Policy Guidelines for Municipal Open Contracting

What characteristics are essential to the successful rollout of an open contracting policy? This is the key question behind research commissioned by the Sunlight Foundation and the Open Contracting Partnership (OCP) on the experiences of cities in making public contracting data easily accessible and useful to all. Sharing this information openly can help governments build public trust, improve the effectiveness of their own agencies, and empower the private sector to make wiser investments.

Based on this research and their previous work on open contracting around the globe, Sunlight and the OCP have produced a set of simple, practical guidelines for city procurement officials to consider as they develop their own contracting data release programs. Real world cases highlight best practices from the 22 North American cities included in the research, drawing on interviews conducted with municipal staff, by phone and in person, across the US, Mexico City and Montreal.

The guidelines complement a more comprehensive research report on the opportunities and issues that have arisen for North American cities in their efforts to publish procurement data and unlock the benefits of open contracting for their communities.

Policy Guidelines for Municipal Open Contracting

1. Policy creation – Ensure regulatory framework fosters openness

How do you create procurement policies and laws that encourage open contracting? What principles should be enshrined in them? How do you ensure the drafting process is effective?

1A. Establish open principles in policies and laws

Writing policies that fix guiding principles into statutory mandates ensures that the regulation’s implementation reflects lawmakers’ goals. A successful open contracting policy will align with existing law, recognize the public’s right to access information generated by the contracting process, will commit to releasing data as a default and include stakeholders in the oversight process.

Example: Scottsdale (AZ) commits to “open by default” in policy
Several cities make reference to the idea that data should be “open by default” (proactively released, and as complete as possible) in the resolution introducing open data policies for all government information, including procurement. However, most do not include it in the actionable portion of the bill. An exception is Scottsdale, which makes clear in Resolution 10548 (Section 1) that all departments should see their data in this light. Section 2 orders the city manager to take actions consistent with this, among other policies. Without statutory authority, open data champions within government may not be able to effectively advocate for compliance with these policies.

Example: An independent public committee in Orlando (FL) oversees some public works
The Mayor’s Citizen Oversight Committee in Orlando reviews public works programs related to community facilities and venues, as well as public spending on stadiums and music halls. This input ranges from views on spending priorities to project oversight, legal compliance, and budget monitoring.

1B. Draft policy with clear aims, data outputs, and consultation

A few steps should be taken into consideration as policy is being written, to ensure it achieves the goals of the open contracting program. Consult stakeholders when drafting the policy, as their support will help drive it forward and their expertise may help drafters avoid preventable mistakes. For example, many municipal professionals have identified technology procurement as a key pain point, due to high costs and low competition. Higher risk procurement like these can be highlighted in policy drafting. Make sure the policy includes clear discussion of objectives and a description of what will be published (while making clear that the list is a minimum, not an exhaustive maximum). Use the drafting process to reinforce and reform existing procurement laws.

Example: Cincinnati (OH) policy includes clear objectives, assignment responsibilities & launch timeline

Cincinnati’s Administrative Regulation #61 beings by stating an objective that recognizes citizens’ access to local government information is “fundamental to transparency and accountability,” and commits to make the government’s operations and finances datasets publicly available “for review, interpretation, analysis, research and criticism.” The document later specifies in detail what a successful and compliant policy for achieving that objective would look like. Such guidance ensures the minimum definition of success is unambiguous. It gives department staff authority to disclose data and a clear mandate to allocate resources to the open data program.

2. Policy implementation – Establish operational policies and procedures for collecting, managing and releasing data

How do you collect the information you need? What’s the best way to structure and organize it? How do you ensure the system is sustainable?

2A. Develop the technical framework

The technical aspect of rolling out an open contracting program is much more than a mere detail. Properly done it will reinforce other open data policies, and improve procurement outcomes which in turn impact every government program. Key objectives include ensuring that the data is captured in a way that reflects and describes the entire procurement process, that this data is stored in a platform that is open and doesn’t tie the program to one vendor, and that it is stored in a standard fashion that is machines readable, licensed for open access, and well-documented so people understand how to use it.

Example: San Jose (CA) policy includes detailed technical requirements

San Jose’s Open Data Policy includes specific instructions for implementing departments on their responsibility to collect and publish metadata along with their datasets, use common data standards so the data is easier to understand and us, publish the data in open and machine-readable formats, and release data under open licenses.

2B. Ensure data quality and timeliness

Policy regulations and their implementation have an impact on government processes and staff workflows that determine whether data is accurate and collected regularly. A commitment from top managers to prioritize the release of data can ensure those processes are initially implemented in an effective way. Assigning clear roles and responsibilities among the departments involved will keep these processes running effectively as the program becomes established.

