without prejudice to other courses of action and remedies available to it. The C/BSPMC
may also take over the contract or award the same to qualified constructor through direct
contracting. In addition to the liquidated damages, the erring contractors performance
security shall also be forfeited.
7.12. Contract Termination
7.12.1. Termination of Contract for Default
The C/BSPMC Chairperson may terminate a contract for default when any of the following
conditions attend its implementation:
Due to the contractors fault and while the project is on-going, it has incurred
negative slippage of fifteen percent (15%) or more, without acceptable
justification;
ii. Due to the contractors fault and after the contract time has expired, it has
i.

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incurred a negative slippage of ten percent (10%) or more in the completion of

the work, without acceptable justification; or
iii. The contractor:
a. Abandons the contract works, refuses or fails to comply with a valid
instruction of the C/BSPMC or fails to proceed expeditiously and without
delay despite a written notice by the C/BSPMC ;
b. Does not actually have on the project site the minimum essential equipment
listed on the bid necessary to prosecute the works in accordance with the
approved work plan and equipment deployment schedule as required for
the project;
c. Does not execute the works in accordance with the contract or persistently
or flagrantly neglects to carry out its obligations under the contract;
d. Neglects or refuses to remove materials or to perform a new work that has
been rejected as defective or unsuitable; or
e. Sub-lets any part of the contract works without approval by the C/BSPMC.
The rescission of the contract shall be accompanied by the confiscation by the
C/BSPMC of the contractors performance security. The contractor will also be
recommended for blacklisting in all KC-NCDDP procurements. The contractor shall
be paid on a quantum meruit basis.
7.12.2. Termination of Contract for Unlawful Acts
The C/BSPMC may terminate the contract in case it is determined prima facie that the
contractor has engaged, before or during the implementation of the contract, in unlawful
deeds and behaviors relative to contract acquisition and implementation. Unlawful acts
include, but are not limited to, the following:
i. Corrupt, fraudulent, collusive and coercive practices;
ii. Drawing up or using forged documents;
iii. Using adulterated materials, means or methods, or engaging in production
contrary to rules of science or the trade; and
iv. Any other act analogous to the foregoing.
The contractor shall be paid on a quantum meruit basis.
7.12.3. Termination of Contract by Reason of Insolvency
The C/BSPMC Chairperson should terminate the contract if the contractor is declared
bankrupt or insolvent as determined with finality by a court of competent jurisdiction. In this
event, termination will be without compensation to the contractor, provided that such
termination will not prejudice or affect any right of action or remedy which has accrued or
will accrue thereafter to the C/BSPMC and/or the contractor.
7.12.4. Termination of Contract at the Instance of the Contractor
The contractor may terminate its contract with the C/BSPMC if the works are completely
stopped for a continuous period of at least sixty (60) calendar days through no fault of its
own, due to any of the following reasons:
i.

Failure of the C/BSPMC to deliver, within a reasonable time, supplies,

materials, right-of-way, or other items it is obligated to furnish under the terms
of the contract; or
ii. The prosecution of the work is disrupted by the adverse peace and order

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situation, as certified and approved by the Municipal Chief of Police.

The contractor must serve a written notice to C/BSPMC of its intention to terminate the
contract at least thirty (30) calendar days before its intended termination. The contract is
deemed terminated if it is not resumed in thirty (30) calendar days after the receipt of such
notice by the C/BSPMC Chairperson.
In cases of termination, the C/BSPMC shall return to the contractor its performance
security and shall pay unpaid claims on a quantum meruit basis.
7.12.5. Termination of Contract for Convenience
The C/BSPMC Chairperson, by written notice sent to the contractor, may terminate the
contract, in whole or in part, at any time for its convenience. The notice of termination shall
specify that the termination is for the C/BSPMCs convenience, the extent to which
performance of the contractor under the contract is terminated, and the date upon which
such termination becomes effective.
Any of the following circumstances may constitute sufficient grounds to terminate contract
for convenience:
i.

ii.

iii.
iv.
v.

If physical and economic conditions have significantly changed so as to render

the project no longer economically, financially or technically feasible, as
determined by the C/BSPMC Chairperson;
The C/BSPMC Chairperson has determined the existence of conditions that
make project implementation impractical and/or unnecessary, such as, but not
limited to, fortuitous event/s, changes in laws and government policies;
Funding for the project has been withheld or reduced by higher authorities
through no fault of the C/BSPMC ;
Failure of the C/BSPMC to acquire the necessary right-of-way; or
Any circumstance analogous to the foregoing.

7.12.6.Termination of Contract due to Force Majeure:

Either party may terminate the Contract by giving a thirty (30) day notice to the other for
events beyond the partys control, such as wars and acts of God such as earthquakes,
floods, fires, etc.
7.12.7.Payment
In any case or bases of termination, actual accomplishment as inspected and accepted
by the C/BSPMC and ACT/MCT shall be paid.
7.13.

