Policy Name: Policy on University Contracts and Procurement

Policy

Name:

Policy on University Contracts and Procurement

Associated

Form(s):

Contract Templates

Policy

Number:

2024-10

Reviewed:

Non-Academic Policy Committee

Approved:

April 29, 2024

Approval

Authority:

President

Adopted:

May 15, 2024

Responsible

Executive(s):

Vice President of Finance/CFO

Revised:

November 2023;

June 2018

Responsible

Office:

Purchasing

Contact:

Purchasing Director

Table of Contents

SECTION I: INTRODUCTION………………………..……………..…………….…....…......3

A. Policy Statement………………………………………………………………….…......3

B. Definitions………………………………………………………………………….…...3

1. Business Transactions……………..............................................................................3

a. Procurement Transactions…………...………………………………………….….3

b. Construction Contracts……………………………………………………….…….3

2. Non-Business Transactions…..……..…..……………….…………….......................4

a. Grants……………………………………………………….......……………….….4

b. Academic Agreements……………………………………………………………...4

c. Funding and Partnership Agreements………………………………………….…...4

SECTION II: PROCURMENT POLICIES AND PROCEDURES……………………………...4

A. Purchasing Threshold Guidelines ……………………………………………….……....4

1. Micro-Dollar Purchases (Under $20,000)...……………..……………………….…...5

2. Small Dollar Purchases ($20,000-$200,000)………………..……………………......6

3. Request for Proposal (RFP)/Request for Qualifications (RFQ)..……………………..6

4. Single and Sole Source Purchases………………………………………………...…..7

5. Consortium Partners ……………………………………………………………….…7

6. Preferred Vendor Listing……………………………………………………………...8

7. Independent Contractor Agreements……………………………………………….…7

8. Established Term Agreements…………………………………………………….…..8

B. Unauthorized Purchases………………………………………………………….……...8

SECTION III.CONTRACT APPROVAL AND SIGNATORY AUTHORITIES……………….9

A. Policy Overview…………………………………………………………………………..9

B. Administrative Review and Approval…………………………………………………….9

C. Delegation of Authority by the President…………………………………………………9

D. Contract Thresholds for Review and Approval, and Signatory Responsibilities………..10

SECTION IV. INSURANCE REQUIREMENTS……………………………………….……..11

A. Certificates of Insurance Required by Outside Parties…………………………………..11

B. Certificates of Insurance Required by Mercy University………………………………..12

SECTION V. ETHICS AND CONFLICTS OF INTEREST…………………………………...12

SECTION VI. TERMINATION AND PERFORMANCE OF CONTRACTS………………...12

SECTION VII. IT SECURITY……………………………………………………….………...12

SECTION VIII. THIRD PARTY PROVIDER CONTRACTS……………………..……...…...13

SECTION IX. RETENTION OF EXECUTED CONTRACTS…………………………….….13

SECTION I: INTRODUCTION

A. Policy Statement

It is the policy of Mercy University to engage in business transactions that offer not only the best

value for the University, but the best services to support the mission of educating its students. With

that, the University supports sustaining and promoting a procurement environment based on the

understanding that University departments and schools are best positioned to determine their

operational needs. The purpose of this Policy is to outline the guidelines by which departments

and schools must operate to ensure best business practices, regulatory compliance, and obtaining

the best value in the sourcing of products in services, while still maintaining some flexibility

depending on the particular needs of a school or department. The guidelines set forth in this Policy

are specific to two University-wide transaction types: Business Transactions and Non-Business

Transactions. Section II of this Policy will detail the purchasing guidelines and thresholds for

these transactions; Section III of this Policy will describe the contracts review, approval and

signatory process relating to these transactions.

Details regarding the procedures for implementing this Policy, such as the Request for Proposal

(RFP) process, are set forth more fully in the Purchasing Procedures Manual.

B. Definitions

1. Business Transactions at Mercy University pertain to two distinct areas:

a. Procurement and b. Construction.

a. Procurement Transactions include the following:

i. Purchase of Goods, such as commodities, supplies, equipment,

subscriptions, and repair services, etc.

ii. Provision of Services (revenue contracts), such as University facilities

rentals, consulting services, etc.

iii. Service Contracts, such as third-party vendors, annual service

agreements, etc.

iv. Independent Contractors, such as videographers, consulting services,

guest speakers, etc. hired at fixed price rate.

v. Established Term Agreements, utilized for longer terms service

contracts such as for maintenance and facilities, information

technology, media (video/photography), and legal services, with

services provided as needed intermittently through the course of the

term.

b. Construction projects include:

i. Capital projects

ii. Professional consultants (architects, engineering, etc.)

