Purchasing Procedure Manual

The following purchasing guidelines are from the University of Kansas Medical Center Director of Purchasing.

Contents

General
Delegation of Authority
Object Code
State Authority
Statutory Authority
Contract Renewals
DA146 Contract Cover Sheet
Emergency Orders
Endowment Orders/Private Funds
Official Hospitality
One-Time Services
Payment of Purchases
Personal Reimbursement
Purchase Request
   Approval
   Form
   Bidding
Requisition
Returning Material
Standing Orders
Student Union

I. General

A. State Purchasing Authority - In 1954 the State of Kansas established centralized purchasing, setting up the Division of Purchases within the Department of Administration. Since that time all State agencies have been obliged to refer all major acquisition of commodities and services to, and to abide by, the rules and regulations of such Division of Purchases.

    1. Responsibilities of State Director of Purchases - By law, the Director is responsible to "establish standards of quality and quantity and develop standard specifications in consultation with the several state agencies," to see that "no such specifications shall be fixed in such manner to effectively exclude any responsible bidder offering comparable supplies, material, equipment or contractual services," and to determine the lowest responsible bidder conforming with specifications, terms of delivery, and other conditions imposed in the call for bids.

    2. Such statutory language strongly supports the Division's policy with regard to seeking competitive bids; and, recognizing that no two competitive products will be identical, it logically follows that no responsible bidder offering reasonably comparable supplies, materials, equipment or services should be excluded from receiving an award. Such language also obliges us to avoid submitting specifications that contain "proprietary features" of one product to the exclusion of others unless we can support such requirements by "need," and the "reasonably comparable" rule effectively limits use of a declaration of "sole source." It should be remembered that merely declaring "sole source" does not make it so; it takes a detailed showing of "need" for the special features (or capabilities) of the product to support such a declaration.

B. Statutory Authority of KUMC Purchasing Director - Monetary limits

    1. No limit on non-competitive commodities or services.

    2.$5-$9,999when competitive, without sealed bids.

    3. Purchases over$10,000require sealed bids; above$50,000or negotiated require advertising in addition to sealed bids.


C. Delegation of Authority to Agencies - KSA 76-399 provides authority to the KUMC Director of Purchasing as follows: 

      • To satisfy the above requirements, the KUMC Purchasing Department must either take several quotations (bids), or verify those taken by the user/requisitioner, when indicated, and must maintain public-record documentation of it.
      • Definition of "Splitting Orders" - "Order splitting is defined as the separating of present needs of an item or group of like items, whether the resulting orders go to one or more than one vendor, to avoid the monetary limit. (Subject to audit interpretation.)
    • (a) Seek competition in bidding wherever possible.

      (b) Not intentionally split purchases or invoices to avoid established limitations.

      (c) Not fix specifications in a manner to effectively exclude any responsible bidder offering comparable supplies, materials, equipment or contractual services.

      (d)Purchase from the lowest responsible bidder conforming to specifications, terms of delivery, and other conditions imposed in the call for bids.

      (e) Maintain records of all transactions for three (3) years.

      (f) Provide public access to transaction records at all reasonable times.

      (g) Conform to other applicable statutory provisions governing the Division of Purchases.

  • 1. KUMC may expend up to $10,000.00 for acquisition of goods and services not covered by a state contract subject to the provisions of C3. Exception: Protected Vendors

    2. Currently, there is no limit on communications, honorariums, hospital fees, tuition, lawyers and doctors fees, utilities, dues, memberships and subscriptions (subject to Purchasing approval).

    3. All of the above expenditures require adherence to the same statutory provisions imposed upon the State Director, to wit:

    4. Object/Account Code Classification - Each Agency expenditure must be classified by the object of the expenditure, and in lieu of requiring a written description, a system of code numbers (object codes) has been developed. Enough information and identification of a proposed expenditure must be provided to enable those responsible for preparing purchasing documents to designate the correct code. In PeopleSoft the object code is referred to as account code.


II. Methods of Procurement

For all funds managed by KU Medical Center, first determine if the product/service can be provided by a Protected State Vendor (State Use Catalog or Kansas Correctional Industries). If not, then determine if the product/service can be provided by either a Statewide Contract or KUMC Contract. The State has established a few contracts that allow for the purchase of any item that vendor can provide. Those are: Staples for all Office Supplies; Fisher Scientific for Laboratory Equipment and Supplies; Software House International (SHI) for all software or software maintenance products; Grainger for Industrial/Facility type products. If the product/service is not available from any contract source, then you may proceed with going to your vendor of choice.

