Procurement and Contracts Policies, Procedures, and Guidelines

Deliver measurable value to our customers in support of their business or educational goals by identifying, selecting and facilitating the acquisition of required materials and services while complying with all applicable federal, District and local regulations. This should be accomplished at the most reasonable cost possible within American University’s accepted standards of quality and service, in a timely manner, while utilizing professional conduct and industry approved methods and available technologies. Each member of the Procurement and Contracts Department staff is assigned commodities based on their expertise; this enables the Procurement and Contracts Department staff to maintain a proactive, accountable and team-oriented relationship with faculty, staff, and vendors.

OVERVIEW

The Procurement and Contracts Department (PCD) is the central purchasing and contracts authority for American University. PCD is a department under the auspices of the Treasurer’s Office and sits within that department’s Controllers Office along with Accounts Payable and Accounting. PCD is responsible for managing the procurement and contracts processes on a University-wide basis, including purchase orders, contracts and any other legal agreements associated with the acquisition of goods and services that support AU’s educational, research and business initiatives.

Office Hours

9:00 a.m. to 5:00 p.m.

Location:

2nd Floor – Brandywine Building

Phone Number:

(202) 885-3811

Fax Number:

(202) 885-3821

E-Mail Address:

pcd@american.edu

PROCUREMENT & CONTRACTS DEPARTMENT PERSONNEL

Director Brian Blair bblair@american.edu

Assistant Director Hallie Porter hporter@american.edu

Assistant Director Bill Walters walters@american.edu

Buyer III Mary Green mgreen@american.edu

Buyer II Marvette Smith msmith@american.edu

Buyer II Evan Bradford ebradfo@american.edu

Buyer I Beth Jones jonesb@american.edu

Senior Contract Analyst John Danner jgdann@american.edu

Contract Analyst Ralph Castiglione rcastig@american.edu

Receiving Clerk Angui Madera madera@american.edu

ROLES & RESPONSIBILITIES

When purchasing goods and services, it is important to understand the two distinct roles that exist in the centralized purchasing environment at American:

A. PCD's role: The Director of Procurements and Contracts has the ultimate authority to purchase goods and services for the University. The Director can delegate to departments the authority to buy certain goods and services. PCD’s Responsibilities include:

Provide appropriate training and documentation

Develop strategy, policy, procedures and systems

Negotiate corporate purchasing agreements

Review preferred vendors for performance and customer satisfaction

Manage the relationship with the One Card provider

Support benchmarking across schools

Offer assistance with any purchase

Offer high level discussions with Schools relating to the monitoring of good purchasing practice

Purchase Order Turnaround- Procurement & Contracts target a 48 hour turnaround to issue Purchase Orders if all information is clearly stated on the Purchase Requisition and has been competitively bid or justified appropriately.

B. Departmental Budget Coordinator’s role: A department budget coordinator has the responsibility to notify PCD of any unauthorized purchases of materials, supplies, services, and repairs when these goods and services are of the following type:

Exceed $500 including tax, freight, and handling charges

Have not been competitively bid or justified and are over $5,000 net

Are considered capital equipment

Are restricted budget items

Require a signed contract

Require labor on University premises

Professional Service Agreement (PSA) over $10,000 OR PSAs under $10,000 and have material changes to the PSA.

WHAT I SHOULD KNOW

What do I need to be aware of when I want to purchase something with American University funds?

There are six keys to success for a good working knowledge of the procurement process at American University. Understanding and complying with these principles will enable you to be a good steward with the University’s resources.

1.Signature Authority (Who can buy?) - You must have specific authority to obligate the University to pay for goods and services.

2. Un-approved Expenses (What cannot be purchased?) - If you are using University funds, they can only be used for purchasing items that are not excluded from permitted University expenditures.

3. Authorized Methods of Procurement (How can you get it?) - You must utilize one of the four authorized methods for purchasing goods and services.

4. Strategic Supplier Selection (Where can you get it?) - Strategic supplier relationships have been established that leverage the University’s buying power and maximize key supplier competencies to obtain goods and services at the best value.

