December 7, 1999
To: Administrative Cabinet
From: Laura Saunders
Subj.: Purchasing Policy and Procedures
Our annual audit by the Office of the State Auditor is focusing on Highline’s adherence to State purchasing regulations. We have found problems in a number of areas, and need to remind you about proper procedures.
Legislative and public expectations are that college business is to be conducted through an open, competitive process to provide equal access and opportunity which leads to best value and cost effectiveness and allows suppliers to compete for public business. The responsibility to administer these state policies and to insure that regulations are followed is delegated to the purchasing department. The only exceptions to this policy are public works and items purchased for the library collection and resale (Food Service and Bookstore). The Purchasing department’s review of all purchases is the means by which we ensure that all applicable State regulations are followed.
We’ve been found out of compliance in many instances. Specifically, a number of departments are dealing directly with vendors and making financial commitments prior to review by the purchasing department. Any purchase over $3,000 requires obtaining three quotations on price, and purchases of amounts over $35,000 must be put out to a formal bid process. Although there have been changes in the law there are requirements that the
quotations be from qualified minority and women owned businesses. Purchasing maintains a list of these vendors, and thus must be consulted about obtaining the necessary quotations. Purchases also cannot be split into smaller amounts to avoid these requirements.Focusing on a single vendor may not result in the best value for the college, as well as being contrary to state law. While occasional use of a single vendor may be allowed it requires extensive substantiating documentation in the file. We have found a number of cases where departments have specified a single vendor for amounts over $3000, and we will be contacting individual departments to ask that they supply this documentation to justify this designation to complete the files. Purchasing may also work with you to qualify a given vendor for a variety of purchases if that will better serve your needs.
While there may be cases where the originating department may help in obtaining quotes or bids for items between $3,000 and $35,000 the purchasing department will review all purchases and requests for payment to see that appropriate procedure is followed and documentation is attached.
State contracts for a number of items are available and these do not require obtaining bids. However, state contracts have specific specifications and cannot be altered without invoking the bid/quotation requirement. There are also opportunities to justify the use of a sole source, but documentation MUST be attached.
Over the next few weeks, work will be done to clarify our policy and document our procedures. Until then, please ask your departments to check with the Purchasing staff on the appropriate procedures prior to making purchases in excess of $3000 and especially before making any commitments to vendors.