• Maintaining Confidentiality and Non-Disclosure of Information
• Expectations of Bid Team and Evaluators
• Policy References

 

 

For purchases involving sums between $5,000 and $100,000, bid or quote requests may be solicited based on the judgment of the Procurement Services professional buying staff handling the acquisition. Such bid or quote requests are typically solicited via fax, telephone or email.For purchases involving sums of $100,000 or more, formal competitive bids or proposals are typically solicited from multiple suppliers or posted publicly.  (Exceptions to the competitive bid policy require submission of a completed of a "Sole Source" justification form  to the Procurement Services buyer handling the request.  All requests must be policy compliant in order to be approved.  Please read the memorandum on Source Selection & Price Reasonableness Justification Form.)

 

UC has established many Systemwide Strategic Sourcing Agreements. These agreements are for use by UC campuses, medical centers and laboratories. Many of these agreements have been competitively bid and are the "Primary Source" for the specified goods or services provided to UC. Such agreements include a commitment to the supplier to primarily use their products or services. Purchases at any dollar level may be made under these agreements without seeking additional competition. Other UC agreements have been negotiated with various firms and are designated as University Price Schedules. Price schedules are not to be used in lieu of competition, when required by policy or dicated by best practices.

The US Bank Visa card has preset limits for transaction dollar amount and number of transactions per day. These cards are also limited to certain merchant category codes. The Procurement Card may not be used for travel or entertainment related purchases or for PERSONAL EXPENSES for ANY REASON. Other restrictions also apply. Suppliers are urged to check identification of the person presenting the card, verify the signature on the back of the card, and “run” the card to obtain Visa’s authorization. For questions concerning the use of UCR's Procurement Card, you may contact Dana Allen, the Procurement Card Coordinator at 951-827-3008.

The Campus telephone directory, which lists all department contacts, may be obtained at the Campus Store at 951-827-2665. You are welcome to contact campus department purchasing personnel directly. The UCR phone directory may be found here: http://enterprisedirectory.ucr.edu/phone/tel_search.show

Purchasing Authority

Purchasing authority is contingent upon adherence to various State of California and UC Regent's Policies and Guidelines, and campus procurement regulations.

The procurement policies we follow ensure our compliance to these regulations and that the University is receiving the best value for its money. It is important that you understand and comply with these policies when obtaining products and services for your department. These policies apply to all funds administered through the University, regardless of source. It is our expectation that staff and faculty will review and follow the formal delegations and published guidelines.

High Value Purchasing Authorization - In general, Procurement Services Buyers are delegated the authority to issue all purchase orders valued at $5,000.00 and above to specific dollar levels, by the Director, Procurement Services.

Authority to Contract

You must have specific authority to obligate the University to pay for goods and service.  If you don’t have contract authority in writing or specifically cited in delegations you don’t have the authority.

Please be advised that only authorized agents of the University with the requisite delegated authority to contract are permitted to make financial commitments to suppliers or sign legally binding purchase documents.

The authority to contract and commit the University to a purchase for goods and/or services is different than the business authority to approve the expenditure of funds. Contract authority deals with agreements and documents that are legally binding and are enforceable by law, whereas business authority is tied to making business decisions and internal agreements within the University.

Once the decision to make an expenditure of funds is approved by a department’s financial officer, a requisition is submitted in accordance with UCR Policy 750-60. It is then and only then that the transaction may be carried out by an authorized agent of the University possessing delegated purchasing authority (See UCR policy 750-63).

Unauthorized Purchases

Unauthorized purchases are purchase transactions that are either entered into by an individual that is not authorized to contract on behalf of the University, or entered into by an individual normally authorized to contract, but who uses an unauthorized procurement method, or exceeds their delegated authority. That authority is limited to Procurement organization buyers and contract administrators to assure compliance with federal and state law, University policy, and prudent business and financial practices.

All University purchases must be authorized in advance, via a written University of California Riverside Purchase Order, Department Authorized Purchase order (DAPO), or University Procurement Card.  Purchases made by unauthorized individuals or  via non approved methods may not be honored for payment at the discretion of the Materiel Manager.

