Operational Memorandum # 15

The A-110 Prescribed Procurement Standards has been and still remains the official AACS policy statement on AACS purchases.

Please note carefully the following requirements when purchasing goods and services for AACS programs and functions.

PURCHASE OF AACS GOODS AND SERVICES

Estimated Cost of Less Than $25.00
Goods and services necessary to the usual and continuing function of the agency and its programs may be purchased following a verbal request and upon the verbal approval of a respective program supervisor, purchasing officer, and assistant director or program director. This provision is to expedite the acquisition of needed everyday goods and services. However, it is advisable to utilize requisition procedure if time permits. With regard to recurring needs a standby authority may be granted by the program director for purchases under $25.00.

Estimated Cost of $25.00 or More
Any and all needed goods and services with an estimated cost of $25.00 or more must be requested, preferably through the requisition process, and authorized by the program director, assistant director, supervisor or purchasing officer. The documentation must be forwarded to the purchasing officer for processing. The purchasing officer will issue a purchase order, attach it to the documentation and forward it to the payables manager for payment. Each county office shall be provided with the requisition forms to be used. An additional supply is to be requested if the supply of forms is low. The items needed must be clearly and completely identified. Please plan ahead so as to allow seven (7) to ten (l0) days for processing and acquisition of the items. If the goods and services are needed immediately, please call the project director or property officer.

Failure to procure goods and services in the prescribed manner may result in the agency refusing to honor unapproved purchases.

Grantor Procurement Standards

Auditors may question procurement expenditures and Grantors will probably disallow procurement costs which were made in disregard to instruction on competitive quotation guidelines designed to conserve grant funds. The procurement standards apply to all goods and services, e.g., insurance, equipment, space purchased by AACS projects and staff.

Competitive Procurement

In substance, the standards are as follows:

(l) Orders under $500 - A project director, assistant director, supervisor or the purchasing officer may place order based on personal judgment without competitive bids.

(2) Orders of $500 to $10,000 - Quotations should be obtained from at least three vendors by telephone and a written record made of prices quoted. Purchases may be made on the basis of the best bid or quotation received.

Further, grantees must observe Grantor requirements which provide that any expenditures in excess of $500 (or any other amount as may be specified by a particular Grantor) for the purchase of a single item of equipment or property be specifically approved in advance.

(3) Orders over $10,000 - Formal written quotations or bids should be obtained from at least three suppliers. As they apply, the agency shall procure goods and services in accordance with federal/state procedures for sealed bids, competitive proposal, or non-competitive proposal.

Agency management and staff should also be mindful that individual contract requirements shall take precedence over any of the above standards. Of course, the more restrictive applicable policy shall be employed in all programs and situations.

"Sole Source" Procurements

There are some situations in which "sole source" procurements without bids are allowed:

"It is recognized that, in some instances, grantees may require certain items of supplies/property which, due to their technical nature or relative lack of capable vendors, must be purchased from a "sole source." Purchase authority requests exceeding $500 from "sole source" must be indicated when requesting approval by the property administrator and include:
• Approximate cost.

• Name of recommended vendor.

• A complete description of the supplies or property to be purchased.

• Specific justification of the reason purchase must be made from "sole source."

CONFLICTS OF INTEREST

Certain Grantor directives limit purchasing where conflicts of interest may occur:

For example, Grantors often direct that "...a grantee or delegate agency...shall not obligate or expend any project funds (Federal or non-Federal share) for a purchase or rental of goods, space, or services if any of the following persons has a substantial interest in the purchase or rental:

• A member of a board or committee of the purchasing or renting grantee or delegate agency.

• An executive officer of the purchasing or renting grantee or delegate agency.

• Any other employee of the purchasing or renting grantee or delegate agency whose responsibilities include procurement of goods, space or services.

• Anyone who is a member of the immediate family of a board member or employee referred to in paragraphs l, 2, or 3."

These restrictions may not apply if the purchases or rentals of goods, space and service:

• Total less than $200 within any l2-month period.

• Cannot be had from any other supplier within the community or within a radius of fifty (50) miles, whichever is larger.

• Are from the lowest bidder in an advertised sealed bidding arrangement.

The AACS Board has established a written procurement policy including, but not limited to, the requirements for competitive quotations and provisions against grantee boards and employees accepting gifts, entertainment from persons or firms who either are doing business or seeking to do business with the grantee and/or delegate agencies. Procurement policies should also require that competing vendors must satisfy applicable published non-discrimination requirements.

It shall be the practice of the Audubon Area Community Services, Inc. to adhere strictly to this policy and the above requisition/purchase order procedures. The AACS/CAA and other component property officers and project directors are responsible for assuring the compliance of all staff with these strict property and supplies acquisition procedures.

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