Contract Completion

Once the project reaches an accomplishment level of ninety-five percent (95%) of the total
contract amount, the C/BSPMC Chairperson shall create an Inspectorate Team to conduct
preliminary inspection and to submit a punch-list within a period of fifteen (15) days. This
punch-list will contain, among others, the remaining works, work deficiencies for necessary
corrections, and the specific duration/time to fully complete the project considering the
approved remaining contract time. The Contractor shall complete the items in the punch-list in
preparation for the final turnover of the project. If the Final Account is still unsatisfactory after
it has been resubmitted, the Project Supervisor shall decide on the amount payable to the
Contractor and issue a payment certificate.

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The Contractor shall request the C/BSPMC to issue a certificate of completion of the Works
upon completion of the punch-list. The TF or Municipal Engineer will recommend such a
certificate when he determines that the work is satisfactorily completed. The C/BSPMC shall
take possession of the site within seven (7) days upon issuance of certificate of completion
of the Works.
The Contractor shall supply the TF or Municipal Engineer with a detailed account of the
total amount that the Contractor considers payable under the Contract before the end of the
Defects Liability Period. The TF or Municipal Engineer shall issue a Defects Liability
Certificate after the Contractor has fulfilled its obligation under the Contract and certify any
final payment that is due to the Contractor within fifteen (15) days of receiving the
Contractors account if it is correct and complete.
7.14. Warranty and Defects Liability Period
A warranty is required to ensure that the Contractor will correct structural defects and failures.
A one-year period after the completion of the project, called the defects liability period, is
observed until final acceptance by the C/BSPMC.
The Contractor shall assume full responsibility for the contract work within the defects liability
period and shall be held responsible for any damage or destruction of the works except
those occasioned by force majeure. During this period, the Contractor shall undertake the
repair works, at his own expense, of any damage to the infrastructure projects on account of
the use of materials of inferior quality within ninety (90) days from the time the C/BSPMC
Chairperson has issued an order to undertake repair.
The Defects Liability Period shall be extended for as long as defects remain uncorrected.
Every time notice of a defect is given, the Contractor shall correct the notified defect within
the length of time specified.
In case of Contractors failure or refusal to correct a defect within the time specified by the
order, the C/BSPMC shall undertake such repair works and shall be entitled to full
reimbursement of expenses incurred upon demand at the cost of the contractor. The TF or
Municipal Engineer will assess the cost of having the defect corrected. The C/BSPMC shall
recover these amounts by deducting from the amounts due to the Contractor.
Any Contractor who fails to comply with the preceding paragraphs shall suffer perpetual
disqualification from participating in any KC-NCDDP projects.
After final acceptance of the project, the Contractor shall be held responsible for structural
defects and/or failure of the completed project within the warranty period from final
acceptance, except those occasioned by force majeure and those caused by other parties.
7.14.1. Warranty Period
After final acceptance of the project by the C/BSPMC, the contractor shall be held
responsible for structural defects and/or failure of the completed project within the following
warranty periods from final acceptance, except those occasioned by force majeure and
those caused by other parties:
i.

Permanent Structures: Fifteen (15) years

Buildings of types 4 (steel, iron, concrete, or masonry construction with walls,
ceilings, and permanent partitions of incombustible fire resistance) and (steel,

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iron, concrete, or masonry construction), steel and concrete bridges, and other
similar structures;
ii. Semi -Permanent Structures: Five (5) years
Buildings of types 1 (wooden), 2 (wood with 1 hour fire resistance), and 3
(masonry and wood construction), concrete roads, asphalt roads, river control,
drainage, irrigation and drainage canals, municipal ports and river landing,
deep wells, rock causeway, and other similar structures; and
iii. Other Structures: Two (2) years
Bailey and wooden bridges, shallow wells, spring developments, and other
similar structures.
In cases where structural defects and/or failures arise during the warranty period, the
following persons/parties shall be held liable individually or solidarily, as the case maybe:
Contractor Where structural defects and/or failures arise due to faults attributable
to improper construction use of inferior quality/substandard materials, and any
violation of the contract plans & specifications, the contractor shall be held liable;
ii. TF or Municipal Engineer the appropriate C/BSPMC officer concerned shall be
held liable in cases where the structural defects/failures are due to his/their willful
intervention in altering the designs and other specifications; negligence or omission
in not approving or acting on proposed changes to noted defects or deficiencies in
the design and/or specifications; and the use of substandard construction materials
in the project;
iii. Users - In cases where structural defects/failures are due to abuse/misuse by the
end user of the constructed facility and/or noncompliance by a user with the
technical design limits and/or intended purpose of the same, then the user
concerned shall be held liable.
i.

The term structural defects shall mean major faults/flaws/deficiencies in one or more key
structural elements of the project which may lead to structural failure of the completed
elements or structure. The term Structural Failures is defined as an occurrence where
one or more key structural elements in an infrastructure facility fails or collapses, thereby
rendering the facility or part thereof incapable of withstanding the design loads, and/or
endangering the safety of the users or the general public.
In case of structural defects/failures occurring during the applicable warranty period
provided above, the C/BSPMC
shall undertake the necessary restoration or
reconstruction works and shall be entitled to full reimbursement by the parties found to be
liable, of expenses incurred upon demand, without prejudice to the filing of appropriate
administrative, civil, and/or criminal charges against the responsible persons as well as
the forfeiture of bank guarantee posted in favor of the C/BSPMC..
7.15. Settlement of Disputes:
The C/BSPMC and the Contractor shall make every effort to resolve amicably by direct
negotiations any disagreement or dispute arising between them under or in connection with
the Contract. The disagreement may also be presented to appropriate Grievance Officer/Unit
of KC-NCDDP. In case of further disagreement either party can take the matter to arbitration
in accordance with the Law governing the Contract.

