Editor's
notes:
POLICY TITLE:
DATE OF ISSUANCE: This policy was approved by
the President's Council on February 15, 2002.
ACCOUNTABLE DEPARTMENT/UNIT: Procurement Services.
Questions on policy content should be directed to Gary Hayden, Director of
Procurement Services, x8-6248.
RELATED POLICIES AND DOCUMENTS:
Policy on Conflict of Interest/Commitment
Purchasing
Manual
Non-Travel Business Expense Policy
Responsibilities for Managing Carnegie Mellon Financial
Assets Policy Statement
Travel Expense Reimbursement Policy
Tartan Trust
Cardholder Guide
FORMS: The forms
mentioned in this policy are available online in
Microsoft Word/Excel or Portable Document Format. To view them in PDF format,
you may need to download Adobe
Acrobat.
Carnegie Mellon University
The Carnegie Mellon
Purchasing Policy comprises four component parts as detailed below: (1) Purchasing, (2) Competition,
(3) Conflict of Interest & Buying Ethics, and (4) Small Business Utilization (Disadvantaged, Women-Owned,
Veteran-Owned, Service Disabled Veteran-owned and HUBZone Business
Enterprises).
(1) Purchasing
At Carnegie Mellon,
most purchasing actions are conducted by academic and administrative
departmental employees rather than a central purchasing authority. Purchasing
activities include obligations for ethical behavior, compliance with government
regulations, proper transaction documentation and fiscal responsibility. Procurement Services (PS)
are intended to help departmental Buyers (those who have access to the tools
for making commitments and payments, i.e., Oracle Purchase Orders and Tartan
Trust Cards), and departmental Users (those who have influence into the
acquisition decision-making process), fulfill these obligations, as well as to
ensure consistent purchasing practices across the university.
Policy Statement
Purchasing
The goal of
purchasing policies and procedures is to provide reasonably priced,
high-quality goods and services to end users, while preserving organizational,
and financial and civic accountability.
o
Buyers and Users
should familiarize themselves with Carnegie Mellon policies and procedures
relevant to their purchasing activities. At the end of this document, there is
a list of related policies and procedures that can be accessed online. A Purchasing
Manual that explains procedures in detail also can be accessed online.
o
Buyers must
complete training and sign all applicable forms, statements and certifications
(including, but not limited to, a Cardholder
Agreement, Buyers’ Code of Ethics, Anti-Kickback
Clause, Purchasing
Using Federal Funds Training Certification, and a Conflict
of Interest Disclosure Statement before making any purchases.
o
PS has developed
a Preferred
Supplier Program whereby all applicable pricing and supporting
documentation has been pre-negotiated. For Purchases under $100,000 (under
$50,000 for FMS contracts within a project) Preferred Suppliers can be used
with any type of funds, without doing supporting documentation. Buyers are
encouraged to purchase goods and services from Preferred Suppliers. The Preferred
Supplier Directory can be found on the PS website. The use of non-Preferred
Suppliers is allowed, but requires individual Buyers and Users to provide
accurate, adequate and complete supporting documentation for any transaction
equal to or exceeding the Competitive Threshold ($5,000 as of 1/1/04; $2,500
for federally funded transactions; and $2,000 for federally funded
facilities-related transactions) (ref: Purchasing
Checklist/Bid Summary Form). Other than good business judgment, there are
no constraints when using non-Preferred Suppliers for purchases that total
below the Competitive Threshold.
o
Buyers should use
the purchasing tool (for example, Tartan Trust Card, Oracle Purchase Order or
Web-based ordering) that is required or most appropriate for the purchase.
o
Buyers and Users
should utilize suppliers and service providers that make use, to a practicable
extent, of materials and services that support the Carnegie Mellon
environmental mission and goals of reducing, reusing and recycling. Information
regarding the university's Green Practices can be obtained by contacting the
Green Practices Environmental Coordinator at 268-7858, or by referencing the Environmental Practices Committee's web site.
Buyer’s Responsibilities
Purchasing
o
Buyers are
encouraged to purchase goods and services from Preferred Suppliers. The use of
non-Preferred Suppliers for expenditures above the Competitive Threshold must
be documented in accordance with Carnegie Mellon requirements and government
regulations (ref: Buyer
Actions Matrix and Purchasing
Checklist.)
o
Choose the
appropriate purchasing tool (Tartan Trust Card, Oracle Purchase Order,
Web-based ordering, etc.) for the transaction.
o
Reconcile Tartan
Trust Card transactions monthly, as needed.
o
Re-allocate
Tartan Trust Card expenses, as appropriate and necessary.
o
Maintain security
of purchasing cards and related card numbers and expiration dates, including
immediately reporting a lost or stolen card.