5. Required Documentation (When should it be bid/how should it be explained?) - A standard set of bid and justification procedures are required to properly document all purchases in order to comply with Federal, District and University requirements.

6. Code of Ethics (Why Procurement and Contracts?) - PCD is committed to fair and ethical business practices that promote open and fair competition in the best interests of the University and the success of its supplier relationships.

SIGNATURE AUTHORITY

1. Signature Authority (Who can buy?) - The Procurement and Contracts Department was established to ensure that all purchasing activities are carried out in accordance with all applicable laws, directives from the Board of Trustees, and sound business practices.

Only The Procurement and Contracts Department has the authority to enter into a contract or lease, or to obligate the University in any way unless: (1) the Trustees have specifically authorized an individual to do so in writing, or (2) the Director of Procurements and Contracts has delegated purchasing authority to specific individuals for a specific term or purpose.

Individual faculty and staff members are not authorized to sign on behalf of the University, or to bind the University in any manner (except certain PSAs under $10,000, please see PSAs).

Some vendors may also require accompanying terms, conditions, agreements or forms. In all cases these agreements are to be signed by the Director of Procurements and Contracts; however, they may also be co-signed by an appropriate representative of the using departments if desired.All documents without an authorized University signature will be considered invalid and not binding upon the University.

Federal and District law provides that individuals who do not have delegated authority, and who enter into unauthorized agreements, may be held personally responsible for the cost of the goods or services purchased.

Accordingly, any, and all, vendor forms of agreement such as: quotations, proposals, contracts, leases, letters of intent, memorandums of agreement, and any other document containing or referring to a supplier’s or the University’s terms and conditions, must be sent to The Procurement and Contracts Department for review and signature.

Procurement and Contracts has a checklist of basic agreement requirements, as well as, standard University contracts, and contract guidelines for reference to a variety of typical business situations.

A properly executed purchase order constitutes a contract that is binding on both the University and the vendor.

Signature Authority for Contracts

Contract Value
PSA - up to $10,000** Division Head

up to - $100,000 - Director of Procurement and Contracts & Controller

up to - $250,000 Assistant VP Finance

up to - $500,000 VP Finance & Treasurer

up to - $1,000,000 President

over - $1,000,000 Board of Trustees

**- There must be no changes to the AU PSA or PSA Work Made for Hire or the terms and conditions, vendor must be an existing supplier; otherwise the PSA or PSA WMFH must be signed by PCD

APPROVED DEPARTMENTAL EXPENSES (What can’t you buy?)

The Treasurer’s Office has clearly identified those departmental expense categories that are prohibited under Restricted Commodities

AUTHORIZED METHODS of PROCUREMENT (How can you get it?)

There are six authorized methods for procuring and paying for goods and services at American:

1. E-Procurement

2. AU P-Card

3. Purchase Order System

4. Travel Services

5. Invoices for purchases under $500.00 (through Accounts Payable)

6. Retail Purchase Forms(through Accounts Payable

The primary tool, the Datatel Financial system, or a PCD- authorized alternative system, should be used for acquiring all necessary goods or services. Each of the above listed procurement methods follow specific approval workflows, and have its own strengths. Office Supplies, travel, and other e-procurement links like Grainger.com, Fischer-Scientific.com, CDWG.com can be purchased through the referenced links. The AU One Card should be used whenever possible for purchases under $500. Otherwise, over $500 requires Purchase Orders. Invoices under $500 can be presented to A/P for direct payment, a requisition in Datatel is not required. Prepayments are used to pay vendors in advance for services such as: registrations and subscriptions.

Certain goods and services are exempted from Purchase Orders and are not required under policy to have a PO or blanket PO. PO’s can still be issued for these commodities, but they are not required by this policy.

Goods and services exempted from a PO

Independent Contractor Agreements

(PSA & Work for Hire) for individuals only,

Not corporations*

Business Cards

* - Note: A Purchase Order is not required for PSAs to individuals, although a current W9 will be required to process a payment with a PSA contract. A Purchase Order should be used in place of PSAs, if the PSA is to be written for a corporation instead of a proprietorship.

PREFERRED OR STRATEGIC SUPPLIER SELECTION (Where can you get it?)

