CSULB Purchasing Operations Manual
Section 2: Requirements Common to All Transactions
The contents of the following paragraphs apply to all procurement transactions, i.e., acquisitions of personal property (commodities) or services, edp (information technology) orders & contracts, and the sale, lease, license, and disposal of CSU personal property. In concert with the intent of the California Legislature, the requirements of this Section are intended to achieve the following objectives:
- to elucidate on law and policy with respect to competitive bidding requirements;
- to protect the public from the misuse of state funds;
- to provide all qualified bidders with a fair opportunity to enter the bidding process, thereby stimulating competition in a manner conducive to sound business practices and state fiscal policies;
- to prevent favoritism, fraud, and corruption in the awarding of state contracts.
PCC 10300, CSU Policy 200.
2.01 Defining Characteristics of Purchase Orders, Service Orders, and Contracts:
- A purchase order, once issued under proper authorization to a vendor who has been duly informed of the intent to buy a commodity offered at a specified time and price and under mutually-agreed-upon terms and conditions, is a legally binding contract. However, it differs from a contract (formal signed agreement) in that only one party (the issuer) is required to sign it. The issuer may, however, require the vendor to sign the purchase order if there are unusual conditions that appear to warrant it.
- A service order is an instrument that technically can be used in much the same manner as a purchase order (signed unilaterally by the issuer), except that a service rather than a commodity is proposed to be rendered to the requester. The issuer may opt to require that the provider sign the service order if there are unusual conditions that appear to warrant it.
- A contract is a formal agreement, signed by all parties who are to be bound (legally) by its terms and conditions. Contracts can be issued for any number of purposes, but usually the purpose is to acquire a service or commodity from a provider in exchange for some form of consideration (usually money). The Standard Agreement form is commonly the instrument used by CSULB for such a contractual purpose.
PCC 10300 et seq.; CSU Policy 300, 400, 406; PSS 97-15.
2.02 Competitive Bidding:
The promotion of fair and open competition by the university in the acquisition of goods and services to meet its needs is indispensable to maintaining its operational health. Not only does it normally result in the best use of the university’s limited financial resources, but by preventing favoritism it provides a professionally viable and comfortable climate in which the Purchasing Office may conduct its business. When properly implemented, it achieves optimal benefits to everyone involved, including the general public in regard to the best use of the university’s budget as appropriated by the California Legislature.
There are numerous ways to promote fair and open competition. They include, but are not limited to, public advertising for bids or proposals through daily or weekly newspapers of general circulation; trade or specialty publications; the use of the California State Contracts Register (CSCR); direct notifications to known vendors & service providers; initiating outreach programs, an extensive use of vendor & contractor source files for bidding purposes, and simple telephone calls to obtain informal quotes.
The use of “bidder lists” for categorical product or services solicitations is good practice. Such lists are to include the most recent provider (if any) as well as those who have responded to past advertisements or notices issued for the same or similar products or services.
Whenever the lowest responsible bid for the award of an order or contract must be rejected as the result of disqualification of the bid or the bidder, a formal rejection notification must be sent to that bidder by telegram or telefax . When sent by fax, the transmission receipt must be placed in the bid file and the notification mailed with a “Return Receipt Requested.” Twenty-four hour notice, excluding Saturdays, Sundays, and legal holidays, is required to be given to the disqualified low bidder before an award may be made to the next lowest responsible bidder.
The decentralization of purchasing authority on campus for low-dollar acquisitions carries with it a tacit and continuing responsibility to use the campus’s dollars wisely. Obtaining competitive bids, even informal ones for comparative purposes, is the surest way to “get the best bang for the buck” and to help keep a departmental budget in the black.
There are occasions when the solicitation of competitive bids is impractical or inadvisable. These are exceptions to the rule. They include the following:
- In cases of emergency where a contract is necessary for the immediate preservation of the public health, welfare, or safety, or the protection of CSU property and programs;
- The proposed contract is with a State or federal agency, a local government entity, or an auxiliary organization of the CSU;
- Contracts for which only per diem and travel expenses are paid and there is no payment for services rendered;
- Contracts for the express purpose of obtaining non-CSU legal counsel or of obtaining expert witnesses for litigation (either of these must be submitted to the Office of General Counsel at the Chancellor’s Office for approval).
- Contracts with business entities operating handicapped workshops which meet the criteria stated in Section 19404 of the Welfare and Institutions Code;
- Contracts that have been certified by an authorized campus official to (a) be non-biddable (products or services being available from a single source only), or (b) best serve the interests of the CSU by not being subjected to competitive bidding.
PCC 1103, 10300 et seq., 10430(c), 12100 et seq.; CSU Policy 201, 202; PSS 95-29, 96-27.
2.03 Solicitation Methodologies:
The selection of a vendor or contractor to satisfy a university need is not necessarily based upon the lowest responsible bid or quote received. While this certainly must be a prime criterion, the quality of the product or service, provider reliability, warranties, and several other factors also can (and often should) enter into the decision to award an order or contract. By and large, awards are based upon either of two different solicitation approaches: (1) An IFB (invitation for bid) based upon the acceptance of the lowest responsible bid for a product that has been fully described with detailed specifications accompanying the solicitation, or (2) An RFP (request for proposal), awarded on the basis of the highest score attained from an evaluation process. The RFP conveys essentially what is needed but leaves the detailed specifications to the proposers.
A “best value” (or “value-effective”) solicitation uses the premise of the RFP. It is normally employed for the acquisition of a large-scale system or complex program requiring an expansive array of criteria (in addition to the cost) to be considered for the award of the contract. Such criteria may include, but are not limited to such things as the quality of the product or service; estimated operational costs; previously demonstrated technical competency of the provider; financial stability and anticipated long-term reliability of the provider; terms & conditions of the warranties, guarantees, returns/refunds; and the quality and viability of the proposal itself. These and other criteria may be assigned weighted value for purposes of the evaluation. The criteria and corresponding weight factors must be disclosed to the proposers in advance, by including them in the solicitation.
A “multi-step” procurement provides a structured method for discussing alternative solutions to the campus’s requirements and to obtain bids or proposals that are responsive to these requirements. It is appropriate whenever the campus finds it desirable to solicit, review and discuss preliminary proposals, particularly when more than one solution might be acceptable. This method of solicitation permits ongoing confidential discussions with bidders and an opportunity for the solicitation document to be revised as the discussions ensue. Once the discussions have ended and the best approach to a solution has been determined, a formal solicitation document is issued. Ultimately the best offer will then receive the award.
“Negotiated competition” is an award method that allows an open and flexible environment (once the proposals have been received and evaluated), in which to arrive at an agreement about all aspects of the system or project, including a best and final offer from the proposer who submitted the proposal that received the evaluation with the highest score. If the details cannot be agreed upon or if the best and final offer is not acceptable, the campus can then elect to negotiate with the proposer who had the next-highest scored evaluation, etc.
A “Request for Quotation” (RFQ) may be utilized to obtain price quotes for products or services whenever (a) the estimated cost is less than the threshold established in policy for acquiring formal bids, and/or (b) the terms and conditions of the transaction, if any, may not be significant enough to require both parties to sign a formal agreement (in which case a purchase order or service order could be more appropriate than a contract).
A “Request for Information” (RFI) is used to determine whether there is market availability or interest in satisfying a specific campus need or providing the solution to a given problem expressed within the RFI. The issuance of an RFI to prospective providers may serve as a preliminary step to the issuance of a formal bid invitation, if multiple encouraging responses are received.
PCC 1103, 10300 et seq., 12100.7; CSU Policy 203.
2.04 Limits on Competitive Bidding (use of Sole Source, Sole Brand, “Or Equal” clauses):
Generally, no agency or employee of the State of California may draft, or cause to be drafted, any specifications for bids in connection with the purchase of supplies or materials in such a manner as to limit the bidding to any one bidder. Likewise, no invitation for bid or request for proposal may be drafted, or be caused to be drafted, for services in such a manner as to limit the bidding to a single bidder. Under California law, any purchase or contract awarded under such conditions is void.