Department & User Responsibilities
Purchasing
o
Identify
departmental buyers for Tartan Trust Cards, Oracle Purchase Orders and
Web-based ordering.
o
Provide
transaction-supporting documentation in accordance with Carnegie Mellon
requirements and government regulations (ref: Buyer
Actions Matrix).
o
Make sure
departmental buyers have received appropriate training before they begin
making purchases.
o
Notify the
Carnegie Mellon University Card Manager when a Tartan Trust Cardholder
terminates employment with Carnegie Mellon or transfers to another department,
and retrieve the card prior to the employee’s exit.
PS’s Responsibilities
Purchasing
o
Provide appropriate
training and documentation.
o
Provide a Purchasing
Manual that describes policies and procedures in detail, including
guidelines for using purchasing tools and for committing Carnegie Mellon and
government funds.
o
Establish and
maintain a Preferred
Supplier Program that identifies qualified suppliers, provides a
competitive atmosphere, analyzes bids and proposals, and documents Preferred
Supplier agreements, including terms and conditions, discount pricing, product
or service quality, delivery performance, and government certifications.
o
Regularly
reevaluate Preferred Suppliers for performance, price adherence and customer
satisfaction.
o
Maintain
financial relationship with bank/card provider.
o
Provide
purchasing tools for committing and forms for documenting purchasing
transactions.
o
Audit selected
Tartan Trust Card transactions.
o
Offer assistance
in the proper finalization of any purchase.
o
Resolve supplier
- customer problems and disputes.
o
Approve federally
funded transactions equal to or exceeding $10,000 with non-Preferred Suppliers
prior to commitment to the supplier.
o
Affix an
authorized Carnegie Mellon signature on contracts, agreements, licenses and/or
leases after all appropriate approvals.
(2) Competition
Carnegie Mellon is
required under the Office of Management and Budget's Circular A-110
"Uniform Administrative Requirements for Grants and Agreements with
Institutions of Higher Education, Hospitals and Other Non-Profit
Organizations" and by Federal
Acquisition Regulations (FARs) to establish a competitive environment for
the purchase of goods and services. The use of competitive bidding also makes
good business sense. Procurement Services (PS) policies and procedures on
competitive bidding ensure that Buyers in Carnegie Mellon’s decentralized
purchasing environment process transactions in a uniform manner consistent with
federal requirements and good business practice.
Policy Statement
Competition
Carnegie Mellon
makes every effort to maximize competitive procurement opportunities by
soliciting competitive bids and proposals for goods and services prior to
issuing or awarding credit card commitments, purchase orders, web-based orders
or contractual documents.
o
PS sets the
Competitive Threshold for Carnegie Mellon ($5,000 as of 1/1/04; $2,500 for
federally funded transactions). Buyers and Users are required (where
competitive vendors can be identified) to solicit competitive bids and
proposals at and above the Competitive Threshold, and to make the purchase from
the lowest, evaluated responsible supplier. All non-competitive acquisitions at
or above the Competitive Threshold must be adequately and appropriately
justified and documented. Supplier bids, quotations and proposal information
are generally considered confidential and should not be disclosed or discussed
with other suppliers.
o
Suppliers listed
in the Preferred
Supplier Directory have already undergone the competitive bidding and
supporting documentation process. For purchases under $100,000 (under $50,000
for FMS contracts within projects), no further bidding or documentation action
need be taken by Buyers or Users purchasing goods and/or services from
Preferred Suppliers. Buyers and Users are encouraged to use Preferred Suppliers
whenever possible.
o
Decisions on
purchases should be based on the supplier’s compliance with Carnegie Mellon
specifications, terms and conditions, price, delivery and capacity to perform.
Carnegie Mellon business should be awarded in the best interest of Carnegie
Mellon based on the merits of the competition. Unsolicited proposals may be
considered as long as they are in the best interest of Carnegie Mellon.
o
Carnegie Mellon
does not engage in or submit to the practice of reciprocity in any purchase
transaction.
Buyer’s Responsibilities
Competition
o
Buyers are
encouraged to purchase goods and services from Preferred Suppliers. The use of
non-Preferred Suppliers for expenditures above the Competitive Threshold must
be documented in accordance with Carnegie Mellon requirements and government
regulations (ref:Buyer
Actions Matrix and Purchasing
Checklist).
o
Compete
transactions to the maximum extent practicable.
o
Choose the
appropriate purchasing tool (Tartan Trust Card, Oracle Purchase Order,
Web-based ordering, etc.) for the transaction.
o
Reconcile Tartan
Trust Card transactions monthly, as needed.
o
Re-allocate
Tartan Trust Card expenses, as appropriate and necessary.