PCD is responsible for selecting the best sources of supply for the University and authorizing potential new preferred suppliers. The Procurement and Contracts Department maintains a PCD Preferred Supplier List which establishes relationships that leverage the University’s buying power and maximizes supplier strengths leading to overall cost savings as well as retaining a feedback mechanism for quality control. Strategic or preferred vendors should be used before any new vendors unless there is a compelling reason to use a new vendor. Through these initiatives, PCD seeks to obtain goods and services at the best value. Value is assured when the goods and services are obtained in a timely manner, at an appropriate level of quality, with reasonable cost, through an appropriate level of competition, and in accordance with applicable Federal, District and University regulations. The following factors in combination, not necessarily listed in their order of importance, will be considered: Price (line item as much as possible); Leveraging required service levels for our customers; Reducing ordering time; Reducing sourcing time; Develop process efficiencies; Centralizing source for agreements available to all AU Departments; Provide timely and accurate customer service.

If the products or services offered by each supplier were of equal quality, the same delivery date and there were no other considerations, the selection would typically be awarded to the low bidder.

REQUIRED DOCUMENTATION (When should it be bid/how should it be explained?)

All University purchases are made in accordance with these University Procurement Andorra Policies and Guidelines regardless of the source of funds. A standard set of bid and justification procedures are required to properly document all purchases to comply with applicable Federal, District and University requirements. This documentation shall be sufficient to constitute a complete history of the actions associated with the establishment of the order for the purpose of:

1. providing a complete background/history on the order;

2. supporting the decision to choose one vendor over another;

3. furnishing essential facts in the event of a dispute.

Towards these goals, the following procedures must be followed in order to establish the documentation required for any and all purchases and contracts.

COMPETITIVE BIDDING (Any purchase or contract over $5,000 net)

Bids should be solicited whenever the items can be purchased from multiple sources to promote competitive bidding. Quotations, either verbal or written, are recommended for requirements totaling up to $5,000.00 in value. A minimum of three written quotations are required for requests totaling $5,000.01 or more. Those items considered sole/ single source or proprietary must be properly justified and confirmed by the Procurement and Contracts Department to waive the competitive requirement. Quotations for requirements over $5,000.00 must be in written form. All pricing and other information furnished by the vendor during the competitive bidding process must remain confidential. Prior to soliciting competitive bids, the requestor should check the PCD Preferred Supplier list to determine if the required product or service is available from an existing vendor supplier. The benefit of using an existing preferred supplier is that the competitive bidding process to secure the least total cost has already been completed by PCD Services. The University's competitive bidding requirement is waived when a purchase with an aggregate value of $5,000 or more is made from a contract supplier. The competitive bidding requirement is also waived for any purchase made from Corporate Express www.eway.com, the University's office supplies and stationery vendor. When requesting formal quotations from potential suppliers, the PCD is required to secure terms and conditions that are favorable to the University and their department, RATHER THAN ACCEPT WHAT IS IN THE BEST INTEREST OF THE SUPPLIER. Whenever possible, the request for quotation should be submitted in writing, and not verbally, to potential suppliers to avoid any miscommunication or misinterpretation of expectations and/or specific requirements. Supplier responses must also be submitted in writing with quoted prices, terms and conditions clearly documented in the response. All formal quotations should detail the requirements both parties, the University and the supplier, have agreed upon. Please note that any “agreement” between the University and a supplier is not bound and valid until PCD has issued a valid purchase order for the goods and services OR has signed off on a valid contract with favorable terms and conditions for the University to accept and comply with.

1. Things to Consider When Soliciting Competitive Bids PCD staff members are available to provide assistance to faculty and staff and can represent the University in a formal solicitation for competitive bids. By contacting PCD before you are ready to solicit bids for a desired product or service, you can take advantage of our professional purchasing experience, capabilities, and technology to help realize the least total cost for the desired product and service.

For faculty and staff interested in soliciting quotations directly from external suppliers, we offer the following guidelines when soliciting quotations from potential bidders:

Each potential bidder must receive the same information and business requirements. Be as specific as possible with requirements. Include manufacturer name and part number if available, a complete description of desired product(s) and/or services, the delivery location and required-by date.