Aside from the legally-permitted exemptions from the solicitation of competitive bids (such as defined emergencies and other circumstances recognized under California statutes), there are obviously occasions when only a single source (or a single brand) exists or is suited to accomplish the need at hand. When this is the case, documentation is required to show why a non-competitive award must be issued. Such documentation is termed “justification.”
Except in cases where a product of a specified brand name is the only product that can properly meet the needs of a requester, the drafting or application of specifications or bid requirements that directly or indirectly limit the bidding to a single brand is prohibited. A “brand name or equal” is a competitive process that allows bidders to propose equivalent items.
A sole source procurement is permissible only when a determination has been made and approved in writing, that only one source exists for the required product or service. A requirement for a proprietary (or sole brand) item does not necessarily justify a sole source procurement, as more than one potential bidder or supplier may exist who can supply that item.
The determination as to whether a procurement has been adequately justified in writing for a sole source award shall be made by the designated authority. For sole source purchases of $250,000 or greater, a copy of the requisition, the justification, and other pertinent documentation, must be forwarded to the Chancellor’s Office CS&P for review and approval prior to execution of the contract.
A request for a sole source acquisition must include a written justification explaining why the sole source is necessary to satisfy the needs of the requester. The justification shall include the following information:
- The unique performance factors required;
- Why these factors are required;
- What other sources have been considered, rejected, and why.
The CSULB Purchasing Office provides an on-line Sole Source/Sole Brand Justification Form for campus use. A completed Form is required for sole source/sole brand requests that entail commodity expenditures of $10,000 or more or services for $50,000 or more. The adequacy of the information provided by the requester is evaluated by the Purchasing Office prior to its acceptance. Sole source requests for acquisitions between $10,000 and $100,000 require the approval of the campus Procurement Officer (or a designee). Sole source requests for expenditures of $100,000 up to $250,000 additionally require the approval of the campus Associate Vice President for Financial Management. For expenditures of $250,000 or more, further approvals are necessary from the campus Vice President for Administration & Finance and the Chancellor’s Office.
PCC 10318, 10339; CSU Policy 206, 210.07; PSS 94-13, 95-27, 95-48, 96-16, 98-03.
2.05 Exclusion of Vendors or Contractors from Bidding:
A vendor or contractor may be removed or suspended from a campus’s list of potential bidders and be prohibited from participating in any of the campus’s bid processes if there has been a failure without good cause to perform in accordance with the terms of a past contract with CSULB, another CSU campus, or with any other governmental entity. It may also be removed or suspended if its performance with respect to a previously awarded purchase order or contract has been unsatisfactory. Such exclusion must remain in effect for at least 90 days after the unsatisfactory performance has been recorded, but shall not exceed a period of 360 calendar days in duration. A vendor or contractor excluded from bidding shall be relieved of the prohibition at any time after the 90-day minimum period, upon demonstrating to the campus’s satisfaction that the problems that resulted in the removal or suspension have been corrected.
PCC 10303, 12102; CSU Policy 213.02
2.06 Standard Purchasing/Contracting Forms:
CSU system-wide purchasing and contracting forms are available for campus use from the Contracting Resource Library (CRL) website
A variety of special purpose campus-produced forms also used for purchasing and contracting functions are maintained by the CSULB Purchasing Office. Many can be found and reproduced from the campus’s internet website
CSU Policy 409, CSU CRL; PSS 97-19, 98-04.
2.07 General Provisions for Acquisitions of Commodities and Services:
Under California Law and Trustees’ Policy there are specific minimum terms and conditions (referred to as “General Provisions” by the CSU) to which a vendor or contractor must agree in order to do business with the State or the CSU. These provisions differ somewhat, depending upon whether the intended acquisition is a product or a service. There are formal General Provisions required for each. They are displayed as Exhibits on the CS&P internet website
PCC 10307, 10351(2); CSU Policy 410, CSU CRL.
2.08 Use of Electronic Transmission and Telefax:
The campus is authorized, under California law, to enter into and make payment on contracts by way of electronic transmission (such as e-mail, telefax, electronic data interchange) including, but not limited to, the issuance of solicitation documents and receipts of responses thereto. Electronic transmission methods are also authorized for the required notification to an apparent low bidder that a different bidder is receiving the award. Formal bids or proposals are authorized via electronic transmission, provided that appropriate measures are employed to protect the confidentiality of the sealed bid requirement. Finally, responses to protests, disputes, and complaints are authorized under Trustees’ policy to be transmitted in this fashion.
PCC 1600; CSU Policy 226; PSS 96-27.
2.09 Electronic Purchasing System on Campus:
The on-campus automated electronic purchasing system permits campus requesters of commodities and services to construct on-line requisitions and submit them electronically to the Purchasing Office. It also permits users to make electronic inquiry of the status of their requisitions and orders. Once the Purchasing Office has received an electronic transmission of a requisition, it can convert the requisition to a purchase order or contract with comparative ease. The System has the advantage of being able to validate on-line budget account numbers, thus eliminating errors that might otherwise be made if users had to copy their numbers into the account blocks. The System may also be used to electronically transmit sole source/sole brand justifications to the Purchasing Office on acquisitions up to $10,000.
PSS 93-01, 93-03, 93-05, 93-12, 95-31, 95-48, 96-09.
2.10 Vendor & Contractor Bidder Files:
To support the principle of open and fair competition, and to make possible the quick identification of known product or service sources, the CSULB Purchasing Office maintains active vendor and contractor files on all products & services that are likely to be requested for the purpose of conducting the university’s business and for carrying out its educational responsibilities.
PCC 10302, 10303; CSU Policy 213.
2.11 Abbreviations used in Electronic “Vendor Create” Data Fields:
The campus electronic purchasing system permits Purchasing Office staff to make abbreviated entries in the “vendor create” blocks of on-line requisitions to identify the general category of commodity or service being sought by the requester. Using a “sort” function, the abbreviated entry can then be utilized to interface with commodity (and service) codes already recorded in vendor and contractor bid files. This procedure permits easy identification of potential providers of the product or service for the purpose of establishing a bid list or of simply identifying alternative sources.
PSS 94-03, 94-29.
2.12 Requisitions (on-line and hard copy) Processing:
The campus electronic purchasing system permits requesters within all on-campus instructional and administrative offices to prepare on-line requisitions for electronic transfer to the Purchasing Office to be processed and transformed into a purchase order, a contract, or a service order. The requester is expected to complete information in the data fields that identify such things as the kind of commodity or service desired, the estimated cost, a suggested provider (if one is known), the timeframe for delivery or completion, the requester’s department name, the account number to be charged, the name of the person making the request, and an electronic signature of the person authorized to approve the expenditure from the account. Hard copies of requisitions may optionally be prepared by requesters. These can be submitted to the Purchasing Office with the same general information on them, albeit with the authorized approval signed in ink.
When a requisition in either electronic or hard copy form is received by the Purchasing Office (if a hard copy, it is date-stamped or otherwise recorded as to the date it is received), it is checked for adequate funding under the account number(s) designated and previously approved by the requester’s department. Next, it is assigned to one of the staff members in the Purchasing Office for further processing. This entails the designation of a variety of coding requirements and other information that is generally required in obtaining commodities or services from an outside source. If an error is discovered on the requisition, it must be rejected until a correction is made by the requester. Some corrections can be made via telephone, but some cannot and must be returned or electronically re-transmitted back to the requester. Once the requisition is accepted, provider sources (including any suggested by the requester) are researched, identified, and possibly contacted. If the estimated or quoted cost is within the limits of an informal acquisition then a purchase order, contract, or service order may be prepared and issued to the provider who appears to be the best source. If the estimated cost necessitates formal bidding, the assigned staff member must make arrangements to issue a formal bid solicitation or a Request For Proposal. Bids and proposals that are received within a specified deadline are then evaluated to determine which provider will receive a purchase order or contract award. The requester can use the electronic purchasing system to query the status of the requisition at any time.