2. Non-Business Transactions are those taking place outside of the

purchasing/procurement process, and include, but are not limited to, the following

agreements by way of example:

a. Grants

b. Academic Agreements

i. Articulation Agreements

ii. Student Exchange

iii. Affiliation Agreements

c. Funding and Partnership Agreements

i. Public Funding Awards

ii. MOU’s relating to partnerships with external entities

SECTION II: PROCUREMENT POLICY AND PROCEDURES

Every employee of Mercy University must make efforts to ensure the University is preserving its

resources to the greatest extent possible. Part of this responsibility relates to the purchasing

process. Competition between suppliers is one of the most effective ways to ensure the University

is obtaining the most favorable price and terms. In light of that, the following guidelines are in

effect for all business transactions (except for provision of services transactions). All non-

procurement agreements, such as academic agreements, grants, funding and partnership

agreements, do not have to go through the procurement process. Rather, they shall be reviewed

and approved as set forth in Section III below. Exceptions to this include contracts that commit

the University to funds or other resources, such as scholarship funds, hiring an employee or

contractor to support a project, etc.

A. Purchasing Threshold Guidelines

Purchase Type

Contract

Value

Bidding

Required

Documentation Requirement

Micro-Purchase

Under $20,000

(under $10,000

for federal

grants)

a) One (1) quote or documented on-

line research, and will be issued a

Purchase Order (PO) via

Purchasing, or Procured with

Purchasing P-Card; or

b) Individuals with authorization

should use corporate credit card

for approved items outlined in

credit card guidelines up to their

approved threshold.

Small Dollar

Purchases

$20,000 -

$200,000

($10,000-

$200,000 for

federal grants)

Minimum of 3 written price quotes on

vendor letterhead, obtained within 30

days of procurement date with pricing

good for 30 days. PO issued by

Purchasing. PO’s can only be

executed every 6 months to same

vendor to avoid split purchasing.

Request for

Proposal

(RFP)/Request for

Qualifications

(RFQ)

Greater than

$200,000 for

goods or

services/

$250,000 for

construction

projects

Yes

Purchases of $200,000 or more

require a formal Request for Proposal

(RFP) for goods or services or

Request for Qualifications (RFQ) for

professional services. (Purchases over

$200,000 for goods or services, and

$250,000 for construction projects).

Process completed by Purchasing in a

sealed bid, non-public opening. CFO

shall review the results.

Single/Sole Source

Greater than

$20,000

Single/Sole Source Form and relevant

supporting documents

Preferred Vendor

(such as NYS

contracts)

N/A

Sole bid/quote, referencing the State

Contract ID #, or other contract

information.

Consortium Partner

N/A

Documentation from sourced contract

through consortium to include bids,

RFP, final contract, amended

contracts

Micro-Dollar Purchases (Under $20,000 ($10,000 for federal grants))

Multiple quotes are not required to purchase goods or services whose aggregate dollar total is

less than $20,000. One (1) quote or documented on-line research to be issued a Purchase Order

(PO) via Purchasing or procured with Purchasing P-Card; or individuals with authorization should

use corporate credit card for approved items outlined in credit card guidelines up to their approved

threshold. The Purchasing Department is encouraged to utilize the Purchasing Card as much as

possible to facilitate regular department purchases. The requester should still seek to ensure that

the price is fair and reasonable. Certified Minority and Women-Owned Business Enterprises

(M/WBE) vendors are encouraged. Splitting purchases with the same vendor to meet the

micro-dollar purchase limit is a violation of this Policy.

For purchases of supplies or services with federal grant funding, the micro-dollar threshold is

$10,000

unless otherwise approved by the head agency providing the funding. Micro-purchases

may be awarded without soliciting competitive price or rate quotations if the non-Federal entity

considers the price to be reasonable based on research, experience, purchase history or other

information and documents its files accordingly. Purchase cards can be used for micro-purchases

if procedures are documented and approved by the non-Federal entity.