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CHAPTER EIGHT: COMMUNITY BASED

PROCUREMENT MONITORING
8.1. Importance of Community
Procurement Monitoring
8.2. Community Procurement Compliance
Monitoring
8.3. Project Billboard
8.4. Community Procurement Performance
Monitoring
8.5. Integrated Procurement Compliance
and Performance Monitoring Report
8.6. Procurement Post Review Assessment

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8.1. Importance of Community Procurement Monitoring

Procurement monitoring is the process of collecting information on procurement related
activities for the purpose of learning from experiences to improve future practices and
activities, promoting accountability on the proper use of resources and results obtained,
making informed decisions and empowering project beneficiaries. It allows results, processes
and experiences to be documented and used as a basis to steer decision-making and learning
processes for procurement action. Since the KC-NCDDP primary objective is to bring more
equitable services and improve human outcomes in the poorest areas of the country, it is
important that the resources allocated for the purpose of procuring these services are properly
managed and skillfully monitored to ensure compliance and to realize project objectives. The
empowerment of community members and their active involvement in the process of procuring
the services that will eventually redound to their benefit is expected to minimize corruption and
the mismanagement of funds.
Procurement monitoring under the KC-NCDDP shall focus on three important aspects: (a)
compliance to the procurement procedures and guidelines discussed in this manual, (b) the
evaluation of performance in comparison to the community procurement plan and the overall
project plans and programs; (c) fiduciary assessment. Procurement compliance monitoring is
expected to identify and evaluate risks and vulnerable areas in the procurement process, and
to generate appropriate risk and anti-corruption mitigation measures. Procurement
performance monitoring, on the other hand, is expected to help determine accomplishment
against planned targets at the community, regional and national levels, to document lessons
learned to help improve the overall procurement policies and procedures, and to identify
additional inputs needed in the training and capacity building of community based procurement
volunteers. Procurement fiduciary or post review assessment refers to the evaluation
conducted by international financial institutions, involved in the KC-NCDDP, the NPMO and
COA to ensure that a high standard of enforcement is applied in the procurement processes
so that there is no uneconomic or inefficient procurement of goods, works, and services using
the loans resources.
8.2. Community Procurement Compliance Monitoring
Procurement compliance monitoring refers to the review undertaken to ensure that the
procurement procedures followed by community based procurement volunteers are in
accordance with those discussed in this Community Based Procurement Manual (CBPM). The
Technical Facilitator (TF) is designated to conduct the procurement review in order to monitor
procurement compliance for goods and works. The TF is expected to possess a working
knowledge of procurement procedures to determine community compliance, to help resolve
issues related to the procurement at hand, to detect the red flags and abnormalities and areas
for improvement as well as to recommend risk mitigation measures to address these issues,
red flags and weaknesses. For the procurement of works, the TF may refer engineering and
other related issues to the Municipal Engineer (ME) or to the Community Infrastructure Officer
(CIO). The TF shall conduct a review of all procurements of each C/BSPMC within one month
after the award of every contract. The objective of the procurement review is to identify the
level of understanding of procurement personnel of the procedures discussed in this manual
and possible problems encountered in the course of the procurement and to come up with an
action plan to address these issues.
There are four important steps that the CF must follow in procurement compliance monitoring.
These are:
i.

Checking the completeness of the procurement and finance documents by

filling up the simplified checklist found in CBPM Form F-1;
ii. Completing the Procurement Compliance Monitoring Report (PCMR) Form

