Policy Portal

University Policy

Purchasing and Selling University Property

Policy Number: 3349-11-50
Effective Date: 03/05/2005
Updated: 06/01/2019
Reviewed:
Responsible Department: Administration and Finance
Applies To: All Departments

A. Purpose

To establish a policy through which the University can purchase and sell property necessary to conduct its operations. The University procurement activities must be conducted in an efficient and cost effective manner that supports the mission of the University while maintaining compliance with applicable state and federal laws and regulations.

B. Scope

These procedures apply to all purchases and sales of University property.

C. Definitions

  1. Consult University Policy 3349-7-01.
  2. Sealed bid is the purchase method used when there are specifications with a defined quantity for a fixed price, where the lowest and most responsive bidder wins the contract. This method is generally used for construction contracts.
  3. Competitive bidding is the purchase method used when each vendor may have a similar product or services and a technical evaluation tool is used to determine the winning bid. This method is generally used for purchasing services, furniture, equipment etc.
  4. Competitive quotes are when you receive quotes for the same purchase or service from multiple vendors or suppliers.
  5. University procurement activities are the methods of obtaining a lower fixed cost either through IUC, group purchasing organizations or University contracts.
  6. Sole source purchase is the purchase of a good or service in which the needed good or service is only available from a single source, only one source can provide the good or service in the time frame required and the competition is deemed inadequate, after solicitation attempts.