Purchasing Contracts Conduct and Ethics

UCR is committed to maintaining professional and ethical conduct in purchasing and contracting.

UCR’s Purchasing Code of Ethics is based on and consistent with the Principles and Standards of Ethical Supply Management Conduct of the Institute for Supply Management (ISM), National Association of Education Buyers Code of Ethics, and The University of California Statement of Ethical Values and Standards of Ethical Conduct.

The University of California Office of the President through the University of California Ethics ensures that the university policy on ethics is circulated to all campuses. This site describes some of the ethics training that is sponsored by the University.

UCR Procurement Services promotes fair and ethical business practices, is committed to open and fair competition in the best interest of the University and in support of our supplier relationships.

Departments are responsible for making sure that the University policies on ethics are circulated and followed by departmental personnel associated with purchasing and contracts.

Departmental participation in UCR programs such as Low Value Purchases, Procurement Card and purchase requisitioning are to adhere to the above code of ethics principals and conduct.

In association with our ethical standards, both the UC system and UCR have instituted policies and practices on Gifts & Gratuities, and Conflict of Interest.

Anti-Kickback Act - FAR requirements for the University

Summary: Federal Acquisition Regulations require that the University follow reasonable procedures in its operations and maintain business relationships that are designed to detect and prevent violations of the Anti-Kickback Act of 1986.

"Kickback" is defined by the FAR 3.502 to mean any money, fee, commission, credit, gift, gratuity, thing of value, or any compensation of any kind provided, directly or indirectly, to any prime contractor, prime contractor employee, subcontractor, or subcontractor employee for the purpose of improperly obtaining or rewarding favorable treatment in connection with a prime contract or in connection with a subcontract relating to a prime contract.
The University has the following policies and procedures in place:

• BUS 43 incorporates the National Association of Educational Buyers and the National Association of Purchasing Management standards of conduct for purchasing professionals. Each contains a statement regarding the acceptance of gratuities.
• The Presidential Policy on the Acceptance of Gifts and Gratuities, dated February 6, 1980, is consistent with the State of California Political Reform Act of 1978 and is responsive to the U.S. President's Office of Management and Budget (OMB Circular A110) administrative requirements.
• Internal and external audits (Office of Naval Research Contractor Purchasing System Reviews (CPSR), A110 audits, etc.) provide checks and balances.
• The University Purchasing Department also has levels of authority for approving transactions to ensure that University Policy and Procedures are followed.

Gifts and Gratuities

Summary: UC Policy states that no officer or employee should solicit or accept any personal favor, gift, gratuity, or offer of entertainment directly or indirectly from a supplier.

UC Policy requires all employees to comply with the provisions of state and federal law governing the acceptance of gifts and gratuities. Employees should act with integrity and good judgment and recognize that accepting personal gifts from suppliers may cause legitimate concerns about favoritism.
Acceptance of modest entertainment such as a meal or refreshments in connection with attendance at professional meetings and events sponsored by industrial, technical, professional, or educational associations is not considered a gift, nor are nominal promotional materials offered by suppliers to market their business.
If you are a buyer or requisitioner for your department, please report any offers of gifts to your supervisor. Your supervisor will confer with the Director, Materiel and Risk Management or the Conflict of Interest Coordinator to determine whether acceptance of the gift complies with University policies.
Some faculty and staff are subject to additional requirements for financial disclosure and disqualification from making decisions on matters in which they have a financial interest. Refer to UCR Policies on Gifts, Gratuities and Conflict of Interest.

Employees need to comply with the University policy and guidelines  regarding acceptance of gifts and gratuities under the California Political Reform Act Disqualification Requirements.  UC policy and the Federal Anti-Kickback Act of 1986 state that no officer or employee should solicit or accept any personal favor, gift, gratuity or offer of entertainment directly or indirectly from a supplier who is doing or seeking to do business with UCR.

If you have a question regarding an offer or acceptance of a gift associated with a supplier or related purchasing activity, you can contact Procurement Services.

