Section 2: Purchasing

Subject: Best Value Procurement Procedures

Issue Date: February 1, 2003

Revised Date: September 2, 2005

1.  General 

This procedure is issued to establish effective guidelines for the procurement of supplies, equipment, and services consistent with best value principles, applicable laws and regulations, and best industry practices. 

2.  Definitions 

“Best Value” - the optimum combination of economy and quality that is the result of fair, efficient and practical procurement decision-making and which achieves the procurement objectives of The University of Texas-Pan American. 

“Purchasing Staff” – Members of the Purchasing section of the Materials Management Department. 

  “Buyer” – Individual authorized to solicit and award purchase orders under the authority of the Director of Materials Management and who is a member of the Purchasing Staff of the Materials Management Department.

 3.  Guidelines

      a.  General:  Personnel authorized to make procurements on behalf of the University shall determine in his/her best judgment the most appropriate and effective method of acquisition for each assigned requisition or request for purchase.  In making this determination, authorized personnel will have a variety of procurement options, including, but not limited to:  Texas Building and Procurement Commission (TBPC) Contracts, Group Purchasing Contracts, Open Market Procurements, Department of Information Resources (DIR) Contracts, Catalog Purchases, and UT System Contracts.  The Buyer’s objective is to acquire the product or service meeting the needs of the end user while ensuring that the procurement achieves:  (1) “best value” as defined above and authorized in Section 51.9335, Education Code; (2) compliance with the Regents’ Rules and Regulations; (3) compliance with the University’s Historically Underutilized Business (HUB) policies; (4) conformance to standards of ethical conduct; and (5) compliance with all applicable laws, rules and regulations.   

In determining best value, The University of Texas-Pan American shall consider: (1) purchase price; (2) reputation of the vendor and of the vendor’s goods or services; (3) quality of the vendor’s goods or services; (4) extent to which the goods or services meets the University’s needs; (5) vendor’s past relationship with the University; (6) impact on the ability of the University to comply with the laws and rules relating to historically underutilized businesses; (7) impact on the ability of the University to comply with the laws and rules relating to the procurement of goods and services from persons with disabilities; (8) long-term cost to the University of acquiring the vendor’s goods or services; and (9) any relevant factor that a private business entity would consider in selecting a vendor. If the procurement relates to the repair of real property, in determining best value the University shall consider the use of material to repair real property that is not proprietary to a single vendor unless the institution provides written justification in the procurement solicitation for use of the unique material specified.  

      b. Federal Funds:  All procurements of supplies, equipment and services utilizing Federal Funds (e.g., Federal Grant or Contract) shall be made in accordance with all applicable federal rules and regulations such as the Federal Acquisition Regulations (FAR), Federal Office of Management and Budget (OMB) Circular A-102, and OMB Circular A110. 

      c. Open Market Procurements:  The following procedures outline minimum solicitation requirements for those orders processed on the open market (e.g., via Invitation for Bid (IFB), Request for Proposal (RFP), etc.); however, such minimum requirements do not negate the Buyer’s obligation to ensure that a competitive procurement occurs and best value is attained.  Thus, it shall be the Buyer’s responsibility to determine the appropriate number of competitive suppliers from whom to solicit offers with consideration given to maximizing HUB participation and contract awards (Ref. HOP Section 8.2.8).  

       d.  Sole-Source or Proprietary Purchases:  When the purchase of a product or service exceeds $5,000, and where an equivalent product or service specified is not available or limited to one (1) manufacturer’s product or one (1) service provider, a written justification (Ref. Attachment A) must be provided and include the following information: 

• An explanation of the need for the sole-source or proprietary specification (part or parts of the stated specification which restrict the purchase to one product, manufacturer or provider).
• The reason competing products or services are not satisfactory.
• Any other relevant information available to document the sole-source or proprietary nature of the purchase.

Prior to committing a Purchase Order for the product or service, the justification must be reviewed and approved by the Director of Materials Management or his/her designate. 

e.  Emergency Purchases:  When the purchase of a product or service needs to be processed on an emergency basis, a written justification (Ref. Attachment B) must be provided and include the following information: 

• The reason for the emergency purchase by explaining what the emergency is and/or what caused the emergency situation.
• The financial or operational damage/risk that will occur if needs are not satisfied immediately.
• Why the needs were not or could not be anticipated so that products/services could not have been purchased following standard procedures.
• The reason and process used for selecting the vendor.