D.Body of the Policy

  1. ADMINISTRATION OF UNIVERSITY PROCEDURE ACTIVITIES. All University procurement activities shall be administered through the Division of Administration and Finance.
  2. PROCUREMENT MUST MEET THE FOLLOWING STANDARDS AND OTHER LAWS AND REGULATIONS:
    1. Costs incurred must be necessary and cost-effective
    2. All procurement transactions must provide full and open competition
    3. The University must maintain written standards regarding conflicts of interest.
    4. The Purchaser must maintain documentation addressing cost and price analysis, and vendor selection, as applicable for the selected method of procurement
  3. REGULATIONS THAT MUST BE CONSIDERED WHEN MAKING PURCHASES
    1. Mandated use of University preferred suppliers and agreements. The University has competitively selected, formally negotiated or has access to preferred agreements for numerous goods, services and capital equipment.  In utilization of these preferred suppliers, the University obtains numerous benefits which include favorable terms and conditions; guaranteed performance levels, no-hassle return policies, free or reduced freight costs, volume incentives, liability and insurance protection, as well as discounted pricing.  Refer to DOCS Administration and Finance Forms, Policies, and Procedures – Accounting & Purchasing – Preferred Vendors Listing for a list of these preferred suppliers.
    2. Supplier Diversity. The University shall seek to set aside approximately fifteen percent (15%) of the estimated value of all purchases per year for competition by certified minority business enterprises in accordance with Ohio Revised Code Section 125.081.
    3. Buy Ohio. The University shall give preference in its purchasing activities to products that are produced or mined in Ohio and to bidders that qualify as having a significant Ohio economic presence in accordance with Ohio Revised Code Section 125.11(B).  This requirement may be waived when compliance would result in the University paying an excessive price for the product or acquiring a disproportionately inferior product.
    4. Buy America. Chapter 125.11(B) of the Revised Code stipulates that state agencies and public colleges or universities shall give preference in its purchasing activities to products produced, mined, or manufactured in the United States in accordance with Ohio Revised Code Section 125.11(B).  This requirement may be waived when a determination has been made that the products to be purchased are not mined, produced, or manufactured in the United States in sufficient and reasonably available commercial quantities and of a satisfactory quality.
  4. LEASE VERSUS PURCHASE ANALYSIS. When equipment is being purchased for projects of limited duration, the University will prepare an analysis, where appropriate, to determine if leasing is a better alternative to purchasing.  The analysis will be done to determine which method is most economical and practical given the project.
  5. METHODS OF PROCUREMENT FOR EACH PURCHASE OF GOODS OR SERVICES:
    1. Purchases less than $5,000 in aggregate or micro-purchases less than $10,000 for federal grants. ($2,000 or less for federal grant purchases that are subject to the Davis-Bacon Act)
      1. No sealed bids, competitive bidding or competitive quotes are required
      2. Must spread purchases out among qualified suppliers
    2. Purchases between $5,000 and $49,999 in aggregate or small purchases between $10,000 and $49,999 for federal grants
      1. Competitive quotes are required from at least three vendors if purchasing goods with University funds.  If purchasing with a federal grant, competitive quotes are required for both goods and services excluding subcontracts.
        1. An exception to this requirement is if the purchase is through the current University, IUC or other group purchasing organization negotiated contract.
      2. Quotes can be obtained directly from suppliers or from their public website
    3. Purchases in aggregate of $50,000 or more
      1. The sealed bid or competitive bidding process must be used for these purchases.
      2. Purchase must be publicly advertised and solicited from adequate suppliers
    4. Single Source purchases of any amount need to document the following:
      1. What is the piece of equipment and how is it used?
      2. Does anyone else sell this equipment?  If yes, not a single source and will need multiple quotes.
      3. What other vendors have you looked at to know they do not have this or similar equipment?
      4. What aspect of this equipment from this vendor is different and necessary over any other similar equipment?  Do you need this aspect that is different from other equipment in your work?  If not, not a single source.  If yes, explain why this is necessary.
  6. METHOD OF PROCUREMENT FOR CONSTRUCTION
    1. Aggregate cost of construction is less than $200,000
      1. Competitive quotes are required from three or more qualified sources
      2. Quotes can be obtained directly from the source or from public websites
    2. Aggregate cost of construction is $200,000 or more
      1. A sealed bid or competitive bidding must be used.
  7. SEALED AND COMPETITIVE BIDDING REQUIREMENTS
    1. A Sealed bid must be advertised at a minimum electronically in the amount of time to sufficiently notify competing persons of the intended purchases and awarded to the supplier with the lowest fixed price and/or most responsive bidder only after three or more qualified suppliers bid on the good or service.
      1. All bids and documentation must be kept with the department purchasing the good or service and must be available when requested from the Accounting Department.
    2. Competitive bidding must be advertised at a minimum electronically in the amount of time to sufficiently notify competing persons of the intended purchases.  The good or service is award is given to the supplier with the most advantageous bid, price and other factors considered. The purchaser must have a documented procedure or method for conducting a technical evaluation or review of the bids and selection process.
      1. All bids and documentation must be kept with the department purchasing the good or service and must be available when requested from the Accounting Department.
  8. WAIVER OF COMPETITIVE OR SEALED BIDDING. Competitive bidding requirements may be waived for the purchase or lease of equipment, materials, supplies and services in the following instances:
    1. The Board of Trustees, the president or vice presidents determine an emergency situation exists that makes obtaining bids impossible or impractical.
    2. In the judgment of the responsible purchasing officer of the University, it is impossible or impractical to obtain more than one (1) bid because the item is obtainable only from a single source, or for other sufficient economic reason.
    3. Existing federal, state, inter-university council, University or other University-partner contracts are used as a source for establishing price.
  9. SALE OF EQUIPMENT
    1. To determine whether equipment is eligible to be sold, refer to the Purchase and Management of Capital Assets Policy. If it is allowed to be sold, and if no University department expresses interest in the equipment after a reasonable time, the property may be sold, disposed of or redistributed in one of the following manners:
      1. Pursuant to competitive bidding procedures with the award being made to the highest bidder;
      2. Advertised public sale with the property having a price assigned to each item and sold to the public at a stipulated time and place;
      3. Advertised public auction with the property being sold to the highest bidder;
      4. Surplus property of minimal (salvage) value may be disposed of in the way most economical for the University.
  10. INELIGIBLE BIDDERS ON SALE OF EQUIPMENT. No employee of the University, or immediate family member of the employee, who has participated in the determination to dispose of property, participated in the preparation of property for sale, participated in determining the method of sale or acquired information not otherwise available to the general public regarding usage, condition, quality or value of property may bid on or purchase any property offered for sale by the University.  To qualify as a purchaser of such property, an employee of the University may be asked to certify in writing that he has not participated in any of the activities or acquired information as specified herein above.

CONTACT

Lisa Noland
Administrative Specialist
Phone: 330.325.6354
Email: lnoland@neomed.edu

Office of General Counsel

Northeast Ohio Medical University