Involves the Documents and Procedure used to procure services, commodities, and capital outlay items.To help reduce the confusion surrounding the requirement that all purchases of commodities and services be pre-encumbered before ordering, the correct procedures to follow in most situations are presented here:

A. Prepare a PeopleSoft Requisition:

    1. For the purchase of commodities and services within the allowed money limits - under $10,000.00 with no competition required. This would also include purchases in certain Object Code categories where there is no limit, and those made against open-ended State contracts. It should also include repair service indicating an estimated cost and contracts for service when the annual obligation is under$10,000.00If you have either not received a purchase order or not received a recycle message within three (3) business days of entering your requisition, contact Purchasing to check on the status of your requisition.

    2. For Standing Orders, for copiers, etc.

    3. Personal Reimbursements in accordance with University policy.

    4. Official Hospitality in accordance with University policy.

    5. Emergency Orders-"Emergency purchases are considered those necessary for preservation of life or property or to avoid serious disruption of agency operations." Enter a requisition in the PeopleSoft system, and a written request on the Prior Authorization and Approval form,  directed to the KUMC Purchasing Director’s Designee certifying that a true emergency exists that can be met only by receiving the material promptly. Also provide telephone notification to Purchasing that an emergency exists. The user will receive an email confirmation with PO attached. The user then places the order, either by call in or faxing to the vendor.

    6. For the purchase of commodities or one-time services above $10,000.00, prepare a paper Purchase Request Form  to initiate the bidding process. This is not done in PeopleSoft.


B. Payment of Purchases -It is the responsibility of the using department, upon receipt of the goods/services, to receive the order within PeopleSoft to submit for payment.

C. Returning Material to Vendor – Arrangements for the return of materials ordered will be made by the ordering department with the vendor.

D. Purchase Request  - An internal form addressed to KUMC Purchasing Department, to be used in the preparation of a Purchase Requisition for sealed competitive bidding, either to be processed locally or forwarded to the Division of Purchases in Topeka.

  •  

      a. The generic name of the needed item (not a trade-name), or the designation of services to be performed.

      b. Type, size, range, capacity, and similar definitions which will set it apart from other sizes, models, etc. available in the market, or the scope of the job (service) wanted.

      c. Features or performance capabilities which will enable it to meet the needs of the user. A definitive need must be expressed to support a request for a "proprietary" feature.

      d. Inclusions - show everything that the user expects to receive with a capital item, such as optional extras, tools, carrying case, adapters or brackets, operator's manuals, etc. It is also advisable to include extra accessories with the main instrument and show a combined package price.

      e. Suggest two or more brands and models that can meet the specifications and are acceptable. If no other brands are acceptable, justification for naming a single brand must be submitted with your Purchase Request.

      f. Name the warranty and delivery requirements. Unless these are stated, no bid(s) can be by-passed for failure to offer adequate warranty or speedy delivery.

      g. Give an "estimated" price for each line item, and designate at least one supplier (vendor) who can supply what is put out for bid, include mailing address.

      h. The Deliver To would be the PeopleSoft building and room location where the goods are to be delivered.

      i. The Requisitioner is the name of the contact person and the person who will receive all communication regarding the bid transaction.

      j. Provide the Department Name and the Speedtype that the acquisition is to be charged against.

      a. The bidding process, at a minimum, involves (3) three weeks. To this period, the requisitioner must allow time for processing and review by the Purchasing Department.

      b. If a named brand/model is offered as low bid and appears to meet all the specifications and requirements, the State Director of Purchases may, and usually does, award without referring the bid file to the Agency. If the requisitioner wishes to review the bids regardless of the specified bidder being low, this request should be made in the COMMENTS/REMARKS section of the Purchase Request Form  .

      c. Bid Review and Recommendation - If any low bid, however, offers an alternate product (one not named in the specifications), the bids will be sent to KUMC Purchasing and on to the requisitioner/user for bid review and recommendation. Good and sufficient reasons must be shown if the requisitioner recommends a low bid be by-passed. Such reasons must be based on and point to lack of those needed capabilities or features called out in the specifications. All recommendations for award to other than the low bid(s) must be supported in writing.


      Please note: The time minimum referenced above involves the actual bid time only. Factors that can increase the time from initial submission of your purchase request to award are:

      I. Insufficient/Incomplete specifications.

      II. Failure to name more than one acceptable brand or submit justification for naming only one brand.

      III. Request to review all bids. (This request will obligate the State to submit the bids for your review even when your recommended vendor is low.)

