State of Minnesota

Minnesota State Colleges and Universities

Pine Technical College

Policy and Procedure

 

Policy Number: 403R   Date: 8/6/98    Revision Date: 8/6/2000, 12/11/02

Division/Department: Fiscal Services Author: Robert Musgrove, Kathy Dettinger

Subject: Initiating and Processing Purchase Requisitions, Purchase Orders and Related Payments
 

Authorities:

Delegated in pursuant to Minnesota Statutes 136F.06,16A.15 &124, MnSCU Policies and Minnesota Accounting and Procurement System (MAPS).
 

Purpose:

To permit employees of the college to purchase goods and services for the efficient operations of the college and to align PTC purchasing practice with state guidelines.
 

Policy:

All purchases of goods and services must be approved by Head of the Department or designee before processing and payment by the business office. All computer hardware, software or parts thereof, require approval from the Chief Information Officer or designee.

Split or artificial division of purchase order or requisitions into small units for the purpose of avoiding any purchasing regulation or approval is strictly prohibited.

The purchase requisitions and orders must be entered in MnSCU Accounting System. Funds will be encumbered using the specific commodity codes and vendor numbers. Timely payments are encouraged for the advantages of discounts and good relationship with vendors or suppliers of goods and services.

Faculty:

Customized Training:

 

Student Affairs –

 

Business Office –

 

Information Services & Facilities Per the Delegation of Authority letter, the Chief Information Officer and the Building Maintenance Coordinator may approve items not to exceed $1,000.  Item over $1,000 must have the signature of the President.

 

Employment and Training Center:  All purchases must be approved the Director of the ETC.

 

Procedure and Responsibilities:

 