Deadlines for the submittal of requisitions (both electronic and hard copy) are established toward the end of each fiscal year by the Associate Vice President for Financial Management. These deadlines are outlined in an annually-prepared Financial Management Calendar. The purpose of this Calendar is to accommodate year-end closing activities in an orderly fashion. Requisitions submitted after such deadlines have passed may be rejected and returned unprocessed to the requester.
PSS 93-04, 93-05, 93-11, 95-25, 96-12.
2.13 Signature Verifications:
The Purchasing Office visually inspects approval signatures on hard copies of requisitions and other procurement documents that are submitted for processing. For documents submitted electronically, the inspection of signatures is performed automatically by the electronic purchasing system.
PSS 93-09.
2.14 Blanket Orders for Commodities or Services:
These are primary source agreements designed to accommodate campus needs on an on-going basis for a specified period of time. An agreement of this kind is sometimes referred to as a “Requirement Contract.” It encompasses a class or category of goods or services in which a vendor or contractor specializes and can readily furnish upon demand. The agreement generally establishes the prices, effective term, general provisions (administrative requirements), any special terms & conditions, a total cost-not-to-exceed for the effective term, order-placing authority, shipment procedures, discounts or prompt payment allowances, and an option to extend the effective term (if mutually desired). Quantities or minimum sales are not normally specified.
The campus must obtain a receipt at the time of any individual sale under the agreement. Such receipt must reference the blanket order number. Summary invoices must be submitted to the campus periodically, confirming the sale and delivery of the goods or services.
Blanket Orders must be competitively bid unless the specified cost-not-to-exceed amount is less than $10,000 (for commodities) or $50,000 (for services), or unless a sole source justification has been approved by the Purchasing Office. Change Orders to increase the amount (or to extend the effective term if so provided in the original agreement) may be executed by mutual consent, as long as the $10,000 (for commodities) and the $50,000 (for services) cost limitations are not exceeded on the Blanket Order. When practical, new bid solicitations are encouraged in lieu of Change Orders so that the campus may continuously benefit from market competition.
CSU Policy 204.03; PSS 95-36, 96-15, 97-04.
2.15 Direct Payments to Outside Providers (no P.O. or Contract):
Direct payments are made for commitments or obligations for which little or no value can be added by processing the transaction through the standard procurement procedures. Such payments are processed by the campus Accounts Payable Office and are not supported by the issuance of purchase orders, service orders or contracts. Invoices are sent by the provider directly to the approving authority. The approving authority date stamps the invoice when received, ensures appropriate signatures, attaches a completed Direct Expense form, and forwards the form and invoice to the Accounts Payable Office. Examples of such commitments or obligations may include but are not limited to expenses for: public utilities, guest speakers, accreditation fees, room rentals, rebates & reimbursements, books, subscriptions, publications, registration fees, and membership dues.
CSU Policy 227.
2.16 Multi-Year Contracts:
Contracts extending into future fiscal years must include a provision stating that continuation of the contract is subject to the appropriation of funds by the California Legislature. The following is an example of this provision:
“If the term of this contract extends into fiscal year periods subsequent to that in which it is approved, such continuation of the contract is subject to the appropriation of funds for such purpose by the California Legislature. If funds are not appropriated, Contractor shall relieve CSULB of any further obligation for payment under the contract, and may remove all equipment furnished thereunder.”
A special coding designation of “M” within the electronic system’s status field is applied by the Purchasing Office to all multi-year contracts. This permits a sort and a separate computer-generated master listing of them to be printed at any time. The listing shows the subsequent fiscal years in which each multi-year contract has been identified to encumber funds. It also shows the amount each year to be encumbered. Any purchase order, contract, or service order that is intended to be kept “active” during subsequent fiscal years must contain a “holding line” entry in any monetary amount of 1 cent or more for each of the fiscal years it is to be left open (this is an idiosyncrasy of computer functionality).
CSU Policy 208; PSS 94-27, 94-36.
2.17 CSU Master Agreements:
CSU Master “enabling” Agreements are instruments of a pooled purchase or consortium solicitation whereby all CSU campuses, including CSULB, may participate and take advantage of volume-discounted acquisitions. The CSU can also enter into such Agreements on a cooperative basis with select external organizations (such as other universities or public entities) wherever no conflicts exist in the laws, policies, and regulations that govern the respective contracting/purchasing operations. A directory for all CSU Master Agreements, CSU site licenses, pricing for computer software and subscription databases is maintained at the website.
Master Agreements contain instructions for entering into a sub-agreement at the campus level. To do this, generally, a separate Purchase or Contract ordering document is prepared and executed by the campus. The ordering document must contain any appropriate attachment, rider, or cost schedule, and show reference to the Master Agreement by name and number.
CSU Policy 204.03; PSS 95-43.
2.18 Pricing Agreements & Schedules:
These are provided by vendors and are negotiated to take advantage of a vendor’s best pricing to the CSU or to CSULB. Such best pricing is based upon an estimated aggregate volume of the product(s) sold to the CSU or CSULB, either in the past or in the future. However, the vendor does not receive exclusive rights to sell the product(s) to the university. A Pricing Agreement or Schedule may be used anytime a formal bid solicitation is not required. It may also be employed to permit a comparison of prices, as informal bids or quotes are collected from other potential providers. A vendor’s Pricing Agreement or Schedule may not be used as a substitute for the competitive bidding process required in formal solicitations. If, however, the Agreement or Schedule prices are shown to be lower than the bids received from other potential providers at the conclusion of the formal process, the university may document the bid results and opt to use the vendor with the Pricing Agreement or Schedule.
CSU Policy 204.03; PSS 95-37.
2.19 State Contracts:
The State Department of General Services (DGS) negotiates State contracts and master agreements for commodities and services that generally represent the best value to the university. They are to be used whenever appropriate. The availability of a commodity or service under contract with the State can be determined by a Purchasing Office staff member by referencing “The Checklist of Effective State Contracts and Price Schedules.” If substantial savings are realized through the use of a State contract then it is preferable to use the State contract.
A California Multiple Award Schedule (CMAS) is an agreement established between the DGS and vendors already contracted with the federal General Services Administration (GSA) and who agree to the State of California terms & conditions as imposed by the DGS. The CSU and CSULB campus may use a CMAS without obtaining further competition. Offers from small businesses that have established CMAS contracts shall be given first priority.
The use of a DGS-negotiated State contract (inclusive of California Multiple Award Schedules, Price Schedules, etc.) requires a fee of approximately 2% to be paid to DGS. When a requisition is submitted to the Purchasing Office, the staff member assigned to the requisition will determine whether or not the request can be filled under a State contract. If so, the requester is notified and requested to identify an account against which the DGS fee may be charged. The amount of the fee can be determined by reference to the “DGS Price Book.” Requisitions will not be processed until the DGS fee is determined and funded.
The DGS fee is kept separate from the encumbrance for the order. The reason for this is to avoid the necessity of leaving orders open for extended periods of time awaiting receipt of DGS billings. These billings can take place well after the orders themselves have been fulfilled. Instead, as a requisition undergoes conversion into a purchase order (or contract), a DGS fee form is prepared and completed by a Purchasing Department staff member and is submitted to the campus Budget Office for temporary funding and further processing. A copy of the fee form is also attached to the file copy of the order maintained in the Purchasing Office, and still another copy is transmitted to the requester. Once the Budget Office is notified that the DGS billing has been received, it instructs the Accounts Payable office to make payment and a direct charge is eventually made against the account originally specified by the requester on the requisition.
CSU Policy 204.03, 225; PSS 94-34, 97-17.