Conflict of Interest in Contracts

If you have a (conflicting) interest in a contract, you must disqualify yourself from the decision making process.

The Political Reform Act prohibits public officials from participating in University decisions when personal financial interest may be affected by those decisions.  All UCR employees must disqualify themselves from participating in a contract decision or contract in which they have a personal financial interest.

Making a decision is when, acting with the authority of one’s office the employee votes or scores a  supplier for selection, provides the source selection justification, obligate or commit UCR to a course of action on the purchase, enters into any contractual agreement, including letter of intent on behalf of the University.  Participating in the making of a decision occurs if the employee advises or makes a recommendation to the decision-maker by conducting research which requires the exercise of judgment with the purpose of influencing the decision.

University employees may not personally benefit from their official positions or decisions. Any University employee who has, or whose relative has, a substantial interest in providing a product or service to the University, shall make known that interest by completing the Report of Proposed Purchasing Transactions Involving Possible Conflict of Interest Form  and shall refrain from participating in the procurement decision making process.

An interest in a contract exists when the employee knows or has a reason to know that any part of a proposed contract is with an individual or entity with whom the employee or an immediate member of their family have engaged in a business transaction on special terms not available to the public within 12 months prior to the time when UCR action is to be taken on a contract.

Employees are not to use University buying power and contracts for personal purchases.  University contracts for goods and services are for institutional use only.

Conflict of Interest – Approval and Source Selection

Contractor/Consultant Restrictions

Summary: Changes in the State of California Public Contract Code significantly changed the way UCR contracts with independent contractors/consultants and imposes penalties on individuals and entities that violate it.

Public Contract Code - Section 10515-10518 (formerly Senate Bill 1467) established new restrictions, with severe penalties for violation in the areas of:

• Purchasing, leasing, or renting goods or services from UC employees.
• Awarding successor contracts or follow-on agreements to consultants or other entities based upon recommendations they previously provided to the University.
• Contracting with former UC employees as independent contractors to perform work related to contracts that were planned, negotiated, or executed prior to their separation, or the employee was in a policy-making position involving the subject matter of the agreement.

Employee contractors

• UC employees (excluding those with teaching or research responsibilities) may not contract with any University department to provide goods or services as independent contractors. There are no exceptions.
• University departments requiring the services of an existing UC employee should work with Human Resources, Academic Personnel or Payroll to compensate the employee through the payroll system.
• UC employees with teaching or research responsibilities may be exempted. However, they are still subject to University guidelines for Employee-Supplier Relationships, as well as Academic Personnel policy.

Successor (Follow-On) contracts

• Contractors who have performed work in the past for the University cannot participate on subsequent projects relating to the findings or recommendations they previously provided to the University.
• If you are planning to contract with a contractor with the expectation that the same consultant could perform work related to the findings, this follow-on contract may not be allowable under the new law. Please contact Gigi Tisdom, Procurement Manager, at (951) 827-3022 for direction.

Contractors who are former UC employees

• Public Contract Code - Section 10515-10518 restricts contracting with former UC employees based on the following:
  • Former UC employees cannot be independent contractors for two years from the date of separation to perform work related to contracts in which they engaged in any negotiations, transactions, planning, arrangements, or any part of the decisionmaking process relevant to the contract while employed in any capacity by any University department.
  • Former UC employees cannot be independent contractors for one year from the date of separation to perform work on a contract if they were employed by that department in a policymaking position in the same general subject area as that contract.
  • You may be able to rehire, as an employee, a retired UC employee. UCR departments requiring the services of a retired UC employee should consult with their representative in Human Resources.
  • Departments requiring the services of a former UC employee should consult with the Procurement Department to determine whether the former employee is subject to the prohibition.

Penalties There are serious penalties, including personal criminal sanctions, for non-compliance with Public Contract Code - Section 10520-10526. They include the following:

• Voided contracts: Every contract or other transaction entered into that is in violation is void.
• Felony: An officer or employee of the University of California who knowingly engages in a prohibited transaction may be guilty of a felony.
• Felony: A contractor to the University of California who knowingly engages in a prohibited transaction may be guilty of a felony.
• Monetary liability: Persons convicted may be liable for monetary damages.