Prior to committing a Purchase Order for the product or service, the justification must be reviewed and approved by the Director of Materials Management or his/her designate.  

f.  Independent Contractors:  When acquiring services from a Sole-Proprietorship or an Individual, an “Employee/Independent Contractor Verification Form” (Ref. Attachment C) must be reviewed for compliance and approved by the Buyer prior to committing a Purchase Order/Contract. The Requesting Department shall complete and submit the Employee/Independent Contractor Verification Form, or the Buyer may assist the Department in completing the form. 

g.  Products and Services not requiring a Purchase Order or Contract/Agreement:  Some purchases of products or services may not require a Purchase Order or Contract/Agreement issued by Purchasing Staff as these are covered by agreements issued outside the authority of the Purchasing Department or best value is obtained by procuring such products or services by other means. These include 

• Registration Fees
• Memberships
• Postage
• Reimburstments
• Affiliation Agreements
• Inter-Agency Agreements
• Collaboration Agreements
• Sponsored Research Agreements
• Lecturers
• Regulated Utilities
• Student tuition, scholarships, stipends, etc.
• Cash awards to employees, students, etc.
• Game guarantees

h. Recycled/Remanufactured Products:  Whenever possible, Purchasing Staff shall specify recycled/remanufactured products, or their use.  

i.  Purchases from People with Disabilities: When the University purchases products or services available from the Texas Industries for the Blind and Handicapped (TIBH) from a non-TIBH source, a written justification must be provided documenting the reason why TIBH products or services were unacceptable.  Such reasons may be delivery time, price, failure to meet specifications or other factors which do not support best value. 

TIBH products and services can be accessed via their website, http://www.purchaseplus.com/index.htm.                   

Prior to committing a Purchase Order for the product or service, the justification must be reviewed and approved by the Director of Materials Management or his/her designate. 

j.  Preferences:  As an agency of the State of Texas and as a public institution of higher education we have a responsibility to support matters of public policy.  Accordingly, when possible, buyers should give consideration in their award decisions to products that are: (i) produced in Texas and/or the United States; (ii) produced by persons with mental retardation or physical disabilities; (iii) energy efficient; and/or (iv) made from recycled materials (e.g., rubberized asphalt paving). 

4.  Release Authority 

No Purchasing Staff member may release a Purchase Order to a vendor either verbally or in writing which exceeds his/her release authority until such order is reviewed and approved by the Director of Materials Management or his/her designate.  Each order submitted for review must be accompanied by the following documentation: 

• Copy of Purchase Order
• Change Order(s), if applicable
• Copy of Requisition or request/authorization memorandum
• Confirming Quotation or Written Bid/RFP (including clarifications & revised bids/proposals)
• Award Recommendation, if applicable
• Bid Tabulation and Justification for Method of Purchase
• Appropriate Justification (e.g., emergency, sole-source), if applicable
• Department (User) Review/Approval Letter or Evaluation Forms, if applicable
• Other Than Low Bid Justification - Approval Memo, if applicable
• Bidders list, if applicable
• Copy of all Submitted Quotations or Written Bids/RFPs, if applicable
• HUB Good Faith Effort Documentation (Orders $100,000)
• TIBH Justification, if applicable
• Miscellaneous correspondence
• Contract Administration Audits/Documentation, if applicable

5.  Exceptions 

The following purchase types shall be processed in accordance with applicable policies and procedures: 

• Orders Over $100,000
• Request for Proposal
• Consulting Services
• Professional Services
• Construction Services
• Procurements from Foreign Suppliers
• Printing (including copying), Stationery, and Fuels (Ref. Article XVI, Section 21, Texas Constitution)

Any other exceptions to this procedure must be in writing by formal addendum to this procedure or by other formal written exception issued by the Director of Materials Management. 

6.  References

Chancellor’s Administrative Rules, Series 22601

Handbook of Operating Procedures, Section 8.2.1

Education Code, Section 51.9335

OMB Circular A-110 

7.  Attachments 

A – Sole Source/Proprietary Justification for Products/Services

B – Emergency Justification

C – Employee/independent Contractor Verification Form (under construction) 

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