2.20 General Services Administration Contracts (Federal):
The GSA, representing the federal government, periodically establishes agreements with multiple vendors for the purpose of acquiring goods and/or services under specific prices, terms and conditions. Since these agreements are issued under a competitive process, the campus may award a contract to a vendor having such an agreement without further competitive bidding, but only if the vendor is willing to extend the same GSA prices, terms and conditions to the campus while agreeing to any additional terms and conditions that may be imposed by the campus. Once a requisition is received, the Purchasing Office staff member assigned to it may determine that a vendor (or service provider) will permit the order to be filled using a GSA agreement. If permission is granted, and a lower price would result in filling the order in this way, the requester shall be notified that the GSA agreement will be utilized.
CSU Policy 204.03; PSS 95-12, 95-14.
2.21 Use of the State Department of General Services (DGS):
The Department of General Services (DGS) offers a variety of services that are available to all State agencies, including the CSU. Chaptered legislation specifies that:
“If the California State University (CSU) determines that greater efficiency would be served by contracting with the Department of General Services (DGS) or another department or agency of the State for the performance of any service or function, the DGS or other department or agency shall contract with the CSU to perform the service or function.”
CSU Policy 225.
2.22 Small Businesses and the Office of Small Business Certification & Resources (State):
CSULB supports the spirit of the Legislature’s declaration as set forth in the Small Business Procurement and Contracts Act (G.C. 14835 et seq.):
The State is required to aid, counsel, assist, and protect, to the maximum extent possible, the interests of small business concerns in order to preserve free competitive enterprise and ensure that a fair proportion of the total purchases and contracts or subcontracts for goods & services for the State be placed with such enterprises;
To provide small businesses an opportunity to request a 5% bid preference, a Small Business Preference Form or equivalent advisory statement shall be included in all bid solicitations for the procurement of goods and for service agreements. Evidence of certification by the State Office of Small Business Certification & Resources (OSBCR) – usually via a copy of the OSBCR approval letter – is required from the bidder in order for a bid preference to be granted.
The definition of a Small Business includes the following:
- An independently owned and operated business;
- Not dominant in its field of operation;
- The principal office is located in California;
- The officers are domiciled in California;
- Together with affiliates is either
- a service, construction or non-manufacturing business with 100 or fewer employees, and average annual gross receipts of ten million dollars ($10,000,000 or less over the previous three years);
- a manufacturer with 100 or fewer employees.
In order to comply with the requirements of the Small Business Procurement and Contract Act, each campus (including CSULB) must report to the OSBCR quarterly on the number and dollar amount of contracts and purchase orders awarded to small businesses. This Report is to be sent directly to OSBCR, with a copy to CS&P in the Chancellor’s Office. The CSULB Purchasing Manager has been designated as the Campus Small Business Coordinator and is responsible for this function as well as the promotion of all Small Business outreach activities and the coordination and reporting of such activities performed on campus.
A Small Business Advocate has been established in the CS&P Department at the Chancellor’s Office and serves as a single point of contact for small businesses and campus coordinators, as needed. The Advocate’s responsibilities include:
- Making information about pending solicitations available to State-registered small business firms that are capable of meeting the CSU’s business needs;
- Actively soliciting offers for goods and services from small business firms;
- Helping ensure that prompt payments are made to small business firms that have provided goods or services to the CSU.
Gov. Code 14835; CSU Policy 216; PSS 99-03.
2.23 Disabled Veteran Business Enterprises (DVBE) and Activity Reporting:
A DVBE goal of 3% of total expenditures has been established which provides the overall percentage of dollar amounts expended each year by the campus for contract awards, including purchase orders. An quarterly activity report shall be prepared and submitted by the Purchasing Office to the CS&P Department of the Chancellor’s Office for systemwide consolidation, and then transmitted to the Governor’s Office. Bidders for EDP-related contract awards and for purchase order awards may opt to submit a “Utilization Plan” in lieu of meeting the 3 percent participation requirement. Utilization Plans are described in the Public Contract Code, Section 10115.15.
PCC 10115 et seq.; Title 5, Sec. 43870 et seq.; CSU Policy 215.
2.24 Target Area Preference Act:
Any California-based company submitting a bid or proposal to the State (including the CSU and CSULB) for goods to be produced or services performed at worksites in distressed (as defined in Gov. Code 4530) areas by persons with a high risk of unemployment are entitled to a 5% bid preference whenever the contract award is in excess of $100,000. The 5% preference is applicable only to contracts awarded on the basis of lowest responsible bidder meeting specifications.
Gov. Code 4530; CSU Policy 217.
2.25 Enterprise Zone Act:
A business may be granted a 5% bid preference when bidding on any State (including CSU and CSULB) contract of $100,000 or more for goods and services (excluding construction contracts) if the business site is located within one of 34 distinct “Enterprise Zones” located throughout California, as designated by the California State Trade and Commerce Agency. Enterprise Zones are designated to encourage job-producing business development in specified sections of cities or counties. The 5% bid preference is applicable only to contracts awarded on the basis of lowest responsible bidder meeting specifications.
Gov. Code 7070; CSU Policy 218.
2.26 Prison Industry Authority:
The State and its agencies (including the CSU and CSULB) are required to procure any available goods or services produced by the Prison Industry Authority (PIA), unless specifically waived by the PIA. It is the responsibility of the campus Purchasing Office to contact PIA regarding acquisition of the type of goods or services listed in the PIA Catalog or within any of its update announcements.
Penal Code 2807; CSU Policy 224.
2.27 Vendor Data Record (State Form 204):
A State Standard Form 204 must be completed by each vendor or contractor (except for a State or other governmental entity) doing business with the State of California. The Form is provided to the vendor or contractor by the Purchasing Office and must be completed, signed, and returned to the campus Accounting Office before payment is rendered. This requirement relates to the taxed earnings reporting requirements (Form 1099) that must be filed by the university. The Accounts Payable division of the Accounting Office collects the completed forms.
Revenue and Taxation Code 18637; CSU Policy 213.01; PSS 92-11, 94-07, 95-07.
2.28 Non-Discrimination:
All contracts of $5,000 or more must contain a clause stating that the contractor, by signing the contract, certifies under penalty of perjury that the non-discrimination requirements of Government Code Section 12990 et seq. have been met, unless exempted under Title 2, Section 8115 of the California Code of Regulations. These are requirements that must be met by all vendors and contractors who wish to do business with the State. This required clause is included within the CSU General Provisions that must be incorporated into all formal P.O. awards of $10,000 or more and in contracts of at least $50,000. For awards of less than these amounts a special State Standard form (17A) is available. It contains the required non-discrimination language, references Gov. Code 12990, and can be used for this purpose.
Gov. Code 12990; CSU Policy 220; PSS 92-24.
2.29 National Labor Relations Board Compliance:
All contracts of $5,000 or more must contain a clause stating that the contractor, by signing the contract, certifies under penalty of perjury that contractor has not violated the provisions of Public Contract Code section 10296 regarding the issuance of orders by the National Labor Relations Board (NLRB). This requirement applies to all State agencies, and includes the CSU and CSULB. This required clause is included within the CSU General Provisions that are normally attached to all formal awards. For awards between $5,000 and the formal bid award thresholds, reference must be made to the requirements stated in PCC 10296.
PCC 10296; CSU Policy 221.
2.30 Audit of Contract Required Clause:
A notification to the contractor is required on all contracts exceeding $10,000 that such contracts are subject to an audit of the Office of the University Auditor and State Auditor for a period of three years after final payment has been made.
Gov. Code 8546.7; CSU Policy 222.
2.31 Drug-Free Workplace Certification:
State contractors and recipients of State grants are required to maintain a “drug-free workplace.” A campus may suspend payments under a contract or grant or terminate the contract or grant, or both, if a contractor or grantee has failed to comply with the legal requirements contained in Government Code Sections 8355, 8356, and 8357.
Gov. Code 8355-8357; CSU Policy 223.
2.32 Community Rehabilitation Programs & Workshops:
Any State agency, including the CSU and CSULB, may acquire commodities and services from a public or private nonprofit California corporation operating a community rehabilitation program or workshop serving persons with disabilities (including blindness) without posting a public notice or soliciting competitive bids, provided that the acquisitions are documented to meet specified needs of the agency (or campus), are obtained at a fair market price, and are made convenient to the agency (or campus) to obtain.