Small Dollar Purchases (Between $20,000 and $200,000 ($10,000 and $200,000

for federal grant purchases))

The University requires a minimum of three (3) written price quotes on vendor letterhead, obtained

within thirty (30) days of procurement date with pricing good for thirty (30) days for purchases

between $20,000 and $200,000 (between $10,000 and $200,000 for federal grant purchases). The

requestor is responsible for obtaining the three (3) legitimate quotes and presenting them to the

Purchasing Department. PO issued by Purchasing. POs can only be executed every six (6) months

to same vendor to avoid split purchasing. Requestors and business managers for each division are

expected to expand acceptable vendor lists, with limited use of sole source rationales.

3. RFP/RFQ (Purchases Over $200,000 for Goods or Services, $250,000 for

Construction Projects)

When the total cost of goods and services is greater than $200,000 for goods or services, or

$250,000 for construction projects, the University must issue a formal Request for Proposal (RFP)

for goods or services, or Request for Qualifications (RFQ) for professional services. The process,

more fully set forth in the Purchasing Procedures Manual, involves a sealed bid, non-public

opening. For purchases over $200,000 W/MBE or NYS preferred vendors are encouraged. After

review and approval by the University’s Chief Financial Officer, a contract shall be issued for

these purchases.

Please note that the University adheres to all policies, procedures and guidelines relating to federal, state

and local grants and that these thresholds are subject to change to adhere to such policies, procedures and guidelines.

In such cases, Mercy shall abide by those changes (regardless of what is stated in this Policy).

Single and Sole Source Purchases

As part of the requirement for maintaining competitive sourcing, departments must provide ample

justification for exemption from the competitive source process. Requests for exemptions from the

small-dollar purchases, big dollar purchases and the RFP process must be made as soon as

practicable, and shall occur in the following limited circumstances:

• Products or services that can be obtained only from one person or company.

• The product or service must match or be compatible with current equipment, services,

inventory, systems, and/or be an upgrades to existing software or the continuation of

ongoing services.

• The product is needed specifically required for use in conjunction with a grant.

• The product or service requested is controlled or mandated by the local utility or

government.

• The supplier is the only one who can meet the required timeline.

• Competitive bids are solicited, and no responsive bid is received (inadequate

competition)

• An unusual or compelling urgency exists; emergency or unforeseen occurrence,

condition or situation will not permit a delay resulting from the competitive bid process.

• The sole source is unique in nature such as artistic services.

• The vendor provides significant cost savings to the University.

In these circumstances the department seeking to purchase the goods or services must justify the

Sole or Single Source procurement decision by completing the Single/Sole Source Justification

Form.

Approved Sole Source requests that are attached to a contract will be good for the initial term of

that contract only. Amendments or extensions to the contract may need to be supported by a new

Sole Source request.

5. Consortium Partners

The University is a member of various procurement consortium partnerships that allow the

University to take advantage of favorable negotiated contracts with suppliers. Since these contracts

have already been through the competitive bidding process, vendors through consortium partners

can serve as a source for procuring goods and services or for researching and comparing pricing

for bids. See as an example the New York State Office of General Services commodities contracts

listing.

6. Preferred Vendor Listing

The University has established set pricing and terms for certain vendors who provide goods and

services frequently purchased within the University. The use of these vendors is preferred and can

be identified through a preferred vendor listing. No bidding or sole source documentation is

required if a preferred vendor is used. The preferred vendor listing will be reviewed at least bi-

annually by Procurement to ensure that the University obtains the most competitive and favorable

rates.

7. Independent Contract Agreements

Independent Contractors are hired on an hourly basis to provide services to the University. The

University has the right to control or direct the result of the work done by an independent

contractor and not what will be done and how it will be done. Contracts must be used and shall

abide by the Guidelines for Evaluating and Engaging Independent Contractors at Mercy

University, and Independent Contractors shall only be hired in consultation with the General

Counsel and the Executive Director of Human Resources, as necessary. Mercy shall ensure that

services have been satisfactorily rendered by the independent contractor before final payment is

made. Contract owners are responsible for ensuring completion of services. Note that contractors

hired in connection with federal grants shall adhere to specific requirements set forth in the

Grants Management Handbook.

8. Established Term Agreements

Independent Contractors can be hired for term agreements to engage and complete numerous

specific projects. The agreement will be issued for a period of one year with the option to renew

for two additional years with the mutual agreement of the contracting parties. The maximum

aggregate amount for one year will be $200,000 for up to three years for a total maximum contract

value of $500,000 per Contract. The Purchasing Threshold Guidelines apply to these contracts.

