Purchase
of goods and services is centralized through the College’s Purchasing Department located at the Flagstaff, Main
Campus. The procedures used depend upon the cost and source of the item.
Laws and regulations require completion of appropriate paper work before
any grant purchase is made. All purchases take time, and in many cases,
require prior approval by the funding agency. Preparation of purchase
requisitions should be a first priority once the operational budget is
established to allow as much lead time as possible and to avoid delays
in implementing the program. All standard College purchasing
policies & procedures
apply to grants. See http://www.coconino.edu/purchase/TOC.htm for more
information.
Requisitions used to order goods and services are developed and processed
electronically using the Banner Software process. Some requisitions may
require separate paper documents such as contracts or price quotations
to be sent to the Purchasing Department at the same time the document
is transmitted electronically. You and your support staff will need training
on using the Banner system to learn how to create requisitions, signify
your approval of the requisition by forwarding it, review budgets etc.
Contact the Purchasing Department to arrange for training.
You can avoid significant stumbling blocks that have plagued
some other Project Directors by making sure that paperwork associated
with the
electronic requisitions is sent to the Purchasing Department. For example,
if you
are hiring a consultant to deliver a service, there should be a written
contract covering the job to be done. To pay consultants for their
time, invoices signed by the consultants have to be submitted periodically
after the work is completed. If you do not submit the invoices, consultants
will not get paid and you may find them sitting on your doorstep. If
a “blanket purchase order” is utilized, the vendor will
not get paid unless you submit the receipts or invoices to Accounts
Payable.
If you take an out-of-town trip your travel will not be reimbursed
until you complete and submit your Travel Expense Claim form with original
receipts for hotel, air travel, and parking to Accounts Payable.
Our second valuable piece of advice pertaining to electronic requisitions
is to have the person inputting the requisition develop and maintain
a log that records date created, vendor, purpose (brief), requisition
number, amount, and purchase order number. Later when the purchase
order number is assigned, the initiator will be so advised. Record
that number
on both the log and on the requisition. It is almost impossible to
track requisitions without this kind of “paper” trail,
so we strongly recommend that you develop this kind of system right
from the start.
You will be glad you did when it is necessary to determine why you
have not received an item your ordered or why a vendor has not been
paid.
The third thing you need to know about electronic requisitions is that
you cannot order from or contract with anyone unless they are on the
Banner vendor list. If the company or individual is not on the list,
you will need to have them complete a Vendor Registration Form which
is obtained from and returned to the Purchasing Department.
A fourth suggestion is to remember that the only approved methods to
obligate College funds (including “grant” funds) is through
utilization of the Banner requisition process and/or through the use
of College “procurement card,” which grants limited authority
to commit funds (within approved limits) to the holder of the card.
Fifth, be aware that only a very few individuals have been delegated
authority (by the District Governing Board) to sign contracts or agreements,
of any kind. Please forward all agreements to the Purchasing Department
for review and signature approval.
Supplies
Funding sources define “supplies” in different ways so you
need to pay close attention to the regulations governing your program.
For internal purposes, the College considers purchases, with a value
of $5000 or less, to be “supplies” or “non-capital
equipment.” Equipment purchases exceeding $5000 (including shipping
and taxes) are classified as “capital equipment.”
Generate purchase requisitions as soon as possible after a grant has
been approved. Indicate clearly that the requisition is based on grant
funds by including the name of the grant and the account code. Also,
show the invoice and/or receipt deadlines; funding sources will have
varying regulations on receipt and billing deadlines.
Keep a record of your electronic requisitions for support staff to track
through the purchasing process. A copy of the purchase order will not
be sent to you when the order is placed with the vendor. Instead, you
will need to track the order on-line or contact the Purchasing Department
for a hard copy to be forwarded to you. Always compare the
purchase amount with the requisition. Bids can come in high or low and taxes or shipping
and handling may be added after you signed the requisitions. Such changes
will affect the grant budget.
The College is required to document competition is its procurement
processes for expenditures exceeding $5000. At the discretion of the
Purchasing
Department, competitive bidding may be required below $5000, in the
College’s
effort to receive best value for every dollar spent. Never
split an order to circumvent a required competition threshold. Splitting or
dividing
orders could result in an unfavorable audit exception reflecting poorly
on your program. As it represents a clear violation of State Statute,
it is also a class 4 felony.
Be sure to fill out a “Disclosure of Interest” form in
order to disclose any potential conflicts of interest. Do not purchase
goods
or services from relatives or friends. (The appropriate form is available
and maintained by the Human Resources Department.) An apparent conflict
of interest can be nearly as damaging to your program and to the College
as an actual conflict of interest. Be careful to remove yourself from
any selection/award process that could result in personal gain for
you, a family member or a close acquaintance.