Department & User’s Responsibilities
Competition
o
Identify
departmental Buyers for Tartan Trust Cards, Oracle Purchase Orders, Web-based
ordering and other purchasing activities.
o
Provide
supporting documentation in accordance with Carnegie Mellon requirements and
government regulations whenever non-Preferred Suppliers are used for purchases
at or above the Competitive Threshold (ref: Buyer
Actions Matrix).
o
Make sure
departmental Buyers have received appropriate training before they begin
making purchase commitments.
o
Make sure
departmental Buyers and Users comply with Carnegie Mellon’s purchasing policy
on competition.
PS’s Responsibilities
Competition
o
Provide
appropriate training and documentation.
o
Provide a Purchasing
Manual that describes policies and procedures in detail, including
guidelines for competitive bidding.
o
Establish and
maintain a Preferred
Supplier Program that identifies qualified suppliers, provides a
competitive atmosphere, analyzes bids and proposals, and documents Preferred
Supplier agreements, including terms and conditions, discount pricing, product
or service quality, delivery performance and government certifications.
o
Regularly
reevaluate Preferred Suppliers for performance, price adherence and customer
satisfaction
o
Audit selected
transactions for competitive bidding compliance and documentation.
o
Offer assistance
in the proper finalization of any purchase.
o
Resolve supplier
- customer problems and disputes related to competitive bidding.
(3) Conflict of Interest &
Buying Ethics
Faculty, staff, and
students who have purchasing or purchase approval authority (collectively
"Buyers and Users") must be aware of the standards of ethical
behavior that apply to their purchasing activities. They must avoid unethical
conduct and conflicts of interest in purchasing goods and services. Federal
regulations require Carnegie Mellon to have explicit procedures for addressing
incidents in which there are allegations of improprieties or conflicts of
interest in purchasing. This purchasing policy works in tandem with the
university-wide Policy on Conflict of
Interest/Commitment.
Policy Statement
Conflict of Interest &
Buying Ethics
Conflicts of
interest occur when Buyers and Users are in a position to make or influence a
procurement decision from which they might directly or indirectly receive
financial benefit or which might give improper advantage to their associates.
Buyers and/or Users should not maintain relationships with firms or individuals
if there is a chance that these relationships might influence their buying
decisions on behalf of Carnegie Mellon.
o
Buyers must
annually complete a PS Conflict
of Interest Disclosure Form describing the existence and nature of any such
conflict. Forms are to be submitted to PS.
o
Buyers and Users
must inform their supervisors if they know or suspect that: a supplier is a
Carnegie Mellon employee, a Carnegie Mellon employee has a substantial
ownership interest in a supplier’s firm, or a Carnegie Mellon employee will
receive financial benefit from a purchase.
o
Purchases from
Carnegie Mellon employees and purchases over $1,000 (threshold as of 10/04/01)
from firms in which Carnegie Mellon employees have a substantial ownership
interest must be reviewed and approved by the Director of Procurement Services
(PS).
Conflicts of Interest
Identification & Resolution
Procedures
Conflict of Interest &
Buying Ethics
o
Buyers and Users
should use good judgment, professional commitment and ethics to protect
themselves and Carnegie Mellon from potential conflicts. Administrators and
supervisors should make Buyers and Users aware of relevant policies and create,
by example, an atmosphere consistent with them.
o
Buyers and Users
in a position to influence a Carnegie Mellon acquisition decision for which
they might receive material benefit should disclose the nature of the conflict
to others involved in the decision. Whenever possible, those with potential
conflicts should remove themselves from involvement in the decision. If the
individual continues to participate in the decision process, discussion with
supervisors and documentation of the potential conflict should be presented to
the appropriate dean, director or department head and to the Director, PS.
o
The first and
most important line of defense against conflicts of interest must be Carnegie
Mellon Buyers and Users themselves. Buyers must fill out a PS Conflict
of Interest Disclosure Form annually. In addition, Buyers and Users are
strongly encouraged to disclose, to the appropriate dean, director or
department head, their outside activities on a regular basis (e.g., during
annual departmental reviews, evaluations, or whenever those activities undergo
significant change). In the event that potential conflicts cannot be resolved at this level, they should be referred to the
Director of PS who will then forward a recommendation to the department for
final resolution.
Some funding
agencies of the federal government require grantees to conform with other
disclosure and conflict of interest resolution procedures. The Office of Sponsored
Research has information about these agencies and their specific
requirements.