Welfare Code 19403, 19404; CSU Policy 219.
2.33 Funding Source Designations:
A requester must designate an appropriate funding source on a requisition before it can be processed by the Purchasing Office. The funding source must also be one that is under the authorized control of the person who signs the requisition. It may be changed upon request to the Purchasing Office, even after the requisition has been converted to a purchase order or contract. However, once an invoice has been processed against the order or contract, the funding source can be changed or corrected only by the University Accounting office via an accounting journal entry.
PSS 95-16.
2.34 Requisitions against Trust Accounts:
Any completed requisition that is intended to utilize a Trust Account number for its funding source must clearly display the Trust Account number in the funding source field in order to differentiate it from General Fund appropriations that may otherwise routinely be used. Processing of the requisition may then follow the regular processing steps with no other special designations being required.
PSS 92-04.
2.35 Requisition Log (formal):
The Purchasing Office will maintain a log of requisitions received, with entries recorded daily as requisitions are submitted. The requisitions, in either hard copy or electronic form, are date stamped as they are received in the Purchasing Office and entries are made in chronological order within the Requisition Log. If a requisition must be rejected for any reason, it is so noted in the Log and then returned to the requester for corrections or other appropriate actions to be taken, as instructed by the Purchasing Office staff member who has been assigned to the requisition.
PSS 93-07.
2.36 Requisition Logs (informal):
Each staff member of the Purchasing Office who is assigned responsibility for processing requisitions shall maintain daily an informal log of requisitions personally assigned for processing that day. The purpose for this is to ensure that data is not lost due to a major error occurring in the electronic purchasing system’s backup process during the day. In other words, the staff member will have retained this informal log so that nothing of major significance should be lost. The informal log will record the date on which the requisition was received, the requisition number (also the P.O., contract, or service order number if one has been assigned), and a note as to any action taken on the requisition that day.
PSS 93-10.
2.37 Requisitions not logged by Purchasing Office:
Occasionally a requisition received by the Purchasing Office is discovered not to require conversion into a purchase order, contract, or service order, at all and therefore does not need to be recorded in the formal log. However, the Purchasing Office staff member assigned to process the requisition should enter it into an informal daily log until the requester has been advised whether or in what manner the request will be processed. Often the request can be filled by campus stores or treated as a Direct Expense. Examples of requested acquisitions of this kind may include subscriptions, memberships, books, office supplies, forms, or other requests that can be accommodated by campus service areas.
PSS 93-08.
2.38 Requisitions for Subsequent Fiscal Years:
Requisitions submitted to the Purchasing Office that call for commodities or services to be purchased with funds budgeted for the following fiscal year must be submitted as a future-year requisition and be clearly identified as such with the following fiscal year’s designation plainly marked on it.
PSS 96-08, 96-09.
2.39 Requisition Status Reporting:
An “Open Requisition Report” showing the current status for all requisitions received in the Purchasing Office is prepared bi-monthly by the Purchasing Office. This Report is made available to Purchasing Office staff both in hard copy form and on-line as part of the electronic purchasing system. Requesters outside the Purchasing Office have the capability and authority to view their own requisitions on-line from this Report.
An “Open Buyer Report” is also prepared generally twice per month, in both hard copy form and on-line, for viewing by Purchasing Office staff only. This Report shows the status of requisitions received by each of the staff members who are assigned requisition processing responsibilities. Each staff member receives a hard copy listing of their own requisitions in process.
PSS 92-02, 96-35.
2.40 Annual Year-End Deadlines for Submitting Requisitions:
Toward the end of each fiscal year, a notification is prepared and transmitted by the campus Office of Financial Management to advise requesters of the deadline(s) established that year for submitting requisitions. The Purchasing Office may also send out a notification or reminder. Deadlines may vary, depending upon the funding used and type of acquisition being requested.
PSS 96-12, 96-19.
2.41 Purchase Order and Contract Coding Designations:
There are various codes used on requisitions, purchase orders, contracts, service orders, and other instruments associated with acquisitions. These codes serve the important purpose of streamlining and speeding up the data collection function while accommodating the electronic sorts that must be performed to meet reporting requirements. They may be viewed on the “help” screen in the campus Electronic Purchasing System. A Code Book is used as the guide to these coding notations. The codes are applicable to acquisition documents processed in hard copy and electronic form alike. Given codes may undergo revision from time to time; therefore, it is essential that all individuals who have the responsibility for preparing and processing acquisition documents are collectively referencing the latest release of the Code Book.
PSS 93-03.
2.42 Commodity (and Service) Codes:
This is a special category of coding designation that pertains to every kind of acquisition, for products and services alike. Purchasing Office staff members assigned to process requisitions must place an appropriate commodity code in the designated data block of every requisition received, whether the requisition is processed electronically or in hard copy form.
PSS 97-09.
2.43 Change Orders to reflect Price Changes or Other Modifications:
Change requests to requisitions normally should be prepared on a “Change Request Form.” Name corrections, funding identification errors, or changes considered to be minor in nature, however, may be submitted on a memorandum, by edp transmission, or by other correspondence, from an authorized requester. Under any set of circumstances, all changes made to a requisition must be documented. Change requests that add money to a requisition are documented by use of the Change Request form unless the requisition has already been processed into a formal acquisition document. In that event, the requester may be advised to submit a new requisition for the additional money, referencing the earlier requisition by the number that was assigned to it. Major changes to a requisition often can be accommodated most readily by canceling it entirely and submitting a new revised requisition with a new identification number. If the earlier requisition has already been processed into a formal acquisition document and issued to a provider before the discovery of a needed major change, the Purchasing Office staff member assigned the responsibility for placing the order must be advised prior to a new or revised requisition being submitted.
PSS 92-03, 92-15, 94-18, 94-19, 94-28, 95-10, 95-38.
2.44 Zero Encumbrance Balance (No-Value) on Open Orders:
Encumbered purchase orders, contracts, and service orders with no-value remaining in the designated cost or price data fields cannot be held open. The computer software modules, by their programmed features, do not accommodate standing encumbrances without having price or cost figures connected to them. For an order to be kept open for further activity (such as on some multi-year contracts) the cost or price data block must contain a holding line figure of at least one (1) cent in value. One way to re-create or preserve some amount of value on an open order with zero balance is to submit a Change Order or Amendment before the order is closed, to reflect the requested services or commodities not yet received.
PSS 94-36.
2.45 Termination or Cancellation of Orders:
The words “termination” and “cancellation” are often interchangeable in use—both result in the closure of a purchase order, contract, or service order ahead of the time previously agreed upon by the parties. Generally, purchase orders or service orders (unilaterally-signed agreements) are “cancelled”, whereas contracts (bilaterally-signed agreements) are terminated.
Upon receipt of a request for cancellation, the Purchasing Office staff member originally assigned the requisition must make contact back with the requester to advise whether or not the request can be cancelled (if the contract or order has already been issued to a provider, it may not be recallable). If both the requester and the provider are willing to accept a no-cost cancellation, the cancellation may be processed. If there is a cost to cancel (e.g., a restocking fee, a return fee, etc.,) the cost must be brought to the requestor’s attention. If the cost is accepted, that cost must be covered either by a change order (Change Request Form) or a new requisition from the requester before a cancellation can be processed.
Many contracts have provisions that allow for termination for convenience by either or both parties to the contract. The provisions may call for termination with a specified number of days advance notice or may allow a party to terminate the contract when or if a certain event occurs. In most cases a notice of intent to terminate should be initiated, with the actual notice of termination following.