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(CBPM Form F-2) within one month after the award of each contract;
iii. Identifying issues, concerns and red flags encountered and reporting this in
Section B of the PCMR Form. In case of problem procurements where there
are serious violations of the procurement procedures, findings of red flags or
issues that cannot be resolved at the AMT level, a formal report shall be
submitted to the RPMO or NPMO identifying the problem areas, red flag
findings and recommendations to address these issues or requested decision
and action at the regional and national level. The regional or national staff will
in turn provide the applicable management action and decision, undertake
corrective measures, intensify project supervision or impose appropriate
sanctions on erring local officials in case there are findings of corruption.
iv. Upon completion of all the PCMR, the TF shall consolidate all the reports
for communities within his/her area of jurisdiction on a quarterly basis. The ACT
shall in turn review all reports and shall submit the same including all supporting
documents within ten (10) days after the end of each quarter to the Regional
Program Management Office (RPMO). The RPMO shall thereafter consolidate
all submitted reports and shall prepare a regional Procurement Performance
and Compliance Monitoring Report (PPCMR) for all projects within the region
within five (5) days after submission of all reports coming from the AMTs and
shall submit the same to the NPMO for further consolidation into a national
report.
For purposes of procurement compliance monitoring, issues and concerns refer to problems,
issues on interpretation of procedures, constraints that the BAC or the C/BSPMC may
encounter in the course of the procurement such as lack of qualified suppliers or contractors,
absence of banks to provide bid and performance securities, etc. that may need clarification,
further action or decision of higher authorities at the regional or national levels. Red flags are
warning signals that may refer to possible violations in the procurement procedures that are
deliberate and meant to commit acts of corruption. These red flags provide a signal for the
Area/Municipal Coordinating Team (A/MCT) and Regional Program Management Team
(RPMT) to intensify supervision and undertake corrective measures. The red flags also serve
as areas of risk that need to be reported and addressed more closely either by the community
or by higher authorities. Section B of the PCMR is a report on the recommended action to be
taken by the community to address possible areas of weakness, issues and concerns that can
be solved at their levels.
As part of enhanced oversight and support mechanisms, the RPMO will also conduct
unannounced visits to barangays to ensure that the ACTs have sufficient support for any
issues that may arise, and to conduct spot reviews to ensure correct implementation of KCNCDDP procedures, particularly with regard to procurement.
8.3. Project Billboard
As part of the transparency initiative of the KC-NCDDP, all community based sub-projects
shall install project billboards to inform the general public on the existence and status of the
sub-projects. It shall be placed at least 5 meters away from any commercial or political
billboard/s and shall provide information on the name of the project, project description, project
cost, name of contractor, project timetable (duration, start and completion date), and
percentage of physical and financial accomplishment. The project billboard shall not include
the names of any politicians. The A/MCT shall remind the C/BSPMC to update the billboard
and report on accomplishments on a monthly basis for transparency purposes. Likewise,
A/MCT shall coach the volunteers on how to present the rates of accomplishment for better
understanding of all community members and the public.

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8.4. Community Procurement Performance Monitoring

Procurement performance monitoring refers to activities to ensure that the procurement is
done in accordance with the community procurement plan. This shall be based on actual
accomplishments against planned targets based on the program of works and the CPP. The
accomplishment for each procurement package identified, validated and approved by the
C/BSPMC Chairperson and the BAC are reported and shall include information on physical
and financial accomplishment, adherence to project schedule and timelines and issues and
concerns encountered in the course of project implementation. For works sub-projects, the
performance monitoring report shall be coordinated and consistent with the Monthly Physical
Accomplishment Report discussed in the Community Based Infrastructure Sub-Project
Manual. Physical accomplishment shall be computed as discussed in the said manual. For
procurement of goods, physical accomplishment shall be based on the percentage of goods
delivered against the purchase order issued. The accomplishment report shall include pictures
taken of the goods or works procured during the period of reporting. The data shall be used
for future plans to develop a geo-tagging system for all sub-projects under the KC-NCDDP.
For municipalities with existing geotagging facilities particularly those with other World Bank
funded projects, the ACT may coordinate with the WB Project Team Leader to include the
community project in its reporting system. The Procurement Performance Monitoring Report
(PPMR) format is shown in CBPM Form F-3. The ACT shall also follow the procedures for
guidance for the application of geotagging tools in procurement issued by the World Bank.
Procurement accomplishment is reported on a monthly basis from the time the contract is
awarded to project completion. Lessons learned on issues, concerns and red flags from
different regions and areas are consolidated to improve national policies and procedures and
to develop appropriate training interventions to strengthen and enhance the capacity of
community procurement volunteers.
The TF shall be responsible for preparing the accomplishment report to monitor procurement
performance. This shall be done on a monthly basis, or when making a request for fund
release and is submitted to the ACT for consolidation and further submission to the RPMO.
Additional inputs to the accomplishment report include the report on the actions taken with
regards to risk mitigation measures identified in the Procurement Compliance Monitoring
Report. The TF may request the Municipal Engineer to assist in the preparation of the report.
The following steps are to be observed in the preparation of the procurement performance
monitoring report:
i.

The TF shall gather all available data with regards to the performance of all
the procurements of each C/BSPMC and shall take pictures of the actual goods
or project site where the sub-project is implemented using the geotagging
facilities and procedures;
ii. The TF shall prepare a report using the Procurement Performance
Monitoring Report Form for submission to the ACT. For works, the TF shall
refer to the Barangay Sub-Project Work Schedule & Physical Progress Report;
iii. The TF shall prepare a consolidated report for all communities under its
jurisdiction and shall submit the same to the RPMO;
iv. Consequently, the RPMO through the Community Procurement Officer shall
consolidate all reports from the ACTs into a regional report for submission to
the NPMO and shall post the report in its regional website.

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8.5. Integrated Procurement Compliance and Performance Monitoring Report

On a quarterly basis, the NMPO shall prepare and issue an Integrated Procurement
Compliance and Performance Monitoring Report (IPCPMR) that includes the consolidated
accomplishments of all KC-NCDDP funded sub-projects from all RPMOs and shall post the
same in the KC-NCDDP website for the information of all concerned. The format for this report
is found in CBPM Form No F-4.
8.6. Procurement Post Review Assessment
The ADB, WB, DSWD and COA conduct procurement post review assessments at various
stages of the procurement process to evaluate procedural compliance and performance,
among others. For these post review assessments, the procedures shall be based on the
existing guidelines of such institutions with the project related procurement monitoring reports
as basis. The Internal Audit Department of the DSWD conducts a regular ex post fiduciary
review of all KC-NCDDP activities in terms of adequacy of compliance to systems and
procedures using the data obtained from the Procurement Compliance and Performance
Monitoring Report.