If the amount could exceed $25,000, you will need to work with Purchasing
to go through a formal bid process. Allow additional time for these highly
regulated processes. It is suggested that you work with Purchasing to
gather information and identify your needs well in advance.
Procurement Process Thresholds
Competitive Bids and Proposals
Whenever practical, competitive quotations from vendors or suppliers
handling the same or similar products or services will be secured.
The Purchasing Department may, at its discretion, choose to bid any
item
which in its judgment "lends itself" to competitive bidding
in each of the following events:
1. Petty Cash
Purchases less than $30 may be made with petty cash with the approval
of the appropriate department head or budget manager.
2. Purchases of less than $5000
Purchases of less than $5000 may be made at the discretion of the Purchasing
Department and do not require bidding processes.
3. Purchases of less than $25,000
The Purchasing Department will, whenever possible, obtain at least
three written price quotations for purchases in excess of $5000, but
less than
$25,000. The price quotations, shall be shown on, or attached to, the
Accounting Department’s copy of the purchase order. If three quotations
cannot be obtained, documentation showing vendors contacted but not offering
price quotations, or explanation of why price quotations were not obtained,
will be shown on, or attached to, the Accounting Department’s
copy of the purchase order.
4. Purchases of $25,000 or more
The Purchasing Department will obtain sealed competitive bids or proposals
for all purchases of goods or services having an estimated cost of
$25,000 or more. The requisitioning unit will assist the Purchasing
Department
in developing a list of potential vendors and specifications. This
process will be conducted pursuant to A.R.S. § 41-2533/2534.
5. Purchases of $50,000 or more
Contracts and purchases of $50,000 or more in value must be approved
by the District Governing Board.
Equipment
All anticipated equipment purchases should be itemized in the proposal
budget agreement. Generally, prior written approval must be requested
and obtained from the funding agency for any equipment acquisition
not itemized. Some agencies such as the Department of Defense
may even require
specific prior approval of certain types of equipment (e.g. computer
equipment) even if listed in the approved budget. Remember to share
this information with Purchasing. Other agencies such as the
National Science
Foundation, U.S. Department of Education, and the National Institute
of Health allow most equipment purchases to be approved internally
through the College's regular purchasing process.
Before purchasing equipment, always check with the Grants Accountant
who can assist you in identifying restrictions that may get you into
trouble. Always keep in mind that proposed equipment purchases must
be justified in terms of benefit to the project. Because the project
cannot
usually benefit from "last minute" purchases, end-of-program
expenditures are generally not appropriate. The cost of goods not used
during the project can be disallowed and the funding agency may ask for
reimbursement. Generally, “equipment” for funding agencies
consists of items of $5000 or more in value (by definition).
Some equipment can be purchased at a significant savings if it is
part of a State Contract or other Cooperative Arrangements. Check
with Purchasing
to find out if the equipment you need is covered by one of those
Agreements.
Travel
Regardless of the funding source, the Controller and the Accounts
Payable Department administer the College’s travel procedures. Detailed
manuals, which include procedures and sample forms, have been placed
throughout the College for easy reference. Remember that reimbursement
rates change periodically. Claim forms are also available on the shared ‘K’ drive
(see “Finance”).
GENERAL GUIDELINES
People
Temporary services of individuals are arranged for in
several different ways. Consultant/Independent
Contractor Agreements are used to
hire non-district employees for consulting services/unique
services or guest
lecturing. Personnel Action Forms (PAFs) are
used to hire College employees to work on special
projects or
to hire
temporary and part-time
staff.
Professional Services Contracts
In all cases, contracts must be approved by the Purchasing
Department. Frequently, a funding agency sets compensation
limits for daily rates
as well. “Consultant / Independent Contractor” agreement
forms (located on the shared K-drive, under “Purchasing”)
must be completed and signed by the consultant, guest
lecturer, or person supplying professional services.
A requisition is then prepared
and the
contract/agreement and the requisition are sent together
through the approval process to the Purchasing Department.
The contract is not
finalized until the Purchasing Department signs it
on behalf of the College and
a purchase order is created from the requisition. The Consultant/Independent Contractor agreement
form cannot be used to hire employees
of the College.
Contracts for consultants/guest lecturers can be paid
on a total fee for services basis or broken out to include
travel and meals
and incidental
expenses. Professional services, as well as all other
services
and goods, require invoices from the contractor in order
to be paid.
Personnel Action Forms (PAFs)
Personnel Action Forms are used to hire College employees
for special projects or extra service or to hire
temporary or full-time or part-time
employees. These forms are obtained from and returned
to the Human Resources Department.
General
Guidelines for Travel and People
Keep copies of all travel-related information including
receipts and the purpose of the trip. Maintain records
of consultant expenditures
and results. Keep invoices and contract copies for all
other services. In other words...keep everything!