To avoid the appearance of favoritism in contracts on behalf of the University, UCR will seek to buy comparable goods and services from non-conflict of Interest sources.

It is the policy of the University to keep separate an employee's University and private interests, and to safeguard the University and its employees from charges of favoritism in the acquisition of goods and services.

It is the responsibility of the requesting department to ensure that a Purchasing Transactions Involving Possible Conflict of Interest Form  is submitted to Procurement Services in cases where a potential conflict may exist.  The completed form is used to evaluate the Employee-Supplier Relationships for goods, services, including Independent Contractor and Professional Services Contractors, to determine if an actual conflict of Interest exists that would disallow a proposed supplier. The Director, Procurement Services, Campus Purchasing Manager or their designee such as a the procurement manager within the department will made the final determination.  In cases where the goods and services are not available either from commercial sources or from within the University, an exception may be granted on a case by case basis.

A Former Employee may be used if the individual had teaching and research responsibilities.

A Former Employee may not be used if:

1. Less than two years’ time has elapsed since the individual separated from University employment, and the individual had been engaged in any of the negotiations, transactions, planning, arrangements, or any part of the decision-making process relevant to the contract during the period of employment; or
2. Less than one year’s time has elapsed since the individual separated from University employment, and the individual had been employed by a department in a policy-making position in the same general subject area as the proposed contract.

A University retiree may enter into a contract for services immediately following retirement if the retiree did not participate in any way while serving as an employee in the making of the contract for services.  Other restrictions may apply according to policy see Employee-Supplier Relationships.

Independent Contractor

An independent contractor is an individual or organization outside the University of proven professional or technical competence who provides primarily professional or technical advice to the University in an independent contractor relationship. The University document used to secure the services of an independent contractor is an Independent Contractor Agreement Form. A purchase order type document may not be used, but is reserved for independent contractor agreements where an employee-supplier relationship exists.

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Arrangements to secure the services of an independent contractor may be entered into only when a determination has been made that the services are so urgent, special, temporary, or highly technical that they cannot be performed economically or satisfactorily by existing University staff during the course of their normal University responsibilities or duties.

Retainment of an Individual as an Independent Contractor

University policies on the retention of independent contractors for personal or professional services are provided in UC Business and Finance Bulletin BUS-43.

1. When departments choose to retain an individual for services other than through normal employment procedures, they must ensure that no employer-employee relationship will exist with that individual (see BUS-43, Part 7). Persons from outside temporary employment agencies do not have an employer-employee relationship if they comply with IRS guidelines and the primary relationship is with the agency rather than the individual.

2. The criteria used to determine a worker's status under Internal Revenue Service (IRS) common law standards and details of the penalties imposed by the IRS for the misclassification of workers are summarized in BUS-43. A compilation of relevant IRS rulings are provided to help in determining a worker's status. An Independent Contractor Pre-Hire Worksheet (available in BUS-43) may be used to ensure that a worker is properly classified.

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Procedure

An approved agreement or purchase order must be in place PRIOR to committing University funds.

1. The originating office prepares a Purchase Requisition and forwards it to Procurement Services. All requisitions, except those for temporary employment, must contain the following information:

• a.  Name and social security number of individual performing the service.
• b.  Whether the individual is currently a University employee or student.*
• c.  Whether the individual is related to a University employee or student.*
• d.  Whether the individual is an alien and, if so, the individual's visa type.
• e.  Service to be performed.
• f.  Where the work will be performed.
• g.  Whether University supplies or equipment will be used.
• h.  Amount of payment and method of computation; i.e., by the hour, day, or job.

*When applicable, attach the Request for Approval of Proposed Purchasing Transaction Involving Possible Conflict of Interest form (This form, which may be obtained from Purchasing, should contain a complete justification.

 

Scenarios- Can I do that?