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GLOSSARY OF TERMS

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Abstract of Bids/Record of Bid Opening the corresponding document prepared by the

BAC after all bids have been received, opened, examined, evaluated and ranked.
Advance payment refers to any payment made prior to the delivery and acceptance of
Goods, Works, or Consulting Services.
BAC the Bids and Awards Committee.
Bid (Bid proposal) is a signed offer coming from a supplier/contractor interested to provide
goods or undertake infrastructure work for the community.
Bid Evaluation the process of determining the Bidder with the Lowest Calculated and
Responsive Bid/Quotation (LCRB/Q) or the Highest Rated Bid (HRB) in case of consultancy
services.
Bid Opening Date the date specified in the Invitation to Bid (ITB) for the opening of bids.
Bid Security- is required to ensure that the successful bidder shall, within five calendar days
from receipt of the Notice of Award, sign the contract with the C/BSPMC. It could be in the
form of cash, check, bank draft, letter of credit or bank guarantee that serves as a guarantee
that the successful bidder shall not default on his offer, and shall enter into contract with the
C/BSPMC and furnish the performance security.
The bid security shall be returned to the bidders only after the successful bidder has signed
the Contract and posted the performance security, except if the bidder fails to comply with all
the requirements and the bid is marked failed.
Bidder, who wants to present cash as bid security, shall be instructed to deposit the
amount to the communitys bank account and to attach the machine validated deposit slip to
the bidding documents to be placed in a sealed envelope.
Bid Validity a period indicated in the bidding documents, but in no case shall exceed sixty
(60) calendar days from the date of the opening of bids, wherein a Bid Security is considered
valid.
Bidder an individual or entity that submits a bid. The term includes anyone acting on behalf
of the individual or other entity that submits a bid, such as agents, employees, and
representatives. More specifically, a contractor, manufacturer, supplier, distributor competing
for the award of a contract in any government procurement.
Bidding Documents the documents issued by the BAC as the bases for bids, furnishing all
information necessary for a prospective bidder to prepare a bid for the infrastructure projects
and/or goods required by the procuring entity.
Blacklisting to place on, or as if on, a list of persons or organizations that have incurred
disapproval or suspicion or are to be boycotted or otherwise penalized.
Brand Name a trade name or product name, which identifies a product as having been
made by a particular manufacturer.
Calculated bid price the price of a bid, after taking into account minor arithmetical
corrections to consider computational errors, omissions and discounts, if allowed.
Collusion an agreement between two or more persons, to commit acts to accomplish a
fraudulent or deceitful purpose.

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Competitiveness a principle in KC-NCDDP procurement that allows broad participation by

eligible and qualified suppliers and contractors to put forward offers for a community project.
Communication costs mail, internet rental, and fax costs, plus cost of advertising,
meetings, internet/web posting, and other costs incurred for the dissemination of information
about the bidding.
Community Bidding- a method of procurement which is open to participation by any
interested and qualified party and which consists of the following processes: advertisement,
pre-bid conference, receipt and opening of bids, evaluation of bids, postqualification, and
award of contract.
Community driven development (CDD) - an approach that gives control over planning
decisions and investment resources for development projects to community groups based on
the principles of local empowerment, participatory governance, demand-responsiveness,
administrative autonomy, greater downward accountability and enhanced local capacity.
Community Direct Contracting - a method of procurement of goods and works where the
community directly negotiates a contract with a technically, legally and financially capable
supplier or contractor.
Community Shopping- a method of procurement where the community simply requests for
the submission of price quotations from a minimum of three suppliers for readily available offthe-shelf goods or standard specification commodities of small value or a minimum of three
contractors for simple works of small value who are of known qualifications.
Conference Notice a formal written communication sent to the participants of the
conference (such as the Pre-procurement, Pre-bid and Post-Award Conference) informing
them when and where the conference will be held.
Conflict of Interest a situation in which a public official's decisions are influenced by the
official's personal interests.
Consulting Services refer to services provided by external technical service providers or
professional expertise that are beyond the capacity of the C/BSPMC or Local Government
Unit (LGU) staff to undertake such as but not limited to feasibility studies; design; construction
supervision; services for capability building types of community projects; and, special studies.
Consolidated Blacklisting Report a report issued by the GPPB that contains a list of
people and/or organizations that are barred from participating in any Government
procurement project.
Contract a meeting of minds between two persons whereby one binds himself, with
respect to the other, to give something or to render some service. Article 1305, New Civil
Code, Republic Act No. 386
A promise or a set of promises for the breach of which the law gives a remedy, or the
performance of which the law in some way recognizes a duty.
An agreement, upon sufficient consideration, to do or not to do a particular thing.
A promise enforceable by law.
Contract Completion project sign-off or acceptance of the project/goods by the end-user.
Contract Implementation the execution of a contract, covering the following milestones:
effectivity of the contract; contractors performance of his contractual obligations; procuring