When a contractor fails to deliver supplies or provide services or otherwise substantially fails to perform the terms and conditions of the contract (this is termed a “default”), the campus may terminate the contract for cause in accordance with the termination clause (generally included in the CSU General Provisions) as stated in the contract. Instead of an outright default, however, the contractor may commit an anticipatory breach of the contract that justifies a termination, such as a notification to the campus that the goods or services cannot be delivered within the timeframe specified in the contract, that a product substitution will be delivered rather than the product specified, or that the cost will be more than that to which the two parties have agreed.
PSS 92-20, 95-33.
2.46 Split Funding of Orders:
Multiple funding sources may be specified on a requisition whenever appropriate. For example, the General Fund and a Trust Fund may both be used to support the purchase of a product in whatever proportion the person who has the authority to expend monies from the respective accounts within those Funds has determined. The split funding must be clearly identified within the cost or price data blocks of the requisition.
PSS 94-09.
2.47 Use of Prior-Year Funds:
No “new purchases” that use prior-year funds may be requested without an approved waiver from policy issued by the Associate Vice President for Financial Management. The use of prior-year funds is generally restricted to payments against encumbrances established in previous years for specifically identified acquisitions that were not acquired (or delivered) within the fiscal year that the encumbrance was established.
PSS 94-23.
2.48 DGS Billing Codes:
These are account code numbers assigned in numerical block (or range) sequences by the State Department of General Services (DGS) to various state agencies (and including the CSU and CSULB) for the purpose of collecting fees that the DGS exacts for use of its negotiated contracts or for other administrative and business services that it provides. Portions of the sequential blocks are identified to various units within the campus for chargeback purposes as the DGS fees are paid from a central (universal) campus account. The DGS Billing Code must appear on any order or contract issued under a State-negotiated award, such as a California Multiple Award Schedule or a DGS Price Schedule.
PSS 93-14, 97-17.
2.49 On-Campus Delegation of P.O.s and Service Orders (Confirming Orders):
The development of methods for reducing the costs of executing low-value purchases through expedited order processing, the use of procurement credit cards, and/or the issuance of low-value purchase authorizations is a CSU policy that the CSULB campus strongly supports. In order to reduce administrative lead-time and to expedite procurement of needed low-dollar items, authority to purchase or acquire goods and services up to $2,500 directly from a vendor or service provider has been delegated to most individual offices on campus. Selected offices have received this delegation up to an amount of $10,000. There are specific rules and parameters under which those who receive this delegation must operate. The rules and parameters have been established and are routinely monitored by the Purchasing Office for compliance. They include the prohibition by State law, CSU Policy, or campus policy of an array of substances, products, and services that may not be purchased or acquired under delegated authority. Campus entities that have received the delegation have the responsibility of knowing and complying with the rules and parameters.
Placing an order with a vendor or service provider requires the requester to follow a set procedure, as promulgated by the Purchasing Office. The requester is expected to be familiar with this procedure which includes such things as obtaining a price quote prior to placing the order, giving the vendor or service provider an order number (which is simply the requisition number preceded by a “D”), development of the requisition itself which must include the phrase “CONFIRMING, DO NOT DUPLICATE”, and submitting the completed requisition via the electronic purchasing system or by hard copy to the Purchasing Office as soon as possible. Failure to indicate that a requisition is a confirming order can potentially result in the order being filled twice.
CSU Policy 205; PSS 95-24, 98-12.
2.50 Procurement Cards:
Low-value purchases are authorized for on-campus instructional and administrative offices, via delegations from the campus president and vice-presidents. Such delegations of purchasing authority serve to relieve the campus of inefficiencies and costs that otherwise would be evident if the orders were to be processed by the Purchasing Office in the customary fashion. The campus procurement cards are made available through a contract between the State Department of General Services (DGS) and an outside provider. Instructions for the use of the cards, including written & enforced limitations and restrictions, are printed in the CSULB Procurement Card Manual. A nominal fee (normally ½ of one percent) is charged to the card user by DGS. User summary reports are submitted to the purchasing office monthly for review and are forwarded to the Accounting Office for audit. Charges made on the cards late in a given fiscal year are subject to being charged against the subsequent year’s budget, depending upon the deadlines shown on the campus Financial Management Calendar. This Calendar is issued annually by the Associate Vice President for Financial Management.
CSU Policy 205; PSS 96-10, 96-21.
2.51 Price Justification on Non-Formal Acquisitions:
Competition is sought, via either formal or informal solicitation, for transactions under $10,000 (for commodities) and under $50,000 (for services) whenever the Procurement Officer determines that the competition is necessary to develop a source, validate prices, or for other sound business reasons. Informal solicitations may be secured either orally or in writing. The number of providers from whom quotes or bids are solicited is the responsibility of the Procurement Officer and will generally depend upon the size, complexity or the purchase and market conditions. Before execution of the order there shall be a determination that the price is reasonable. Such determination shall be documented for audit purposes.
“Reasonable price” is defined as a price that does not exceed that which would be paid in the conduct of a competitive business. It may be established by market quotes, price or cost analysis, or the experience and judgment of the Procurement Officer. Such judgment considers total value to the campus. There is value to the campus in acquisitions that meet the campus needs for quality, quantity, and delivery time, and those that further small business and other affirmative action goals. A reasonable price need not be the lowest price available, but is one that offers acceptable value to the campus.
PCC 10301; CSU Policy 401; PSS 96-02.
2.52 Confirming Orders:
The campus empowers various instructional and administrative offices with general authority to place single orders up to $10,000 in value directly with an outside provider, prior to submitting a requisition to the Purchasing Office (a few offices that have heavy acquisition needs are empowered with authority that exceeds this amount). Under such an arrangement, it is usual for a vendor to ship items to Central Receiving and to forward the invoice to Accounts Payable well before the Purchasing Office has received the requisition. In order to expedite delivery of the items to the requester and to pay the invoices, the requisition must be prepared promptly and be delivered (or transmitted) to the Purchasing Office. The Purchasing Office converts the requisition (either by hard copy or electronically) to a purchase order, service order, or contract. Central Receiving receives a copy of, or electronically accesses, the converted requisition. This permits Central Receiving to substantiate the placement of the order and to ultimately advise the Accounts Payable office of receipt. Small business and DVBE information is the reporting responsibility of the requester; appropriate coding for this must therefore be furnished to the Purchasing Office on all confirming order requisitions.
PSS 92-09, 94-10.
2.53 Emergency Acquisitions:
As defined in State statute, an “emergency” means a sudden, unexpected occurrence that poses a clear and imminent danger, requiring immediate action to prevent or mitigate the loss or impairment of life, health, property, or essential public services. When such an emergency requires the immediate issuance of an order that would otherwise require a formal bid solicitation, an approved Emergency Purchase Authorization form must be attached to the requester’s requisition and become a permanent part of the file. The form must describe what is being procured, why it is needed, and why formal bids could not be solicited. It must first be approved by a department head and then by the Director of Procurement & Support Services. Emergency acquisitions of $250,000 or more must receive the approval of the Associate Vice President for Financial Management and the Vice President of Administration.
PCC 1102, 10302; CSU Policy 209; PSS 98-05.
2.54 Financed Acquisitions:
Most CSU acquisitions that are selected for financing (periodic payments issued against the principal and interest) will qualify as “tax-exempt” under the provisions of federal and state law. Even though tax-exempt rates for the State and the CSU are invariably less than non-tax-exempt rates would be, any financing arrangements should be planned and negotiated with care, since any interest charges at all add to the total cash outlay for the acquisition. Early involvement of the Director of Procurement & Support Services on such acquisitions is usually wise, since there may be on-campus funding or financing sources to consider first. Generally, financing arrangements are not considered unless the acquisition has a cost of at least $100,000.
Tax-exempt acquisitions are also subject to additional requirements that assure compliance with federal tax code provisions. Financed acquisitions are identified as tax-exempt whenever the seller/lessor or third party financier intends to claim the interest portion of its proceeds as exempt from federal income tax. Helpful information for the development of contracts that provide for a financed tax-exempt acquisition can be found on the CS&P website at www.calstate.edu/csp/.