      IV. Failure to evaluate the bids in a timely manner.

      V. Failure to submit written justification to support recommendation to other than the low bid(s), or if the justification is based on criteria not called out in the specifications.


      d. Award - If the State accepts the recommendation from the Agency (KUMC), it will issue a Purchase Order Voucher (POV) conforming to the bid. Usually the order will recite what delivery and warranty was offered in the bid, rather than what may have been requested in the specifications. The user/requisitioner will get a copy of the order, along with a copy of the PeopleSoft order and should immediately check the order to see if it is correct. If not, CONTACT THE PURCHASING DEPARTMENT IMMEDIATELY SO THAT WE MAY ATTEMPT RESOLUTION.

      e. Payment – For bids processed through the Division of Purchases (over $25,000.00): Upon receipt of goods/services, the requisitioning department shall advise Accounts Payable, in writing, of the satisfactory completion of the order. This notification shall serve as authorization to pay for the goods/services upon presentation of an invoice by the vendor. If the invoice is sent to the requisitioning department, it shall be forwarded to Accounts Payable. If there is more than one (1) line on the purchase order, advise Accounts Payable exactly which lines have been received and are authorized for payment. Do NOT “Receive” in PeopleSoft.

      For bids processed through KUMC (less than $25,000.00): The requisitioning department will be required to “Receive” in PeopleSoft. If invoice goes to requisitioning department, it should reference the PeopleSoft purchase order number and be forwarded to Accounts Payable.

  • 1. When to use - to request the acquisition of equipment, expendables, or services in an amount in excess of $10,000.00 and which are not covered by a State contract.

    2. Completing the Form - in the body of the form and on whatever continuation sheets are required, a full and complete description of the material or service needed must be delineated in the following sequence:

    (Please Note: A generic brief description should be all that’s put on the form itself, in the Specifications section. Detailed specifications should be done in Word and attached to the form as continuation sheets. The word document should also be sent via e-mail to the responsible person for bidding in the Purchasing Department.)


    3. Approvals, Numbering, and Distribution - all required approvals must be obtained before the Request is sent to Purchasing. It then is submitted electronically via Division of Purchases Software onto a Purchase Requisition (DA-100), given a number for the solicitation of bids or transcribed onto a Request for Quotation for those acquisitions within KUMC's delegated local authority.

    4. Bidding, Review and Recommendation, and Award


E. Agency Contract Cover Sheet (Form DA-146) - A pre-encumbrance document and State-approval form covering a contractual service to be performed to benefit this agency. Most, but not all, such services involve annual maintenance agreements on capital equipment or other professional fees when the annual obligation exceeds $10,000.00.

    1. The KUMC Purchasing Department always prepares the Cover Sheet after the user (benefited department or grantee) submits a negotiated contract with the supplier of the services. Such negotiated agreement must incorporate all of the provisions the State requires to be included before it will approve the contract. Such provisions are compiled in the State form called Contractual Provisions Attachment (DA -146a). When attached to a vendor’s contract, this form serves to modify or contradict some of the provisions of the vendor's contract. A Prior Authorization Form may be required. Purchasing will contact requisitioner if this form is required.

    When the annual contractual service is within this agency's local authority ($10,000), and one lump sum payment is made, submit all contractual documents to the Purchasing Department referencing the PeopleSoft requisition number. A contract cover sheet is NOT required in this circumstance.

    2. A Cover Sheet is required whenever the contract involves an annual commitment (expenditure) of$10,000or more, and/or payment is made on an installment basis. A Cover Sheet is prepared for each fiscal year in which payments will be made.

    3. Cover Sheets are used to commit funds for rental, lease, or installment purchase of equipment when multiple payments are to be made for a specific term. When such commitment exceeds $10,000 a year, the acquisition requires competitive bidding before a contract is made.

F. Endowment/Private Fund Purchases - All purchases of goods and/or services using endowment or private funds are to be made utilizing the "E" Agency Purchase Order  . When using endowment funds, list endowment number and indicate "ENDOWMENT." The completed purchase order should be forwarded to Purchasing for assignment of a purchase order number. Referencing the purchase order number will allow delivery from the Receiving Dock to the requisitioner, of the ordered items.

G. Student Union Bookstore Purchases - Purchases may be made from the Student Union Bookstore with an approved purchase order. Personnel authorized to make such purchases will sign the Student Union invoice. However, items that are on State Contract or available from a protected vendor must be purchased from the appropriate source. Payment vouchers for purchase of items from the Bookstore of the above category will not be honored for payment and become the financial responsibility of the purchaser.


H. Contract Renewals and Product Evaluation - Contracts are established and subsequently renewed on an annual basis. It is the responsibility of State Purchasing to require that "...No such specification shall be fixed in such a manner as to effectively exclude any responsible bidder from offering comparable supplies, materials, equipment or contractual services." During the contract process, bidders offering comparable products submit samples for evaluation. These samples must be submitted in accordance with the provisions of the bid proposal. Purchasing will deliver the samples to the "primary user(s)" for evaluation. Due to the time factors involved in awarding a contract, the evaluation notice will designate an evaluation due date. It is critical that your response be received by this date in order to assure your input into the award process.

Last modified: Jan 06, 2014
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