Provide a copy of the University's purchase order terms and conditions

Obtain at least three quotations from competent sources of supply.

Provide a contact name, phone number and e-mail address for suppliers that may have questions regarding the request or requirements.

Clearly define bid submission instructions and submittal day and time.

At no time should one supplier's proprietary information be shared with another supplier. Please remember to allow sufficient time (usually 2-3 weeks for complex requests) for the supplier to respond to a Request for Quotation, RFP or RFI. Please contact PCD for more information on formal requests and any templates you may need assistance managing.

Once bids have been received from the suppliers, analyze the proposals to determine which supplier is able to meet all business and delivery requirements, at the least total cost. Contact PCD if help is required to assess each proposal to determine which represents the best value to the University. No proposals should be signed by end users unless they have first been reviewed by the PCD department. Typically, PCD will issue a Purchase Order and attach an unsigned proposal for pricing and description information only. Procurement and Contracts has templates for the above RFP/Q/I documents.

JUSTIFICATION (how should it be explained).

Sole/single source justification. A sole source purchase is one where there is only one vendor capable of providing an item or service, and therefore it is not possible to obtain competitive bids. A single source purchase is one where there are multiple sources of supply, but for specific reasons the item or service must be purchased from a specified vendor. For purchase transactions exceeding $5,000.00 in total value and it is deemed that there is only one viable source for the item or service that is essential to the needs of the University, and it has been determined that competitive bidding is not possible, the requisitioning department will be required to complete the Sole Source Justification Form. An order will not be placed without proper documentation, including a written quotation from the awarded vendor. PCD has the authority to review and challenge any order.

Request to Waive the Bidding Requirement. The competitive bidding requirement can be waived for an equipment purchase or services with an aggregate value of $5,000 or more when the product or service is available from only one non-contract supplier, thereby exempting the purchase from the otherwise required competitive bid policy of the University. This is done under exceptional and limited circumstances. In order to waive the competitive bidding requirement, the faculty or staff member requesting the exemption must provide PCD with a detailed written explanation as to why competitively bidding the product or service would be impracticable and that thecost charged by the supplier is reasonable and customary. Such request should include specific technical requirements of the product or service and supportable evidence that due diligence has been performed in an objective market analysis. PCD reserves the right to negotiate pricing or to solicit additional information and remains the final authority on all procurement issues.

Examples of waving the competitive bidding requirement include:

Equipment for which there is no comparable competitive product.

A component or replacement part for which there is no commercially available substitute, and which can be obtained only from the manufacturer and/or a manufacturer’s distributor.

An item where compatibility is the overriding consideration, such as computer operating software enhancements for an existing system.

A supply, equipment, part, service or supplier that, due to technically constraining factors associated with scientific research, are needed to ensure the fairness and validity of the underlying research.

Repair/replacement parts for non-competitive equipment

Continuation of an existing contract when work is so closely related to that of the uncompleted basic contract that it would not be feasible to consider another potential contractor.

See sole source justification doc.

CODE OF ETHICS (Why call it Purchasing?)

PCD serves as the intermediary between the campus community and vendors to ensure impartiality by maintaining the proper separation of duties. Accordingly, all vendor price quotes must remain confidential, as revealing them undermines the competitive bidding practice and opens the door to potential legal actions. PCD is committed to fair and ethical business practices that promote open and fair competition in the best interests of the University and the success of its supplier relationships.

SALES TAX

The University is exempt from District and certain state’s sales tax. Other taxes such as Entertainment Tax, Luxury Tax and Excise Taxes are not exempt. Upon request, The Procurement and Contracts Department will furnish a copy of the University's tax exemption certificate with the purchase order. The Procurement and Contracts Department maintains a list of each state (as well as the District) where the University holds a sales tax exemption. Please contact PCD with any questions regarding taxes and their applicability.