Conflict of Interest &
Buying Ethics
Carnegie
Mellon subscribes to the intent of the National Association of Educational
Buyers’ (NAEB) Code of Ethics. Carnegie Mellon’s Code states that Buyers will:
o
Give first
consideration to the objectives and policies of their institution.
o
Strive to obtain
the maximum value for each dollar of expenditure.
o
Decline personal
gifts or gratuities in accordance with Policy.
o
Grant competitive
suppliers equal consideration insofar as state or federal statute and
institutional policy permit.
o
Conduct business
with potential and current suppliers in an atmosphere of good faith, devoid of
intentional misrepresentation.
o
Demand honesty in
sales representation, whether offered through the medium of a verbal or written
statement, an advertisement, or a sample of the product.
o
Receive consent
of originator of proprietary ideas and designs before using them for
competitive purchasing purposes.
o
Make every
reasonable effort to negotiate an equitable and mutually agreeable settlement
of any controversy with a supplier; and/or be willing to submit any major
controversies to arbitration or other third party review, insofar as the
established policies of my institution permit.
o
Accord a prompt
and courteous reception insofar as conditions permit to all who call on
legitimate business activities.
o
Cooperate with
trade, industrial and professional associations, and with governmental and
private agencies for the purposes of promoting and developing sound business
methods.
o
Foster fair,
ethical and legal trade practices.
o
Work on behalf of
the interests of the University solely, and avoid situations that may result in
personal benefit or gain to the buy.
Gift Guidelines
Conflict of Interest &
Buying Ethics
It is essential to
Carnegie Mellon and its subsidiaries, its suppliers, contractors and
consultants that all decisions and actions regarding acquisitions are based
upon proper business considerations and are not influenced in any way by
personal obligations or opinions.
<P
Therefore,
individuals with expenditure authority on behalf of the Carnegie Mellon must
avoid any behavior that involves a real conflict of interest or any appearance,
however remote, of using affiliation with Carnegie Mellon as a means of
furthering personal interests or showing favoritism to any individual, or
current or potential supplier.
Requesting or
accepting any favor or special consideration from any individual or
organization doing or seeking to do business with Carnegie Mellon that may
result in any direct or indirect financial gain by an employee (or a member of
his/her family) with the capability of influencing a source selection process
involving that individual or organization, is not allowed.
No one with the
capability of influencing the selection of an individual or organization doing
or seeking to do business with Carnegie Mellon should accept entertainment,
gifts, or favors with a value in excess of $75.00 (threshold as of 10/04/01)
without first obtaining the written approval of their immediate supervisor or
higher level management. (Professional samples, i.e., textbooks for review
provided by publishers, are not considered gifts or gratuities.) No employee
should accept any gifts or gratuities that are provided by persons with whom
Carnegie Mellon has business dealings under circumstances that suggest the
donor intends to influence the judgment or conduct of the employee, or Carnegie
Mellon’s business decisions.
Courtesy gifts,
such as flowers, standard event tickets and business meals, as well as
unsolicited advertising or promotional materials (pencils, calendars, etc.)
that are valued at less than $75.00 in the aggregate may be accepted. Gifts in
excess of $75.00 (threshold as of 10/04/01) are generally not permitted
(exceptions may be golf tournament outings, non-standard event tickets,
computer software, etc.). Exceptions must be reported to at least the next
level of supervision, in writing (i.e., e-mail or memorandum).
If any employee
with the capability of influencing the selection of an individual or
organization doing or seeking to do business with Carnegie Mellon receives a
gift that is contrary to this policy, the employee's immediate supervisor
should be notified and the gift returned to the sender with a letter stating
that the receipt and acceptance of the gift(s) is contrary to Carnegie Mellon
policy. Major exceptions to this policy should be reviewed by the Vice
President for Administration and Chief Financial Officer or designee to
determine if special circumstances exist to warrant the acceptance of a gift
from either a supplier or vendor, or to determine whether a gift should be
declined or returned.
Should a
questionable situation arise, the employee shall consult his or her immediate
supervisor or the Director of Procurement Services for guidance and
disposition.
Conflict of Interest &
Buying Ethics
The Office of Naval
Research (ONR), which is Carnegie Mellon’s cognizant agency, requires all
Carnegie Mellon Buyers to read, understand and sign off on this clause, which
is distributed annually to all Buyers:
Definition: "Kickback" as used in this clause means any
money, fee, commission, credit, gift, gratuity, thing of value, or compensation
of any kind which is provided, directly or indirectly, to any prime contractor
(university and/or principal investigator), 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.