B. Unauthorized Purchases

Purchases made without timely or appropriate departmental approval or university-approved

purchase order are deemed unauthorized. Timely is defined as having the required approval before

the order is placed, the service rendered, or the invoice received. Any person, regardless of their

purchasing authority, who makes an unauthorized purchase of goods and services may be

responsible for paying the total charges or cancellation fees associated with that transaction and/or

returning the product. Additionally, abuse of this policy could lead to the revocation of the

individual’s procurement authority, removal of access to procurement systems, and additional

disciplinary action up to and including termination of employment.

SECTION III: CONTRACT APPROVAL AND SIGNATORY AUTHORITIES

A. Policy Overview

No officer or member of the University community has the authority to sign contracts or indicate

acceptance of a proposed contract on behalf of the University, or its program, department, or

division without signatory authority or authority delegated by the President. Nor should contracts

should be entered into that do not align, or are in direct conflict, with the mission of the University.

B. Administrative Review and Approval

All procurement contracts to purchase goods or services (Business Transactions) for the University

must be submitted through the procurement system for proper contract application, administrative

review, and approval. No procurement contract except for micro-purchases should be signed or

executed outside this process. Contract owners should ensure that there is no performance under

the contract, acceptance of any terms, or signatures on a contract before it has been

administratively and approved through the procurement system.

Unless expressly noted or a pre-approved contract template is used without any substantive

changes, all contracts or leases that do not get processed through the procurement system (such a

micro-purchases) must be sent to the Office of General Counsel for review. Review by the General

Counsel’s Office shall be limited to those provisions which are legal in nature, pose a substantial

risk to the University or are new, non-standardized clauses which the initiating departments’

representative is not familiar and/or comfortable with. The Contract Initiator should review the

contract before sharing it with the General Counsel’s Office.

C. Delegation of Authority by the President

The following employees have signatory approval: the President, the Provost, the Chief Financial

Officer, the Chief of Staff, and the Vice President of Operations & Facilities. The remaining vice

presidents and staff officers, as well as deans of each school, shall have signatory approval to bind

the University in the limited circumstances set forth in Section D below.

Temporary delegation requests are made for those with contract authority who are unable to

complete their responsibilities due to vacation, leave of absence, illness, etc. Temporary

delegations require formal approval from the President and must be made known to the General

Counsel.

No officer or member of the University community may sign or otherwise execute a contract that

binds the University or its schools or departments unless they have been delegated signature

authority as set forth in thus Policy. Contracts signed by officers or employees without written

signature authority may be deemed void. Individuals in such circumstances may be personally

liable for the obligations assumed under such contracts and be subject to disciplinary action,

including termination of employment.

D. Contract Thresholds for Review, Approval and Signatory Responsibilities

Contract Type and

Value

Approval Authority

Signatory Authority

Special Procurement

Contracts Under

$200,000

Any contracts or agreements

with a value under $200,000

must be reviewed by legal

counsel if is not a standard

contract (i.e. template

approved in advance by legal

affairs) and approved by the

Vice President for Operations

and Facilities.

Contracts or agreements

in value under $200,000

will be signed by the Vice

President for Operations

and Facilities, or other

designated signatory as

needed.

Special Contracts Over

$200,000 (Construction

Over $250,000)

All contracts in value greater

than $200,000 ($250,000 for

construction projects) and up

to $1,000,000 must be

reviewed by legal counsel if is

not a standard contract (i.e.

template approved in advance

by legal affairs) and approved

by the Vice President for

Operations and Facilities.

Contracts or agreements

in value greater than

$200,000 (over $250,000

for construction projects)

will be signed by the Vice

President for Operations

and Facilities, or other

designated signatory as

needed.

Contracts over

$1,000,000

All contracts in value greater

than $1,000,000 must be

reviewed by legal counsel and

approved by the Vice

President for Operations and

Facilities.

Contracts in value greater

than $1,000,000 will be

signed by the President.

Contracts over

$2,000,000

After review by legal counsel

and the Vice President for

Operations and Facilities,

contracts that either (1) exceed

$2 million in a single year or,

(2) have a multi-year term

with an aggregate value

After review by Finance

and Control, the contract

will be signed by the

President.

exceeding $3 million, or (3)

are outside the ordinary course

of business, shall require the

review of the Finance and

Control Committee of the

Board.