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entitys performance of its contractual obligations, as specified in the Contract; final

acceptance or project sign-off; all other related activities; and payment by the Procuring Entity.
Contractor one who undertakes to perform a work or service, or supply goods for a public
or private entity.
Contract Termination ending of a contract prior to its completion.
Corrupt practice the offering, giving, receiving, or soliciting of anything of value to influence
the action of a public official in the procurement process or in contract execution. Compare
fraudulent practice.
Cost Recovery Component direct and indirect costs accounted for in determining the price
of Bidding Documents to be sold to interested suppliers/contractors.
Defects Liability Period - refers to the period from the date of issuance of Certificate of
Completion of the works as certified by the C/BSPMC Chairman up to the date within which,
the contractor shall still be liable for defects, shrinkage or other faults as determined by
C/BSPMC. The contractor shall execute all such work needed to amend, reconstruct, or
remedy at his own cost.
Development Cost costs incurred in developing the original content of the documents,
designs, plans and specifications. The design cost may be excluded if the same is to be
included in the capitalized cost of the project which is to be recovered from the usage of the
completed project facility.
Direct Contracting an alternative method of procurement of goods and infrastructure
projects whereby the C/BSPMC directly negotiates a contract with a technically, legally and
financially capable supplier or contractor.
Direct Costs - costs directly incurred such as development, reproduction, and communication
costs allocated to the bidding activity.
Disclosure the act of disclosing, uncovering, or revealing.
Disqualification the act of barring a bidder from further participation in the procurement at
hand, even if, in some instances, it has initially been declared eligible or post-qualified.
Eligible Bidder a contractor, manufacturer, supplier or distributor who meets all the
eligibility requirements for procurement at hand.
Eligibility refers to the status of a Bidder in relation to its legal, technical and financial
competence to comply with the requirements of the contract to be bid.
Eligibility Check - a procedure used to determine if a prospective bidder is eligible to
participate in the procurement at hand.
Eligibility Requirements - refer to qualifications set by the BAC for participating bidders.
Some examples of qualifications are:
Suppliers must have a SEC Registration, mayors permit or municipal license, or the
Cooperative Development Authority, if a cooperative;
Contractors for works must be either a duly licensed Filipino citizen or a sole proprietorship,
or a duly registered partnership or corporation;

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Estimated Budget for the Contract the budget for the contract duly approved by the
C/BSPMC which will serve as the agency estimate as reflected in the Community
Procurement Plan.
Evaluated Bid - refers to the corrected bid after evaluation has been completed.
Force Majeure see Fortuitous events.
Fortuitous events/Force majeure an event which could not be foreseen, or which though
foreseen, was inevitable e.g. natural disasters or any man-made calamities
Fraudulent practice misrepresentation of facts in order to influence a procurement process
or the execution of a contract to the detriment of the C/BSPMC.
Goods and services - refers to all items, supplies, materials, and general support services
which may be needed in undertaking the project related activities or in the operations of the
Barangay Sub-Project Management Committee (C/BSPMC).
Incidental Services services supplementary to the supply of the Goods, such as
transportation and insurance; installation, provision of technical assistance, training, and other
such obligations of the Supplier covered under the contract or purchase order.
Indirect Costs - costs indirectly incurred such as overhead, supervision, and administrative
costs allocated to the bidding activity. Compare Direct Costs.
Ineligible bid- a proposal submitted by a supplier that is considered disqualified due to the
following reasons: (a) late submission; (b) inability to meet the eligibility requirements such as,
non-submission of correct bid security, or lack of eligibility or technical requirements, among
others.
Ineligible Bidder a contractor, manufacturer, supplier or distributor who fails to meet any
or all of the eligibility requirements.
Infrastructure Projects (Civil Works) include the construction, improvement,
rehabilitation, demolition, repair, restoration or maintenance of roads and bridges, railways,
airports, seaports, communication facilities, civil works components of information technology
projects, irrigation, flood control and drainage, water supply, sanitation, sewerage and solid
waste management systems, shore protection, energy/power and electrification facilities,
national buildings, school buildings, hospital buildings, and other related construction projects
of the government.
Inspection examination and/or testing of merchandise to determine whether it has been
received in the proper quantity and condition and to verify that it conforms to the applicable
specifications.
Instruction to Bidders (ITB) outlines the specific instructions that the bidder needs to follow
in the preparation of his/her bid.
Invitation to Bid (IB) - serves as the notice to the public and all interested parties of the
procurement and bidding opportunities of the community.
Latent Defect a defect that is not apparent to the buyer by reasonable observation. A latent
defect is hidden or one that is not immediately determinable.