Example: Montreal prioritizes data release
Montreal has been notably successful in keeping its datasets timely, especially when compared with area borough governments. While Montreal ensures its contract data is updated at least monthly, some of its autonomous borough s like Côte-des-Neiges–Notre-Dame-de-Grâce only release updates in annual batches . This difference highlights the impact of policy champions in management in an environment where both administrations work under the same regulatory regime, and are subject to the same mandates.

2C. Focus on key data release points

To prevent backlash or poor implementation, start with a data catalogue that lists the available datasets, and focus on establishing sustainable practices on one or a few processes in the procurement cycle that generate larger amounts of data.

2D. Consider sensitive information

While city policy should presume that most government business can take place in the open, valid reasons may arise for withholding sensitive data, such as confidentiality, privacy, or security. These concerns can be addressed by adding release consent clauses to bid submissions, contract offers and issued contracts. A record of any information withheld should be made in a “redaction profile”, as a separate form of metadata that describes what is withheld, why, and how.

2E. Gain buy-in from stakeholders

It is important to win the support of, and take input from, a broad range of stakeholders, from municipality staff to vendors and citizens. Make a case for the initial effort and cost of opening up contracting data by regularly communicating the benefits of the approach and evidence that it works. Particular attention should be paid to emphasizing the internal communication benefits, external communication labor/cost savings, increase in internal compliance enforcement, reduction in staff-related misconduct, and increase in public trust. Each of these overarching themes can connect to specific challenges faced by stakeholders. Platforms such as Insight can help to both inform as well as facilitate input on the reform process.

3. Disclosure requirements – Share data throughout the procurement cycle

What information should you publish and when? Who needs to receive access to it? Each contracting phase represents a unique opportunity for publishing open data. At a minimum, there should be timely, accessible, affirmative disclosure of open data about procurement plans, solicitation notices and bidding documents, award notices, full contracts, and implementation details.

3A. Planning

The earlier a municipality gives vendors a sense of its future needs, the more preliminary planning they can do. This leads to more submissions and higher quality proposals that are more responsive to governments’ needs. Beginning with a unique identifier for the contract and an entity identifier for the purchaser (that are included in all contract phases) publish data related to budget, rationale for the purchase, and other relevant documentation . Documents about upcoming opportunities, such as draft solicitations or information about the pipeline of upcoming contracts and contract rebids are ideal to publish, as they may raise market awareness and permit nontraditional contractors to assemble the resources and capabilities needed to submit a credible proposal.

Example: New York City ordinance requires sharing contracting plans

In 2011 the New York City Council passed a law that requires the mayor to coordinate all executive departments to share upcoming contracting opportunities for the coming year, at least five months in advance. By 31 July, each agency’s plan for the year ahead must be published online and include detailed information on when the contract opportunity will be released, the contract vehicle, and the number of staff needed and their qualifications. This level of specificity gives vendors time to identify key personnel and research the best method to provide the goods and services.

3B. Solicitation

Share all available information about new contract offers with potential vendors. This should include information about the good/service to be purchased, the value of the procurement, and any accompanying documents that justify or explain exemptions from regular procedures and requirements (such as sole source contracts). This information should remain publicly available even after the solicitation period has ended. Any direct communication between the city and a potential vendor should be shared with all vendors at a minimum, and ideally with the public as well, to avoid bias in the bidding process.

Example: Montgomery County (MD) publishes solicitations and offers

Montgomery County, MD releases a wide variety of procurement datasets as part of its comprehensive OpenMontgomery initiative. MoCo publishes many varieties of solicitations, including potential contracts small enough that they are not subject to its “formal” procurement process, and even calls attention to existing contracts whose terms will be expiring soon . By doing so, it provides other vendors opportunities to compete, and ensures for itself a better deal.

3C. Award

Publish details about the government’s decisions, stipulating the winner, price, and reasons for contracting with a particular vendor. This should include non-competitively awarded contracts, such as direct purchasing and purchases using procurement cards. Release documents for successful and unsuccessful bids after the decision, to ensure the selection process is fair and to give potential vendors insight into the needs and decision-making of the department.

Example: Miami-Dade (FL) publishes internal recommendations before vendor selection

Before selecting a vendor, Miami-Dade publishes interim recommendations online and provides a period of time for challenges to be filed. This ensures competitors who have been ruled out can examine the proposed decision before it becomes irrevocable. Miami-Dade is also unique in highlighting contracts being issued on a sole-source basis to give other potential vendors a chance to offer equivalent services at competitive rates.

3D. Contract

Publish the full text of signed contracts including all amendments . Ensure a digital copy of that document is accessible on the same open data platform as the contract listing , and make key details such as awardee, amount, date etc. available as structured data. Any modifications to the contract should be published proactively and promptly.