Fully developed contracts or purchase orders containing the tax-exempt provisions must be submitted, along with all their related financial documentation, to the Auxiliaries Planing and Bonds Department (APB) at the Chancellor’s Office for review and approval prior to execution. The Chancellor’s Office is responsible for maintaining records to insure that financiers who issue tax-exempt obligations on behalf of the CSU comply with federal tax reporting obligations. The Chancellor’s Office also maintains pre-negotiated terms and conditions with selected financiers, provides model agreements, and coordinates efforts to obtain legal counsel on tax-exempt issues as they arise.
Ed Code 89036; PCC 10320.5, 12113; CSU Policy 214.
2.55 Document Numbering Schemata:
Requesters are encouraged to use automated sequential numbers for their requisitions whenever possible. Purchase orders, service orders, and most contracts normally employ the same document number as used on the corresponding requisitions. The letter “R” which appears as a prefix on the requisition number is usually replaced in the Purchasing Office by a “B” (Blanket), a “P” (being processed by the Purchasing Office), a “D” (Dept. Confirming Order), or a “C” (Correction to the Order).
The number assigned to a lease consists of a two-digit fiscal year designation, followed by a three-digit sequential number.
The number assigned to a teaching agreement or an affiliation agreement consists of the requesting department’s designated code number, followed by a three-digit sequential number.
The number assigned to an inter-agency agreement or a memorandum of understanding consists of “CSULB” followed by a two-digit fiscal year designation, followed by a three-digit sequential number.
A document number may also be reserved for any order planned to be issued, pending a bid award. That number may be the requisition number preceded by a “P” or an automatically-assigned number that consists of a “P” followed by one digit that indicates the fiscal year (i.e., “0” would be for year 2000-2001), and four digits at the end of the number that comprise a sequence of all numbers reserved.
PSS 92-17, 95-35, 97-06.
2.56 Purchasing & Contracting Data Input Printouts (FOCUS Reports):
Monthly FOCUS reports on purchasing data (including P.O.s, contracts, and other open orders) are prepared and maintained by the Purchasing Office.
There are six of these reports:
- REQSORT — Lists all requisitions in system sorted alpha numerically.
- REQINFO — Lists all requisitions in system sorted by requisition date.
- NOREQS — Lists Orders that do not have requisitions.
- DUPPOS — Lists Orders that are duplicated in the system.
- POSORT — Lists Orders in the system sorted alpha numerically.
- POINFO — Lists Orders in the system by the document date.
Brio query may also be used to produce similar reports as needed.
PSS 94-22.
2.57 Personal Use of University Information:
Unless specifically stated within the terms and conditions of an employment or contractual relationship, it is unlawful for a person to utilize any CSU or CSU auxiliary organization information, that is not a matter of public record, for personal pecuniary gain. Prohibition of such utilization applies whether or not a person is or is not so employed or under contract at the time the gain is realized.
Ed Code 89006; CSU Policy 210.01.
2.58 Personal Use of University Property or Facilities:
No CSU employee shall derive personal benefit from the use of State or CSU property or facilities, unless such use has been authorized in writing by a person having custodial responsibility for such property or facilities. This authorization must include a statement which assures that such personal use is of benefit to the CSU.
CSU Policy 210.02.
2.59 Misrepresentation:
The use of CSU procurement facilities or procedures to obtain property or services for personal use, or misrepresentation to vendors or contractors that personal acquisitions are for the CSU when they are not, can result in prosecution for misrepresentation, embezzlement, and theft.
PCC 10334; Penal Code 72; CSU Policy 210.03.
2.60 Conflict of Interest:
It is unlawful for any person to utilize any information, not a matter of public record, that is received by that person by reason of his or her employment by, or contractual relationship with, the trustees, the California State University, or an auxiliary organization of the California State University, for personal pecuniary gain, not contemplated by the terms of the employment or contract, regardless of whether the person is or is not so employed or under contract at the time the gain is realized.
Ed Code 89006; Gov. Code 81000 et seq., 82019, CSU Policy 210.04, 412.10.
2.61 Endorsement of Products or Services:
No person shall, without the permission of the Trustees, use the name “California State University” or any abbreviation of it or any name of which these words are a part, for endorsements of any commercial product or service through the use of advertisements or promotions.
Ed Code 89005.5(a)(2)(3); Trustees’ Resolution 63-16; CSU Policy 210.05.
2.62 Splitting of P.O.s or Contracts:
No person shall willfully split a single transaction into a series of transactions for the purposes or evading bidding requirements as is prescribed in law, regulations, or CSU policy.
PCC 10329; CSU Policy 210.08.
2.63 Advance Payments:
Payment in arrears is the prescribed method of remitting payments for State acquisitions. Documentation is required to be recorded by the disbursing officer that appropriate return and/or in-kind value has been received before a disbursement of funds is made. Advance payments on some types of transactions are permitted, however, where it can be determined that there is no other way to obtain the service or commodity, where the advance payment is determined to be in the State’s best interests, or wherever specifically authorized in law.
PCC 10312; Title 2, Sec. 679; Gov. Code 11257; CSU Policy 210.09.
2.64 Bid Security Deposits:
A bid bond that is executed by a State-registered bonding agent on behalf of its client (as a competitive bidder) for a State contract or purchase order is often made a requirement by the campus as a condition for accepting a formal bid. However, in lieu of this requirement, the campus may elect to accept a certified cashier’s check, payable to CSULB, or cash, along with the submitted bid. If such a form of bid security deposit is accepted, a signed receipt in duplicate must be prepared by the person assigned to receive the deposit on behalf of the campus. The original is delivered to the bidder. The copy is transmitted along with the deposit to the campus Cashier’s Office where a holding account for the deposit is established until after issuance of the purchase order or execution of the contract. All bid security deposits must ultimately be returned to the bidders.
PSS 97-05.
2.65 Protests, Disputes, and Complaints:
Any protest, dispute, or complaint lodged by a bidder, vendor, or contractor shall initially be addressed by the staff member in the Purchasing Office who was assigned to the transaction. Often, an issue may be resolved simply by providing a clarification of the bid document. However, once it becomes evident that a matter cannot be resolved informally by this means, it must be elevated to the next level. At that point, the Procurement Officer (or a delegated representative) formally acknowledges the issue by serving written notification to the bidder, vendor, or contractor that a full and complete formal statement detailing the nature of the problem must be received by the campus within five (5) working days after the notification is issued. Failure to file the formal statement shall be interpreted to mean that the matter has been withdrawn.
Once the formal statement is received, the matter shall be escalated to the Associate Vice President for Financial Management, who has been designated by the Vice President for Administration and Finance to act in such matters. The Associate Vice President for Financial Management shall review the written formal statement filed by the bidder, vendor, or contractor, analyze the actions of the campus to determine whether it acted in a manner consistent with the requirements of the solicitation document and applicable laws and policy, and shall issue a final decision in a timely manner. The decision shall be in writing and shall be mailed or otherwise furnished to the bidder, vendor, or contractor in such a manner as to ensure receipt. The decision of the campus is final.
If, prior to the award of a contract, and in accordance with the posting of a “Notice to Award”, any bidder files a protest on the grounds that the award is not in conformance with the provisions of the solicitation document, the contract shall not be awarded until either the protest has been withdrawn or a decision has been reached by the appropriate campus authorities as to the action to be taken in response to the protest.
PCC 10306, 12102(h); CSU Policy 212; PSS 95-21, 96-25.
2.66 Requests to Review Public Records:
From time-to-time, a vendor or other interested party will request to review a bid, a contract, or other public document. Generally, any record that is subject to review for the public is also subject to be copied for the public, per The Public Records Act. A request may be formal or informal and is to be accommodated in the most reasonable manner, including in advance an agreed reimbursement of costs to the campus (if applicable) and a mutually acceptable timeframe in which the review or copywork is to be performed. Any formal request must be forwarded to the Director of Procurement & Support Services and be handled in accordance with the provisions within the Public Records Act.
