Virginia unveils e-procurement system

Virginia plans to launch a Web-based procurement system this week that officials say is easier, faster and cheaper for state agencies and vendors.

Bette Dillehay, the commonwealth's deputy secretary of technology, called the system an "electronic mall" where agencies could shop for products and services. The prices would be set, so agencies wouldn't have to negotiate contracts themselves.

Future enhancements would include online auctions, and the system would be available to local governments.

American Management Systems Inc. built the system, called eVA (www.eva.state.va.us), at no cost to the state and will make its money through transaction and registration fees, Dillehay said.

Vendors pay a one-time basic fee of $25 or an advanced fee of $200. The basic fee includes online access, vendor catalog posting and services such as electronic receipts and online bid submissions. The advanced fee includes the basic service plus automatic electronic receipt of bid documents and the ability to research historical procurement information.

Vendors also must pay a 1 percent transaction fee per order, not to exceed $500. For example, if an agency buys $500 worth of goods, the supplier or vendor would pay $5 to the state for that transaction. If an agency buys $50,000 worth of goods, the supplier pays $500. If an agency buys $1 million worth of goods, the supplier still pays only $500.

Vendors have had mixed reactions to the system, but Dillehay said she didn't expect them to pass on the additional costs to agencies. The commonwealth has guaranteed AMS a certain level of business, she said. Once that is reached, revenues would be split between AMS and the state. If the guaranteed level is not reached, the state would have to make up the difference, she said.

Mandated through an executive order by Gov. James Gilmore in May 2000, eVA was spearheaded by the Department of General Services with help from Dillehay's office.

To help with the eVA project, the officials revised codes and manuals, reviewed privacy and security issues, and monitored legislation, Dillehay said. The state also added tools such as seat management, digital signatures and middleware to connect current legacy systems to the eVA.

A major benefit of eVA is that the state can track agency buying patterns. "We don't know what we buy," Dillehay said. "Anybody knows that volume gives you a leverage point [for better prices]."

Agencies are not required to use the system, but Dillehay said there's an intensive marketing effort to encourage agencies and vendors to sign up.

"We're always hesitant to say, "You must do this,'" she said. "It's a culture that has to be nurtured."