Purchasing Policy

Status:  Draft

Purpose

The purpose of this policy is to assist departments in understanding the purchasing policies and procedures employed by the University when acquiring supplies, equipment, and contractual services necessary for the operation of the University.
These policies and procedures are designed to meet three objectives:

1. To provide efficient and effective purchasing services to the University.
2. To meet the fiduciary and policy requirements of the University and the Board of Trustees.
3. To ensure compliance with applicable Federal and State regulations

Guiding Principles

Competitive Fairness – DePauw requires fair, unbiased vendor relationships. This includes, whenever feasible, positive efforts to ensure that small businesses, minority-owned firms, and women-owned business enterprises are used to the fullest extent practicable.

Absence of Personal Interest/Conflict of Interest – DePauw expects that employees, officers, or agents do not participate in the selection, award or administration of a contract if a real or apparent conflict of interest (financial or otherwise) is involved and that the University's Conflict of Interest Policy and Procedures will be followed with all purchasing activities.

Vendor Selection & Cost/Price Analysis – Some form of cost analysis will be made in connection with each procurement action. Part of this analysis includes selecting the appropriate vendor considering price and quality and ensuring DePauw avoids purchasing unnecessary items. While this analysis is required each time purchases are made on behalf of the University, formal documentation of the analysis must be forwarded to Business Services when individual items of $5,000 or more are purchased from a single vendor using a Vendor Selection Form.

Allowable, Allocable and Reasonableness Assessment
Each element of cost must be reasonable and allowable to the account being charged. To determine the appropriateness of costs for sponsored programs projects, contact the Grants Coordinator.

Lease Purchase Analysis – There are circumstances in which a lease or lease purchase agreement for the procurement of goods (primarily equipment) for the University may be the most cost effective option. All leases are subject to the Debt Management and Derivatives Policy and only the President and Vice President for Finance and Administration are authorized to sign capital or operating leases or any other debt instruments. No capital or operating lease may be entered into or will be binding on the University unless provisions of this policy and procedure are satisfied.

Competitive Bids – The University follows a policy of obtaining a minimum of three written competitive bids or quotations for purchases of $100,000 or more. If service and quality are considered equal, the lowest reputable bidder meeting the specifications will be awarded the contract. DePauw reserves the right to award the contract to other than the lowest bidder, to waive any and all formalities not required by law, and to reject any and all bids if this action serves the best interests of the University.  Exceptions

1. The competitive bid requirement is waived when departments utilize negotiated contract pricing available through University sponsored group purchasing consortium(s) (e.g., Independent Colleges of Indiana).
2. The competitive bid requirement is waived for purchases of “exempt goods and services” which includes memberships, service agreements, insurance, travel, subscriptions, licenses, mail services, utilities, registration fees, and advertisements. However, bids are strongly encouraged when feasible and appropriate.
3. All procurement of professional services for insurance, legal and audit fees for the University will be coordinated by the Vice-President of Finance and Administration. These services may be bid periodically, depending upon facts and circumstances. Such bid process will be coordinated with the Board of Trustees.
4. All other procurement of professional services are subject to the same $100,000 threshold for bid purposes.

Contractual/Legal Agreements – In accordance with the Authorization of Financial Transactions Policy, only the President and the Vice President for Finance and Administration, or their designees, are authorized to sign contractual/legal agreements. 

Capitalization - All University purchases are subject to the University's Capitalization Policy.

Sales Tax – The University is a 501(c)(3) organization and is therefore exempt from sales tax in many instances.  When making purchases, vendors should be provided with the tax exempt number from the University. Here is DePauw's NP-1 tax exemption certificate.

Purchasing Policy

* Subject to transaction limits established by cardholder's supervisors and the area Vice President.

Purchasing Methods

Commercial Card – The purchase of goods, travel fees, meals and hotels, and publications and printing services less than $2,500 can be made using a Commercial Card (subject to individual limits established by cardholder's supervisors and the area Vice President).  When possible, the Commercial Card is to be used when making purchases with local vendors.  See the Commercial Card Policy for further information.  An exception to the $2,500 limit can be made by the Business Office for certain pre-approved transactions (e.g., hotel).

Purchase Order - The purchase of goods, printing and publications of $2,500 or more should be made by completing a purchase request and purchase order unless an invoice has been submitted by the vendor.   Payment in this situation should be made with a payment request. The University has online processing of purchase requisitions available for employees to submit requests for the purchases of goods and services requiring the issuance of a purchase order.

A purchase order is to be issued for service contracts, office furniture and equipment, and computer equipment not purchased by using a Commercial Card and the established procedures.

Payment Request for Payment to Outside Vendor – Conference fees can be processed using this method but the preferable method is Commercial Card.  Use a payment request for payment of amounts over $2,500 if an invoice has been issued by the vendor.

Payment Request for Reimbursement to Employee –Miscellaneous cash expenses incurred while traveling are processed using this method.

Special Contract – The University has negotiated with various vendors and has contracts in place for the purchase of office supplies, catering services, vehicle rental and in making travel reservations.

The following matrix presents these purchasing methods for various expenditure categories:

Signature Approval

The requestor and supervisor are required to sign all expense reimbursement and purchase requests.  The area Vice President or designee is required to sign all employee reimbursements and any other purchase $1,000 or more.