Procurement Academy Purchases Over $5K and Contracting

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Procurement Academy Purchases Over $5K and Contracting

  1. 1. Procurement Academy Purchases Over $5K and Contracting
  2. 2. Authority to Obligate <ul><li>The Purchasing Department is delegated their authority to purchase for the organization from the President of the University per Hoop policy 1.04 </li></ul><ul><li>The Purchasing Department authorizes individual departments to purchase goods and services up to but not exceeding $5,000. These purchases must be paid on purchase orders or BuyCard </li></ul>
  3. 3. Authority to Sign Contracts <ul><li>The authority to sign any contract for the purchase of goods and services is delegated to the Purchasing Department and select additional individuals from departments such as Legal, Auxiliary Enterprises, Office of Sponsored Projects, Office of Technology Management, Facilities Planning and Engineering… </li></ul><ul><li>Individuals within departments do not generally have the authority to sign contracts on behalf of UTHSC-H. Some examples of contracts: </li></ul><ul><ul><ul><li>Hotels contracts </li></ul></ul></ul><ul><ul><ul><li>Equipment maintenance/repair contract </li></ul></ul></ul><ul><ul><ul><li>Annual software support or license renewals </li></ul></ul></ul>
  4. 4. Process of Procuring Goods and Services >$5K <ul><li>Existing contracts: </li></ul><ul><ul><li>Local contracts </li></ul></ul><ul><ul><li>UT System Supply Chain Alliance contracts </li></ul></ul><ul><ul><li>State contracts (DIR,TXMAS) </li></ul></ul><ul><ul><li>GPO’s (E&I, Novation…) </li></ul></ul><ul><li>Sole Source determination </li></ul><ul><li>Competitive processes (ITB,RFP ) </li></ul>
  5. 6. Local Contracts <ul><li>Local Contracts: UTHSC-H enters into contracts for goods and services that are used routinely by departments within the University </li></ul><ul><li>These contracts are competitively bid </li></ul><ul><li>They normally have an effective period of 3-5 years </li></ul>
  6. 7. Local Contracts <ul><li>These contracts cover such products/services such as: </li></ul><ul><ul><li>Architectural and engineering services </li></ul></ul><ul><ul><li>Employee moving and relocation services </li></ul></ul><ul><ul><li>Locum tenens services </li></ul></ul><ul><ul><li>Housekeeping services </li></ul></ul><ul><li>http://buy.uth.tmc.edu/Forms/LC%20Listing%20for%20Web%20Posting.pdf . </li></ul>
  7. 8. UT System Supply Chain Alliance Contracts <ul><li>A group purchasing organization that works on behalf of all UT components </li></ul><ul><li>Kevin Dillon, COO/CFO, and Jerry Fuller, AVP, Procurement, serve on the Alliance management committees </li></ul><ul><li>Current contracts include laboratory equipment, laboratory consumables, office supplies, and personal computers and laptops </li></ul><ul><li>Contracts are competitively bid </li></ul>
  8. 9. Sole Source Purchases <ul><li>If a faculty or staff member feels that there is only one supplier who is capable of supplying the good or service they require, they may submit a request to the Purchasing department in accordance with the Sole Source procedure outlined in the Purchasing Procedures Manual </li></ul><ul><li>Purchasing Procedures Manual </li></ul><ul><li>http://buy.uth.tmc.edu/procedure_index.htm </li></ul>
  9. 10. Sole Source Purchases <ul><li>The written justification must explain: </li></ul><ul><li>1) The need for the products or services </li></ul><ul><li>2) The specific need/request </li></ul><ul><li>3) The reason why competing products are not satisfactory </li></ul><ul><li>4) Specific impact on department </li></ul>
  10. 11. Sole Source Purchases <ul><li>The individual who is writing the justification must also sign the conflict of interest statement </li></ul><ul><li>The Purchasing Department will review the request to assure that the justification is valid </li></ul><ul><li>If approved, the Buyer will write a statement to describe their due diligence that supports the justification and sign the request </li></ul><ul><li>Additional approval is required by a Manager in Purchasing </li></ul><ul><li>AVP, Procurement performs weekly audits of approved requests </li></ul><ul><ul><li>Discrepancies are reported to the Compliance Office </li></ul></ul>
