Because of the Port of Houston Authority's responsibility as a governmental entity, the Port must adhere to the following guidelines when purchasing goods and services. Before your company submits its bid to the Port of Houston Authority, your firm should familiarize itself with the following guidelines and procedures.

Submitting a Bid
The purchasing department of the Port of Houston Authority is responsible for purchasing all the goods and services necessary to maintain its facilities and must adhere to the following purchasing procedures:

1. Formal Bids (In excess of $25,000):
The state's Navigation District Purchasing Act requires that public notice of a proposed purchase exceeding $25,000 be published once a week for the two consecutive weeks proceeding the date of the bid opening. Port of Houston Authority notices appear in the Houston Chronicle Classified Section under "Bids and Proposals," and in other selected area publications. The Board of Port Commissioners has encouraged the staff to publish public notices in local minority and small newspapers so that more companies may participate in providing goods and services.

Listed in each ad is a short description of the goods and services to be purchased, the location at which detailed specifications may be obtained, and the time and date of the bid opening. Vendors are encouraged to pick up bid packages, as the purchasing department cannot assure timely delivery of bid packages when mailed. All bids should be submitted to the Port's purchasing department.

When submitting sealed bids, it is extremely important that vendors pay close attention to the detailed instructions included, particularly the requirement for a bid security. Bid security, equal to 5 percent of the greatest amount bid, must be included with the bid and must be in the form of a bidder's bond on the form provided by the Port Authority or a cashier's or certified check drawn on a bank that is a member of the Federal Deposit Insurance Corporation. Personal checks, company checks, money orders and checks drawn on credit unions are not acceptable and will cause the bid to be rejected. Bid security, not in accordance with these requirements, will cause the vendor's bid to be rejected, even if it is the lowest bid received.

Bids are opened and publicly read in the board room on the fourth floor of the Port of Houston Authority Building, 111 East Loop North, Houston, Texas at 1:30 pm on the day designated in the public notice, usually the fourth Thursday of the month. After the public opening, bids are evaluated and reviewed and a recommendation for award is submitted to the Port Commission. The Port Commission has the right to accept or reject any or all bids. Vendors unable to attend the bid opening may call 713-670-2460 to obtain the bid results.

2. Requests for Proposal (In excess of $25,000):
State law provides an alternative procedure for purchase of insurance and high technology items. "High technology" is defined as "a service, equipment or goods of a highly technical nature, including data processing equipment and software used in conjunction with data processing equipment, telecommunications, radio and microwave systems, etc."

This process differs from the formal bid process in that bids are not opened in public forum and a request for proposal allows negotiation with vendors submitting proposals that have a reasonable possibility of satisfactorily performing the work required by the contract. The final negotiated contract may be quite different from the original proposal. All documents become public issuance of the purchase order, unless requested otherwise.

3. Personal or Professional Services:
Such services are specifically exempted from the formal bid or request for proposal process. For these services, Port of Houston Authority personnel meet with the vendors to determine the vendor's experience and background. A list of the most qualified vendors for the specific project is then submitted to the Port Commissioners. The Port Commissioners then select the vendor best qualified for the project and vote to award the contract.

In selecting consultants, the Port Commission takes into account the amount of small business participation indicated by each firm.

4. Informal Bids:
Purchases of goods and services for $25,000 or less do not require the formal bidding process. The procedure begins when the requesting department completes a Request for Purchase Order (RPO) which is sent to the purchasing department. A buyer then refers to a list of vendors providing the goods or services requested and obtains a minimum of three quotes and, after proper authorization, a purchase order is issued to the lowest responsible bidder. After the order is signed by the purchasing manager and the county auditor, it is mailed to the successful bidder. Informal bids may be taken by telephone, in person or in writing, the method being at the discretion of the buyer and the requirements of the department requesting the products or services.

5. Equivalent Products:
In order to reduce operating costs, the purchasing department encourages all vendors to offer lower-cost equivalent products to any items solicited, whenever possible. There are some instances where safety considerations compel this office not to accept equivalent products; however, the Port of Houston generally encourages bids that contain lower-cost equivalent alternatives.

6. Getting On The Bid List:
To get on the Port of Houston bid list, a company can simply forward a business card and a line sheet or list of specific goods and services that the company can provide. Such information may be sent to the purchasing manager, Port of Houston Authority, P.O. Box 2562, Houston, Texas 77252-2562, or it may be faxed to 713-670-2465.

7. Additional Important Information:
Under no circumstances will late bids be accepted. Sealed bids received after 1:00 pm on the day for receipt will be returned, unopened, to the bidder.

The “Certificate of Residency” form must be completed and attached with all formal bids. Certain states impose a penalty on bids received from out-of-state businesses. The Texas Legislature has enacted a law that imposes a penalty on bids equal to that imposed by the state where the bid originates, if that state has such a policy. If the bidder's home state does not impose such a penalty on out-of-state bids, then no penalty will be imposed.

The purchase order is the Port's official means of notifying the successful bidder of the purchase, although in an emergency situation an authorized representative will give a purchase order number verbally to the vendor. This authorization will be followed as soon as possible by a written confirming purchase order. Vendors are not authorized to deviate from instructions set out in the purchase order.

All prices quoted, whether verbal or written, are to include prepaid delivery charges to the location of the department requesting the goods or services.

While cost is the most important factor in selecting the successful bidder, other factors are also taken into consideration. Among these are delivery time, delivery charges, quality, durability, maintenance costs, warranties, cost of consumable supplies, past experiences with the vendor, etc.

Vendors are strongly encouraged to suggest lower-cost equivalents for all items quoted to the Port's buyers. These equivalents will be presented to the requesting department that may request samples or other additional information before determining the acceptability of the equivalent item offered.

All invoices will be paid within 30 days after receipt of the goods and services or the invoice, whichever occurs last, unless there is a problem with either the item(s) delivered or with the billing. In such instances, the invoice will be paid 30 days after the problem is resolved.

The Port of Houston Authority is exempt from all state and federal excise taxes, and state and local sales tax. Tax exemption certification is furnished by the Port Authority as part of all purchase orders.

Glossary of Helpful Terms Used in Purchasing

Purchase Order: A contract form sent to suppliers requesting specific goods and services which contains detailed specifications concerning quantity, price, size, etc.

Blanket Purchase Order: An order or agreement negotiated with the supplier for a set period of time, usually one year. It specifies what products or services may be purchased by the company and at what price.

Release Against Blanket Purchase Order: A notice to the supplier to authorize delivery of part of the merchandise contracted for under the blanket purchase order.

Confirming Purchase Order: In an emergency, the Port's purchasing representative may call a supplier and request immediate shipment of merchandise. A confirming purchase order is then sent to formalize the sale, even though the goods have already been shipped.

Invitation to Bid: The notice inviting vendors to submit pricing information for goods or services the Port is interested in procuring.

Payment Bond: A bond for 100% of the contract price that is required by law for all construction projects in excess of $25,000. The purpose of the bond is to protect the subcontractors, material and equipment in case of non-payment by the general contractor.

Performance Bond: A bond equal to 100% of the contract amount guaranteeing the contractor will perform the scope of work set forth in the signed contract or forfeit said amount to the Port of Houston Authority. The bond is voided upon completion of the project.

Certificate of Residency: A form all prospective Port vendors must submit indicating the primary location and residency status of the company submitting the bid. Preference is given to firms with a state of Texas residency.

Port of Houston Authority
111 East Loop North • Houston, Texas 77029
P.O. Box 2562 • Houston, Texas 77252-2562
Phone: 713-670-2400

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