ON-SITE WORK / INSURANCE REQUIREMENTS

Under a variety of circumstances, outside organizations are required to provide evidence of commercial general liability insurance and to name the University as an additional insured to the organization's insurance policy in order to be permitted to conduct business on University property. All such arrangements require a written contract or purchase order with the University. PCD works with the Office of Risk Management to ensure that proper insurance requirements are in place before any on-site work begins. Refer to the Risk Management website for more details.

PERSONAL PURCHASES

PCD will not facilitate or approve any transaction for purchases of a personal nature. Requisitions and vouchers containing items which appear to be of a personal nature will be questioned by PCD and will be returned to the requisitioner if the purchase is inappropriate.

CONFLICTS OF INTEREST

Employees of American University who act on its behalf have an obligation to avoid activities or situations which may result in a conflict of interest or the appearance of conflict of interest. Employees must not use their University positions to influence outside organizations or individuals for the direct financial, personal or professional benefit of themselves, members of their families or others with whom there is a personal relationship.

GIFTS AND GRATUITIES

In order to avoid a conflict of interest or the appearance of a conflict of interest, at no time should an employee solicit or accept gifts from a vendor or contractor or from a potential vendor or contractor. Ordinary business courtesies, such as payment for a modest lunch are acceptable when approved by the Director of Procurement and Contracts in advance. Gifts which are promotional items without significant value (less than $25.00), and which are distributed routinely by the vendor to clients, are also acceptable. All gifts, or "free" items received in conjunction with a purchase are perceived to be University property. As such, they must either be used within the department or forwarded to surplus property. Gratuities or gifts of money to an employee cannot be accepted at any time.

SPECIFIC SERVICES ON CAMPUS

All vendors performing on-site services may not enter University property unless they are insured in accordance with the University’s established insurance requirements.

EQUIPMENT MAINTENANCE AND SERVICE AGREEMENTS

Computers, scientific, diagnostic and testing equipment, hardware, software, and other facilities and specialized equipment require on-going periodic maintenance after warranties expire. One of the primary benefits of negotiating a service/maintenance agreement with the manufacturer is that the manufacturer has ready access to the parts and factory trained personnel required to maintain or repair the equipment.

New Equipment- If the equipment purchase is a 'one time' buy, service and maintenance requirements should be addressed in the bid or during negotiations with the vendor. In evaluating RFQs (Request For Quote) and RFPs (Request For Proposal), costs for service and maintenance should always be considered as part of the total price of the equipment. The LIFE CYCLE COST of the equipment includes purchase price for the equipment and the cost of service/maintenance extended over the useful life of the equipment - usually more than 3 years. If the equipment will be rented or leased, the service coverage offered as part of the rent/lease program should be reviewed for adequacy.

Developing Service/Maintenance Agreements for New or Previously Purchased Equipment- Fully describe the scope of the work to avoid any misunderstandings or unsatisfactory levels of service. Terms and conditions that should be agreed upon between the buyer and vendor include:

• working hours

• labor

• included services (what the vendor is obligated to do) & Service Level Agreements

• excluded services (what the vendor is not obligated to do)

• warranty

• included parts

• excluded parts

• response time and Service Level Agreement to understand what will happen if response times are not met

• loaner equipment

• and appropriate insurance coverage

AU has standard terms and conditions available for review by the supplier. If the buyer feels additional services might be required or if the terms and conditions require amending, the buyer should negotiate these elements with the vendor before the service/maintenance agreement is signed. The buyer should also try to negotiate shipping terms in case the equipment needs to be returned to the manufacturer for repairs. AU is a tax exempt entity and should not be charged sales and use tax.

Typical Questions Procurement Asks Before Procuring Services-

Maintenance- See Equipment Maintenance and Service Agreements above

Installation- Who will be responsible? What does it include and what does it not include? If the installation will be performed by the vendor's personnel, make sure the vendor has adequate general liability insurance and worker's compensation insurance, or other specific insurance, say malpractice insurance for a doctor’s services. Can personnel install the equipment? How long will installation take? Is installation a separate cost or included (F.O.B. Installed).

Training- Is training available for end users? Where will it take place? How long will it take? Is training included in the purchase price? Is a user's manual included, complete with parts list and schematic, and in English? Will the vendor provide on-going technical assistance if needed?