  1. Requestor obtains a material requisition form from the mailroom or the Business Office.
  2. Requestor completes the material requisition form, to include the date; cost center(s) to be charged; name of requestor; description, quantity, and price of the item(s) to be purchased; vendor name, address, and contact phone and/or fax numbers; and other relevant information.  Requestor should also indicate whether he/she would like to place the order after the purchase order has been issued or whether the Business Office should place the order.
  3. If necessary, requestor submits the completed requisition to the Unit Head or designee for approval.
  4. Unit Head or designee reviews and forwards the approved requisition to the Business Office or returns the rejected requisition to the requestor with a brief explanation for the rejection.
  5. The Accountant or designee reviews the requisition forms, assigns cost center and object codes, and determines the availability of funds.  If the requisition forms are incomplete and/or if there are insufficient funds, the requisition forms are returned to the requestor.
  6. The Dean of Administrative Services or designee approves and forwards the requisition forms for data entry and processing in the accounting system.
  7. When the requisition forms have been processed, a purchase order is issued, and the order is placed either by the requestor or the Business Office, at the discretion of the requestor.
  8. When the goods or services are received, the requestor/receiver confirms the receipt and signs and submits the delivery documents and packing slips to the Business Office.
  9. The Business Office matches the requisition form, purchase order, delivery documents, packing slips, and invoice; obtains payment approval from the requestor; and processes the payment in the accounting system.
  10. The Business Office maintains purchasing and payment records until audited and archives them as necessary.
  11. Requestor must comply with the following purchasing requirements as defined in Minnesota Statute 471.345, Uniform Municipal Contracting Law:
    1. Purchases less than $2,000 – If the amount of the purchase is estimated to be $2,000 or less, the purchase may be made in the open market. 
    2. Purchases from $2,000 to $10,000 – If the amount of the purchase is estimated to exceed $2,000 but not to exceed $10,000, the purchase must be made by obtaining two or more quotations.  Quotations may be obtained by telephone or in written form via fax, delivery service, or the Internet.  Quotations must have a specified date and time for submission.  All quotations obtained shall be kept on file until audited.  The record to be retained must include the names of vendors providing quotes, amounts of quotations, and each successful quote signed and dated.
    3. Purchases from $10,000 to $25,000 – If the amount of the purchase is estimated to exceed $10,000 but not to exceed $25,000, the purchase must be made by obtaining sealed bids.  Bids will not be required to be advertised or otherwise comply with the requirements of competitive bidding.  Bids must be sealed and, when they are read, must be opened in public.  Bids must have a specified date and time for submission.  All sealed bids obtained shall be kept on file until audited. 
    4. Purchases from $25,000 to $100,000 – If the amount of the purchase is estimated to exceed $25,000, sealed bids shall be solicited by public notice through publishing a two-week notice in an official newspaper(s).  The official newspaper may be the State Register.  Sealed bids also may be solicited by directly notifying prospective bidders not less than seven (7) days before the final date of submitted bids.  This notice shall state the time and place of receiving bids and contain a brief description of the subject matter.  A bid containing an alteration or erasure must be rejected unless the alteration or erasure is crossed out and the correction printed in ink or typewritten adjacent to it and initialed in ink by the person signing the bid.  Bids must be sealed and, when they are read, must be opened in public at the hour stated in the notice.  All sealed bids obtained shall be kept on file until audited.
    5. State contracts – Purchases not exceeding $100,000 may be made without receiving quotations or sealed bids if they are covered by a State contract.
    6. Purchases over $100,000 – Purchases over $100,000 require the approval of the Office of the Chancellor.  Institutions must submit a memorandum explaining the need for the purchase, the purchase amount, verify that funds are available for paying for the purchase, and describe what processes will be used in making the award.  The institution may proceed with the purchase upon approval of the memorandum.
    7. Computer Equipment – All purchases of computer equipment require the approval of the College’s Chief Information Officer or designee.
    8. Rental of Equipment under $60,000 – If the amount of a contract for the rental of equipment is estimated to be $60,000 or less, the contract may be made by direct negotiation by obtaining two or more quotations for the rental, when possible, and without advertising for bids or otherwise complying with the requirements of competitive bidding.  All quotations shall be kept on file until audited.
    9. Encumbrance – Funds must be encumbered prior to making an expenditure or obligation.  An expenditure or obligation incurred prior to encumbering funds is illegal and ineligible for payment and is in violation of Minnesota Statute 16A.15, Subdivision 3.  An employee making an expenditure or obligation prior to encumbering funds is liable to the State for the amount of the transaction.  A knowing violation of Minnesota Statute 16A.15, Subdivision 3, is just cause for the employee’s removal.  The State cannot agree to indemnify third parties or hold them harmless (MS 10.17; Minn. Const. Art. XI, Sec. 1).
    10. Prepayment – Minnesota Statute 16A.41, Subdivision 1, prohibits the State from paying in advance.  The State can only make prepayments for software or software maintenance contracts for State-owned or leased computer equipment, sole source maintenance agreements, exhibit space, subscription fees or newspapers and magazines, and the Library of Congress.
    11. Fixed Assets – All fixed assets of $2,000 or more, all computer equipment, and all firearms must be recorded in the fixed asset module of the Minnesota State Colleges and Universities’ database.
    12. Code of Ethics – State employees are covered by Minnesota Statutes 43A.38 and 43A.39.  They cover such topics as acceptance of gifts, conflicts of interest, and use of confidential information.  Minnesota Statute 15.43 states that no employee of the State in direct contact with suppliers or potential suppliers to the State, or who may directly or indirectly influence a purchasing decision or contract by establishing specifications, testing purchased products, evaluating contracted services, or otherwise have official involvement in the purchasing or contracting process may have any financial interest or have any personal beneficial interest directly or indirectly in the contracts or purchase orders for goods or services used by or purchased for resale or furnished to the College or accept directly or indirectly from a person, firm, or corporation to which a contract or purchase order has been or may be awarded a rebate, gift, money, or anything of value other than items of nominal value.  No such employee may further accept any promise, obligation, or contract for future reward.  Textbooks, software, and other course materials authored by an employee of the Minnesota State Colleges and Universities may be used as required course material.  Instructors may accept free samples of textbooks and related teaching materials.

 

 

Dissemination:

  1. Leadership Team members will provide the policy to employees in their work areas.
  2. The policy will be available in the President's Office, Administrative Services, Media Center, and on the College's shared directory.

 

Reviewed by Leadership Team: 09/06/00; revision: 7/15/02; 8/12/02, 12/02/02.
Reviewed by Faculty Senate:  12/11/02
Approved: 09/06/00; Revision: 8/12/02, 12/11/02   

 

Signature:___________________________________ 

Robert L. Musgrove, Ph.D., President