The right of public review of records does not include any right to disrupt operations. Thus, while bids are generally not available for full review at the time of bid opening, they could be made available at a subsequent time. Likewise, work-in-progress, such as an evaluation committee’s unfinished bid analysis effort, and bidder employee information or financial records are not subject to a public request for review. However, any of these are subject to subpoena by a court.
True proprietary information submitted by a bidder may be protected from public review, but the mere fact that the information is marked by the bidder as proprietary does not necessarily make the information proprietary and protected by the Public Records Act. If material marked as proprietary is requested to be reviewed, the entity or individual claiming it to be proprietary shall be contacted and given the opportunity to demonstrate that it is proprietary. In contested cases, the Procurement Officer shall be advised. An opinion of the CSU General Counsel’s Office may also be requested.
Procurement records being reviewed are to remain under the control of and in the presence of Purchasing Office personnel.
PSS 96-32, 96-33.
2.67 Purchase/Contract Status Report:
Twice monthly (on the 1st and 15th) an internal Purchase/Contract Status Report (P/CSR) shall be prepared by Purchasing Office staff members who are assigned to process requisitions and convert them to orders. These are forwarded to the Procurement Officer for review and distribution in the Purchasing Office. Data recorded by staff members is to include (1) all potential two-party contracts, (2) all purchases estimated to cost over $10,000, (3) all in-process transactions over 45 days old, and (4) transactions selected by the Procurement Officer for tracking.
PSS 92-13.
2.68 Purchasing System Activity Printouts:
This is an internal daily computer report for the Purchasing Office that consists of two parts: (1) active purchase orders, and (2) approved requisitions.
PSS 93-16.
2.69 Workload Indicators/Charts:
A series of computerized graphs and charts is prepared for internal management purposes. The graphs and charts indicate the monthly workload for various types of transactions handled by the Purchasing Office. The indicators also include a comparison with prior year workloads for the same month of the year.
PSS 95-06.
2.70 Document Filing & Retention:
Education Code section 89045 describes the general nature of the materials that must be retained and the time frame for preserving them (five years, or after a Trustees’ audit, whichever comes first). The CSULB Purchasing Office maintains Purchase Orders, Service Orders, and Contracts (other than construction and related service agreements) for six (6) fiscal years (i.e., the one in which the document is dated, plus five (5) additional years). Closed documents that are more than two (2) years old are stored outside the Purchasing Office itself.
Closed documents are filed separately by fiscal year and arranged in sequential order by document number (not including the prefix alpha character).
Multi-year orders and contracts are maintained in a separate active (current) set of files until all that was ordered has been received. After such contracts are completed, they are integrated with other orders and contracts completed during the current fiscal year, and stored off-site.
Construction and related service agreements are maintained in the Purchasing Office until the corresponding projects are substantially completed, after which they are boxed separate from all the other closed documents and shipped off-site for storage for a period of ten (10) years.
Ed Code 89045; Code of Civil Procedure 337; CSU Policy 207; PSS 95-39, 95-39a.
2.71 Internal Compliance Audits:
At least once every five years the Trustees’ Internal Audit staff is required to perform audits of the activities of the CSU and its campuses. These activities include purchasing, contracting, leasing of CSU property, property management, and other support services generally under the direction of the campus Procurement and Support Services Officers. To ensure compliance with all applicable codes, regulations, and policies, the CSULB Procurement Officer provides or makes available to the auditors all local policies, procedures and descriptions of operating control mechanisms, and any files, documents, records, or reference materials, that may be requested during the course of these audits.
Ed Code 89045(c)(d); CSU Policy 211.
2.72 Purchasing Office Budgetary Savings:
Purchasing Office staff members who process requisitions routinely are to make calculations (or estimates) that indicate how much savings have been effected on their own particular transaction assignments. Various ways are available to accomplish this, though some of the more common approaches may include (1) obtaining a commodity or service at a lesser cost from a provider not shown on the requisition, (2) negotiating for a lower price from a suggested provider, (3) using available master agreements, and (4) establishing blanket orders for high volume acquisitions.
PSS 95-15, 95-15A.
2.73 Campus Unexpended Budgetary Savings:
Year end unexpended budget balances from State General Fund appropriations can be carried forward and made available for new encumbrances for up to two additional years (including the subsequent fiscal year). With the approval of the Associate Vice President for Financial Management, balances may also be “re-appropriated” to instructional and administrative accounts any funds that were encumbered or accrued and then failed to materialize or were cancelled during the prior fiscal year.
PSS 95-08.
2.74 Recurring Reports on Purchasing Activities:
Regular reports are often required by outside entities such as State control agencies, the legislature, and the Chancellor’s Office. These include, but are not limited to, recycled product and bleached paper acquisitions, small business contract awards, and disabled veteran business enterprise contract awards. The Purchasing Office designates one staff member to coordinate the scheduling and completion of such reports to assure that they are filed on schedule and are as accurate as they can be.
PSS 93-18.
2.75 Purged Purchasing Data on Disks:
Archived data, including that generated by the campus electronic purchasing system, is captured by the Purchasing Office and is made available in electronic format. Instructions and guidelines for the use of these disks are also made available by the Purchasing Office.
PSS 94-24.
2.76 Address Errors on Invoices:
Vendors and service providers sometimes send invoices to the Purchasing Office instead of to Accounts Payable. Normally, the Purchasing Office simply re-routes them to Accounts Payable and advises the vendor of this mistake via a form letter (it is a violation of acceptable internal control procedures for a purchasing office to handle invoices). However, if the vendor or service provider continues to mis-route its invoices after being advised, the Purchasing Office may return the invoice along with a different form letter advising that a disbursement will not be forthcoming until the invoice is properly addressed.
PSS 97-07.
2.77 Internal Notification of Bid Openings, Job Walks, Pre-Bid Meetings:
An internal form and cover sheet shall be posted weekly on the “bid board” in the Purchasing Office showing the scheduled bid openings, advertised job walks, and pre-bid meetings for the week. The cover sheet is designed for uniformity and clarity for the reader, including all potential bidders and purchasing office staff. The blank form, to be completed by various staff within the Purchasing Office, is located in the electronic purchasing system under the file <S:/COVER.BID/COVER>. Tuesdays, Wednesdays, and Thursdays are the days these activities are to be routinely scheduled, with pre-bid meetings or job walks at 10:00 AM and bid openings at 2:00 PM. If multiple bid openings occur on the same day, they shall be conducted in a consecutive order with the bidders waiting in the reception area for their particular bid opening session to be called.
PSS 95-45, 98-07.
2.78 Closedown & Security Procedures for the Purchasing Office:
A routine procedure for desk and office closedowns at the end of the working day shall be followed by each Purchasing Office staff member. This procedure is as follows: log off the computer; turn off the monitor; and turn off all lights in the immediate work area. Additionally, office supervisors shall check visually that individual closedown procedures have been performed, and ensure that all equipment is turned off that does not need to continue running after work hours. The last person to leave the Office shall ensure that all lights and photocopiers are turned off, verify that the coffeepot is not on, and shut and lock the entrance door. At the close of the work week, each staff member shall also log off and shut down his (or her) computer and turn it off along with all other related equipment that does not need to continue running after work hours.
PSS 92-22, 98-01, 98-22.
2.79 Telephone Courtesy & Responsiveness:
The “golden rule” of phone utilization and courtesy is to be applied by all Purchasing Office personnel. Essentially, what this means is that one’s telephone responses (including voice mail recordings) should be as pleasant and professional as one would like to receive from others. A typical response to an incoming call should be “Purchasing Office…May I help you?” Voice Mail should be used only when the telephone cannot be personally answered. A professional recording, identifying yourself and the fact that you are not available to answer the phone at the moment but that you will return the call if name and number are left, should be utilized. An alternate recording should be utilized if you are away from your desk more than one day. This recording should also offer an optional number to call. Generally, phone messages received should be answered within one day.
PSS 92-23.