Acceptance- The equipment is expected to conform to certain performance specifications and should be tested before the buyer/end user authorizes payment to the vendor.

Warranties- Warranties should begin from the date of acceptance of installation and training. They are typically 90 days for software and 1 year for hardware and services, usually by manufacturer but could be by distributor. The equipment should be operational and personnel fully trained. The buyer should avoid taking partial shipments and risk warranties on components expiring at different times. If the equipment is to be stored, arrange with the vendor for an extended warranty or have the vendor activate the warranty after the equipment has been installed and tested. Otherwise, the warranty may expire before the equipment is up and running. Buyers may find an extended preventative maintenance agreement more cost effective than whatever discount terms the vendor is offering.

Payment Terms- Net 30 is the standard payment term used within the industry and should be the minimum terms agreed to for payment from AU to any vendor. Net terms of longer than 30 days are advantageous to AU and will be secured if possible. Deposits and other arrangements within Net 30 are not considered standard and will be avoided at all costs.

PURCHASE REQUISITIONS AND PURCHASE ORDERS

ALL completed online purchase requisition through Datatel should contain the following information:

Requisition Date: Datatel will default to the days date
Initiator: The requesters Datatel user-id.

Vendor ID: Type in the vendor's name. If Datatel responds that the name is not found, it probably means that the vendor is not in system. If the item requested is not available through any other vendor that AU has a purchasing arrangement, a request can be sent to PCD with a copy of of the company's W-9 form to add a vendor to Datatel.
Ship To - Each department has their own unique shipping code. To find a department ship to code, type three periods (...) in the ship to field and click the blue square on the right. A list of ship tos will appear. Pick the one that is correct for your department.

Approvals - Approvals are set up specially for each department:
In some cases, the Initiator is the same person as the Approval.

Other departments may designate another staff member to be the Approval. In this case, the Initiator should click on the blue box at the end of the Approval field and type the Approval's userid in the next approval column
Line Item - Click on the blue square to continue with entering the order
RQIM Screen - Type in description of item to be purchased, cost, and quantity and G/L account number that the items should be charged against. When complete, click enter to return to front page of requisition.
Requisition Done - type in Y. If you not complete the requisition, it will be in the Not Approved list bin until further action is taken to release it to be processed into a purchase order

PURCHASE ORDER TERMS AND CONDITIONS

The American University General Terms and Conditions and the purchase order (collectively, the “Agreement”) shall constitute the complete and exclusive statement of the Agreement between University and the vendor with respect to the purchase of any goods and/or services. To the extent that vendor terms and conditions conflict with the American University General Terms and Conditions, the latter shall control.

PURCHASE ORDER TYPES

Standard- A Purchase Order (PO) clearly identifying a supplier to which the scope of particular goods and services to be purchased. At minimum it should include the supplier’s name, date of the PO, date of delivery, manufacturer, model #, quantity and line items pricing information and be signed by an authorized buyer within AU. A reference to the acceptable Terms and Conditions that are applicable to the PO and an unsigned proposal or Statement of Work by the vendor should be adequate for most PO requirements at AU.

Blanket Purchase Order- Should be used for repetitive purchases, for a particular supplier of goods or services which may include multiple shipments; Volume requirements yield additional discounts (those terms will be attached to the PO); multiple payments; Leasing office equipment; or a maintenance agreement for goods or services; other items to be identified. Blankets should include:

The period of time for the performance

Clear indication of the purpose of the blanket

Not To Exceed amount for the blanket

Scope of goods or services to be included or not

Person authorized to issue releases against the blanket

After a blanket is issued, the department is responsible for the following:

Placing the order to the company using the Blanket PO# as reference

Arranging delivery

Approving the invoice and forwarding to Accounts Payable according to the following:

a. If the amount is fixed, the dean or department head will need to authorize automatic payment

b. If the amount is fixed, and the requisition indicated a fixed price over a fixed number of months no further approval is needed

c. Invoices not returned within 15 days and $500 or less will be processed for payment

d. The correct blanket PO# must be clearly visible on the invoice

At the end of the fiscal year, all blankets will be closed and reopened with new blanket PO#s. Any money remaining encumbered will automatically be released into the respective budget that requested the blanket. Each department is responsible for the re-issuing of all blanket orders for the following fiscal year unless prior approval is given by the department to extend the expenditures for certain agreements.

