1. General

The Small Purchase Order (SPO) Program was designed to give requesting departments the authority to place orders directly with suppliers without the prior approval of the Purchasing Department.  The program creates convenience and flexibility for departments when purchasing goods and services in the amount of $5,000 or less.  These purchases are considered low dollar purchases where the user has already researched the price and availability with a supplier, and the purchase of the desired item(s) is unrestricted (i.e., by policy, state regulations, etc.).  Processing small dollar purchases through the SPO Program results in greater efficiency in the procurement process for both the user and the Purchasing Department.  Users do not have to submit a departmental purchase requisition to the Purchasing Department for most small dollar purchases.

2. Authority

Authority to administer the University’s SPO Program is derived from The University of Texas Board of Regents’ Rules and Regulations, Part Two, Chapter XI, Subsection 2.1.  The Rules and Regulations authorize the President to implement, manage, and oversee the University’s SPO Program.  The President has delegated this responsibility to the Director of Materials Management.  The Handbook of Operating Procedures, Section 8.2.3, provides the authority and guidelines for operation of this program.

3. Participation in SPO Program

Departmental account managers may participate in the SPO Program by submitting a properly approved application to the Director of Materials Management.  Once the Director of Materials Management approves the application, the account manager for the requesting department may begin participation in the program.  The account manager, authorized designee, and support staff who will be assisting him/her with small purchases must attend an SPO Program training session on rules and operating procedures of the program.  Once the training is accomplished and on-line access is established, account managers may begin processing SPOs.

4. Authorized Signatures

Only the account manager’s signature or his/her designee’s signature is acceptable on SPOs.  Any other substitute signatures are not acceptable.  An account manager’s designee must be approved to sign in the account manager’s absence via the Account Authorized Signature form.

5. Spending Limit

SPOs may be made up to $5,000 inclusive of all miscellaneous charges such as shipping and handling.  Dividing large purchases into two or more SPOs is prohibited.

6. Funds

Account managers must verify that sufficient funds are available in his/her University budget to cover each SPO issued.  Account managers may be held personally liable for payment of invoiced SPOs when funds are not available for the purchase.

7. Exclusions

The following items may not be purchased on SPOs:

	Items or services required to be provided by other UTPA departments
	UTPA contracted items or services (unless purchased from contract vendor)
	Membership dues or conference registration fees
	Travel expense items and other non-allowable expenditures
	Consulting and professional services
	Purchases from UTPA employees
	Hazardous materials as determined by the Environmental Health and Safety Office
	Controlled substances
	Reimbursements to employees
	Postage
	Cash handling items (receipts, boxes, safes, deposit books, etc.)
	Tickets for UTPA events required to be delivered to the Office of the Comptroller
	Purchases requiring signature of vendor agreements
	Any items or services prohibited by UTPA policy and/or state law

8. Receiving of SPO Items

Normally, items ordered through an SPO will be shipped by the vendor to the Central Receiving dock located at 501 North Sugar Road.  There are instances when SPO items will not be received at Central Receiving.  Examples of these items are magazine and newspaper subscriptions mailed directly to the subscriber and items picked up by the department.  Central Receiving will deliver SPO items to the department and prepare the necessary receiving information.  If SPO items are picked up by the department, the Accounts Payable Office must be notified within 24 hours for processing of payment to the vendor.

Account managers must verify that items received are as ordered.  If incorrect or damaged items are received, Central Receiving must be notified immediately so that payment may be withheld until resolution of the problem.  The requesting department should attempt to resolve the problem with the vendor.  Central Receiving will assist departments in processing of freight claims on damages if the items were received through Central Receiving.  For assistance with problem resolution, the requesting department may contact the Purchasing Department.

9. Invoicing of SPOs

Invoices received directly by the requesting department must be forwarded to the Accounts Payable Office immediately for payment processing.  The Accounts Payable Office will forward any questionable invoices and/or unauthorized purchases to the Purchasing Department for review.  Invoices for unauthorized purchases will be returned to the account manager for handling with the vendor.

10. Changes to SPOs

Change orders on SPOs are acceptable provided that the change will not cause the total SPO value to exceed the SPO dollar limit.  See Section 5. Spending Limit above.  Cancellation of SPOs must be confirmed in writing.  Copies of any change orders or cancellations approved by the account manager must be forwarded to the Accounts Payable Office.  Instructions for processing of changes to SPOs are provided in program training materials.

11. End-of-Fiscal Year Considerations

SPOs that are to be paid from current fiscal year funds may be made through the last day of that fiscal year under the following conditions:

	All items must be received no later than August 31st, and
	A copy of the SPO is received by the Accounts Payable Office no later than the close of business of the first working day following the end of the fiscal year.

12. Historically Underutilized Business Program (HUB) Participation

State law requires all state agencies and institutions to make a good faith effort in utilizing HUBs in contracts for construction, services, including professional services, and commodities purchases.  The University of Texas System and The University of Texas-Pan American are committed to putting forth a good faith effort to increase the number and value of business transactions with HUBs.  See Handbook of Operating Procedures, Section 8.2.8.  Account managers will be required to make a good faith effort to award SPOs to HUBs.  A list of HUBs is available through the Texas Building and Procurement Commission’s web site or from the Purchasing Department.  Instructions on finding HUBs are provided in program training materials.

13. Audit and Review of SPOs

The Purchasing Department will review SPOs issued for compliance with program rules and procedures. 

The Office of Internal Audits will conduct audits of SPOs for compliance with policy and established procedures and to determine the adequacy of accounting control by the account manager.

The HUB Program Office will conduct a review of SPOs issued by the Account Manager to determine if a good faith effort has been made in utilizing HUBs for SPOs.  If the review indicates a lack of good faith, the HUB Program Office will give the Account Manager an opportunity to submit documentation explaining why HUBs were not given an equal business opportunity to provide purchased goods and services which are also available from HUBs.  Good faith effort documentation should include a list of HUBs contacted and the price quotes obtained from these HUBs which affirm that a non-HUB provided the best value for those purchases.  Failure to provide the documentation may result in removal of SPO privileges.