  11. 13. Service Contracts <ul><li>A Service contract is an agreement between the Contractor and the University that: </li></ul><ul><ul><ul><li>Describes the work and specific deliverables to be completed (Scope of Work) by the Contractor </li></ul></ul></ul><ul><ul><ul><li>Defines the total not-to-exceed fee to be paid to the Contractor </li></ul></ul></ul><ul><ul><ul><li>Defines how contractor will be compensated </li></ul></ul></ul><ul><ul><ul><li>Defines the time frame in which the Contractor has to perform the work </li></ul></ul></ul>
  12. 14. Service Contracts <ul><li>Contract start date can not be before contract execution date </li></ul><ul><ul><li>No work should be performed until the contract is signed by both parties </li></ul></ul><ul><li>If the work to be completed will be paid for by grant funds it must first be reviewed by OSP </li></ul><ul><ul><li>Subcontract determination </li></ul></ul><ul><li>The contract period can be for multiple years </li></ul>
  13. 15. Special Purchase Approvals <ul><li>Purchases of these types of products require additional approvals: </li></ul><ul><ul><li>Radioactive – approval by EH&S </li></ul></ul><ul><ul><li>Controlled Substances – approval by Procurement </li></ul></ul><ul><ul><li>Motor Vehicles – approval by EH&S fleet manager </li></ul></ul><ul><ul><li>Animals – approval by Animal Care department </li></ul></ul><ul><ul><li>Capital Assets – approval by Capital Assets Management </li></ul></ul><ul><ul><li>IT products and services over $5K – approval by IT </li></ul></ul><ul><ul><ul><li>For MSB – IT approval is needed for any amount </li></ul></ul></ul>
  14. 16. Vendor Status with State and Federal Government <ul><li>Vendors’ debarment status is checked with various State and Federal agencies: </li></ul><ul><ul><li>State of Texas Comptroller of Public Accounts </li></ul></ul><ul><ul><li>US Department of Treasury </li></ul></ul><ul><ul><li>Excluded Parties List System </li></ul></ul><ul><ul><li>HHS Office of Inspector General </li></ul></ul><ul><ul><li>Health & Human Services Office of Inspector General </li></ul></ul><ul><li>Purchasing cannot conduct business (PO’s, Payment’s,…) with debarred vendor until the issue is resolved </li></ul><ul><li>Debarment status is checked: </li></ul><ul><ul><li>New vendor set up </li></ul></ul><ul><ul><li>Issuance of a PO greater than $25K </li></ul></ul><ul><ul><li>Monthly random sample of active vendors </li></ul></ul><ul><li>Vendor is responsible for resolving the issues and notify when complete. Do not contact the Comptroller’s office </li></ul><ul><ul><li>AVP, Procurement, can grant exception when possible </li></ul></ul>
  15. 17. Competitive Bid Process <ul><li>There are several types of competitive bids used by the Purchasing department: </li></ul><ul><ul><li>Informal Bid </li></ul></ul><ul><ul><li>ITB – Invitation to Bid </li></ul></ul><ul><ul><li>RFP – Request for Proposal </li></ul></ul>
  16. 18. Informal Bid <ul><li>Informal bids (e-mail, fax, phone) are utilized for purchases $5K-$25K </li></ul><ul><li>Price and delivery are the evaluation criteria for an informal bid </li></ul><ul><li>Departments or Purchasing can solicit these informal bids </li></ul>
  17. 19. Invitation to Bid (ITB) <ul><li>Formal ITB is utilized for purchases >$25K where contract award can be determined on price and delivery </li></ul><ul><li>Scope of Work </li></ul><ul><ul><li>The requesting department is responsible for developing the SOW (Scope of Work) and/or products specifications </li></ul></ul><ul><ul><li>Purchasing will evaluate the bids and award the contract </li></ul></ul>
  18. 20. Request for Proposal (RFP) <ul><li>RFP is utilized for purchases >$25K where contract award should consider multiple factors to determine the “Best Value” </li></ul><ul><li>Scope of Work </li></ul><ul><ul><li>The requesting department is responsible for developing the SOW (Scope of Work) and/or products specifications </li></ul></ul><ul><ul><li>Clear evaluation criteria is necessary </li></ul></ul><ul><ul><li>Evaluation teams score the proposals </li></ul></ul><ul><ul><li>Purchasing scores pricing and delivery </li></ul></ul><ul><ul><li>The evaluation team makes a recommendation for contract award based on the total score </li></ul></ul>

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