Prepayment - When a PO is accompanied by a University check and services are paid BEFORE they actually occur. Typically, AU contracts with suppliers using net terms or payment AFTER services are rendered. Occasionally though, a situation may arise when a check must be presented upon receipt of goods or prior to receiving the items ordered. To request a prepayment:

The purchase requisition must clearly state that a prepayment is required ( please note request in the comment field on requisition)
Supporting documentation needs to be forwarded to PCD (order form, quote, proforma bill, etc.). Typically postage, conference or subscriptions, deposits, or other one-time, up-front purchases are included in this category.
If the department needs to pick up the check from the Controllers Office and wishes it to be sent to their office by campus mail, the request should be noted in the Comment field of the requisition.

A standard prepayment will be processed and a check ready to be mailed or picked up with in 48 hours

Change Orders- To request a change to a previously issued purchase order, a purchase requisition, appropriately authorized email or fax is required in addition to the original PO#, PR#, & supplier if handy. Upon receipt of the authorization, PCD will contact the supplier to make the necessary changes. If the order can be changed, a modification to the original PO will be issued. In the event the item has already shipped, PCD will communicate the alternatives available to the end user.

UNIVERSITY SERVICES

Department’s budget coordinators or those so authorized by those representatives may purchase services from on-campus approved suppliers such as Bon Appetit and the UPS Store. The Campus Retail Purchase Order is available on the portal (the form is located in the Office assistant section under Accounts Payable forms) and can be used to purchase University Services although many on campus vendors are accepting the One Card going forward. Please contact the establishment directly for specific instructions on how to order on your budget.

RECEIVING PURCHASES

Deliveries must be made directly to the location specified on the purchase order by the buyer in the PCD. All packaging should be carefully examined for any visible evidence of damage, particularly if the purchase is fragile or costly. Receiving will make a note of the date the order was received, the name of the vendor, the quantity received, the purchase order number, serial number, manufacturer’s model number and back order information if available. The receiving and purchase order information will be checked against the invoice to make sure that the quantities received are the same as the quantities being invoiced.

Damaged Shipments and Shortages- Damaged shipments should be refused especially if they are totally destroyed and if the broken contents would cause contamination. If the shipment is refused, the vendor or shipper could dispose of the shipment, making it very difficult for the buyer or end user to initiate a successful claim. Any damage to the package, no matter how slight, should be noted on the carrier's and receiver's delivery receipt. If the shipper is unwilling to wait while the contents of the package are inspected, the receiver should note on the delivery receipt that the condition of the contents is unknown. If concealed damage is discovered during unpacking, stop unpacking, notify Central Receiving, and request an immediate inspection. Save damaged packaging and cartons for Central Receiving.

Initiating a Claim- The shipper should be notified immediately by phone and in writing within thirty (30) days of receipt of the damaged merchandise. A formal claim letter should:

describe the damage

give the date the shipment was received

include a copy of the delivery receipt with the shipper's signature and the receiver's description of the damage

provide the name of the vendor

include a written estimate from the vendor of the costs to replace or repair the damaged items

provide a copy of the vendor's original invoice

provide copies of all correspondence pertaining to the claim.

The shipper should acknowledge the claim within thirty (30) days and offer a settlement within one hundred (120) days. When terms are F.O.B. Destination, the end user should contact the buyer or Central Receiving immediately so that a claim can be filed with the appropriate transportation vendor.

Returning Goods to the Vendor- Goods should not be returned without first notifying the vendor. Some vendors require the buyer to obtain a return authorization number and have procedures as to how and when a return shipment should be made.

UNAUTHORIZED PURCHASES

Procurement Authority may only be delegated by PCD. An individual who has not been delegated procurement authority who makes an unauthorized purchase of goods or services may be held personally responsible for payment of the charges incurred. At the discretion of the PCD Director or Controller:

The unauthorized individual shall be required to pay either the full amount whenever the purchase is found to cover unneeded items or items whose purchase would not otherwise be authorized and the transaction cannot be canceled, or the amount of any cancellation charges incurred when cancellation can be arranged.

