The purchasing process at UT System Administration consists of the following steps:
- Define the specifications or develop a scope of work (SOW)
- Solicit price quotations, bids or proposals from suppliers
- Issue a purchase order or enter into a contract
- Accept delivery and document receipt or completion
- Issue payment
1. Define the Scope of Work (SOW)
Before a department can begin the purchasing process, the end user must identify the specific need for goods or services by defining the specification or scope of work (SOW). The specifications or SOW must be sufficiently detailed for suppliers to accurately respond to requests for quotation, bids or proposals. This should include:
- Detailed description of the good or service, such as:
- manufacturers part number
- specific sizes, volumes, properties, etc.
- full descriptions of service deliverables required
- description of functional requirement for a software solution
- Quantity required
- Quality requirements
- Date requirements such as:
- due date for commodities
- project completion dates for services
- Estimated or budgeted costs
2. Solicitation of Quotations, Bids or Proposals
Once the specifications or SOW had been developed, the correct solicitation process can be determined. Solicitation methods are generally determined based on the estimated dollar value of the product or service to be purchased. A department generally may solicit quotations from suppliers for purchases up to $50,000. There are some restrictions that apply to items being purchased on State contracts and Group Purchasing Organization (GPO) contracts. Purchases with a value expected to be greater than $50,000 are managed by the Office of Contracts and Procurement and often required formal solicitation processes.
The following value thresholds govern the purchase of goods and services:
|Dollar Range||Solicitation Process|
|$0||$14,999.99||Competitive quotations are encouraged, but not required. Departments can solicit quotations from suppliers|
|$15,000||$50,000||A minimum of three (3) quotations are required. Quotations must be received in writing (mail, email, fax). A good-faith effort must be made to include at least one (1) quote each from a minority-owned or woman-owned business. Departments can solicit quotations in most situations (some exceptions exist for State contracts and Group Purchasing Organization contracts). An Exclusive Acquisition Justification (EAJ) may be used in situations where the good or service may be proprietary or only one (1) supplier is capable of meeting the requirement.|
Consult with Office of Contracts and Procurement to determine the most appropriate procurement method. A formal solicitation process may be required. Other procurement methods include the use of existing State contracts, Group Purchasing contracts or local contract. An Exclusive Acquisition Justification may be used in situations where the good or service may be proprietary or only one supplier is capable of meeting the requirement.
3. Issuance of Purchase Order or Contract
Purchase orders or contracts must be issued prior to the shipment of a product or the delivery of a service in order to be compliant with State guidelines and UT System Administration policy and procedure.
Upon final approval of a PeopleSoft requisition, a purchase order is created. Currently all purchase orders are final approved by the Office of Contracts and Procurement. The purchase order is a contractual document that in addition to specifying description, price, quantity and delivery requirements also specifies terms and conditions that govern the transaction between UT System and the supplier. If the standard terms and conditions are insufficient to govern the transaction, a contract is normally issued which will include any additional contractual requirements. Certain purchases, such as software, will always require review of terms and conditions regardless of the dollar value of the purchase.
4. Delivery and Receipt
Documentation of the receipt of the good or service is required in order to support making payment to the supplier. Documentation of the receipt of goods (such as packing slips) or verification of service delivery on invoices is required.
Payment of invoice is managed by Financial Shared Services. Payment requires a 3-way match between the:
- Purchase order or contract
- Delivery receipt or verification of service completion
- Invoice from the supplier
Payments can be made via check or electronic deposit and are governed by the Texas Prompt Pay Act.