Scenario		Pay as Independent Contractor
	A department wants to hire a programmer analyst from another department to build a Web site.	Not allowed Contact your Compensation Analyst in Human Resources
	A department wants to purchase a microscope from an employee.	Not allowed Goods or services may not be purchased from staff employees.
	A full-time Assistant III (non-exempt) also plays the harp. She is asked to perform at a Chancellor's reception for $200.	Not allowed Contact your Compensation Analyst in Human Resources
	A staff member from one department is asked to teach an aerobics course in another department, for $75 per course.	Not allowed Contact your Compensation Analyst in Human Resources
	A non-salaried adjunct professor seeks compensation for research services.	May be allowed. Requires further evaluation. Employees with teaching and research responsibilities are exempt from the new regulations, but are still subject to University policies for employee-suppliers.
	A UNEX art instructor is asked by a department to restore a damaged sculpture.	Yes Because teaching/research employees are exempt from Public Contract Code - Section 10515-10518 and if the restoration work cannot be done commercially or by someone within UCR as part of their job duties, the instructor may be paid for these services after an exception has been made by the Materiel Manager.
	A professor seeks compensation for non-research services.	May be allowed. Requires further evaluation. Employees with teaching and research responsibilities are exempt from the new regulations, but are still subject to University policies for employee-suppliers.
	A full-time Assistant II is asked to transcribe tape-recorded interviews from Spanish to English on an as-needed basis for $50/hour.	Not allowed Contact your Compensation Analyst in Human Resources
	A tenured professor prints t-shirts as a part-time business. The Bookstore proposes to purchase these t-shirts from the professor for re-sale.	Not allowed Employees with teaching and research responsibilities are exempt from the new regulations, but are still subject to University policies. Because t-shirt printing is commercially available, they cannot be purchased from a UC employee, even one with a teaching/research position.
	The tenured professor who prints the t-shirts mentioned above offers to sell them to the Bookstore for less money than the Bookstore can get them from any other source.	Not allowed Employees with teaching and research responsibilities are exempt from the new regulations, but are still subject to University policies. Because t-shirt printing is commercially available, they cannot be purchased from a UC employee, even one with a teaching/research position who sells them for less money.
	Jane Smith was hired as an independent contractor to assist a department in reorganizing staff functions and roles. She completed the contract and has now submitted a new proposal to complete the work recommended in the initial contract.	Not allowed Consultants who have performed work for the University cannot submit a bid or be awarded a contract for projects relating to the previous contract's findings or recommendations.

Return of Goods

If it is necessary to return goods to a supplier, it is the department’s responsibility to make the arrangements.  Contact the supplier for specific information pertaining to the vendor’s return goods policy.

Typically suppliers’ need to know the reason for a return before they are willing to take it back.  Once a supplier has agreed to the return they usually issue a Return Goods/Merchandise Authorization (RGA/RMA) number.  The RGA/RMA is referenced in the return documentation and on all associated correspondence. 

Supplier return policies often include a restocking fee or disallow returns on items that require refrigeration or have limited shelf life.  If in advance of a purchase you have concerns on a vendor’s return policy, contact Procurement Services for assistance in working to get restocking fees waived or reduced.

If the purchase was made against a purchase order or DAPO, the buyer or purchasing assistant who placed the original order needs to be notified so that a change order can be issued and credit lines may be applied.

Sales Tax

Keep in mind that UCR typically pays sales or use tax on purchases of tangible property, such as equipment and supplies.

Suppliers often fail to include taxes in quotes.  Procurement Services will build in sales or use tax unless the department identifies the purchase as for resale, or that the purchase is against a Federal Contract whereby the title is retained by the Federal government.  For supplier's who do not collect CA sales tax, UCR Accounts Payable will accrue the use/sales tax and pay it directly to the state.

Sales Tax: Retail sales to UCR by California retailers are subject to sales tax. The obligation for the payment of California sales tax lies with the retailer, not the purchaser. State laws require the retailer to charge sales tax to the purchaser at the time of sale.

Use Tax:  A use tax obligation arises when UCR purchases a commodity which is taxable under California State Sales and Use Tax Law, but for which the retailer has not billed, or the retailer is not licensed to collect California sales tax. The current rates for use tax are the same as for sales tax. The liability for payment of use tax belongs to the purchaser (UCR).

