Statutory Procedures

Section: IV – Purchasing
Page: 8 - 10
Subject: Procedures
Effective: July 1, 2000

The purpose of this manual is to be both informative and instructive to those associated with acquiring goods and services for the Guilford County Schools. This section will describe the procedures to be used to ensure that statutory requirements relating to purchasing have been met. This manual also contains information regarding shipping, receiving and accounts payable functions, due to the relationship of these functions to purchasing.

G.S. 115C-522 states that all purchasing by school administrative units is subject to the policies and procedures of the North Carolina Department of Administration (Division of Purchase and Contract). Individual schools, as part of the local school administrative unit, must also comply with these statutes. It is the responsibility of each employee involved in the procurement process to understand the policies upon which these procedures are based.

The following policies affecting purchasing by school administrative units and individual schools are drawn to comply with the various requirements of the North Carolina General Statutes and regulations of the North Carolina Division of Purchase and Contract.

Purchase Options

Equipment, materials, and supplies must be purchased in one of the following ways.

1. State Term Contracts

Term contracts are established by the Division of Purchase and Contract and are binding agreements between the purchaser and seller to buy and sell certain commodities at certain prices and under specified terms and conditions. These contracts are established through legal advertising and competitive bids. The bidder is advised as to whose business he has earned. Therefore, school units cannot avoid compliance with the contract without risk of being legally in default and liable for damages.

Orders may be placed by local school units directly with the state contractor. Term contracts are for a specified period of time (generally twelve months) and are for a given commodity group.

School systems have the authority to purchase supplies, equipment and materials from noncertified sources, subject to the following conditions:

• The purchase price, including the cost of delivery, is less than the cost under the state term contract.
• The items are the same or substantially similar in quality, service and performance as items available under state term contracts.
• The cost of the purchase does not exceed the bid value benchmark established under G.S. 143-53.1.
• The school system maintains written documentation of the cost savings.
• The school system notifies the Department of Administration of any purchases of items that are substantially equivalent to and not the same as items under state term contracts.
• The Purchasing Department has given the school/department prior approval to exercise this authority.

2. Items not on State Term Contract and Costing Less than $90,000

Equipment, materials, and supplies not covered by any existing contracts and totaling less than $90,000 may be purchased locally after seeking competitive quotations according to good purchasing practices. Bid dates and bid selection criteria must be fully documented. Items may not be divided to circumvent this provision. The $90,000 maximum applies to the total cost of the order rather than to a line item cost or single item cost.

At the discretion of the Purchasing Officer, orders totalling less than $30,000 may be awarded without a bid process. This determination is solely at the descretion of the Purchasing Officer.

Verbal or written quotations must be obtained based on procedures detailed in Section IV, page 13.

3. Items not on State Term Contract and Costing $90,000 or More

Equipment, materials, and supplies not covered by any existing contracts and totaling more than $10,000 but less than $25,000 are to be advertised on the internet according to procedures prescribed by the North Carolina Division of Purchase and Contract. Orders over $90,000 are to be referred to the North Carolina Division of Purchase and Contract for handling.

This policy applies to all funds, regardless of source. The $25,000 maximum applies to the total cost rather than the cost of a single item. Dividing an order to circumvent the $25,000 maximum is illegal.

Exemptions and Delegations of Authority

1. Some items are exempt from these policies. The state delegates authority to local agencies to purchase the following:

• published books, manuscripts, maps, pamphlets, periodicals, playground equipment and shrink-wrapped software;
• perishable articles such as fresh vegetables, fresh fish, fresh meat, eggs, and others as may be classified by the Secretary of Administration; and athletic apparel.

2. Lease-purchase contracts are handled in the same manner as outright purchases and are therefore subject to the purchasing procedures beginning in Section IV, page 13.

3. Contracts for the straight lease or rental of equipment, materials, or supplies are exempt from the purchasing procedures above.

4. The purchase of equipment, materials, and supplies necessary for construction or repair work is handled the same as the outright purchasing procedures beginning in Section IV, page 13.

5. Policies guiding purchases of contractual services by school units are not established by North Carolina General Statutes.

6. Construction or repair work with third parties is governed by Chapter 143, Article 8 of the North Carolina General Statutes. All such contracts are to be handled by the Facilities and Maintenance Departments in conjunction with the Purchasing Department.

7. Guilford County Schools has an increased delegation/benchmark of $90,000. This authority is delegated solely to the Purchasing Officer.