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Liquidated Damages damages agreed upon by the parties to a contract, to be paid in case
of breach thereof.
Minor Deviations are deviations in the bid that can be corrected. Some examples are the
following:
Computational error such as when the total amount is not equal to the unit cost times the
number of units. In this case, it is the unit cost, which should be taken as the correct amount,
and the total price should be corrected.
Discounts which do not have pre-conditions should be applied to the total price to get the
net amount
Minor deviations shall be corrected and adjustments shall be computed to determine the
calculated price.
Major Deviations - are deviations which affect in a substantial way the scope, quality or
performance of the works; which limits the communitys rights under the contract; or one that
if corrected would affect unfairly the comparative position of other bidders.
The following are examples:
Bid contains a different design that does not respond to the contract plans and
specifications;
Stipulates price adjustment when bid price should be fixed given the short duration of the
contract;
Proposed timeframe of implementation does not conform to the required period
Bid contains provision to exempt the bidder from some critical provisions of the contract.
Motion for Reconsideration in procurement, it is an application made to the BAC for the
purpose of obtaining a rule or order setting aside a previous decision.
Notice of Award the document issued by the C/BSPMC to the bidder to whom the contract
is awarded.
Notice of Post-qualification the document issued by the BAC to the bidder with LCB or
HRB whose bid is found responsive subjected for post-qualification evaluation.
Notice to Proceed the document issued by the C/BSPMC to the winning bidder to proceed
with the implementation of the contract.
Observer one who is invited to attend and observe all stages of the procurement, especially:
the pre-bid conference; opening of bids; bid evaluation; post-qualification; contract award; and
special meetings of the BAC.
Off-the-shelf goods procurement - applies to the purchase of readily available goods from
local market outlets/stores.
Pakyaw contract - an alternative method of procurement where the partial or full
implementation of an infrastructure project or items of work for its completion is carried out
by skilled or unskilled labor from the community or its vicinity. Process involves negotiations
within the Barangay Assembly (BA).
Patent Defect a defect that is apparent to the buyer on normal observation. An apparent or
obvious defect.
Performance Security a security posted by the winning bidder to guarantee the faithful
performance by the same of its obligations under the contract prepared in accordance with
the bidding documents.

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Post-qualification the process of validating and verifying the documents, information and
statements made in the Eligibility Documents by the Bidder who submitted the Lowest
Calculated and Responsive Bid/Quotation, as well as ascertaining the said Bidders
compliance with the legal, financial and technical requirements of the bid.
Post-qualification Report the report prepared by the TWG containing the findings/results
of the post-qualification conducted on the bidder with the LCRB or HRB, as the case may be.
Pre-bid Conference is the forum where the Procuring Entitys representatives and the
Prospective Bidders discuss the different aspects of the procurement at hand.
Procurement the acquisition of Goods and Infrastructure Projects by the C/BSPMC.
Project Implementation Unit the unit created through an Executive Order that is primarily
responsible for implementing and managing a community project.
Procurement Package is a group of similar goods that can be purchased from one supplier
or work items that can be performed or implemented by a single contractor.
Procurement Preparation Meeting is the forum called by the BAC for procurements
undertaken through public bidding, where all officials involved in the procurement meet and
discuss all aspects of the transaction, including the technical specifications, the Estimated
Budget for the Contract, the applicability and appropriateness of the recommended method
of procurement and the related milestones, the bidding documents, availability of the pertinent
budget release for the project / contract, among others.
Protest a formal declaration made by a person interested or concerned in some act to be
done, or already performed, whereby he expresses his dissent or disapproval, or affirms the
act against his will. The object of such declaration is usually to save some right which would
be lost to him if his implied anent could be made nil, or to exonerate himself from some
responsibility which would attach to him unless he express negatively his assent. (Blacks Law
Dictionary, 5th Ed.)
Purchase Order - a contract between the community and the supplier/dealer for the delivery
of supplies, subject to stipulations in the order.
Reproduction cost labor, supplies and equipment rental costs incurred in the reproduction
of the documents e.g. photocopying, blue printing, etc
Request for Clarification a written request submitted by the bidder to the BAC, asking the
latter to clarify a particular provision of the Bidding Documents.
Responsive bid is a solicited bid is determined to be in substantial conformance with the
conditions, completion or delivery requirements, and specifications detailed in the invitationto-bid (ITB), request for proposals (RFP), request for quotations (RFQ), or request for tenders.
Retention Money - refers to the amount retained from progress payment to cover uncorrected
discovered defects and third party liabilities. This is equivalent to 10% of all progress
payments. Upon issuance of Certificate of Completion by the C/BSPMC through the
recommendation of the Project Supervisor, 100% of the retention money is returned to the
contractor. It is understood that the Contractor is still liable to C/BSPMC under Defects
Liability Period provision of the contract.
For performance guarantees in the form of cash for contracts that are nearing the end of KCNCDDP project, such guarantee shall be replaced with a bank guarantee from a reputable
bank.