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Purchases for Resale: No sales or use tax is imposed on purchases made for resale. The UCR resale permit number must be provided to the seller when material for resale is purchased. Purchase orders that are non-taxable will indicate the UCR resale permit number.

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Federal Contract and Grant Purchases: University purchases funded by a federal contract or grant are not taxable if title to the goods/services vests in the federal government. Each contract or grant and the regulations of the related agency should be reviewed to determine which purchases are subject to sales or use tax.

Requests for Bid/Proposal

Requests for Bid or Proposal, for purchases of $100,000.00 or more, contain detailed specifications and requirements and are awarded to the responsive/responsible bidder providing the lowest overall cost to the University. In determining whether a bidder is responsive and responsible, such things as thorough completion and submission of their bid response, their facilities, capacity, experience, previous work, references and financial standing are taken into consideration. Award of a contract pursuant to a request for bid or proposal may be made on the basis of cost alone or on a cost per quality point basis. The method to be used to make award will be stated in each request for bid/proposal. UCR reserves the right to reject any or all bids.  NOTE: UCR DOES NOT MAINTAIN ACTIVE BIDDERS LISTS

POLICY: Pursuant to University of California system-wide policy as stated in UCOP Business and Finance Bulletin (BUS-43) http://www.ucop.edu/ucophome/policies/bfb/bus43.html, Negotiation is allowed for transactions below $100,000, however, competition is sought if the Materiel Manager determines that the competition is necessary to develop a source, validate prices, or for other compelling business reasons. Negotiation may be used in conjunction with competitive quotations as well as in situations when competition is not obtainable or required.

The Public Contract Code of the State of California (Public Contract Code Section 10507, et seq.) requires competition must be sought, for any transaction expected to involve an expenditure of $100,000 or more for goods or services, other than personal or professional services, unless it is determined that a brand or trade name article, thing or product, or proprietary service is unique, available only from a sole source, or is designated to match others used in or furnished to a particular installation, facility, or location. Requirements shall not be artificially divided into separate transactions to avoid competition.

Maintaining Confidentiality and Non-Disclosure of Information During Open Solicitations

Procurement Services asks that you agree not to disclose or otherwise divulge any information pertaining to the contents, status, or discussions of any proposal to anyone inside or outside the University other than the initiative team leader or other initiative team members without Procurement Service's knowledge and approval.

The terms disclosed or otherwise divulge includes, but is not limited to, reproduction of any part of or portion of any solicitation, proposal, quote or supplier correspondence.  During the purchase process and formal bid evaluations, suppliers and other UCR personnel may be interested in gaining “insider information” on the purchase.  Confidentiality of this information will ensure integrity of the purchase process and avoid giving information to suppliers inadvertently that may undermine the pricing, terms and conditions obtained by the University. The buyer or buying team lead needs to be able to control the dissemination of information and manage negotiations associated with a purchase.

Expectations of Bid Team and Evaluators

Procurement Service’s standard practice is to include individuals from the requesting or using department(s) as part of a team to establish bid requirements and evaluate bids.

Participants must disclose any potential or known conflict of interest in evaluating any company which may bid for the University’s business. 

Evaluators are to provide observations and input in a manner which demonstrates that decisions are based on facts, data, good judgment and logical inference. 

An evaluator must agree not coerce others on the team to change their decisions based on their own personal conclusions.  Evaluators are to encourage others on the team to thoughtfully examine all available bid materials and to also make their own fair and objective evaluations. If an evaluator has a conflict of interest they are required to recuse themselves and recommend a replacement.  Confidentiality and non-disclosure of bid information is extremely important.  Individuals need to participate with a mindset of fairly and objectively evaluating all proposal responses in an unbiased manner and with the best interest of the University of California being paramount in all decisions.

Policy References

UCOP:  A Series – Accounting, BUS Series - Business & Finance Bulletins (Business Affairs), G Series – General, RMP Series – Records Management

Local Campus:  SECTION 750 - Purchasing & Management of Supplies and Equipment