Purchasing Policy 5.2-1

I.  Introduction/Purpose

The Purchasing Policy is established to provide the University community with requirements and procedures in regard to the centralized purchasing of goods and services by Saginaw Valley State University (SVSU) in its entirety.

II. Delegation of Authority

Business Services, is responsible for the administration of the centralized purchasing services, and for most procurement negotiations on behalf of the University as delegated by the President through the Board of Control approved policy. By providing these services in accordance with sound and ethical business practices, the department seeks to maximize resources and to protect the University from unnecessary risk.

To achieve this goal, Business Services has been charged by the University with responsibility for the following:

1. Secure competitive bids when possible to obtain maximum value from the expenditures of University funds.
2. Maintain liaison with the vendors who service the University.
3. Coordinate the procurement of goods and services for the academic, administrative and support areas of the University.
4. Develop and maintain an adequate number of vendors from whom to obtain supplies, equipment and services.
5. Assure that vendors provide a valid certificate of insurance which meets University requirements, prior to the issuance of purchase orders for services.

III. Key Definitions (Consulting versus Contracted Services)

Identifying the type of service, Consulting versus Contracted Services is critical when determining if the process of procuring services is governed by Section IV or VII. of this policy.

A. Consulting Services are services that involve the engagement of a subject matter “expert” for advice (documented recommendations) or development of specifications that will guide the University in its efforts to achieve specific results. A Professional Consulting Agreement (149KB)  is required.

B. Contracted Services are services that involve the engagement of a contractor in the performance of a defined task or set of tasks. A contracted service provider may also provide advice in conjunction with the services required to achieve the defined task(s).  The key differentiator is the performance of an actual task which exposes the University to a greater level of risk than present in simply receiving advice from a consultant.  Contracted Services which exceed the Board of Control specified bid dollar amount thresholds are to be selected via an authorized competitive bidding process and require:

1. verification that University insurance requirements are met
2. a purchase order to be completed in advance of any services rendered, and
3. may require a contract reviewed and signed by a University administrative staff member with assigned contractual authority.

IV. Specification of Items & Bid Requirements

A. Specification of Items - The university employee and/or account manager determines the nature of goods or services necessary for the performance of their job responsibilities and are encouraged to make recommendations to Business Services regarding specifications, potential vendors, etc.

1. If an employee/department intends to obtain quotes from prospective vendors it is recommended they consult with Business Services in advance to assure that appropriate terms & conditions are requested and that the appropriate vendor list is utilized.
   
   
2. Any price quotations from potential vendors solicited directly by the employee(s) shall be in writing except when time or other circumstances do not permit, in which case verbal bids are acceptable if they are properly documented.  It is the responsibility of the employee(s) to provide this documentation to Business Services for review before a purchase order will be issued.
   
   
3. Purchase requisitions submitted for goods or services from one vendor with total price exceeding any bid limit shall not be intentionally divided into multiple purchase requisitions for the purpose of avoiding the solicitation and documentation of the required quoting process.

B. Bid Requirements

1. Goods or contracted services exceeding $2,500 in value will generally require a minimum of three (3) documented price quotations unless the desired goods or services are covered by competitive cooperative pricing agreements, state contracts, are a single source of supply, or a justifiable waiver of the requirement is approved by Business Services in advance.
   
   
2. Purchases of goods or services less than $25,000 in value may be formally bid if Business Services determines that the formal competitive bidding process would be to the University's advantage.
   
   
3. Purchases of goods or services $25,000 or greater in value unless covered by competitive cooperative pricing agreements, state contracts, are a single source of supply, or a waiver of sealed bid is approved by the President or Executive Vice President for Administration and Business Affairs, must be preceded by:

a. formal competitive sealed bid - A formal sealed bid request will state the day and time due and will be open to the public after the defined deadline. No sealed bids will be accepted if received after the day and time specified. 

OR

b. formal request for proposal (RFP) process - A formal RFP process will state day and time due and will be closed to the public at the defined deadline.   Proposals and results of an RFP process will not become available to the public until an award decision has been made.

V.  Vendor Selection

Business Services is responsible for the selection of the vendor, however, if the goods or services being procured are within the list of exceptions noted below, the ordering employee(s) may be involved in the final vendor selection. 

Saginaw Valley State University (“University”) subscribes to a policy of equal opportunity and non-discrimination.  The vendor selection process is available to all without regard to age, color, disability, gender identity, genetic information, height, marital status, national origin, race, religion, sex (including pregnancy), sexual orientation, veteran status, weight, or on any other basis protected by state, federal, or other applicable law. 

It is vitally important that the University, a public institution, avoid even the appearance of impropriety, including the inference that certain prospective vendors might enjoy an unfair advantage in doing business with the University by virtue of the employment relationship of its owner with SVSU.  Purchases will not be made where a conflict of interest situation exists.

VI.  Purchase Authorization Requirements

All purchase requisitions must have all required approval(s) before Business Services can generate a purchase order.

No commitment of funds shall be made by Business Services without prior approval from the named Account Managers or Account Supervisors of the business unit to which the purchase is to be charged.

University employees who have been named Account Managers or Account Supervisors have the authorization to approve expenditures against their assigned account(s).  However, these individuals have not been authorized to act as an agent of the University, and are not authorized to actually purchase goods or services from vendors.  It is the responsibility of Business Services to place purchase orders and monitor any variances that may occur.

University employees who have been delegated Account Manager or Supervisor status, but who do not follow established University purchasing policies and procedures may also be personally liable for all or part of the cost of purchases where these policies were not followed. In the most severe situation, it may also be cause for dismissal.

A.  Additional Authorization Requirements

1. The purchase of any computer related hardware or software requires Information Technology Services (ITS) Department approvals prior to the generation of a purchase order, thus assuring that devices are compatible with the University computer systems, and that software licensing is tracked in accordance with manufacturer requirements.

a. Mobile device apps under $25 that directly support an individual’s job requirements are exempt from additional approval from ITS.  Please reference the SVSU Petty Cash Policy 5.2-12 for instructions on how to purchase these low price mobile apps.

2. The purchase of any goods or services of $5,000 or greater value requires approval of the appropriate divisional executive on the purchase requisition before Business Services is authorized to generate a purchase order. 

If the good or service being procured is within the exceptions listed and defined under the “Exception Items” category set forth below, modified purchase authorization requirements may apply.

VII.  Exception Items

Business Services is not responsible for, but may assist with purchases related to the following specific items or services:

A.  Employee Travel - Expenditures for approved travel and entertainment can be incurred, and the       employee reimbursed in accordance with Travel Policy and Regulations 2.3-1. 

B.  Professional Consulting Services - The University does not require that consultants be selected via a competitive process, but a contract must be authorized by a University staff member with contractual authority prior to the performance of any consulting services. 

C.  Architectural and architectural related consultant services, new construction, and contractual repairs and remodeling involving SVSU Facilities Planning Department.

D.   Books, pamphlets and periodicals for the Library.

E.   Expenditures for goods made in accordance with the SVSU Purchasing Policy and:

• Procurement Card Policy
• Petty Cash Fund Policy