Clause: The Anti-Kickback Act of 1986 (41 U.S.C. 51-58) prohibits
any person from: providing or attempting to provide or offering to provide any
kickback; soliciting, accepting or attempting to accept any kickback; or
including, directly or indirectly, the amount of any kickback in the contract
price. The Act imposes criminal and civil penalties on any person who knowingly
and willfully engages in the prohibited conduct addressed in the Act [ FAR 3.502-2 (b) and (c)].
Documentation
Conflict of Interest &
Buying Ethics
Carnegie Mellon’s Conflict
of Interest Disclosure Form, Buyers’ Code of Ethics,
Gift Guidelines for Employees, and Anti-Kickback Clause are
distributed annually to Carnegie Mellon Buyers. Buyers should make sure they
read and understand these requirements, sign the forms, and return them to Procurement Services.
(4) Small Business Utilization
Carnegie Mellon is
committed to supporting small business enterprises, including disadvantaged,
women-owned, veteran-owned, service disabled veteran-owned and HUBZone business
enterprises, in its purchasing programs. Small business enterprises are defined
by the federal government in FAR 19.102.
Categories of socially and economically disadvantaged small business
enterprises are defined in FAR 19.001.
Policy Statement
Small Business Utilization
o
Carnegie Mellon
has established a goal for small business enterprise participation of 15% of
the dollar volume of Carnegie Mellon purchasing (excluding purchasing from sole
source providers where there is no discretion in supplier selection, e.g.,
utilities). Within this overall goal, Carnegie Mellon has established goals for
disadvantaged, women-owned, veteran-owned, service disable veteran-owned and
HUBZone business enterprise participation of 5% of the dollar volume of
Carnegie Mellon purchasing. Awards from federal government or other sponsoring
agencies may mandate different participation goals. The Office of Sponsored Project
Accounting tracks and reports individual award goal attainment and overall
Carnegie Mellon goal attainment to the appropriate agencies.
o
Although
individual purchases, projects or awards may not reach these goals, Carnegie
Mellon’s intent is to work for the achievement of these goals over a fiscal
year. Success depends on the active commitment of all Buyers and Users.
Carnegie Mellon procurement activities should be as inclusive as possible to
allow small, disadvantaged, women-owned, veteran-owned, service disable veteran-owned
and HUBZone business enterprises the maximum practicable opportunity to
participate in providing goods and services to Carnegie Mellon.
o
All contractors
and suppliers doing business with Carnegie Mellon are expected to share these
goals and participate in their achievement. Carnegie Mellon’s Equal Opportunity Services (EOS)
will work with the Procurement
Services and Buyers and Users to develop, implement and monitor the
effectiveness of strategies to achieve these goals.
o
The degree of
utilization of small, disadvantaged, women-owned, veteran-owned, service
disabled veteran-owned and HUBZone business enterprises should be considered
along with other selection factors, such as cost, when choosing vendors. EOS and the Design & Construction Office
will review construction proposals to verify that reasonable good faith efforts
are being made to achieve participation goals in Carnegie Mellon’s capital
programs. They may grant goal waivers, where appropriate.
o
In addition to
meeting contractual obligations and federal, state and local requirements to
include small business program suppliers in Carnegie Mellon’s bidding process,
Carnegie Mellon is also committed to encouraging these suppliers to compete for
business. To be sure that such suppliers are not overlooked, use the following
guidelines or resources:
(1) Contact PS or the EOS for help identifying
appropriate suppliers.
(2) Consider
breaking an order into smaller installments to give smaller businesses an
opportunity to supply items (but not as a way to avoid Competitive or
Requirements Thresholds).
(3) Contact
supplier representatives, PS,
EOS, and Design & Construction when
developing specifications.
Buyer’s Responsibilities
Small Business Utilization
o
Use best efforts
to comply with policies on the utilization of small, disadvantaged,
women-owned, veteran-owned, service disabled veteran-owned and HUBZone
businesses.
Department & User Responsibilities
Small Business Utilization
o
Make sure
departmental Buyers have received appropriate small business utilization
training before they begin making purchases.
o
Make sure
departmental Buyers and Users use best efforts to comply with policies on the
utilization of small, disadvantaged, women-owned, veteran-owned, service
disabled veteran-owned and HUBZone businesses.
PS’s Responsibilities
Small Business Utilization
o
Provide
appropriate training and documentation on Carnegie Mellon and government small
business programs.
o
Use best efforts
to locate, solicit and contract small, disadvantaged, women-owned,
veteran-owned, service disabled veteran-owned and HUBZone businesses into the
Preferred Supplier Program.
o
Provide
information related to locating all categories of small businesses.
Contact
Questions about
these policies should be directed to Procurement Services ,
8-8430. Questions regarding the specific requirements of governmental grantors
should be directed to the Office
of Sponsored Research, 8-2091.