Example: Cincinnati (OH) portal links to implemented contract files with amendments

Cincinnati’s open data portal includes procurement datasets. The primary contracts dataset contains links to a variety of contract-related documents, including the signed contract itself. The records are updated to reflect any amendments to a contract.

3E. Implementation

Disclose information on the implementation of contracts. This might include the projected completion date, implementation milestones, actual completion date, and information on funding extensions outside the scope of the original agreement. Publish periodic evaluations of contracts underway, and past evaluations of contracts and vendors . Once the project is complete, ensure all materials related to the contracting process are linked together, and shared with vendors and the public.

Example: Austin (TX) publishes ongoing contract details including current expenditure

Austin, like many cities, publishes a list of currently active contracts. What is unusual is that Austin releases details for each contract about the maximum expenditure for the contract, the amount currently ordered, and the amount actually spent up to this point. These details provide some insight into the progress of each contract over time. It also displays a list of current contracts for each vendor. While that information can be assembled from the published data of other cities, doing so automatically makes the data more accessible to less technically savvy stakeholders.

4. Encourage use of open contracting data

How do you make the data easy to handle and useful for people with different needs?

4A. Highlight specialized data

Identify unique subsets of city contracting data that have specialized uses. Republish them in tailored resources so that relevant stakeholders can interact with the information in the most productive way possible .

Example: San Francisco (CA) publishes commodity purchase prices

Most jurisdictions publish past contracts, but San Francisco also collates commodity purchase contracts and provides at-a-glance encumbered per-unit cost information in an organized way . This makes it easier for potential commodities vendors to identify municipal needs and determine whether they can meet those needs efficiently and profitably.

Example: Topeka (KS) platform displays geo-indexed progress on public works projects

Few projects generate as much public interest as public works. They are expensive and can take decades to complete. Although citizens rely on the infrastructure built by these projects, it is often difficult for them to monitor their progress. Topeka recognized the unique public concern over public works, and built a geographically-organized interface that shows ongoing and imminent projects using a subset of procurement data that the city was already collecting. This map-driven site describes the project, displays current and total expenditures, and the status of the project, as well as the current controlling vendor.

4B. Build user-centered interfaces

People with different needs will be most likely to use open contracting data if it’s presented to them in ways that are conducive to their aims and capabilities. Data visualization and simple interfaces are good for the general public, which wants a clear aggregate view and to drill down to particular projects. Search tools are good for journalists who want to dig into the data to, for example, find connections between departments, vendors and staff. Vendors will want automated alarms and notifications, as well as detailed information about deadlines, past contracts, and the past decisions of key staff. Documented APIs and unique IDs will help tech experts who are interested in developing their own tools with the data. This applies to government users too – clearly defining ways for internal oversight bodies to use the data will help to make intergovernmental information sharing processes more agile and the work of these institutions more efficient. Stakeholder mapping, user persona exercises , and other user-centered design approaches can help to identify ideal formats.

Example: Data visualization for the public, and raw data for specialists in Montreal

Montreal has developed a data visualization portal that can be easily navigated by the average citizen. Users can see aggregate spending, zoom in on specific contracts and departments, and explore individual projects. The city also has a more traditional portal designed to cater for specialist audiences who need more power and are less interested in aggregated data visualization. Features of this portal include complex search parameters, table-based displays, and documented APIs.

Additional Resources and Further Reading

The Sunlight Foundation and the Open Contracting Partnership have also produced a more in-depth research publication that complements the guidelines on open contracting policy and best practices in American cities introduced here.
The Sunlight Foundation’s existing research provides a solid overview about issues in procurement in government generally and about municipal procurement specifically .
The Sunlight Foundation’s Open Data Policy Guidelines are a clear link when developing policy for the publication of procurement data.
The Open Contracting Assessment Methodology provides a set of indicators and methods which can be used in conducting a more structured baseline assessment. The method was designed for country-level implementation.
The Methodology for Open Contracting Scoping Studies covers law, policy and institutional setup, existing data publication and user engagement, stakeholder and project analysis, and analysis of advocacy opportunities.
The “Understanding the Basics” and “Context Analysis” sections of the Open Contracting Guide suggest issues to focus on during a baseline assessment.
The OCDS Implementation Guidelines give specific guidance on publishing particular kinds of contracting data along the contracting cycle, as well as guidance on creating public API s, getting the data registered with a unique identifier, etc.
The Open Contracting Global Principles present high-level norms and best practices for disclosure and participation in public procurement. They serve as a guide to advance open contracting around the world.
Other resources: Get Started with open contracting, includes links to additional reports, guides, and briefs; and a global map gives an overview of open contracting efforts worldwide.