Grants, public funding

awards and academic

agreements, such as

partnerships, study

abroad MOUs, affiliation

and articulation

agreements, that bring

funding to the University,

are cost neutral, or cost

below $20,000

Review by legal counsel and

the relevant office impacted

Signed by the Provost

Clinical affiliation

agreements

Review by legal counsel (or

use of pre-approved template)

Signed by the Dean of the

relevant school

Funding and partnership

agreements, such as

MOUs relating to

partnerships with external

entities (for admission

discounts, international

recruitment, workforce

partnerships, agreements,

engagement letters, etc.)

Reviewed by legal counsel (or

use of pre-approved template)

and the Provost’s Office if

there is any academic

component

Signed by the relevant

department Vice

President/Staff Officer

SECTION IV. INSURANCE REQUIREMENTS

In most transactions involving the purchase of services, provision of services and professional

services, clinical partners, etc., proof of insurance is required, either from the outside party or by

the outside party, depending on the nature of the services.

A. Certificate of Insurance Required by Outside Parties

Mercy University is often requested by outside parties to provide proof of insurance evidencing

the University’s insurance coverage. Requests for Certificates of Insurance (COI) must be made

in writing, with the specific insurance requirements, to the University’s General Counsel’s Office.

B. Certificate of Insurance Required by Mercy University

Contractors, suppliers, or other outside parties who will be performing work for or services to the

University, or using University facilities, are required to enter into a contract reflecting the

insurance and relevant indemnification requirements, and to provide evidence of the insurance

required by the University.

SECTION V. ETHICS AND CONFLICT OF INTEREST

The procurement of goods and services should comply with all applicable federal laws, and the

University’s policies and procedures, including the Conflict of Interest and Gifts Policy for Faculty

and Staff. Procurement Services and the Director of Compliance, Ethics, and Privacy will review

all conflicts of interest with vendors.

SECTION VI. TERMINATION AND PERFORMANCE OF CONTRACTS

Contract owners should be familiar with the contract terms such that they can monitor performance

and ensure the vendor or other party is properly performing under the contract. The contract owner

is responsible to monitor performance under contracts after execution unless they designate

another Mercy faculty or staff member to monitor performance in their stead. If performance under

the contract is deficient or there is any conduct that would amount to a possible breach of the

contract, the contract owners should contact the signatory to the contract and the Office of General

Counsel in order to address the lack of performance and possible remedies.

Contract owners are responsible for reviewing and understanding any extension and termination

requirements in the contract to ensure the contract is properly extended or terminated at the end of

the term.

SECTION VII. IT SECURITY

Mercy University is committed to protecting its community members, partners, and clients

from damaging acts that are intentional or unintentional. The lack of supplier attention to

quality management could compromise Mercy University’s reputation. Lack of physical or

cybersecurity at supplier sites could result in a breach of corporate data systems or information

corruption.

Effective security is a team effort involving the participation and support of every vendor that

interacts with Mercy University data and/or systems. As such, all contracts that could have

potential IT security implications must be reviewed by the General Counsel and shall adhere

to the IT Vendor Risk Management Procedures, which establishes accountability, procedures,

and standards for the selection and management of vendors.

SECTION VIII. THIRD PARTY PROVIDER CONTRACTS

In addition, Mercy University is responsible for ensuring the quality, integrity, and transparency

of all activities conducted in its name, including services and educational programming delivered

by third-party providers (“TPP”). Under the University’s Third Party Provider Policy, Mercy is

committed to the thorough review of the quality and integrity of institutional services and programs

delivered through partnerships with TPP’s. As such, any contracts that could impact any academic

programs must be reviewed by the General Counsel and the Provost.

SECTION IX. RETENTION OF EXECUTED CONTRACTS

Once a contract for goods, services or construction projects is fully executed (that is, signed by all

parties to a contract), the employee initiating the contract is responsible for emailing a copy to the

Purchasing Director, who shall retain a copy. Employee initiating the contract shall also be

responsible for maintaining an executed contract for their department files. Academic and other

affiliation contracts, such as clinical contracts, are maintained by the department. The General

Counsel’s Office shall have access to all contract databases maintained throughout the University.