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Short term services procurement - the purchase of non-consultancy service requirements

available in the local community and requiring a very limited period of time.
Small value procurement - a method for the procurement of goods, services, and works
where direct purchase is used for items of very small quantities and value since it is more
practical and economical to do so.
Small works procurement - the purchase of construction related service requirements
available in the local community and requiring a very limited period of time and skilled labor
which would be more economical to procure as small works rather than pakyaw contract.
Spare parts refer to extra components, equipment, tools, instruments or parts of machinery
or apparatus that replace the ones that are damaged or worn out.
Special Power of Attorney- a legal document where a principal grants authority to an agent
who is an officer or staff of the firm to represent him in certain procurement as allowed by this
manual related transactions in case he is not available.
Specification - a description of what the purchaser requires and what a bidder must offer.
- A detailed description of design criteria for a piece of work or material.
Splitting of Contracts/Packages is the act of dividing or breaking up of contracts into
smaller quantities and amounts, or dividing contract implementation into sub-contracts but it
can be undertaken/procured as one contract to circumvent or subvert the procurement
method.
Standard the established and fixed measure used in assessing quality or performance.
Subcontractor one who takes a specific part of the work undertaken by the principal
contractor. (Blacks Law Dictionary, 5th Ed.)
Submitted bid price the bid price as indicated in the financial proposal submitted by the
bidder.
Supplemental/Bid bulletin a notice issued by the Procuring Entity to Prospective Bidders
with respect to any clarifications or modifications in the Bidding Documents, including those
affecting the technical specifications, eligibility requirements, procurement schedule, and
other similar matters.
Supplier of good standing - one who is known in the community to be in the business of
providing the goods to be procured for at least one year, duly registered with the DTI, SEC or
CDA and possessing a mayors permit/municipal license from the suppliers principal place of
business with no outstanding record of being blacklisted by any government agency or local
government unit.
Technical Bid one of two components comprising a bid, the other being Financial Bid.
Technical specifications- refers to the physical description of the goods or services, as well
as the requirements of the community in terms of the functional, performance, environmental
interface and design standard requirements to be met by the goods to be manufactured or
supplied, or the services to be rendered.
Tender See Bid.

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Unbalanced Quotation/Bid- a bid where part of the cost of one work item is shifted to another
item of work making the cost of such item unreasonably high and other items unreasonably
low.
Warranty an undertaking by the supplier, manufacturer or distributor to guarantee that it will
correct any manufacturing defects of the goods procured by the C/BSPMC.
Works or Infrastructure Projects refers to undertakings to construct, improve, upgrade,
rehabilitate, demolish, repair, restore, or maintain small scale infrastructure and all types of
physical works identified under the KC-NCDDP, fabrication of equipment and structural parts,
as well as physical labor to complete such projects.

138

PERIOD OF ACTION ON
PROCUREMENT ACTIVITIES

139

COMMUNITY SHOPPING
ACTIVITIES

DEADLINE

Preparation of Request for

Quotation

Conduct of Procurement
Preparation Meeting
Posting of Notice of Request
for Quotation
Issuance of Request for
Quotation

Once for a minimum

period of 3 c d

Contractors Conference for

P1M and above contracts

Conducted at least 3
days brior to
submission of
quotation

Site Visit or Inspection (any

day prior to submission of
quotation)
Submission and Opening of
Quotations
Quotation Evaluation
Postqualification
Prior Review of Contract (No
Objection Letter)
Sub-Total
Issuance of Notice of Award
PO/Contract Preparation and
Signing
Issuance of PO or Notice to
Proceed
TOTAL

DURATION (IN CALENDAR DAYS)

GOODS
WORKS
MIN
MAX
MIN
Max
1

1
3

2
5

5 (RPMO)

5 (RPMO)

5 (RPMO)

5 (RPMO)

13

17

16
3
3

25
7
5

16

20

23

39

140

COMMUNITY DIRECT CONTRACTING

Activities

Deadline

Preparation of Request for

DURATION (in calendar days)

GOODS
WORKS
Min
Max
Min
Max
1
1
1
1

Quotation

Conduct of Procurement
Preparation Meeting
Posting of Notice of Request
for Quotation (for information)
Issuance of Request for
Quotation
Contractor Conference and
Site Visit or Inspection
Submission and Opening of
Request for Quotation
Quotation Evaluation
Prior Review of Contract (No
Objection Letter)
Sub-Total
Issuance of Notice of Award
PO/Contract Preparation and
Signing
Issuance of PO or Notice to
Proceed
TOTAL

Once for a period of

3cd

5 (RPMO)

5 (RPMO)

5 (RPMO)

5 (RPMO)

11

15

12

17

3
3

7
5

14

18

19

31

141

COMMUNITY BIDDING
ACTIVITIES
Preparation of Bidding
Documents
Conduct of Procurement
Preparation Meeting
Posting of Invitation to Bid
Issuance of Bidding
Documents
Conduct of Pre-Bid
Conference
Site Visit or Inspection
Submission and Opening of
Bids
Bid Evaluation
Postqualification
Prior Review of Contract (No
Objection Letter)
Sub-Total
Issuance of Notice of Award
Contract Preparation and
Signing
Issuance of Notice to Proceed
TOTAL

DEADLINE

DURATION (IN CALENDAR DAYS)

GOODS
WORKS
MIN
MAX
MIN
MAX
1
3
1
3
1

Once for a minimum

period of 7 c d
7-14CD from posting
of IB

14

14

5-7 days before bid

opening

1
1

1
1

1
1

1
1

1
1

2
2

1
1

3
3

5 (RPMO)
5 (NPMO)

5 (RPMO)
5 (NPMO)

5 (RPMO)
5 (NPMO)

5 (RPMO)
5 (NPMO)

25

36

25

38

3
2

7
5

3
2

7
5

1
31

3
51

1
31

3
53

142