The unauthorized individual shall be required to pay only the difference between the charges such individual incurred and those AU would be reasonably expected to have incurred whenever the purchase is otherwise found to have been authorized.

INVOICE PROCESSING

Invoices must be submitted to the following address for payment:

American University

Attn: Accounts Payable

4400 Massachusetts Avenue NW

Washington DC, 20016-8020.

The invoice will be matched with the executed PO and packing slip, if available. In case a properly executed PO does not exist, the invoice will be sent back to the vendor indicating the PO process must be initiated and signed prior to invoice payment. Invoices will be paid promptly if the above procedures are followed. Delaying payment to a vendor can result in the vendor placing AU on credit hold. Eventually AU may pay higher prices to offset the vendor's collection costs which in turn can downgrade AU’s credit status with not only the vendor, but with credit bureaus. Invoices should be sent to Accounts Payable for processing, not to PCD. In case of discrepancies between invoice, PO, and packing slip, the documentation will be routed back to the initiating AU employee for explanation and further authentication of the actual goods ordered and delivered. EACH INVOICE MUST BE APPROVED (SIGNED AND PRINTED NAME) AND MARKED WITH AN “OK TO PAY” PRIOR TO PAYMENT. Invoices received for goods and services rendered outside of the PCD process described in these sections may not be processed for payment or may be delayed considerably. Exception to the above- Invoices for PSAs should not be mailed directly to Accounts Payable, but should be mailed directly to an end user whose authorized signature signed the PSA.

DELEGATION OF PURCHASING AUTHORITY

Additionally, the Trustees have delegated certain authority for purchasing within the following select functional areas:

Employee Benefits - Human Resources

Food Services – Dining Services

Insurance - Risk Management

Legal Services - General Counsel

Library Books - University Library

MATERIAL MANAGEMENT

A. CAPITAL EQUIPMENT -A Capital Equipment purchase exceeds $5,000 (including freight and installation charges) and has an economic or useful life span of more than 2 years.

PCD issues bar coded tags to the asset's owner for affixing to the equipment and performs annual inventories. Additional information is provided in the Capital Equipment Definitions.

B. SURPLUS -Items that departments no longer use must be turned over to the Surplus Program so the University capital asset records can be updated and the items can be redistributed to other departments, sold, donated, or scrapped. PCD manages this program to ensure that University acquisition, funding and disposal regulations are met.

VENDOR INFORMATION

Business Opportunities

Any qualified business can become a potential vendor for American University. The Procurement and Contracts Department has numerous contracting and individual order opportunities available across a wide variety of products and services.

Vendor Fair

Each Spring, The Procurement and Contracts Department hosts its annual Vendor Fairs showcasing over 100 vendors and their products to more than 500 campus users. Housed in Butler Board Room, the Vendor Fair is aimed at providing contract vendors with the opportunity to show their products, make new contacts, and achieve new business with the University. Special sections are organized for vendors offering environmentally friendly products and ergonomics vendors.

Small Business Development

The Procurement and Contracts Department actively works to support the University's commitment to provide equal opportunities through contracting and individual order opportunities for small businesses. Purchasing makes every effort to ensure that the University includes the maximum practical number of small businesses in the competitive bidding process in compliance with Executive. The Procurement and Contracts Department seeks to maximize the opportunity for local, small, and disadvantaged business participation through the development mutually beneficial business relationships, while also educating the University community about American's goals in this area.

Environmental Purchasing

American University is committed to providing a safe and healthful environment for its employees, students and visitors and managing the University in an environmentally sensitive and responsible manner. The Procurement and Contracts Department works with the Environmental Issues Project Team to encourage the use of products that minimize adverse environmental and health effects and take into consideration costs associated with the full product life cycles.

FAQ

1. When can I use my P-Card?

Purchasing cards can be used for any transaction under $500 provided it is not a restricted account, grant, or commodity, and provided the vendor accepts VISA.

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